I know it might seem kind of earlier to be planning ahead for 2011, especially in view of my recent health concerns, but it's never too early to plan as far as I'm concerned. Given the major changes to my financial situation due to recent medical bills, I think it's even more important to come up with a plan of attack.
One thing I've been wanting to get done was to revamp the spreadsheet I use each month to keep track of personal finances. While I've made adjustments and improvements along the way, the current spreadsheet I use is one I created 10 years ago and was due for a major update. The simple spreadsheet has worked well for me over the years, but I thought it was time to prepare a more professional monthly financial statement. With that in mind, I've created an entirely new system incorporating a personal cash flow statement and balance sheet. While not any more complicated or informative than my current spreadsheet, it presents the data in a more professional and organized manner. Which means, I should be able to use this spreadsheet for the next 10 years.
As an update on the medical front, I've finished my application from the hospital for consideration for their financial aid program for the uninsured. Seems my reduced pay since the economy crashed may actually qualify me for assistance in paying my hospital bills or at least help in arranging an affordable payment plan. I'm turning my application in tomorrow and I'll keep my readers posted on how well it works out.
Showing posts with label personal finance. Show all posts
Showing posts with label personal finance. Show all posts
Sunday, November 14, 2010
Tuesday, January 12, 2010
It's Not Your Bosses Job to Make You Rich
Since starting my new job, I've mentioned in some of my posts that I'm not making as much in pay as I'm used to. However, I don't want anyone to get the wrong idea. I'm thankful to have a job. Whatever the pay is, I always create a budget based on current income. For several years the income from my jobs went up. Now it's gone down, but I've still budgeted to live on the money I have coming in from my paycheck. I make allowances for my bills and living expenses and for building my investments.
So many people seem to think they are underpaid and in some cases, maybe they are. But what everyone should keep in mind is that it's not your bosses job to make you rich. Your reward for your hard work on the job is the pay and benefits package you agreed to when you accepted the job in the first place. Your bosses job is to see that you get what you were promised and that's it.
It is each individuals job to make themselves rich. And the way to do that is to learn to handle your cash flow. Whether you make a lot of money or minimum wage is irrelevant if you are unable to handle your money properly. If you constantly mismanage your personal finances, no matter how much money you make, you will never get ahead. That is why I feel so strongly about financial education. Accepting responsibility for your own financial future and taking action to reach your goals is about the only way the average person will ever hope to achieve wealth. Basically what I'm saying is, it's not how much you get paid, it's what you do with it when you cash your paycheck.
So many people seem to think they are underpaid and in some cases, maybe they are. But what everyone should keep in mind is that it's not your bosses job to make you rich. Your reward for your hard work on the job is the pay and benefits package you agreed to when you accepted the job in the first place. Your bosses job is to see that you get what you were promised and that's it.
It is each individuals job to make themselves rich. And the way to do that is to learn to handle your cash flow. Whether you make a lot of money or minimum wage is irrelevant if you are unable to handle your money properly. If you constantly mismanage your personal finances, no matter how much money you make, you will never get ahead. That is why I feel so strongly about financial education. Accepting responsibility for your own financial future and taking action to reach your goals is about the only way the average person will ever hope to achieve wealth. Basically what I'm saying is, it's not how much you get paid, it's what you do with it when you cash your paycheck.
Monday, October 12, 2009
Keep Your Money Working After You Retire
Retirement can be a joyful time of life. You get to leave the daily grind and spend more time doing the things you love with the people you care about. If you've saved up enough money to live comfortably, you can live a fulfilling, carefree life.
If you did a particularly good job of retirement planning, you may have enough money in savings to carry you through for many years to come. Even so, it's wise to keep your money working for you. You'll need to keep up with inflation, and if you live a particularly long life, you could run out of funds. And then there's the chance that you could incur unexpected expenses such as long-term care.So instead of putting the brakes on your investing, it's best to continue as though you have yet to retire. If you have adequate retirement savings, you'll only be using a portion of your money each year. There's no reason that the rest of your money shouldn't be earning a return for you.
The Best Investments for RetireesThere are many types of investments available, each with its own pros and cons. To find the best investment for your situation, you need to consider your tolerance for risk and the need for access to your money.
You should be able to put most of your retirement funds into fairly long-term investments. If you want to take on very little risk while keeping up with inflation, CDs are a good option. Money market funds and mutual funds are also low-risk. Stocks and bonds are riskier, but if chosen wisely and managed responsibly, they can net larger returns. Annuities are also popular investments among retirees. Life annuities require the annuitant to pay a premium in exchange for payouts made at regular intervals for the rest of his life. This provides guaranteed income, eliminating the danger of outliving one's savings. There are also joint annuities that pay out until the last of two people dies, and guaranteed term annuities that pay out for a specified period of time, with payments going to a beneficiary if the annuitant dies.
For money that you want easy access to, a money market account is a good place to keep it. These accounts earn more interest than your average savings account, yet they allow for quick and easy withdrawal of funds. But keeping your entire nest egg in such an account is unwise, because it could be earning much more with other investments.
Retirement should be a time in your life where money is not a major concern. Unfortunately, it doesn't always work that way. By keeping your money at work for you, you can keep your finances in good order for years to come and have some left over for your heirs.
If you did a particularly good job of retirement planning, you may have enough money in savings to carry you through for many years to come. Even so, it's wise to keep your money working for you. You'll need to keep up with inflation, and if you live a particularly long life, you could run out of funds. And then there's the chance that you could incur unexpected expenses such as long-term care.So instead of putting the brakes on your investing, it's best to continue as though you have yet to retire. If you have adequate retirement savings, you'll only be using a portion of your money each year. There's no reason that the rest of your money shouldn't be earning a return for you.
The Best Investments for RetireesThere are many types of investments available, each with its own pros and cons. To find the best investment for your situation, you need to consider your tolerance for risk and the need for access to your money.
You should be able to put most of your retirement funds into fairly long-term investments. If you want to take on very little risk while keeping up with inflation, CDs are a good option. Money market funds and mutual funds are also low-risk. Stocks and bonds are riskier, but if chosen wisely and managed responsibly, they can net larger returns. Annuities are also popular investments among retirees. Life annuities require the annuitant to pay a premium in exchange for payouts made at regular intervals for the rest of his life. This provides guaranteed income, eliminating the danger of outliving one's savings. There are also joint annuities that pay out until the last of two people dies, and guaranteed term annuities that pay out for a specified period of time, with payments going to a beneficiary if the annuitant dies.
For money that you want easy access to, a money market account is a good place to keep it. These accounts earn more interest than your average savings account, yet they allow for quick and easy withdrawal of funds. But keeping your entire nest egg in such an account is unwise, because it could be earning much more with other investments.
Retirement should be a time in your life where money is not a major concern. Unfortunately, it doesn't always work that way. By keeping your money at work for you, you can keep your finances in good order for years to come and have some left over for your heirs.
Thursday, August 6, 2009
Update on Personal Financial Situation
The stock market took a breather today, both of my accounts are down just a bit. Not really a bad thing as far as I'm concerned, since I'm still in the buying phase. I'd like to see the market level off or even drop back down a bit, so I could add to my holdings at the lower prices.
My IRA is set up for automatic investments each month. On the second Tuesday of every month I purchase more shares of stock for my retirement portfolio. This month I will be adding to my AT&T holdings. I own shares of AT&T in both of my accounts. I think their dividend is stable and I'm with them for the long haul.
Other investments in my IRA include British Petroleum (BP), Universal Insurance (UVE), AFLAC (AFL), Great Plains Energy (GXP), S&P 500 Index SPDR (SPY). Since opening the account in December of 2008, my holdings are up by 23.39%. Not a bad return! Just wish I could say the same for my taxable investment account. Still down some on that account, although the total dollar amount has increased. I've actually surpassed my investment goal for the year, so I've had to set the bar a little higher.
I've also been holding extra cash while continuing my job search, just in case I would need it for some reason. I've been able to accumulate the cash by cutting spending to the bare necessities. It's worked so well, I'm thinking that I may just keep it up when I return to work, just to build my investments more rapidly.
My total credit balances continue to decrease. I cancelled 2 of my credit cards to avoid extreme increases in the interest rates. Will probably cancel at least one more as soon as it's paid off. I've decided I really don't need more than 2 credit cards and plan on using them sparingly when the balances are paid. I really haven't been using my cards at all since being off work, just keep paying down the balances and paying cash for everything.
Given the crazy market and economic situation for the first half of 2009, I very happy with my finances right now. If the market continues to improve during the second half of the year, I should be in pretty good standing by the start of 2010.
My IRA is set up for automatic investments each month. On the second Tuesday of every month I purchase more shares of stock for my retirement portfolio. This month I will be adding to my AT&T holdings. I own shares of AT&T in both of my accounts. I think their dividend is stable and I'm with them for the long haul.
Other investments in my IRA include British Petroleum (BP), Universal Insurance (UVE), AFLAC (AFL), Great Plains Energy (GXP), S&P 500 Index SPDR (SPY). Since opening the account in December of 2008, my holdings are up by 23.39%. Not a bad return! Just wish I could say the same for my taxable investment account. Still down some on that account, although the total dollar amount has increased. I've actually surpassed my investment goal for the year, so I've had to set the bar a little higher.
I've also been holding extra cash while continuing my job search, just in case I would need it for some reason. I've been able to accumulate the cash by cutting spending to the bare necessities. It's worked so well, I'm thinking that I may just keep it up when I return to work, just to build my investments more rapidly.
My total credit balances continue to decrease. I cancelled 2 of my credit cards to avoid extreme increases in the interest rates. Will probably cancel at least one more as soon as it's paid off. I've decided I really don't need more than 2 credit cards and plan on using them sparingly when the balances are paid. I really haven't been using my cards at all since being off work, just keep paying down the balances and paying cash for everything.
Given the crazy market and economic situation for the first half of 2009, I very happy with my finances right now. If the market continues to improve during the second half of the year, I should be in pretty good standing by the start of 2010.
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