COMPANY SPONSORED SAVINGS PLAN

Recently I was talking to one of the guys at work about signing up for the company sponsored savings program.  Although he is also eligible, he said he was probably not going to enroll.  Now our company, like many others now days, is a little tight fisted when it comes to giving raises.  They are few and far between and you're not going to get much of one regardless of performance.  The guy I was talking to is also one of those guys who are constantly complaining about not getting a raise.  Yeah, I like raises too, but there is something to be said about the number of people out of work right now and being thankful that you at least have a job.  That being said, why would you pass up an opportunity to help yourself to a raise.  Where we work, they might be stingy with raises, but their savings plan is quite generous, offering a dollar for dollar match of employee contributions.  For every dollar we put in, our employer contributes an equal amount, up to a certain percentage of our pay.  Why would you pass that up???  It's like they're offering you the opportunity to give yourself a raise.  I don't know about anybody else, but if the only thing I have to do is save a little money to get more money from work, I'm going all in.

I'm afraid he didn't see it that way.  He said he couldn't afford to defer any of his pay for savings, even though I explained to him that money withheld in "before tax" dollars would most likely make little if any difference in his take home pay.  This is something most people fail to realize.  If you're withholdings for savings are in "before tax" dollars, your taxable income is less and therefore you pay less in taxes on the remaining paycheck.  Which means that often times, your take home pay remains relatively unchanged.

As I've mentioned before, I have no real plans to continue working for my current employer until I retire.  However, why shouldn't I take full advantage of all the benefits they have to offer while I'm there?  No matter how much I end up saving, with employer matching contributions and more than 10 years before I plan to retire, it could definitely add up to a significant amount of money when I'm likely to need it most.

MY MOST EXCITING DISCOVERY IN INVESTING!!!

While doing some research to boost my monthly cash flow from dividends, I discovered something truly amazing.  I'm ashamed to admit that I never considered it before, since I have been investing for many years now.  However, here it is.  I found out that I can replace the money I earn in a years time at my current job for a total investment of just under $140,000.  To do this I would only need purchase 2,000 shares each of 3 dividend stocks that pay in different quarters.  The average dividend income per month would be roughly equal to what I currently earn at work.  

Why is this so exciting to me?  Because even though I'm working for a lot less than I'm used to making in this down economy, I've been managing quite well.  Not only am I paying all my bills ahead of time, I add to my investment portfolio every month as well.  On top of that, I've always estimated that I would need anywhere from a quarter to half a million dollars to retire comfortably.  Now I've come to the realization that I can retire on a whole lot less than I thought and possibly years earlier than I expected.  

I've revised my automatic investment plan to include my new discovery.  The greatest thing of all is that I already own shares in all three companies, so I need only increase my stake to 1,000 shares each.  While I don't have enough cash to buy the entire 6,000 shares, I'll be diverting dividends and capital gains from my other holdings to speed up the process until I reach my goal.  In the mean time, I should benefit from ever increasing monthly dividend income as my stake in the 3 companies rise.   

BONDS VS DIVIDEND STOCKS

Just finished reading an interesting article about investing in bonds versus dividend stock investing.  It made some great points about the current state of the bond market.  Not the least of which is the fact that with current bond rates at all time lows, the bond market yields have nowhere to go but up.  As yields rise, bond prices move lower, eating away any gain from the coupon.


On the other hand, dividend stocks make quarterly or annual cash payments similar to bond payouts, but also have unlimited potential for capital appreciation.  They satisfy the two main concerns of most investors by giving them cash to help with rent, groceries and other expenses, while increasing in value over time, helping to raise the value of your portfolio in the process.

What I found most interesting about the article was, of the five dividend stocks recommended for stability and long term gains, I already hold positions in four of the corporations.  The remaining was an energy limited partnership which I do not own shares in, but I do still have shares in 3 other energy partnerships, so it all works out in the end.

Investors this year have pulled billions of dollars out of the stock market and poured their hard earned cash in to bonds.  With the uncertainty in the market, this is certainly an understandable response.  But I firmly believe that the only way for most of us to achieve a secure and comfortable retirement, is to invest in individual stocks. 

While you won't get rich over night, diverting a good portion of your investment portfolio toward dividend paying stocks, will go a long way towards building wealth and helping you sleep better at night.  

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.

The Rich Get Richer and The Poor Get Poorer

We've all heard the statement, "The rich get richer and the poor get poorer." This has been especially true in the past several years and may be even more true in the years ahead. But have you ever asked why this is the case? It is simply because the rich keep doing what makes them rich and the poor keep doing what keeps them poor. I saw a video on Youtube recently and the guy was talking about when he realized what he was doing wrong. He said he realized at the early age of 24 that it is ALWAYS possible to spend more than you make. If you always spend more than you make, you'll always be broke.

If you're tired of being one of the poor, and believe me I'm very tired of it, then you have to change the way you think about money and the way you act upon your thoughts. I had to get over my little pity party and get away from the victim mentality of "I'll always be poor." You'll always be poor if you keep doing the things that make you poor.

A lot of people think, "If I just made more money." Well you first need to be able to handle the money you do have. Do you want to have more and possibly even be one of the rich getting richer? Then you need to take control of your finances and stop spending more than you take in. Once you've accomplished this simple rule, then you can put your excess money to work. When your money works for you, that's that much less work you have to do yourself. John D. Rockefeller once said that the only thing that made him truly happy was the dividend checks he got every month. I can relate to that! I've worked hard all my life, starting at age 5, but never really had anything to show for it until the past 10 years or so. Now the money comes in every month in the form of dividends and interest and you can't imagine how it makes me feel to know that I didn't have to do any physical labor to earn it. I'm still a long way from being one of the rich. But I have every confidence that the more I learn about handling my finances, the more money I will make and the less I'll have to physically work for it.

If this sounds good to you, then take a look at your personal circumstances. We can all find reasons or excuses why we can't put any money aside to invest, or why we can't improve our situations. It's when you STOP making excuses and START looking for ways to improve your situation, then your life will change. It may not be easy and you might not like all the changes you have to make, but believe me, it will be more than worth the effort. Don't wait for a bailout from the government, help yourself to a better life!

An Easy Extra $39,000 For Retirement!!!

A few days ago I wrote about the credit card companies who seem to be on a spree to fleece Americans out of even more of their hard earned money. To give myself and some of my readers a little more incentive to pay off the charge card balances, I figured up how much extra money I would have for retirement if I pay off my cards and divert all the money I currently spend on credit card payments to a simple, no interest account.

For the past several months, I have paid an average of $250 per month in credit card payments. Depending on your current credit card debt, this may sound like a great deal, or not much. At any rate, when I finally have my balances paid in full, I plan to divert this money to my investment account. I also plan on working for at least another 13 years. So $250 per month times 12 months comes to $3,000 per year. Multiply $3,000 per year times 13 years and it comes out to a whopping $39,000. Since I'm currently paying this money out every month, I won't miss it if I continue paying it to myself after I pay off my credit cards. The $39,000 total is the amount I would have in 13 years if I simply put the money in a non-interest bearing account. How much will it be in an interest bearing account or if I invest it in stocks? I'm thinking it could add substantially to my retirement.

Now let's add in the money I'm saving by not smoking. (I quit 5 weeks ago) On average I spent $80 per month on cigarettes, was never really a heavy smoker. $80 times 12 months equals $960 per year. $960 times 13 years comes to $12,480. Add the $12, 480 to the $39,000 from above and it comes to an astounding $51,480!!!

Just a little thought and a few minor changes to our lifestyles now, can make a BIG BIG difference when it comes to retirement.

Personal Wealth Is Not All About Money

I recently read this quote on wealth and thought it an appropriate reminder that true wealth is not all about money. I thought I should share it with my readers.

Wealth Comes In Many Forms

My mentor, Bob Proctor, once said, "Don't cry over anything that won't cry over you." People will often create tremendous suffering for themselves just because they're in debt or have lost money. They'll generate intense feelings of anger, sadness, and fear, all of which are destructive and actually make it more difficult for them to regain the wealth they lost. Because they're upset, they may fight with their spouse over money or become severely depressed, not realizing that the power to create abundance for themselves once again is always available to them.When you understand that money is simply one form of the tremendous force known as abundance or wealth, and that you can always receive riches from our ever-giving Universe, it becomes easier to let go of negative feelings about money and the destructive belief that material wealth is more important than other manifestations of abundance.

Ask yourself how much money you would take in exchange for your eyesight and your abundant health. How much would I have to pay you for you to give up your relationship with the person you love the most? My guess is that your health, your eyesight, and the people you love are far too precious to trade for any amount of money.If what you receive isn't money, open yourself up to it with gratitude and joy. Allow your creativity to flourish and you can discover ways to convert the abundance into the form you could most use right now.Wisdom and knowledge are types of abundance that we often overlook.

An antiques dealer I know often purchased items from homeless people who brought him furniture and other objects they'd found in the garbage.He was always gracious and kind to them, and one day one of his regular sellers, who was a homeless man, noticed that the dealer had recently acquired a gold record by a celebrity."You have that underpriced," he said. "I used to work in the music business. I know."The antiques dealer listened to what the man had to say and decided to take his advice and quadruple the price. A few days later, the dealer's dentist came in, got very excited about the gold record, and said, "Listen, I'd love to own that, but I don't have that much in cash to spend. How about if I do that dental work I recommended to you, in exchange for the gold record?"The antiques dealer was able to pay for expensive dental procedures he needed and couldn't afford, because he valued the abundance that came to him from an unexpected source and converted it into something he could use.

Peggy McColl