Monday, January 28, 2008 4:56 PM
That may seem like a lot of cards, but you’re actually on the low
end of the average for Americans, who usually have between 5 and 10
cards, counting store cards. The key question isn't how many cards you
have -- it's how much you spend in relation to how much you pay. If you
pay off your bill on time each month and don’t ever get more than
halfway to the balance limit, then you’re doing your credit score a
favor in most cases.
But if you have a problem with your credit
and five cards entices you to overspend, you might want to think about
trimming back. But don’t pick up the phone to cancel right away. First,
find out your credit score and see how bad things really are. Once a
year, you can get your score for free. Then evaluate which cards have
the lowest rates and put those in the keep pile. Definitely think about
paying off and canceling any store cards you have because they cause
the most problems with your credit score (your score will need to be in
great shape when you try to buy a new pad).
For any cards in the
discard pile, cancel them slowly; your credit score is based on your
debt-to-credit ratio, which isn't supposed to tip over 50 percent. That
means that if you have five cards with a limit of $2,000 on each card
and you cancel three of them, your combined credit limit drops from
$10,000 to $4,000. So, if you owe under $2,000, you’re fine, but if you
owe more, you could raise some red flags.
Filed under: Money
Posted by Nest Caitlin
Monday, January 28, 2008 4:49 PM
They’re both investment opportunities but one is only for the superwealthy. A mutual fund is managed by an investment company that uses the money from selling shares to the public to invest in a range of stocks and bonds. Shareholders get dividends and their share prices can increase in value. A hedge fund is also managed by a company and invests with money from people who buy in, but those people are limited and loaded. Individuals are courted by the hedge funds to invest millions of dollars each. Why do they do it? Hedge funds operate under less stringent laws and regulations and therefore shareholders have an opportunity to make a lot more money, but at greater risk because they short stocks (predict they will decrease in value) something not allowed in mutual funds. So unless you work for a hedge fund, or your second cousin in Connecticut does, you’re not going to have anything to do with one.
Filed under: Investing, Money
Posted by Nest Alonna
Monday, January 14, 2008 5:29 PM
There are so many acronyms in investing it can start to look like alphabet soup. But E, T, and F are three letters you should know. It’s a hybrid of a mutual fund and stock because it’s set up like a fund that tracks the performance of an index, but it’s also traded daily like a stock. So how is that helpful to you? First off, you’re not locked in for a certain time period as you are with a mutual fund -- you can buy and sell anytime but you will pay a commission as if you were working with an individual stock. But unlike buying shares of a solo stock, it’s a less risky option because you’re automatically diversified thanks to all of the stocks that make up the fund.
Monday, January 14, 2008 4:55 PM
How serious is the situation? Is she a compulsive spender, or does she just overshop occasionally? If it's the former, she needs professional help. But if she simply spends frivolously, you can make changes together. Offer to be her shopping buddy and help her figure out ways to avoid unnecessary splurges -- whether she's drawn to the latest tech gadgets or new clothes. And do it nicely, not in a nagging tone but with a "Look, honey, we're spending time together, and I'm not spying on you. I'm just working with you to make smart choices."
Next, encourage your mate to get off any email lists that may tempt him into shopping online. And help him find a new weekend activity that doesn't include strolling the mall or window-shopping (which often leads to actual purchases). Another option is to track both of your spending, big and small, for a few weeks (also a sign of solidarity). Your spouse may not realize how hard he's hitting the family bank account until the numbers start adding up. Finally, if none of those things work (or work well enough to satisfy you) it may be time to divide and conquer. Open one bank account for your spouse, another for you, and a third that's joint. Put enough in the joint account to satisfy all of your household expenses and joint savings needs, then divvy up the rest. The idea is to give your wife or husband only as much discretionary cash as she or he can blow through without dragging your family finances into the gutter.
- Jean Chatzky
Tuesday, January 08, 2008 11:06 AM
At the end of each month, there are three, and only three, possible outcomes. You are either getting ahead, getting by, or getting behind. You?re getting ahead if you are financially better off than when the month started. That means you saved part of your paycheck or put some money away in your 401(k). It means you are closer to reaching your goals. On the other hand, if you are getting by, it means you spend pretty much what you make. You?re not going into debt but you?re not saving either. Financially speaking, you?re just surviving. The last option is that you are getting behind. That means you are spending more than you are making?you?re going into debt each month.
The only way to get ahead each day, week, month, and year is to save and to invest. Even if it?s only $10 or $20 a month. Do it. Just get it started even if you have debt. There?s something very special that begins to happen when you start to save and you begin to see your savings/investment account grow. Most of us want to achieve our goals and to improve our lives. If we simply focus all of our money and effort on paying off debt, it doesn?t feel as good. While of course we need to pay off our debt, I absolutely recommend you take some money each paycheck and put it into a savings or investment account.
Buy Robert's Book on Amazon.com
Check out his website SixDayFinancialMakeover.com
Tuesday, January 08, 2008 10:36 AM
Most people with normal finances don?t need an actual trained account with a CPA license, not, at least, if you don?t own a business, handle a lot of rental property or have an estate to settle. If you?re just a regular working person out there in the world, though, you probably are in the market for a tax preparer, and that person may or may not be an accountant as well. You have a couple options here.
If you go high-tech, you can buy a box of tax prep software or download it and follow the directions. Or, you could stop into one of those tax prep specialty shops, like H&R Block. To find a local, private tax preparer, the best way to go is by word-of-mouth by trusted contacts. You could also go to an online search engine like AccountantsWorld.com.
Filed under: Money
Posted by The Nest Editors
Monday, December 24, 2007 11:32 AM
You know that quacking duck? The Aflac mascot, ubiquitous on TV, is an advertisement for a certain type of disability insurance known as short-term disability. If you have a policy for this, you pay a monthly premium and are covered in case you are injured and cannot work. There is also long-term disability, which covers you for longer periods of time. And finally, there is long-term care insurance, which is for nursing home or full-time at-home care.
Many employers offer a basic version of these plans as part of a benefits package, especially short-term disability, which may be used for maternity leave as well as injuries. In some states, employers are actually required to provide this up to 26 weeks. But you may have to pay extra if you want additional coverage. Some plans will only cover you if you can?t do any work at all ? but if you can earn minimum wage flipping burgers, you can?t cash in. Look into what your plan covers, and if shopping around, you should look for a plan that covers 60 to 70% of your income, has cost-of-living increases and has a liberal definition of disability.
Monday, December 24, 2007 11:12 AM
Paper for the recycling bin, if you got them from most Internet startups; a billion dollar check if you have them from a place like Google or Microsoft. For a lot of companies, handing out stock options to employees is a way of adding to their compensation packages without spending a lot of cash upfront. Stock options are a future proposition, a promissory note from the employer that the holder can buy a certain amount of company stock at a certain price under certain conditions.
The return can be great, but it?s not guaranteed. For one thing, the company has to be a public company traded on the stock exchange. If you get stock options from a startup company that never goes public or goes under, your options aren?t worth anything. If the company is publicly traded but the share price never goes above your option, then you may never want to exercise it.
Then again, you could work for one of the lucky companies that offered you stock options at something like $3 a share, and the share price is now in the hundreds, in which case you'd be rich. You could buy up your allotment and then sell it back on the open market at the going rate (assuming, of course, that there are no restrictions on how much you can sell at one time), reaping a great profit.