Have you ever wondered how the “checkbook” for a large corporation is different from the one you keep at home? Or what their needs are when they go to bank to stash their money or take out a loan? If so, what you’re really asking about is the difference between commercial and corporate banking, and why corporations receive different treatment from common consumers.
Ever since traveling to England during their pension riots back in November, I’ve been somewhat curious about the options that other countries offer for retirement savings. I know we talk an awful lot on here about plans that are available in the U.S. like IRA’s, 401k’s, etc. So today we’re going to jump across the pond and take a look at what folks in England have to supplement their retirement savings. In particular, we’re going to talk about the ISA or Individual Savings Account.
An ISA is very similar to Roth IRA here in the U.S. You fund (or “subscribe”) money to the account with post-tax sources, the money grows tax free, and no taxes are paid at the time of withdrawal. However unlike American IRA’s, there are no limits or restrictions as to when or how much money can be taken out.
When you’re finally ready to retire and start accessing your money, mainstream advice says to follow the 4 percent rule. For anyone who doesn’t know, the 4 percent rule says you can start your retirement by withdrawing 4 percent of your total retirement portfolio to live on, and then doing the same each year thereafter with small adjustments for inflation. Research suggests that you’ll have a pretty good chance of success for about the next 30 years. Although this method is very popular for retirement income planning, there have been some studies to that show you can do better!
We are all pioneering the age of social media and its effects on everything that happens in our lives. While there is certainly a lot of good that comes from these sites, there is also a lot of damage that can be afflicted as well. Namely – sabotaging our careers and getting fired over Facebook.
Getting fired and ruining your finances over something as dumb as Facebook posts may seem like something that could never happen to you, but it could! Here’s a story of something that just happened recently…
Oh, no! It’s finally happening! It’s back to school time for Mrs MMD and my kids. Since Mrs MMD is a teacher, this marked the first week that she has had to go back into her room and start setting up for the start of the year. The kids had to actually wake up and go back to daycare while she and I are at work. Overall, it’s been an outstanding but too fast Summer. Unfortunately play time is over and they’ll be waking up at the crack of dawn (with me) every day very soon.
The week flew by for me. I spent the first part of it in Virginia for business, and have been playing tons of catch-up at work ever since. Around the house, just after paying for the new floors, our washing machine broke down! Crap! This is soon to become another unfortunate and upcoming expense. Darn appliances!
Do you really know how to split your retirement savings up in the best way? Chances are probably not. Trying to figure out the best asset allocation for your money design is something we refer to often here on my blog. Why? Because there of all the millions of combinations of investments we could put together, how do know which ones will work? What are the best asset allocation models for us to follow?
I have been asking this question since I started investing and am still looking for the answer. We all know that in order to save up for a healthy retirement you’ve got to choose the right funds to stuff inside our investment portfolio. Choose poorly and your money will slip away from underneath your feet. Choose wisely and you’ll enjoy a full retirement with plenty of safety.