How Much Should I Put in My 401k Plan? My Surprising Answer

save money for retirement

It’s one of the most commonly asked questions of employees when they start saving for retirement: How much should I put in my 401k?  5%?  10%?  15%? Especially when you’re young (in your 20’s and 30’s) and just starting out, retirement can feel like such a long ways away.  You know that you should be contributing, but at the same time you want to enjoy your earnings and save towards other goals like a house and family needs too. To simply answer this question with “save as much as you can afford” feels too much like an easy-out.  I’ve recommended that advice to friends in the past only to find out that they end up saving only a measly 2 or 4% of their paychecks.  Since I’m friends with them, I KNOW they can do much better than … [Read more...]

Should I Do a 401k to IRA Rollover?  The Benefits and Drawbacks

401k to ira rollover

Recently during a discussion with my money coach client there was a very important question that came up:  “I have an old 401k with a former employer that is still sitting right where I left it.  I’m wondering if I should make a 401k to IRA rollover or simply leave the money right where it is?” That’s a really good question. I’m sure for a lot of people (myself included) that the money you have in your 401k account is probably the largest percentage of your wealth you have saved up – anywhere!  Even if you’ve got nothing more than the average 401k balance of $81,000 as reported by Fidelity, that’s still a very serious amount of retirement savings that you want to be putting to work as hard as possible. Unfortunately, however, … [Read more...]

What is the Minimum Retirement Savings You Could Comfortably Live On?

minimum retirement savings

One of the hallmarks of a solid early retirement plan is thinning out your expenses as much as possible. To a lot of people they will probably interpret this to mean shaving a few hundred bucks off by not eating out every night or scaling back on their trips to the mall.  Those kinds of things are good, but we’re talking about going a whole lot further.  For someone who wants to retire early really, really badly, part of what they’ll do is clip back their expenses to the point of virtual non-existence. Why would they do this?  Simple.  The fewer expenses you have means you’ll only need the minimum retirement savings possible.  Take for example everyone’s favorite super-frugal early retiree Mr Money Mustache.  I remember reading that … [Read more...]

5 Common Financial Mistakes We’re All Guilty Of

5 Common Financial Mistakes

It's not always easy to make all the right moves when it comes to money. In fact, as a society, we're pretty bad at managing our money.  CNN Money recently stated that over 25 million middle class families are living paycheck to paycheck. That's horrible!  So much for saving for a house, rainy day, or even retirement. The good news: It doesn't have to be this way.  Most common financial mistakes are pretty easy to identify and correct.  Here's five of them that you can take care of right away.   1. Late Payment of Bills: Paying a bill only a few days late can show up on credit reports, especially if one of those bills is your credit card bill or any other loan repayment. With modern technology there's no reason you have … [Read more...]

Going Back to School on a Budget as an Adult

Budget

Going back to school isn't just for the little ones.  It can be a time for grown-ups to get anxiety too.  And not just over the work they'll have to do. If you've noticed the job market is saturated with candidates that have bachelor's degrees, you've possibly considered getting a graduate degree to give yourself an edge. But balancing family expenses is hard enough without adding tuition and books.  Plus don't forget all those hours invested in working on projects and studying. You might even convince yourself that paying for a graduate degree and keeping your family afloat is nearly impossible.  But remember - you're not the first adult who's gone back to school while working, parenting, etc. If you're in this boat, here are a … [Read more...]

3 High Risk High Return Investments You Should Get to Know

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When most people talk about investing, their goal is to complete alleviate risk while earning as much money as possible. Although it’s never possible to alleviate risk, it is possible to reduce it if you’re willing to accept a low return.However, what if you’re willing to take on a bit of extra risk for the prospect of a higher return rate? What do you do then? Well, here are 3 high risk high return investments that you can take part in.   Binary Options: When it comes to high risk, high return investment vehicles, binary options happen to be my favorite. With binary options, you’re not purchasing a stock or bond. Instead, it’s up to you to predict whether the value of an asset will rise or fall over the course of a … [Read more...]

How to Reach an IRS Installment Agreement

How to Reach an IRS Installment Agreement

No one intentionally falls behind on their taxes unless they’re taking cues from Thoreau’s Civil Disobedience (which by the way will hardly work in your defense in court). While Thoreau ended up spending a night in jail and getting some material for his book, most of us would prefer to avoid the penalties imposed for tax delinquency. For those who have found themselves unable to meet their tax requirements with the federal government due to a poor financial situation, one viable solution might be figuring out how to reach an IRS installment agreement.   What is an Installment Agreement: Because the IRS would prefer that it receive at least some portion of your prescribed tax obligations, it is often willing to come to a … [Read more...]

How to Remove Disputes from Credit Report History and Get a Higher Score

Credit Report Disputes

It is always a good idea to keep an eye on your credit score and credit report. I have been been doing my homework in this area, and I am thrilled to report that my credit score has risen dramatically due to some simple efforts I made. Here’s what was holding me back. I’m pretty conscientious when it comes to paying my bills on time. But a year ago my wife and I moved to a new city. Though we canceled our utility accounts only after the final balances had been paid, my credit report showed an unpaid partial month. Because we changed addresses twice in 3 months, I guess written confirmation never found me, and we were never notified any other way. I only noticed the negative mark on my credit report when I checked … [Read more...]