Currently, I have three different savings/investment accounts open. I have my 401(k) through work, a Traditional and Roth IRA, as well as a general savings account for Travel and Emergencies.
First and foremost, you should consider having some money set aside as a Nest Egg. This is why CDs and Mutual Funds are beneficial because they allow your money to grow at a better rate than a simple Savings account. More importantly though, they have penalties in place to prevent early withdrawal of your investment. This forces you to keep that investment separate and you are more apt to use it only for emergencies. They say the rule of thumb with the Emergency Fund is an amount enough to cover 3 to 6 months of bills should you be unable to work or earn money.
The second thing to focus on is starting a retirement fund. The earlier you begin, the faster you will build a hefty amount to keep you comfortable when you retire. I postponed putting money in to an IRA or 401K until I was 25 and I regret it. I should have started as soon as I was working. That would have given me an additional 7 to 8 years of money saved and interest earned. IRAs are retirement accounts that you can open using After-Tax money, as opposed to 401(k)s through your employer that save your money pre-tax. Either way you are going to pay taxes on that money, it is just a matter of paying before of after you reach retirement. But it's never too late to start, and a Financial Advisor can assist you with how aggressive your Investments should be based on the point you are at in your life. The closer you are to retirement, you may want to put aside more, but have less risky investments, that way you do not risk losing money on unstable stocks for example. When you are younger, and have more time to build your investment, the fluctuation of the market will not affect your money as much - over a long period of time, the peaks and valleys of the market even out and you usually come up ahead. Definitely enlist the aid of an advisor if you are serious about saving and investing.
Read up all you can - I like the MSN Money website. http://moneycentral.msn.com They have a lot of articles that are easy to understand about paying off debt, saving your money, preparing for your taxes, etc. I actually educated myself about the various investment vehicles because the amounts I was stockpiling were not great. Once I make a significant amount of money, I plan to utilize the expertise of a financial planner. That's what they get paid for, to study the market and understand what the best options are for your individual circumstance. Whatever amount you have to start with, even if it is in a savings plan which does not a huge interest rate, just start saving. At a later point you can transfer your funds in to more financially lucrative investment opportunities.
Showing posts with label money. Show all posts
Showing posts with label money. Show all posts
Friday, June 8, 2007
Monday, June 4, 2007
When is the right time to ask for a raise?
This can be a tricky situation. Asking for more money is always a tough thing to do. It needs to be done with tact, otherwise all they see is a money hungry employee who is trying to leach off of the company. Usually, my employers have offered more money on their own, either because I was leaving and they wanted me to stay, or I was being promoted or given more responsibility. The rule of thumb on asking for a raise: if you feel your current responsibilities have far outgrown your original duties or responsibilities, it is time.
Twice that has happened to me and both times I requested a raise. It was not a matter of wanting more money; it was about needing more money. Companies most times will distribute tasks and restructure an Organizational Chart in order to save money. For example, they let someone go and split up that person’s tasks and assign them to other people in the department instead of hiring a replacement. That’s great for the company, but lousy for you. Of course, added responsibilities are a part of life; they show your supervisors your ability to handle more on your plate and thus, get promoted. However, when it feels that you are doing the work of two people, it may be time to evaluate if your compensation is adequate.
The first time I asked for a raise, I had been working for about a year as a Receptionist/Administrative Assistant. When they realized I could do more than type, file and answer phones, they quickly started loading up my plate with additional tasks. That was fine until I realized I was doing not only my job, but that of an Office Engineer. At someone’s suggestion, I typed out a list of my Daily Tasks and it nearly filled the whole page. I requested a meeting with my Project Manager and pointed out how my duties had doubled since I started on the Project and if I could possibly be compensated accordingly. He took my list and discussed it with the Project Executive and a couple of days later, notified me that they were going to pay me an additional $3 per hour.
The second time was with the same company. About a year or so after the first incident, I had taken on the role of assistant to the Change Order department. They had already increased my salary to reflect the change in position. A couple of months after working with their Change Management consultant, they switched him over to another project and left me in charge of the whole department. Since the department consisted of the consultant and myself at the time, that left only me. I was responsible for processing all of the Change Orders for the project, from initiation to completion. I lasted about a month or two before I started feeling completely overwhelmed and taken advantage of. I approached the new Project Manager and explained my dilemma. He understood, and saw how stressed out I was becoming. He talked to our Project Executive, as well as our Client, to see if they would not mind paying more for my position. I already had the back up plan that if they did not give me a raise, I was leaving. So for me, there was no real loss. Thankfully, they appreciated my efforts and showed me monetarily.
Every single time however, I have had the proof to back up my request. I show them how much of an asset I am to the company, in that they get their money’s worth and how the added responsibilities to my role merits additional compensation. If done right, it proves to your supervisors that you know your own worth and are willing to stick up for yourself.
Twice that has happened to me and both times I requested a raise. It was not a matter of wanting more money; it was about needing more money. Companies most times will distribute tasks and restructure an Organizational Chart in order to save money. For example, they let someone go and split up that person’s tasks and assign them to other people in the department instead of hiring a replacement. That’s great for the company, but lousy for you. Of course, added responsibilities are a part of life; they show your supervisors your ability to handle more on your plate and thus, get promoted. However, when it feels that you are doing the work of two people, it may be time to evaluate if your compensation is adequate.
The first time I asked for a raise, I had been working for about a year as a Receptionist/Administrative Assistant. When they realized I could do more than type, file and answer phones, they quickly started loading up my plate with additional tasks. That was fine until I realized I was doing not only my job, but that of an Office Engineer. At someone’s suggestion, I typed out a list of my Daily Tasks and it nearly filled the whole page. I requested a meeting with my Project Manager and pointed out how my duties had doubled since I started on the Project and if I could possibly be compensated accordingly. He took my list and discussed it with the Project Executive and a couple of days later, notified me that they were going to pay me an additional $3 per hour.
The second time was with the same company. About a year or so after the first incident, I had taken on the role of assistant to the Change Order department. They had already increased my salary to reflect the change in position. A couple of months after working with their Change Management consultant, they switched him over to another project and left me in charge of the whole department. Since the department consisted of the consultant and myself at the time, that left only me. I was responsible for processing all of the Change Orders for the project, from initiation to completion. I lasted about a month or two before I started feeling completely overwhelmed and taken advantage of. I approached the new Project Manager and explained my dilemma. He understood, and saw how stressed out I was becoming. He talked to our Project Executive, as well as our Client, to see if they would not mind paying more for my position. I already had the back up plan that if they did not give me a raise, I was leaving. So for me, there was no real loss. Thankfully, they appreciated my efforts and showed me monetarily.
Every single time however, I have had the proof to back up my request. I show them how much of an asset I am to the company, in that they get their money’s worth and how the added responsibilities to my role merits additional compensation. If done right, it proves to your supervisors that you know your own worth and are willing to stick up for yourself.
Wednesday, May 9, 2007
Banking moments...
The actual title of the blog subject is too long to fit up there, check it out: What are your personally discovered positive aspects of money and finances? Name a few uncomfortable banking moments you have had and what is most important to you in a financial institution. How would you like to see banking become more lighthearted and enjoying?
The topic of money and finances definitely belongs to the “'depends on how you look at it'” category. Half Full, Half Empty. Root of all evil or a tool to offer endless possibilities. I used to hold the “Money is the Root of all Evil” mentality for the longest time. I knew how to manage it, but would let it escape me at times and would get caught in this vicious cycle of working to pay off all of the excess debt I accrued. I felt like a Recovering Alcoholic that would fall off the wagon. At a certain point, you start to think, what’s the point of getting back on. There was many a month of borrowing from credit cards to pay bills and juggling minimum payments or transferring balances. The other predicament I would get caught in is trying to save so diligently that I barely left any money in my checking account and would get hit with Overdraft Fees left and right. I learnt the hard lesson of “defeating the purpose”!
What I did not know at the time is how to take control of my finances and make my money work for me. The thing about finances is it says a lot about your management style and amount of discipline. Finances are like diets, exercising, education the more focused and dedicated you are, the greater the results. You have to be knowledgeable and aware. There is a huge amount of personal satisfaction when you start seeing your debt going down and your savings going up. The best part is being able to afford a luxury item and knowing you have the money for it in hand. What is important to me in a financial institution is flexibility. Sounds funny, but makes sense in cases like applying for a loan. There are occasions when things are rough, finances are tight, and I wish banking would understand that. I had to file bankruptcy years ago, because I was tied to my mom’s credit cards and back then, I felt I was young enough that it would not affect me too adversely. Sadly, you are treated like you have the black plague if there is a bankruptcy on your credit.
That is one of the reasons I am so loyal to the USC Credit Union. When other places would try and rip me off with a 19% rate on a Car Loan, they would offer 11%. That is a huge difference in monthly payments! Obviously, we need to more careful of our decisions and not allow ourselves to get in to predicaments, however in my case, it was out of my hands. If a financial institution would have looked at the entire picture, investigated the rest of my credit, I would not have been written off at the beginning as many times. There is a reason people prefer Credit Unions over Banks, they treat their customers more like people and less like numbers. The easiest way you can witness this is in their terminology –they call their customers
Members.
The topic of money and finances definitely belongs to the “'depends on how you look at it'” category. Half Full, Half Empty. Root of all evil or a tool to offer endless possibilities. I used to hold the “Money is the Root of all Evil” mentality for the longest time. I knew how to manage it, but would let it escape me at times and would get caught in this vicious cycle of working to pay off all of the excess debt I accrued. I felt like a Recovering Alcoholic that would fall off the wagon. At a certain point, you start to think, what’s the point of getting back on. There was many a month of borrowing from credit cards to pay bills and juggling minimum payments or transferring balances. The other predicament I would get caught in is trying to save so diligently that I barely left any money in my checking account and would get hit with Overdraft Fees left and right. I learnt the hard lesson of “defeating the purpose”!
What I did not know at the time is how to take control of my finances and make my money work for me. The thing about finances is it says a lot about your management style and amount of discipline. Finances are like diets, exercising, education the more focused and dedicated you are, the greater the results. You have to be knowledgeable and aware. There is a huge amount of personal satisfaction when you start seeing your debt going down and your savings going up. The best part is being able to afford a luxury item and knowing you have the money for it in hand. What is important to me in a financial institution is flexibility. Sounds funny, but makes sense in cases like applying for a loan. There are occasions when things are rough, finances are tight, and I wish banking would understand that. I had to file bankruptcy years ago, because I was tied to my mom’s credit cards and back then, I felt I was young enough that it would not affect me too adversely. Sadly, you are treated like you have the black plague if there is a bankruptcy on your credit.
That is one of the reasons I am so loyal to the USC Credit Union. When other places would try and rip me off with a 19% rate on a Car Loan, they would offer 11%. That is a huge difference in monthly payments! Obviously, we need to more careful of our decisions and not allow ourselves to get in to predicaments, however in my case, it was out of my hands. If a financial institution would have looked at the entire picture, investigated the rest of my credit, I would not have been written off at the beginning as many times. There is a reason people prefer Credit Unions over Banks, they treat their customers more like people and less like numbers. The easiest way you can witness this is in their terminology –they call their customers
Members.
Monday, May 7, 2007
How the heck do you figure out your taxes? Do you do them yourself or do you take them to a friend or service?
Preparing your taxes is a pretty daunting endeavor. That’s why Accountants have four-year degrees and certificates for passing an intensive test. I used to try and figure it out on my own. Actually, up until three or four years ago, to be exact - then I started using a CPA to prepare my Tax Return. Here was my rule of thumb: if you are taking the Standard deduction, you can generally do it on your own through one of the online Tax Return preparation software, like TurboTax or TaxSlayer. (I used to use TaxSlayer at the time because it only cost $10 for Federal and the State return was free). They walk you through the process step by step and you can research the line items to see if you qualify. If you have any circumstances which require Itemization or additional deductions to the Standard, i.e. owning your own business, having a freelancing gig on the side, being married, having kids, owning a home, etc. have someone help you!
There are too many tax laws to remember in the first place. In addition, these laws are changing constantly. Accountants are paid to stay on top of the regulations and will better assist you in getting the most return for your taxes. What we plan to do this year is sit down with our Accountant at the 6 month mark and plan on how we can minimize our taxes and start preparing for Tax Return Time. Always save receipts, especially for donations. As a student, there are Educational Credits you can receive. You can write off Tuition and books, as well as Interest paid on Student Loans once you start repayment. These are all things your accountant can help with the $50 - $100 spent for having someone prepare your taxes is well worth it, especially when they can save you hundreds of dollars!
There are too many tax laws to remember in the first place. In addition, these laws are changing constantly. Accountants are paid to stay on top of the regulations and will better assist you in getting the most return for your taxes. What we plan to do this year is sit down with our Accountant at the 6 month mark and plan on how we can minimize our taxes and start preparing for Tax Return Time. Always save receipts, especially for donations. As a student, there are Educational Credits you can receive. You can write off Tuition and books, as well as Interest paid on Student Loans once you start repayment. These are all things your accountant can help with the $50 - $100 spent for having someone prepare your taxes is well worth it, especially when they can save you hundreds of dollars!
Thursday, April 19, 2007
Dude, where's my money? What to expect when first starting your career.
Expect to work your butt off and not have much of a social life!
Just kidding.
On a serious note though, in the beginning, it is all about building the foundation for your career. Money is usually not a driving factor for negotiations or job security. When you are fresh out of school, the experience is not there to let your resume speak for itself.
You need to earn the respect of your peers and superiors and put in the hours to grow and learn. I am not advocating working long hours or letting your career consume your life, however, your dedication and drive is what will push you up that “corporate” ladder. The pay might not be that great for that first job, but you need to think bigger picture.
You need to see down the road and factor in where this job will lead you. If it provides networking opportunities and hands-on education for that management position you see yourself in, then the experience is worth its weight in gold.
When we get caught up in making money the main focus, we lose sight of our overall goals. Yes, money is going to be ONE of those goals, but bigger picture is financial security, financial freedom and ability to “play” when the opportunities present themselves. Someone once told me “Do what you love, and the money will follow.” Some of the best advice I have ever received, because working for the money will not bring the love for what you do! When you do what you love, you have the best of both worlds as I mentioned when I wrote about the importance of fostering your passions.
Another important motto should be “All in due time.” There is no need to rush through life or race your way to retirement. For some that works, but for a lot of us, it leaves us frustrated, resentful and burnt out.
Take your time, learn all you can, build up a diverse set of skills, allow doors to open from various directions. You never know where your career path will take you. All you should focus on is: working at a job you enjoy, not living outside of your means and saving, saving, saving!
Just kidding.
On a serious note though, in the beginning, it is all about building the foundation for your career. Money is usually not a driving factor for negotiations or job security. When you are fresh out of school, the experience is not there to let your resume speak for itself.
You need to earn the respect of your peers and superiors and put in the hours to grow and learn. I am not advocating working long hours or letting your career consume your life, however, your dedication and drive is what will push you up that “corporate” ladder. The pay might not be that great for that first job, but you need to think bigger picture.
You need to see down the road and factor in where this job will lead you. If it provides networking opportunities and hands-on education for that management position you see yourself in, then the experience is worth its weight in gold.
When we get caught up in making money the main focus, we lose sight of our overall goals. Yes, money is going to be ONE of those goals, but bigger picture is financial security, financial freedom and ability to “play” when the opportunities present themselves. Someone once told me “Do what you love, and the money will follow.” Some of the best advice I have ever received, because working for the money will not bring the love for what you do! When you do what you love, you have the best of both worlds as I mentioned when I wrote about the importance of fostering your passions.
Another important motto should be “All in due time.” There is no need to rush through life or race your way to retirement. For some that works, but for a lot of us, it leaves us frustrated, resentful and burnt out.
Take your time, learn all you can, build up a diverse set of skills, allow doors to open from various directions. You never know where your career path will take you. All you should focus on is: working at a job you enjoy, not living outside of your means and saving, saving, saving!
Friday, April 6, 2007
Personally, its not all about work and money - Here's some insight into my passions and how to foster yours too.
Passion … It is the reason your heart beats and your mind wanders. If you cannot already tell, my passion is writing … poetically posing my points or expressing myself through the written word. From journaling what I did every day in junior high to chronicling my inner most thoughts and feelings present day, writing has been my sanity and my savior.
Work is important, it builds character and responsibility. Money is nice since it affords some luxuries and dreams, for example traveling in my case. However, your passion is what keeps you going when the days seem routine and the nights become a precursor to “doing it all over again tomorrow”.
Passion fosters creativity and inner-peace. Hopefully, we can all find a way to merge the two worlds: passion and work, but for the rest of us, we need to make time for both.
Up until eight months ago, writing for me was very personal and purely therapeutic. What started out as travel journaling to all of my friends via email, turned in to a desire to write more religiously. Prompted by a friend to start a blog, I overcame that fear we all have of rejection and failure and finally took that leap to “publish” some of my work.
The funny thing is, 30 plus poems/pieces later, I did not even know I was holding all of that within me. My confidence as a writer has grown tremendously. Where before I would allude to the fact that I dabbled in writing, now I proudly call myself a writer! The next step is polishing some of my pieces, with the hopes of publishing a collection of my work in the near future. I kept thinking “one day”, “later on down the line”, “when I’m older”, but Why Not NOW?
If an opportunity presents itself, go for it. I doubted myself for so long as to my abilities and possibilities. Maybe the time was not right, or maybe I told myself that to excuse my procrastination. Never stifle your dreams or your passions; it just makes for a life of misery and resentment. We can have the best of all worlds if we believe we deserve them.
Work is important, it builds character and responsibility. Money is nice since it affords some luxuries and dreams, for example traveling in my case. However, your passion is what keeps you going when the days seem routine and the nights become a precursor to “doing it all over again tomorrow”.
Passion fosters creativity and inner-peace. Hopefully, we can all find a way to merge the two worlds: passion and work, but for the rest of us, we need to make time for both.
Up until eight months ago, writing for me was very personal and purely therapeutic. What started out as travel journaling to all of my friends via email, turned in to a desire to write more religiously. Prompted by a friend to start a blog, I overcame that fear we all have of rejection and failure and finally took that leap to “publish” some of my work.
The funny thing is, 30 plus poems/pieces later, I did not even know I was holding all of that within me. My confidence as a writer has grown tremendously. Where before I would allude to the fact that I dabbled in writing, now I proudly call myself a writer! The next step is polishing some of my pieces, with the hopes of publishing a collection of my work in the near future. I kept thinking “one day”, “later on down the line”, “when I’m older”, but Why Not NOW?
If an opportunity presents itself, go for it. I doubted myself for so long as to my abilities and possibilities. Maybe the time was not right, or maybe I told myself that to excuse my procrastination. Never stifle your dreams or your passions; it just makes for a life of misery and resentment. We can have the best of all worlds if we believe we deserve them.
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