Category Archives: Guest Bloggers

Protect Your Retirement: Don’t Make These Tax Mistakes

Saving money for retirement is important and can be done more easily with the help of tax-advantaged accounts such as an IRA or an ISA.

However, when you have worked hard, put your money into an IRA or ISA and done everything right, you can still jeopardize your successful retirement by making some simple money mistakes. To help make sure you do not lose what you have worked so hard to save and earn, here are some tax mistakes to watch out for.

1) Rolling over your IRA too often or improperly

When you move money from a 401K to an IRA or from one IRA to another, there are special rules in place in order to avoid tax consequences. If you fail to follow these rules, your money move can be considered a distribution rather than a roll-over.
This can have serious tax consequences as you may have to pay taxes and penalties for taking the money out of the IRA. Before you move your money, check with an experienced financial advisor to make sure you do it right. You also need to avoid moving your money too much as you are allowed only one IRA to IRA roll-over per year before you are considered to have taken a distribution.

2) Failing to consider your retirement account when you are planning your estate

You must remember to name a beneficiary for an IRA or an ISA account in order to make sure that the money goes to the person you want it to go to.

If you are going to leave your money to more than one beneficiary, you will also want to spell out exactly who is to receive what. This is so there is no money wasted as your beneficiaries squabble over who is supposed to receive funds from the IRA or ISA.
In some cases, you may wish to use tools like an IRA trust when you name a beneficiary. This would prevent your beneficiary from spending the money all at once and taking it in one lump sum.

When setting up the trust, it again needs to be done carefully and in accordance with your financial advisor in order to make sure that you are doing everything right and following all guidelines. Otherwise, your efforts could be ineffective.

3) Not understanding the tax rules of your retirement account

When you invest in an IRA or an ISA, there are rules associated with maintaining the tax-advantaged nature of the money. For instance, with traditional IRAs, you must begin to take distributions when you reach a designated age.

It is also very important to not withdraw money before you have reached an age where you are allowed to do so, or unless the reason for your withdrawal falls into an exception and is permitted.

When you take money out of an IRA prematurely, you may have to not only pay taxes on the IRA distribution, but also pay penalties associated with early withdrawal as well. These penalties can be significant.

Cashing in your IRA or ISA can thus deplete the money you have tried to save, leaving you with far less than you would have had if you had followed the rules and waited to take the money out. Not only that, but cashing it in too often at improper times can trigger multiple penalties and tax consequences that could dwindle your investment down to nothing.

Whether you have an IRA, an ISA, a 401K or any other type of special retirement account, do not take action without knowing the implications.

How to make money from Google+

google plus

Google+ is finding itself in a somewhat disadvantaged position of a latecomer to the social media world. Despite the fact that online marketers are always willing to get their hands on any new technological development that could help them promote a business online, they often make a mistake of trying to use Google+ the same way they would use Facebook or Twitter. While it is similar to the other two in many ways, there are some key differences that you need to consider if you want to turn your Google+ into a powerful online marketing tool. The main strategies and steps for launching your successful Google+ campaign are as follows:

1. Create a Google+ business page

It is common sense: keep your business and personal lives separate. Not only will you avoid the embarrassment of accidentally sharing a personal update with your professional circles, you will also be able to take advantage of multiple Google+ features geared towards a business audience. Ability to create professional circles and virtually meet with customers via Google Hangout are the two most practical features Google+ offers. That being said, your business page does have to be linked to your personal account – you can’t create a standalone page the way you would on Facebook.

2. Expand your circles

This is simple, and very similar to any social media platform you want to use for marketing – you do need to make your content visible to as many people as possible. Work on building your audience prior to overwhelming them with affiliate links and product offers – let your circles get to know your company first. Ability to create multiple circles is a great way to segment your customer base and only share specific content with particular groups, thus minimizing the “spamming” effect.

3. Focus on the quality of your content

This applies to all your online content, but it’s even more important for your Google+ page. Research shows that the average age of Google+ users is higher than that of Facebook users, which indicates that your Google+ audience is probably more mature and won’t necessarily be compelled to buy your product if you post a Tinkerbell picture next to it. Keep your stream updates relevant and to the point.

4. Cross-post content from other sites

If you are running a business, you probably already have a Facebook page, a Twitter account, and perhaps a company blog or a YouTube channel. Share the content that you publish on your other sites on Google+ – it will create perception of consistency in your customers’ minds and generate more interest in your Google+ account among users who are already following you on other platforms.

5. Add a +1 button anywhere you can

Encourage people to share your content anywhere on the web with a +1 button. Put the button on all the pages of your website and all the posts that you would want your customers to see and share.

6. Capitalize on the fact that it’s a Google product

As an owner of an online business, you know all about the importance of search engine rankings. You have probably done a good amount of SEO for your website. Google+, being a Google product, makes this a little easier. Each +1 share of your content automatically turns into a backlink to your original post. This feature has been implemented very recently – prior to this update, clicking on shared content would take you to the author’s profile, but not the post. Fortunately, this is no longer the case.

My name is Nisha Sharma. I represent a site called http://www.comparelogbookloans.co.uk. I love to write, especially about travel, finance and offer business advice.

Get a Act of God Plan

lightning

In light of recent natural disasters around the globe-earthquakes, floods, fires-it seems only to right to recommend having an Act of God Plan, especially if you live in a disaster prone area. Ensuring you have a safety net set up should you get into strife through no fault of your own is paramount to survival, and easy to arrange.

1. Have a Cash Stash

Always have a little amount of cash hidden in your house should you find yourself in a situation where you have no access to money. Flooding will easily cause shortages to cash machine dispensers, and often in a crisis situation many staff will not be working as they’ll be sorting out their own affairs. The only problem with having a wad of cash in the house is the associated temptation. To avoid dipping into the stash when you’re a bit short of money, keep it in a locked up section of your emergency grab bag, and if you’ve already been involved in a natural disaster you won’t need reminding of why it’s important to keep your mitts off.

2. Carry a Credit Card

Even if you don’t normally carry a credit card, it’s a good idea to have one should you find yourself in a sticky situation. Whether you’ve lost your wallet or need to pay for accommodation, clothes or food, having a credit card can make things a little easier in dreadful circumstances. One advantage of having a credit card is their emergency assistance feature-emergency funds can be wired to wherever you are, should you have that function set up on your card.

3. Invest in Insurance

While most of us hate giving money to the insurance companies, it is worth it when you run into problems, be it travel, home or content insurance. The golden key is to read and double read the terms and conditions. Yes, they’re ludicrously boring and often hard to understand, but it will make all the difference when you come to making a claim. Also, talk to someone to clarify their terms if you need to. However, sometimes things happen that you’re just not prepared for so wouldn’t know to ask about, or check. In the Brisbane floods, in early 2011, a number of people who took out flood insurance in good faith were told that their claims would not be awarded because their houses were insured against flooding, not inundation from the river!

4. Emergency Contact Numbers

Pretty much everyone owns a mobile phone these days, and rarely lets it out of their sight. However, when you’re caught in a freak flood and all you think about is hanging on to your nearest and dearest, your phone no longer seems so important. Having a few numbers memorized is a good idea. And while it seems obvious, because most phones are set up to show names not numbers there is little opportunity, or need, to remember other people’s numbers. Just one or two contacts are all you need to let people know you’re safe. They can then contact others on your behalf.

5. Safe Place to Stay

If you’re unfortunate to be caught in a natural disaster, but lucky to be near your family, go stay with them until things start to return to normal. If you live in an area prone to bush fires it’s important to have a substitute home organised prior to fires breaking out, that way you know exactly where to head without having to think about it in an adrenaline fuelled situation. Sometimes things happen that you just can’t plan for, so if you’re travelling in an unfamiliar city and don’t know anyone in the immediate vicinity, head over to any of the disaster relief centres where you’ll be offered a place to stay and support during what could potentially be a terrifying and lonely time.

This article was written by William from Life Insurance Finder. Visit Life Insurance Finder to compare Income Protection Insurance

Spending Habits That Spells Havoc in Your Bank Account

broken piggy bank

We all like having money, and we all like spending them. Yet did you know that the little things that we use our hard-earned money on can spell problems for our bank account?

Our spending habits say a lot about ourselves. It shows how much we care about our bodies and welfare with the products that we buy. However, there are instances when what we purchase do not bode well for our finances. Let’s take a look at these habits and see how they negatively affect our bank account.

Giving in to impulse buying. This is one of the biggest pitfalls anyone can have when it comes to bad financial habits, regardless of whether you use cash or credit. Window shopping is a harmless enough activity, only if you truly do not have anything with you that will cause you to spend (meaning, no cash or credit cards). Maybe giving in once (once a year, maybe?) is acceptable. But if you give in to these urges every time you go out; if your closet is bulging with things you bought but don’t really have a use for, you need to curb your impulse buying.

The solution: When you go out, bring only enough money for your needs. Don’t bring a credit card especially if you’ll be going to a place where the temptation to shop is strong. For emergencies, just add an addition 10% to your budget for the day. If it doesn’t get spent, consider putting it into your savings. And if you’ve got a lot of purchases that are still in their wrappers, consider having a garage sale and adding whatever you earn from that into your savings too.

Not keeping track of your credit card expenses. Having a credit is a great thing. It gives you more buying power. The opportunities to be able to get the things you want are quite endless. The downside? Not keeping track of what you’re spending it all on creates a huge pile of debt for you. The bills rack up, not just for the cost of the item or service itself, but also for the interests and other fees. Plus, you end up shelling out more than you have to because of all these added expenses.

This includes not knowing the fees your credit card company charges you for each transaction, for each late payment, or for every time you go beyond your credit limit.

The solution: Collate all your bills, outstanding or otherwise, and see how much you owe. Next, hold off all other spending until you’ve paid off your existing balance. Find a method or system to pay off your debt that will work best for you. One such system is the “debt snowball”. Starting with your smallest bill, think of an amount you can easily add to the minimum amount due. Pay off the bill and move to the next. Add the amount you used with the previous bill to this bill until you pay it off. Keep doing this until all your bills are paid. Note that you have to stop using your credit card for the duration.

Trying to keep up with the Joneses. In this day and age, it’s hard not to be envious of the cool things other people are buying or doing. You see your coworker with a spiffy new mobile, and you want one too. Your neighbor went on a vacation to the Bahamas, you’d like to go out of town too. The thing is, trying to keep up with what everyone is buying or doing will create problems with your bank account. Sure, you can charge them, but once those bills pile up, you’ll wish you didn’t give in to envy at all.

The solution? Evaluate your envy. Do you want the same thing they have, or are you all right with a more affordable but equally satisfying alternative? Once you know the answer to that, you’ll be able to curb your expenses and work your way to getting what you want. Who knows? They might end up envying you for what you have.

Spending more than you can afford. This is a trap we all get in to so very easily. It’s closely related to the previous habit of keeping up with the trends and other people’s spending habits. The tendency to shell out more than what we can afford is what buries us deep in debt.

The solution: Set up a small fund where you can stash some money. Call it your “splurge savings”. Think of how much of your monthly budget can you set aside for these savings. Make a goal, either a certain amount or an item you want to purchase, and build towards the amount. Once you have enough, use it to get what you want. It make take some time, but on the upside one, you got what you wanted and two, you’re not in debt.

Buying what you don’t need. Again, it’s closely related to the previous items and it’s another habit that can create problems for your finances. So maybe you’re not an impulse buyer. Maybe you don’t really keep up with what the neighbors are doing or you’re buying things that are within your budget. The question is, are the things you are spending your money on are things you really need? Many people are able to work well with a budget but sometimes, half of the things they buy are not necessities.

The solution: Double check your expenses for name brands against generic and less costly alternatives. Their effectiveness is just the same, and at a lower price. If you can cut these out of your expenses all together, so much the better.

Not having any financial goals. It’s simple enough to say “Oh, I’ll set aside a couple of hundred dollars each payday,” but if you have no clear purpose for that money, there’s a chance that you’ll end up spending it once you reach a substantial amount. You’ll never run out of money, but your finances will never be stable either.

The solution: Take a step back and think about what you want to accomplish with your finances. Do you want to save up for a big expense or investment, like a house or a business? Think long term. It’s one thing to save up for a splurge, it’s another thing to save up for your future.

It’s the little things that matter the most, they say. It applies to your finances as well. Watch out for the little habits that slip by unnoticed, but can create problems if left unchecked. Here’s to a healthier bank account!

Author: Cathy

Cathy is part of the team that manages http://www.australiancreditcards.com.au a complimentary loan comparison service and a personal finance blog based in Sydney, Australia. Before she joined PLF, she was a staff nurse at Clark Airbase Hospital and conducted lectures on First Aid, Bio-terrorism and Disaster Management.

Credit counseling agency – Questions to ask before hiring

debt consolidation

In case you are suffering from excessive mental tensions and anguish due to the state of your finances and your rising debts, then you must think of ways in which you can come out of the situation. One of the first debt solutions that you should consider is credit counseling. Credit counseling is a debt solution in which you are offered advice regarding how you can get out of your debts as well as how can you stay out of debts and mange your finances well in future. Credit counseling is provided by credit counseling agencies that help you by assessing your financial scenario and then formulating a budget for you. You are to follow the advice that is provided to you by these counseling agencies and if there is no improvement in the state of your finances, then you will be asked to enroll in a debt consolidation program.

It is important to consider certain aspects before you make the choice of your credit counseling agency. You must ask various questions before you choose a particular company so as to ensure that the company is good and will be able to help you out. Some of the questions that you must ask are as follows.

1. What kind of services does the company provide?

You should ideally look for a company that provides you with a wide range of services. These services will include giving you classes on budgeting and managing your debts as well as providing you with the necessary advice which will help you in getting out of debts. The company you choose should provide you with counselors who will assess your finances and as per that make a plan for you that has been specially designed for you. This plan is to help you in resolving all your financial problems. If it is required then a debt counselor may also advise you to enroll yourself in a debt consolidation program.

2. How much will they be charging you as fees?

One of the important determinants of choosing a credit counseling agency will be its fee structure. You are taking the help of a credit counseling agency because you wish to get out of debts. If the agency charges you an exorbitant fee, then there will be no use of opting for it. Thus, it is essential that you get the detailed price quote of all the companies that you are considering. This price quote should include the full fees and all this information must be provided to you in writing. Another important thing that you must find out is that if the agency will waive off your fees partly.

3. Will they be providing you with the necessary information?

It is most necessary that the company that you choose provides you with information regarding how they function without charging anything. If the agency is one that will charge you for providing you with information then you must not opt for it.

These are a few questions that you must ask a credit counseling agency in order to make sure that you are in the right hands.

Reverse Mortgages – How Can You Benefit?

Reverse Mortgage

A reverse mortgage is a type of mortgage in which you can release equity from your home in order to help fund your retirement. This can be an excellent tool for helping overcome the gap between the end of your super or pension and your actual bills. Read on for more information about reverse mortgage solutions.

What Are Reverse Mortgages?

Remember all the years that you spent paying off your mortgage? What if you could get that money back? That is, essentially, what a reverse mortgage is. These types of mortgage are only available to those over 60, and they’re meant to be used in order to support your retirement lifestyle. The Australian government is making it so that people are more responsible for funding their own retirements – and this making it difficult for some people as their super and pension aren’t providing the money they need to support their chosen lifestyle. It may not be the extras doing them in, either. It could be something vitally important such as medicines, hospital stays or a new car.

Many people will go the obvious route, selling their biggest asset for more money. Unfortunately, this can often compound the problem as they now need a place to live. The answer to getting the money that you need to fund your retirement while still living in your home is to take advantage of reverse mortgages. As stated above, it’s kind of like getting mortgage payments yourself.

A reverse mortgage is a type of mortgage available to property owners, older than 60 and they’re great for pensioners. These mortgages allow you to release money from your home using equity. These funds can be used as a stream of income or can be borrowed against. Like all money – it can be used for anything you like. You can use it to fund travels, medical needs, home improvements, anything you want.

This is still a loan product, which means there is still interest that you will be charged. However, you aren’t required to make payments on this type of loan. Your interest on this loan will be capitalised, or added to the amount of the loan. Instead, you will repay this loan either when the home is eventually sold. Hopefully, the sale of the house will more than pay off the loan and leave some profit in your hands or the hands of your beneficiaries.

You have a variety of reverse mortgage options if you’re over sixty and you own your home. It’s important that you choose the loan which is right for you, and that will depend on your own personal needs and a variety of other factors.

In order to find the correct solution for you, it’s recommended that you work with a professional mortgage broker in order to help you find the reverse mortgage solution which is best for your needs. These brokers will be able to look at your situations objectively, and they’ll know exactly what solution (or solutions) will be the best fit for your circumstances. They can then take their skill and expertise, along with their access to multiple lenders and hundreds of loans and put it to work for you. They’ll do all the legwork, finding the loan which will give you the highest amount of money with the lowest interest rates.

Do keep in mind that a reverse mortgage is still a loan, and it will have to be repaid at some point in the future. While it might not be you who will be doing the repayment, you still want to make sure that you don’t burden your survivors too much. If at all possible, it would be nice if they walked away from the sale of your home with some little bit of profit, or maybe even found a way to keep the home they may have grown up in. Keep this in mind when you’re looking into reverse mortgages, and your mortgage broker will be able to find you the best possible loan solution to help you and your family get through your retirement gracefully.