August 2013


Here is August’s review of blog posts. We hope you find something you enjoy!

  • Good Financial CentsAre You Talking About the Sandwich Generation – More and more people are joining the “Sandwich Generation.” If you are one of them, or will soon become one of them, your financial life can become quite complicated.
  • U.S. News MoneyWhy Small Businesses Don’t Offer Retirement Plans – If you are looking to work for a small business, keep in mind you will likely not receive the same retirement savings benefits through your employer that you might at a larger company.

Please let us know if you have a favorite financial blog that you think we should be reading.

 

  • Disclaimer: The information on this blog is not meant for specific financial advice. The ideas/opinions stated are not suited for everyone, and readers should use their own judgment in applying them in their financial lives.

When do people start worrying about their retirement? Often, people don’t start worrying about it until the reality of it is right around the corner. Sometimes it takes a scare at work: an early retirement buyout, pressure from the company, etc.

Obviously, needing to worry about your retirement is not ideal. It would be great if everyone was in a financial position to be able to retire without stressing over whether their money is going to run out. But often, regardless of how much money you have, you will still worry, many times because you have no idea how much you need. So when you receive that early retirement package to review, you have no idea what you should do. The only real way to avoid this is to stay on top of your retirement savings throughout your career. It’s unfortunate that more people do not do so.

What happens when you reach the conclusion that you can’t afford to retire. You’re in your 50s or 60s, and you know that you don’t have enough. It’s not an easy situation to be in. In a post at U.S. News – Money by Joe Udo, “How to Salvage Your Retirement,” Udo makes some recommendations on what to do if you find yourself in this situation:

  • Run the numbers now.” If you aren’t tracking your expenses, know your potential Social Security income, or don’t have a grasp on where your other retirement income may come from, run those numbers right now. You should gain a better understanding of where you really are financially.
  • Cut your expenses now.” – This will help in two ways. Cutting your expenses now will help you be able to save more now while you’re still working. Also, it will help once you reach retirement and are living on a reduced income.
  • Start saving more now.” – If you are still working, you need to utilize what time you have left to save for your fast approaching retirement. Cutting expenses should help you up your savings amount, so don’t delay any longer.
  • Make money doing something you like to do.” – Some people have no choice but to keep working as long as they are able. If you are in this situation, try to find something you enjoy doing. While not always an option, if you can make money doing something you like, getting up for work each day will not be such a chore.

Don’t wait until it’s too late to salvage your retirement. It’s much too important to neglect.

 

  • Disclaimer: The information on this blog is not meant for specific financial advice. The ideas/opinions stated are not suited for everyone, and readers should use their own judgment in applying them in their financial lives.

This week, over at The Simple Dollar, Trent Hamm posted an interesting article on renting a place to live versus buying a home, “Renting Isn’t a Throwaway”. We thought it was an interesting take on the issue, and since we often hear the opinion that renting is just “throwing money away,” we thought we’d share some of Hamm’s ideas here.

It’s always been our opinion that the renting vs. buying question varies for every individual. Buying is not a financially sound decision for everyone, and the same goes for renting. Here are some of Hamm’s thoughts on why “renting isn’t a throwaway:”

  • “Insurance Rental insurance is significantly less expensive than homeowners insurance. Both provide similar protections – they make sure that in the event of catastrophe, you retain the value of your possessions – but homeowners insurance also insures the value of the home and many other things.”
  • “Property taxes Homeowners have to pay these. Renters do not.” – Depending on where you choose to buy, this can end up being a very major expense.
  • “What is the recent history of property values in the area I’m looking at? Has the area been rising in value? Holding steady? Dropping? To make home ownership worth it, your home will need to at least retain its value.” – Not all areas are conducive to buying. If you are looking to live in an area with falling housing values, buying is not likely to be a good idea.

A point that we would make that Hamm doesn’t is that if you are moving somewhere new from out of the area, you shouldn’t jump right into buying a home. Even if buying is ultimately the right decision for you, renting for a period of time to get to know the area (what neighborhoods you like, what amenities you enjoy, etc) can go a long way in helping you decide where the right place to buy is.

You should never assume that buying is the always the right decision. Take time to analyze your situation before ultimately deciding what is right for you.

 

  • Disclaimer: The information on this blog is not meant for specific financial advice. The ideas/opinions stated are not suited for everyone, and readers should use their own judgment in applying them in their financial lives.

There will be no post next week because we will be going on our family vacation. We usually take one every year, even though this year is not to Disney World! We thought we would share our previous post about taking family vacations with a larger group.

From 5/2/11:

As you know, we just went on a family vacation to Disney World. We traveled as a group of 8 people, 6 adults and 2 kids. And we thought we’d use our experience to give you some tips on how best to travel as a family.

  • Plan ahead – We know some people are planners while vacationing, and others would rather take it as it comes. It shouldn’t be a surprise that we’re planners. However, even if you aren’t, the more people you are traveling with, the more important planning becomes. Make sure everyone has an input on what they’d like to do and see. This will help eliminate wasted time and money while vacationing because you will already know what everyone wants to do ahead of time.
  • Save ahead – Estimate any potential expense you will have for your family vacation, plus extra, especially if you’re traveling with a larger group. Then, once you decide on your potential budget, save everything up before you go, or even before you book anything if you want to be completely safe. It’s too easy to plan and book a big vacation using credit to cover any short fall. Even if your intention is to pay if off right away, it can be dangerous territory. Also, if you go on the trip knowing that you still owe on it, your vacation won’t be as enjoyable.
  • Pay ahead – If possible, prepay for what you can (transportation, hotels, etc). Prepayment gives your vacation budget a better chance at being followed because it reduces some of the risk of unexpected expenses. Also, since food is such a major expense, if you happen to be going on a vacation to a place that allows you to prepay for food (like Disney or a cruise), look into taking advantage of the option.
  • Be flexible – We know we just told you to plan ahead, but that doesn’t preclude being flexible. When traveling with a group, there will be things that someone else wants to do that you won’t (especially when kids are involved). Just go along with it. You may not want to do it, but your overall vacation will be much more enjoyable because you won’t be at odds with other family members. There is probably something you want to do that the others don’t, so hopefully they will be flexible as well!

If you’re currently planning a family vacation or thinking about it, hopefully these ideas will give you a head start!

 

  • Disclaimer: The information on this blog is not meant for specific financial advice. The ideas/opinions stated are not suited for everyone, and readers should use their own judgment in applying them in their financial lives.