KEYS TO FINANCIAL SUCCESS

bloatdecorumSoftware and s/w Development

Oct 30, 2013 (3 years and 10 months ago)

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KEYS TO FINANCIAL SUCCESS



HOW TO MANAGE AND MAXIMIZE YOUR
ASSETS


PLAN YOUR FUTURE BY BEGINNING WITH
THE END IN MIND

SPENDING HABITS


WATCH FOR THREE BAD WORDS:
DISCOUNT! NOW! AND SAVE!


WATCH FOR THESE BAD TERMS: LIMITED
TIME! LIMITED QUANTITY! AND ONCE
-
IN
-
A LIFETIME OPPORTUNITY!


SPENDING HABITS


LOOK CLOSELY AT THESE TERMS; “PRE
-
HOLIDAY
SALE” “END OF THE SEASON SALE” “CLEARANCE
SALE” AND “BUY TODAY AND PAY NOTHING FOR 6
MONTHS



TIPS ON SAVING MONEY


PAY YOURSELF FIRST
-
YOU NEED TO SAVE 6
MONTHS OF YOUR MONTHLY INCOME


USE PAYROLL DEDUCTIONS


SAVE WINDFALL INCOME SUCH AS TAX RETURNS
OR MONETARY GIFTS.


COLLECT LOOSE CHANGE.


TIPS ON SAVING MONEY


TRY FRUGAL SPENDING.


BREAK A HABIT SUCH AS GOING TO THE MALL
EVERY SATURDAY


SAVE LUNCH MONEY.


SAVE SALE MONEY.


HAVE A “NOTHING”.


MORE TIPS FOR SAVING MONEY


BEFORE PURCHASING, ALWAYS RESEARCH THE COST
OF MAJOR ITEMS.


USE COUPONS AND DISCOUNTS BUT BE CAREFUL.


UTILIZE OUTLET STORES, SHOP OFF
-
SEASON AND
BUY CLOTHES THAT WILL ENDURE.


BECOME AN INFORMED BUYER AND DON’T BUY
MORE THAN YOU NEED.


SUBSTITUTE A LESS COSTLY ITEM.


TAKE CARE OF YOUR POSSESSIONS AND AVOID
WASTE.


ALWAYS COMPARE SHOP.


MORE TIPS FOR SAVING MONEY
-
USING THE CREDIT CARD


DO NOT HAVE MORE THAN 2 CREDIT CARDS
AND PAY OFF THE BALANCES IN A TIMELY
MANNER. AVOID PAYING THE MINIMUM
MONTHLY PAYMENT.


FOR LARGE PURCHASES, PLAN TO PAY OFF IN 3
MONTHLY INSTALLENTS.


DO NOT CONSIDER A CREDIT CARD AS AN
EMERGENCY FUND.


MANAGING YOUR ASSETS
-
GROWTH AND RETIREMENT


STOCKS

ARE AN ASSET THAT CAN INCREASE
YOUR NET WORTH


STOCKS ALLOW YOU TO HAVE OWNERSHIP IN A
PUBLIC COMPANY ON THE NEW YORK STOCK
EXCHANGE OR THE NASDAQ


INVESTING IN STOCKS CAN ASSIST IN
MAINTAINING OR INCREASING YOUR
PURCHASING POWER
DURING INFLATIONARY
TIMES

MANAGING YOUR ASSETS
-
GROWTH AND RETIREMENT


YOU CAN RECEIVE DIVIDENDS(QUARTERLY
BONUSES) FROM THE STOCKS AND/OR PROFIT
FROM THE INCREASE IN THE PRICE OF A STOCK.
YOU CAN ALSO LOSE MONEY IF THE PRICE
DROPS.


EXAMPLES OF GOOD COMPANIES TO BUY
STOCK: IBM, MICROSOFT, JOHNSON AND
JOHNSON, GOOGLE, APPLE INC, WALMART,
SCANA, PROCTER AND GAMBLE, INTEL, BANK
OF AMERICA, AND CISCO SYSTEMS


MANAGING YOUR ASSETS
-
GROWTH AND RETIREMENT


IF YOU ARE LOOKING TO INVEST
CONSERVATIVELY, YOU NORMALLY WANT TO
PURCHASE
BONDS
.


YOU PURCHASE
BONDS

IN UNITS OF $1000 WITH
FIXED INTEREST RATES AND FIXED TERMS. YOU
RECEIVE INCOME FROM THE INTEREST EITHER
MONTHLY, QUARTERLY, SEMI
-
ANNUALLY OR
ANNUALLY. BONDS ARE LONG
-
TERM WITH
TERMS LASTING 5 TO 30 YEARS.

MANAGING YOUR ASSETS
-
GROWTH AND RETIREMENT


WHEN YOU PURCHASE A BOND, YOU ARE
PURCHASING AN ORGANIZATON’S DEBT.
EXAMPLES OF BONDS INCLUDE
FEDERAL
TREASURY BONDS, BILLS AND NOTES
.


YOU CAN ALSO PURCHASE
STATE BONDS, CITY
OR MUNICIPAL BONDS, OR CORPORATE
BONDS.


MANAGING YOUR ASSETS
-
GROWTH AND RETIREMENT


A
MUTUAL FUND
IS A COLLECTION OF
DIFFERENT STOCKS, COLLECTION OF DIFFERENT
BONDS, OR A COLLECTION OF DIFFERENT
STOCKS AND BONDS COMBINED. THE MUTUAL
FUND IS MANAGED BY A SINGLE FINANCIAL
COMPANY THAT BUYS ALL THE STOCKS AND
BONDS FROM ALL AVAILABLE SOURCES.

MANAGING YOUR ASSETS
-
GROWTH AND RETIREMENT


THE ADVANTAGE OF A
MUTUAL FUND
IS THAT
YOU CAN PURCHASE THE MUTUAL FUND THAT
HAS THE TEN COMPANIES OF STOCK THAT YOU
WANT.


THE
MUTUAL FUND ADDS DIVERSIFICATION
WHICH
REDUCES OR SPREADS THE RISK OF THE
STOCK FALLING OR THE BOND FAILING.

MANAGING YOUR ASSETS
-
GROWTH AND RETIREMENT



DUE TO THE COST TO USE THE MUTUAL FUNDS
SUCH AS 2
-
5%,
MUTUAL FUNDS ARE BEST FOR
LONG
-
TERM INVESTING INSTEAD OF
INVESTING LESS THAN ONE YEAR
.

MANAGING YOUR ASSETS
-
GROWTH AND RETIREMENT


EXAMPLES INCLUDE AGGRESSIVE GROWTH
FUNDS, BALANCE FUNDS, BOND FUNDS,
INTERNATIONAL FUNDS, OR BLEND FUNDS.


MUTUAL FUND COMPANIES INCLUDE
AMERICAN FUNDS, JP MORGAN, JOHN
HANCOCK, FIDELITY, VANGUARD, AND
OPPENHEIMER


MANAGING YOUR ASSETS
-
GROWTH AND RETIREMENT


EXCHANGED
-
TRADED FUNDS (ETFs)
-
ACT LIKE
MUTUAL FUNDS BUT TRACK AN INDEX,
COMMODITY OR BASKET OF STOCKS AND
BONDS. EXAMPLES INCLUDE
NATURAL GAS ETF,
GOLD ETF, JAPAN ETF, S & p 500 ETF, ENERGY
ETF, HEALTH CARE ETF, AND CHINA ETF
.

MANAGING YOUR ASSETS
-
GROWTH AND RETIREMENT


CERTIFICATE OF DEPOSITS (CD)
-
ACT LIKE A
BOND WITH FIXED RATES AND TERMS. THE
RATES ARE LOWER AND THE TERMS ARE SHORT
-
TERMS SUCH AS 3, 6, 9, 12, 48, OR 60 MONTHS.


MANAGING YOUR ASSETS
-
GROWTH AND RETIREMENT


TRADITIONAL INDIVIDUAL RETIREMENT
ACCOUNTS (IRA)
-
YOU CAN CONTRIBUTE UP TO
$5000 ANNUALLY OF BEFORE TAXES OR TAX
-
DEDUCTIBLE MONEY. THIS IS A MEANS TO SAVE
FOR RETIREMENT. IF YOU TAKE OUT BEFORE 59
1/2 YEARS OF AGE, CAN WILL BE TAXED AND PAY
A 10% PENALTY. YOU CAN INVEST YOUR MONEY
IN MANY INVESTMENT MEANS.


MANAGING YOUR ASSETS
-
GROWTH AND RETIREMENT


ROTH IRA
-
YOU CAN CONTRIBUTE UP TO $500
ANNUALLY OF AFTER TAX DOLLARS.


THE ADVANTAGE IS THE DOLLARS ARE ALREADY
TAXED AND YOU CAN INVEST BEYOND 70 ½
WITHOUT FORCE WITHDRAWALS.


MANAGING YOUR ASSETS
-
GROWTH AND RETIREMENT


529 EDUCATION IRA PLAN
-
A TAXED
ADVANTAGED INVESTMENT VEHICLE DESIGNED
TO ENCOURAGE SAVING FOR FUTURE COLLEGE
EXPENSES FOR A DESIGNATED BENEFICIARY
SUCH AS PARENTS SAVING MONEY FOR THEIR
CHILDRENS EDUCATION OR GRANDPARENTS
SAVING MONEY FOR THEIR GRANDCHILDREN.

MANAGING YOUR ASSETS
-
GROWTH AND RETIREMENT


THERE ARE TWO TYPES OF 529 PLANS:
PREPAID
AND SAVINGS PLANS


THE
PREPAIN PLAN
ALLOWS ONE TO PURCHASE
TUITION CREDITS, AT TODAY’S RATES, TO BE
USED IN THE FUTURE. THEREFORE,
PERFORMANCE IS BASED ON THE TUITION
INFLATION. THIS PLAN IS ADMINISTERED BY THE
STATE OR COLLEGE. YOU MUST ATTEND A
COLLEGE IN YOUR COLLEGE IN YOUR STATE TO
RECEIVE THE TAX FREE FUNDS.

MANAGING YOUR ASSETS
-
GROWTH AND RETIREMENT


THE
SAVINGS PLAN
IS DIFFERENT IN THAT ALL
GROWTH IS BASED ON WHAT YOU PUT IN THE
PLAN AND MARKET PERFORMANCE OF THE
UNDERLYING INVESTMENT SUCH AS MUTUAL
FUNDS OR ETFs.

MANAGING YOUR ASSETS
-
GROWTH AND RETIREMENT


401K RETIREMENT PLAN
-
MANY COMPANIES OFFER
THEIR EMPLOYEES AN OPPORTUNITY TO INVEST IN A
401K RETIREMENT PLAN. THIS IS THE MOST COMMON
RETIREMENT PLAN. THE EMPLOYEES CONTRIBUTE
PART OF THEIR SALARY TO THE PLAN ON A PRETAX
BASIS INTO AN EMPLOYEE TRUST AND THE
EMPLOYERS MAY ELECT TO MAKE MATCHING
CONTRIBUTIONS ON BEHALF OF THEIR EMPLOYEES.


THE CONTRIBUTIONS CAN BE INVESTED IN MUTUAL
FUNDS, STOCKS, OR BONDS. THE EMPLOYEE DECIDES
HOW TO INVEST.


MANAGING YOUR ASSETS
-
GROWTH AND RETIREMENT


PENSION RETIREMENT PLANS
-

THESE PLANS ARE
MORE COMMON WITH THE FEDERAL , STATE
AND LOCAL GOVERNMENT, THE MILITARY AND
VERY LARGE WELL
-
KNOW COMPANIES SUCH AS
FORD, GM, GE, IBM, WESTINGHOUSE AND SCANA.


MANAGING YOUR ASSETS
-
GROWTH AND RETIREMENT


INSTEAD OF YOU MAKING CONTRIBUTIONS AND
DECIDING HOW TO INVEST IN THE
PENSION
PLAN,

THE EMPLOYER OR COMPANY PROMISES A
SPECIFIED MONTHLY BENEFIT AT YOUR
RETIREMENT THAT IS PREDETERMINED BY A
FORMULA BASED ON YOUR EARNINGS, WORK
HISTORY, TENURE OF SERVICE AND AGE.


KNOW YOUR NET WORTH


YOUR
NET WORTH
IS THE DIFFERENCE BETWEEN
YOUR
ASSETS LESS YOUR DEBTS
. IF YOUR ASSETS
EXCEED YOUR DEBTS, YOUR NET WORTH IS
POSITIVE. IF YOUR DEBTS EXCEED YOUR ASSETS,
THEN YOU HAVE A NEGATIVE NET WORTH.


KNOW YOUR NET WORTH


EXAMPLES OF
ASSETS

ARE CHECKING AND
SAVINGS ACCOUNTS, STOCKS, BONDS, MUTUAL
FUNDS, 401Ks, IRAs, PAID VEHICLES, JEWELRY,
PAID FURNITURE, MARKET VALUE OF HOME,
AND CASH IN A LIFE INSURANCE.


KNOW YOUR NET WORTH


EXAMPLES OF
DEBT

ARE STUDENT LOANS, CAR
LOANS, CREDIT CARD DEBT, MEDICAL BILL DEBT,
PERSONAL LOANS, BALANCE ON YOUR MORTAGE


BOAT LOANS, FURNITURE LOANS, JEWELRY
CREDIT DEBT, STORE CREDIT CARDS AND ANY
OTHER OUTSTANDING DEBT

PROTECTING YOUR ASSETS


LIFE INSURANCE
-
WHOLE, TERM LIFE, AND
UNIVERSAL
-
PREMIUMS, CASH BUILDUP


HEALTH INSURANCE
-
BLUE CROSS, AETNA,
UNITED HEALTH
-
PREMIUMS, CO
-
PAYS,
DEDUCTIBLES


AUTOMOBILE AND HOME INSURANCE
-
PREMIUMS AND DEDUCTIBLES

PROTECTING YOUR ASSETS


WILLS
-
USE TO PLAN HOW TO DISTRIBUTE YOUR
ASSETS AFTER DEATH


LIVING TRUSTS
-
MAY BE ESTABLISHED TO
PROVIDE FOR THE MANAGEMENT OF ASSETS IN
THE EVENT OF AN INDIVIDUAL’S INCAPACITY OR
ILLNESS, AND TO AVOID THE TIME AND COST OF
PROBATE UPON DEATH.