10 Year-end Financial Ideas to Boost Your Quality of Life

10 Year-end Financial Ideas to Boost Your Quality of Life

by | Dec 20, 2013

yearendfinances

With the economic ups and downs of the last several years, many Americans are more motivated than ever to get their finances on track. With some financial alternatives expiring before the year’s end, there’s no better time than the present to start.

“If you’re waiting until the New Year to resolve to better your finances, you may want to think again. You could be missing out on some year-end strategies that could help bolster your retirement savings and even provide tax benefits,” says Lule Demmissie, managing director of retirement at TD Ameritrade, Inc., a broker dealer subsidiary of TD Ameritrade Holding Corporation. “By being proactive, you can really have a positive effect on your nest egg.”

Demmissie offers 10 smart year-end strategies to help you start the new year with a strong financial focus:

1. Make 401(k) contributions by the end of the year
Not good at regularly saving for retirement? Make up for it by investing part of – or your entire -year-end bonus. For 2013, the maximum 401(k) contribution for people younger than 50 is $17,500. It’s a simple way to help build your retirement savings.

2. Play catch up
If you’ll be 50 by the end of the calendar year, now may be the perfect time to make catch-up contributions. In addition to the $17,500 401(k) maximum, people 50 and older can make a $5,500 catch-up contribution. Visit the IRS website for more information on contribution amounts.

3. Invest in a traditional or a Roth IRA
While the deadline for this year is technically April 15 of the next year; some say don’t wait to make contributions to an IRA for the 2013 tax year. Take advantage of the tax benefits, such federal tax-free growth and tax-free withdrawals during retirement. For traditional IRAs, most wage earners can deduct contributions on income taxes now and pay the taxes upon qualified withdrawals in retirement. Note: Adjusted Gross Income (AGI) limits apply for deductibility for both Roth and traditional IRAs.

4. Invest in a child’s future
Give your child a head start in life by investing toward his or her education. Consider opening a 529, Coverdell or custodial account. For parents of children already in college, don’t forget to take advantage of the American Opportunity College Credit if you are currently paying your child’s college tuition. (Note: AGI limits apply).

5. Pay down high-interest debt
Having high-interest debt can make saving for anything else very challenging. By paying it down now, you can save yourself money in the long run. If you only pay the minimum amount each month, a seemingly small purchase could take months to pay off and over time could cost significantly more due to the high interest rates.

6. Own a home? Invest in it
Numerous energy-efficient home improvements qualify for a federal tax credit if done by the end of 2013. Things like new windows, doors, water heaters and skylights may qualify. Visit energy.gov to learn more. In addition to a tax credit, these improvements can save you money on your utility bills, opening up more of your monthly budget.

7. Donate to charity
Donating to charity isn’t only an act of goodwill; it can be used as a write-off come tax time. Whether a monetary gift or donation of goods, such as clothing and household items you no longer use, keep records and include the deduction when you do your taxes.

8. Adjust your W9
In 2012, the average tax refund was just under $3,000. Rather than loaning Uncle Sam the money at no cost, consider adjusting withholdings and using the funds for saving or investing

9. Save for a rainy day
It can be tempting to spend any monetary holiday gifts or bonuses from work immediately. Instead, if you don’t already have one, use that money to start an emergency fund. Some financial professionals advocate having six to nine months’ worth of expenses set aside for unforeseen emergencies.

10. Review your portfolio
Don’t delay reviewing your contributions and portfolio allocations. TD Ameritrade offers a variety of tax-deferred savings vehicles that can help you pursue your retirement goals. If you have questions, meet with a qualified financial advisor and learn what you can do to start 2014 on the right financial foot.

TD Ameritrade does not provide tax advice. -Please consult with a tax-planning professional with regard to your personal circumstances.

Provided by: TD Ameritrade, Inc. Member FINRA/SIPC /NFA & BPT

Why Was Your Credit (or Debit) Card Transaction Denied?

Why Was Your Credit (or Debit) Card Transaction Denied?

by | Dec 16, 2013

NOTE: This happened to me recently because I made an unusual purchase online. My financial institution (USAA) is always concerned about keeping my account from unauthorized use. I simply called and verified my purchases and they re-activated my card. On the surface it can feel annoying (especially during the Holiday Season), but when you look at the big picture, it’s better to be safe than sorry…

By Jason Alderman

creditcarddeniedWe’ve all had these moments: You’re at a romantic restaurant and the evening went great. But just as you and your date are readying to leave, an embarrassed waiter appears and whispers, “I’m afraid your card has been denied.” So much for romance.

The same thing can happen at the grocery store, when shopping online or worst of all, when you’re traveling and don’t have a back-up means of payment. Why do credit card transactions get denied and what can you do to prevent it?

Banks and other credit card issuers have developed complex algorithms that track credit card behavior and highlight unusual usage patterns commonly associated with card theft or fraud.

“Unusual activities” that jump out to card issuers include:

  • When you ordinarily use your card only rarely, but suddenly make several charges in one day.
  • Making multiple purchases at the same store (or website) within a few minutes of each other.
  • An unusually large purchase – say for a major appliance, furniture or jewelry. Alert your card issuer before making large purchases.
  • One small purchase quickly followed by larger ones. Thieves will test the waters to see if a small purchase is denied; if it’s not, they’ll quickly run up major charges.
  • Exceeding daily spending limits. Some cards limit how much you can charge per day, even if you have sufficient remaining credit.
  • Making large purchases outside your geographic area.
  • Multiple out-of-town purchases in short succession. (Always tell your card issuer when you’ll be traveling.)
  • International purchases, whether online or while traveling. In fact, some card issuers automatically decline international transactions because of the high potential for fraud, so learn your issuer’s policy before attempting one.

Other common triggers for credit card denials include:

  • Outdated or incorrect personal information – for example, when you’re asked to enter your zip code at a gas station. Always alert your card issuer whenever you move.
  • Also, make sure you don’t mistype your credit card number, expiration date, security code, address or other identifying information.
  • Expired card. Always check the card’s expiration date. You should receive a replacement card several weeks beforehand. It’s often mailed in a plain envelope, so be careful what you toss. If the new card doesn’t arrive, contact the issuer to ensure it hasn’t been stolen.
  • You’ve reached your credit limit. For the sake of your credit score, try to keep your overall and individual card credit utilization ratios (credit available divided by amount used) as low as possible – ideally below 50, or even 30, percent.
  • A temporary hold has been placed on your card – say for a rental car or hotel reservation – that puts you over your credit limit. Always ask whether a hold will be placed, how much and for how long, and factor that into your remaining balance calculations.
  • You miss a monthly payment. Card issuers may let this slide once or twice, depending on your history with them, but eventually if you don’t make at least the minimum payment due, your card will probably be frozen.
  • The primary cardholder made changes on the account and forgot to tell other authorized users – for example, reporting his or her card stolen, lowering credit limits or removing you from the account.

One last thought: If your card is denied, don’t shoot the messenger – he’s only following instructions. Rather, call the card issuer and find out what happened. Embarrassment aside, it’s nice to know that someone is trying to ensure your card isn’t being used fraudulently.

Jason Alderman directs Visa’s financial education programs. To Follow Jason Alderman on Twitter: www.twitter.com/PracticalMoney

[Podcast] How to Thrive as a Single Mom

[Podcast] How to Thrive as a Single Mom

by | Dec 14, 2013

Listen in as I talk with Diamonaire Lifestyle radio about how to thrive as a single mom and begin creating the life you want.

I believe with all her heart that single moms do not have to struggle endlessly with depression, poverty, and a chronic survival mentality. I teach single moms how to be joyful, prosperous, and thrive!


[Podcast] How to Go From Toxic to Healthy Relationships

[Podcast] How to Go From Toxic to Healthy Relationships

by | Dec 7, 2013

Hear the interview I did on In Da Streets Radio show with Nina Capone talking about toxic relationships, the No More Crumbs book, and much more.

Toxic relationships does not have to be the status quo for you. You can attract healthy people and relationships. All you need are the tools to show you how to go from toxic to healthy. It does take a bit of work but it’s not impossible.

Listen in, learn, and apply the tips you hear in this interview. Pick up a copy of No More Crumbs for more details and hire me as your coach for help with your specific problems. I am here to help and provide as many resources as possible to help smart women who feel anything but when it comes to romantic relationships.


Managing Your Finances As A Single Mom

Managing Your Finances As A Single Mom

by | Dec 3, 2013

As a single mom, your responsibilities to your home and your family are panoramic. As the sole earner, and by definition the sole adult at home, it is on your shoulders to establish effective financial practices for you and your family. That means assessing both income and outgoings, in order to make the household budget balance. But it also means thinking about the future, and laying the right foundations now for a more prosperous tomorrow. You don’t need to be highly financially savvy to run a tight ship – through making simple changes to the way you structure your finances, it can be possible to achieve the desired effect.

Single moms often find themselves being in the position of receiving a single monthly income. In a one-parent family, there can only be one breadwinner, and that often means juggling the responsibility of childcare and work commitments. With only one income, expenditure needs to be much more tightly managed. In these cases, there is no financial safety net, and no support from a partner to afford emergency expenditure or plan for the future. This means moms need to seize the initiative, taking control of their finances now to make it easier to benefit from the advantages in future.
Image source: http://www.moneysavingadvice.co.uk/wp-content/uploads/How-To-Write-A-Family-Budget-And-Save-More-Money-800×600.jpg

When you are starting to plan your finances, you need to develop a solid picture of your expenditure month to month. There are certain bills that crop up each month that always have to be accounted for – structural expenditure, like your rent, broadband, utilities and so on. Then there are other items of expenditure that are variable, yet still essential, like transport costs in getting to work, or childcare costs around your working pattern. These are things you can’t necessarily cut out from your financial picture, and these are the first items of expenditure your income will notionally cover each month.

Next, you need to look at non-essential expenditure in your monthly budget, and whether you can find savings from these outgoings. This is all the expense you could comfortably do without. Naturally, definitions on this point vary significantly – some people live more modestly than others, and so define “non-essential” in very different ways. Look at your optional expenditure and decide where you can cut back. If you approach your finances through the lens of reducing what you are spending, chances are you will find one or more areas of saving. Remember these can add up into serious amounts of money with time, so it pays to look for reductions wherever possible.

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Simple things, like more efficient shopping, or switching energy suppliers, can save you significant amounts of money. Saving does not have to mean a deteriorating standard of living. There are plenty of ways of spending more efficiently to receive an equivalent standard of lifestyle, and those who adhere to these ideas will benefit from the savings they can bring. When you are running your household budget, you need to consistently think about ways of squeezing expenditure, both necessary and unnecessary – this is your kids’ college fund at stake, and the minor adjustments you make now will come back to thank you in the years and decades to come.

Finding ways to save money on a monthly basis is one thing, but you need to invest that money if you want to feel the fullest potential benefits. Investing is all well and good, but you do need to look for security. Nothing would be worse than losing that money you have saved and consistently set aside. Certificates of deposit are a good option for this type of saving, providing you with a certain return on the money you invest, based on certificate of deposit rates. The money you make from your investments can be reinvested until you need to use it, allowing you to compound your gains for the best result. This can be a key stepping stone to financial freedom, both for now and in the future.

Being a single mom can be tough. Not only do you bear the full extent of childcare duties, but also a 100% share of household admin and organization. Financial planning and management are important parts of that, and getting the right framework in place now can help ensure you and your family have a financially stronger future. From cutting down on excessive expenditure now, while finding better ways to invest your money, a simple refinement of your financial circumstances can be worth it, both for now and for the long-term.