Posts Tagged ‘savings’

Just Starting Work How Much Is Enough To Save

Friday, November 7th, 2008

Question from a reader, “Kim, I have graduated college and am working.  How much should I be putting into my 401K that they are offering me?”

My answer:  First off, congratulations on being employed in this economy!  Kudos to your company as well for keeping their 401K intact.  The common wisdom is to maximize your contributions and save in your 401K as much as they will let you put it.  The rationale is that when you retire say 30-40 years from now, whatever bumps in the economy that we are going through now (bumps? they are more like mountains)  will look like nothing looking backwards in time.

The reality is that you need to live in the here and now.

If you can’t afford to max out your 401K, at least start putting in something, especially if your employer is offering matching money.  That is free money that you are getting and that accumulates over time.  If you are scared about putting money into the stock market, check with your human resources person or plan manager and see if they have some sort of fixed interest rate fund (most do) that you can park your money in for the short term. Always do your own due diligence and remember that you can be pretty forgiving with yourself if you are patient. You are starting early in your retirement savings and that in of itself is a good thing.

If you are married (and I am guessing that you are not) and have two incomes, it might be worthwhile to sit down with a financial planner and/or a tax professional so you can see which is the best way that you can save money and get the best situation you can in terms of taxes.

A lot of people don’t quite seem to get it right (as pointed out often in this blog).

In the long term, any money that you can park now is a good thing.  Remember though as investment warnings state, “Past performance doesn’t guarantee future returns”.  A lot of things can happen over thirty years and it pays to still watch what your money is doing and not forget about it.

Also, you didn’t mention if there was a grace period where you will be putting money in but won’t be 100% vested. Generally, check with your plan manager and read the timing of how and when you are actually fully vested in the plan and see if there is any tiered matching or vesting as you stay with the company.

You are asking a great question at a great time in your career.  All the best and keep me posted how things go!

Worried about the economy?  Looking for a part time job?  Please check out my book, Practical Money Making for suggestions about how to ride through the hard times.

 Practical Money Making-Surviving Recession, Layoffs, Credit Problems, Generating Passive Income Streams, Working Full Time or Part Time and Retirement
 

Kim Isaac Greenblatt
 

Kim answers a question about saving money in a 401K.

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Don’t Get Sick Over Money

Thursday, October 9th, 2008

We all go through this, especially during economic hard times.  You worry about money.  About not having enough of it.  Not being able to pay bills.  Not being able to earn money.  Worrying about if our families have enough money.  In the news you hear depressing stories about people taking their families lives and their own from frustration.

Try to maintain a sense of balance through this.  It may take deep breathing, it may take seeing a counselor.  It is important that you make money but man and womankind have survived with less for millenia.

If your health goes because you are worrying too much about money you won’t be in any shape to help anybody.  Take care of yourself first.  Take some time to relax.  Enjoy the outdoors, go for a walk.  I am big on physical exercise because it gets you out of your head.

It may take some time, but financially things will get better.  You will need patience, if you have savings, you will need that and more to try and stay profitable.  Keeping your money and priorities straight is very important.

Don’t let the little things get to you.  Be thankful that you have you are alive.  There are people who are in worse shape than you.  There are people who don’t understand how they have gotten into the situation that they are in. 

As I’ve stated in the beginning of one of my books, “We are all in this together”.

Talk to politicians, talk to clergy and above all keep communication open with family.  If you have children explain to them what is going on without going into graphic detail.  Kids are generally pretty smart and can figure things out if you get them away from video games.

Above all, watch your health because once that is gone, it is sometimes hard to get it back!

Be healthy, be profitable and of course, be happy!

Kim Isaac Greenblatt

 

Kim Isaac Greenblatt advises you to don’t get sick over money.

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Ten Things To Do While The Global Economy Works Itself Out

Saturday, September 27th, 2008

1.   Find an economist who is around from the 1970s and 80s and get him to advise us what to do.  We haven’t had an economy with stagflation since then and the current economists so far don’t have a clue as to what to do.

2.  Write your Congressmen and the candidates and tell them to give US $4-7000 directly to each taxpayer.  Let the money trickle up to the businesses in reverse trickle up economics.  Giving the billions to the banks didn’t work before and it doesn’t look like it will work now if the money isn’t getting to the people, not the businesses, that need it.

3.    Stay profitable by avoiding any investment where there is too much change for the immediate future.  If you are in something stable and happy, we envy you.  If you are in a stock or commodity that is all over the map, you may want to park your money for a bit, at least a few months - maybe longer till we see what happens.

4.   Be nice to people who can’t help themselves.  I am talking about people with special needs, the elderly, your relatives who can’t take care of themselves.  You don’t have to go nuts but remember that they need help and you could be worse off than you are right now. 

5.    Explain to your kids and anybody else who doesn’t quite understand what is going, what is going on.  This may be the turning point for a lot of people in terms of waking up financially and getting their acts together and they in turn can pass these values onto their kids.

6.   Hang onto cash and gold (actual gold if you have it).  Cash is more than king and if you remember the cliche, “Money talks”, you will be happy to know that the cliche is wrong.  Money doesn’t talk, it screams. See if you can get discounts with some merchants if you pay cash instead of credit cards. This won’t work with chain stores but maybe with some other stores or with business suppliers. Work on eliminating your debt in case interest rates start going up and to get you back to some position of financial stability if you don’t have one already.

7.   Keep your house or apartment clean. Clutter may keep your house warm but you will be pleasantly surprised at how psychologically your thinking will get cleaned up if your surrounding living space is clean. It will also be easier to find important financial documents, statements, tax information or anything else that you need or are looking for.

8.   Stay healthy and make sure your family and friends are healthy. Without your health, you will not be able to keep your spirits happy through the upcoming financial readjustments.

9. Ask questions about finances and keep your eyes and ears open. Don’t rely only on the internet alone for financial information. Everybody parrots everybody else and at this point in the world, nobody has the answers as to what we should do and where we are going.

10.   Get a copy of my book.  It will help you get and stay on track financially!

Anything else to say or add?  Post a comment or drop me an email!

Good luck everybody!

Kim Isaac Greenblatt

 

Kim Isaac Greenblatt has ten things for you to do while the global economy works itself out.

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Thinking Poor but Happy

Wednesday, September 24th, 2008

What is a great way to force yourself to save money?  Whether you have money or not, pretend that you don’t have money.  That means, whenever you find you have the urge to go get a cup of coffee from the Starbucks or need to go to Walmart or Target “just to window shop” you don’t because you don’t have the money.

Folks, one of the reasons we are in the situation we are in is because the entire world has been driven by marketing people telling us that we “have to” have this or “have to” have that. Other than food, clothing, shelter, the rest is just embellishment!

Seriously, you don’t have to go over the top. Just start thinking about taking the money that you would have spent on extra coffee, comic books, magazines, clothes, snacks you don’t need to eat, and anything else and put that into a jar. Keep the jar away from your family. Unless they are putting money into that jar I suggest that you hide it. With all the banks going under, maybe under your mattress may be lumpy, so try a shelf in your closet.

A lot of people live their entire lives without anything other than food, clothing and shelter. If you judge being profitable by happiness, the chances are that they are much more profitable than you or I.

Am I asking you to become completely spendfree? Of course not. You may not be able to do it but at least you are pointing yourself on the right track for savings. Thinking poor is the first step to getting rich. Save, save and save and treat yourself as if you don’t have money. We all need to work on developing better money management attitudes.

If you are in debt, that may not be an easy thing to do and I applaud you for working through your debt. Keep at it but try and soak away some money for savings as well. It is profitable in case something happens and you need a doctor, a new car, or an emergency trip somewhere. You will need money for that. If something happens with your kids or relatives, you can be in a position to help out - though don’t make it a habit.

Try and think back as to when you were really happy. Sure, a lot of the times you may have had money or gotten something material that you really wanted. How about some other things that were not depending on cash? Ever feel happy just being alive? How about walking along the beach? Thanking the universe that you are healthy and able to walk, run, wheel, think, have working bodily functions? You don’t need to spend money to be happy. It does help at times but you need to search yourself - and you don’t have to be spiritual or psycho-babbling to do it.

Start small by pretending that you don’t have excess cash and see how creative you can get. Try and see what things you can do for you and your family that will keep you all happy and not cost money.

Drop me a line as to how that is working out as well!

Kim Isaac Greenblatt

Kim Isaac Greenblatt in his blog, profitable suggests you think poor to be happy.

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Kim’s EMF - Emergency Medical Fund

Monday, September 8th, 2008

Take five minutes now. I want you to answer a question for yourself.
Do you have money saved up in case you have a medical emergency? If you were to slip and break your arm and somebody has to pick up the kids, get them home or take care of your parents or a special needs loved one, do you have emergency cash available?

Separate from your insurance, you should have cash put aside for some basics that people don’t think about:

Medical Deductible - They range from $5 (if you are lucky) to $100 (average these days) to whatever it is on the plan you have. Don’t always count on credit cards to get it covered. Make sure you get a receipt for any deductibles you pay if you use cash.

Prescriptions - Pain killers, antibiotics, and whatever else - figure $20-200 depending on what has happened to you and your medical coverage.

Parking - Hospital parking runs from free to $15 in some cities.

Food - Relatives who visit need to be fed and watered (hi kids) and snack machines, cafeteria meals are easier to do when everything is up in the air then worrying about brown bagging it to the hospital.

Phone Cards - Some hospitals don’t give you outgoing phone service, you should plan for it accordingly by having some phone cards for $20 in case you don’t have your cell phone with you when you are checked into the hospital or it is damaged or separated from you. Watch the hours that they don’t expire right away or have a relative buy a phone card and bring it to you the day you check into the hospital. Remember also cell phones aren’t normally allowed in a hospital.

This is just a start - you can figure regionally for what the cost might be for you. Figure the neighborhood of $200 - $1000 depending on what city that you live in and what kind of medical coverage that you have. Keep it in your checking account and accessible by your ATM card.

I know it is weird locking up money like that but trust me, when you are in pain, and there are a million other things going on you need to take care of, you will be glad that you had some cash saved up. Insurance, if you have the coverage, will kick in, but it doesn’t always cover all of the little things that you need to have taken care of when you check into a hospital.

Kim Greenblatt

You are in Kim Greenblatt’s blog, profitable, where he is suggesting you establish an Emergency Medical Fund of cash.

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Kim Greenblatt Asks If You Teach Your Children About Money While They Are Young

Thursday, August 14th, 2008

Where do kids learn their first values about money? From mom and dad. Or from your baby’s mom, or your baby’s dad. Whoever. The people that will introduce a strong sense of monetary education into your kids at first will be you. What kind of example are you being for them?

Are you a saver? Have you shown them that they need to start saving money, even if it is with a piggy bank and just small change once a week?

Are you a spender? Do you buy everything you want, when you want it regardless of the cost? Do you end up charging up your credit cards in order to do that? Not a good idea. Do you want to have another generation of kids piling up debt?

I love America. I love the fact that capitalism is all over the globe. What I don’t love is the mass marketing and media shoving ads from the internet, from tv shows, from the radio from magazines trying to tell my kids what they “need” to have. They can get by on a lot less than they think they can and yes, like any devoted parent I want what is best for them but I would be doing my son a disservice by giving him everything he wants. In Arianna’s case, Arianna has Rett Syndrome, I am doing all that I can to make her life comfortable and help her develop her communication skills.

There is a difference between teaching children to be frugal and cheap. Frugal is where you save a little bit of money from each weekly allowance, paper route, usher job at the theater, etc. You put that into a savings account for something big later on. You get your children use to saving for emergencies and a rainy day. Cheap is not leaving a tip to a waiter or waitress at a restaurant who gave you great service. If they give you lousy service, you can teach your children at that point the value of good service by still leaving a tip, just a small one. They may not say anything but they will get the message.

Teach them about money to avoid gambling schemes as well.

Special needs kids can get the message too. They need to learn - and some learn it quite well and quickly - the need to price shop, to learn the difference in value with some items and to see through marketing at times.

If you are reading my blogs, I am sure you are teaching your kids the value of money. While you are at it, you may want to look into getting them a Roth IRA if they are working a part time job as well.
It doesn’t hurt to start their retirement while they are young.

If they have questions about money, please encourage them. Any ideas about making money also should be encouraged. If they want to start a part time business, do what you can to help them. You never know. They may become the next garage start-up billionaire.

Part of all my book proceeds go to research finding a cure for Rett Syndrom and reversal of symptoms.

Kim Greenblatt

Questions or comments? Let me know about them! Thanks for taking the time to visit and for more information or to get back to the beginning of the blog, go here.

You are reading from Kim Greenblatt’s blog, profitable, on teaching your kids about money, taxes and money management while they are young!

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Profitable Gambling Advice-Don’t Play the Lottery-the Odds Are That It Is A Sucker Bet

Tuesday, July 29th, 2008

Want some great gambling and investing advice? Don’t play the Lottery. If you live in any state that has a state lottery, Powerball or any kind of bingo ball lottery, you’ve seen the ads, you’ve seen people become millionaires overnight. It doesn’t happen very often.

In fact it happens so rarely that you have better odds of being hit by lightning, winning the Congressional medal of honor or winning the Nobel Prize than winning the lotteries.

They are built the way they are to make it seem that it is easy to pick numbers. How easy is it to pick numbers? Let’s see from the California Lottery what the odds are…

How to Win California SuperLotto and Odds of Winning
To win you must have one of the following matches against the number actually drawn:

Match 5 Plus Mega (Jackpot Win!) Odds = 1:41,416,353
Match 5 (No Mega Match) Odds = 1:1,592,937
Match 4 Plus Mega Odds = 1:197,221
Match 4 (No Mega Match) Odds = 1:7,585
Match 3 Plus Mega Odds = 1:4,810
Match 3 (No Mega Match) Odds = 1:185
Match 2 Plus Mega Odds = 1:361
Match 1 Plus Mega Odds = 1:74
Match 0 Plus Mega Odds = 1:49
Overall Odds of a win is 1:23

Okay, so the starting pay out is something like $7 million dollars? The odds of you winning are one out of 41 million? That doesn’t sound like such a great deal. Yes, if you win, it is all worth it but realistically they should be paying you out $41,000,000. So, even if somebody wins out of the chute and they get $7,000,000, they have not paid out what the bet should have been worth.

What does that mean to you? If you really want to play or feel that your numbers are the lucky ones (and you may be better off going with random number Quick Picks to maximize your chances) you should wait till the jackpots are over $41 million. Otherwise, you aren’t getting your bang for your buck.

Here is a profitable idea - how about taking each $1 that you want to invest in the lottery and place it in a savings account or donate it to charity each time you want to play the lottery? If you keep track of your donations over a year, two years or five years you will be pleasantly surprised at what your newly found savings or donations can do!

So, if you are also ready to see how your odds stack up, check out some of these comparisons:

Odds of going into a bowling alley and bowling a 300 game: 11,500 to 1

Odds of going to the golf course and getting a hole in one: 5,000 to 1

Odds of getting canonized: 20,000,000 to 1

Odds of being an astronaut: 13,200,000 to 1

Odds of winning an Olympic medal: 662,000 to 1

Odds of injury from fireworks: 19,556 to 1

Odds of injury from shaving: 6,585 to 1

Odds of injury from using a chain saw: 4,464 to 1

Odds of injury from mowing the lawn: 3,623 to 1

Odds of fatally slipping in bath or shower: 2,232 to 1

Odds of drowning in a bathtub: 685,000 to 1

Odds of being killed on a 5-mile bus trip: 500,000,000 to 1

So, your best deal is to save a dollar and don’t take a bath while taking a 5 mile bus trip in a lightning storm while mowing your lawn with a chain saw!

Kim Greenblatt

Questions or comments? Let me know about them! Thanks for taking the time to visit and for more information or to get back to the beginning of the blog, go here.

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