There is a Better Future for Real Estate Investing

Investing in real estate is a good option for anyone who is not sure of their finances in the future. If you have saved a lot of money for the past decades, it is a good decision to put your money in buying real properties. The price of land whether agricultural or commercial continues to increase and with proper management of your money you can always assure of a good future. As the saying goes, “do not put your eggs in one basket”, investing in real estate is a great way to diversify your investment portfolio so that you can have a better chance at a good return on investment. But how much do you know about investing in real estate?

investing in real estate

Investing is a broad subject because it deals with the ownership, purchase, sale and rental of an estate. Whether these are commercial, residential, industrial, or agricultural; they are all covered under estate property. Owning a piece of jewelry or an electronic gadget is not covered by this type of investment. Real estate development is a sub-specialty of estate investment which covers developing land for commercial buildings, subdivisions, condominium buildings, hospitals, cemeteries, housing projects and industrial buildings. The assets that result from this type of investment are generally just called real estate.

Every year thousands of acres of land are developed across the globe as sites for commercial buildings and housing projects with large capital invested by the land owner and estate developer. Millions of dollars have been spent for this investment which is expected to give multiple incomes when the construction is completed or make the land ready for sale or rental. When the buyers and renters are attracted to the property, the estate developer/owner can start reaping the fruit of their labor. More cash inflow is expected to come in as the price of rental for a condominium unit continues to rise with demand, the same goes for apartments and commercial buildings and store areas.

Brokers and agents will benefit from the proceeds of the sale or rental because they are entitled to a commission that would be negotiated before the deal is made. Most the commissions are usually anywhere from 5 to 10 percent. But 10 percent is too high. In fact in some parts of Asia, usually the commission is anywhere from 3 to 5 percent, a heavy cost savings. Although it sounds small, this can add up on a property being sold in millions. 5 percent is certainly enough to cover a broker’s bills and other expenses.

If you know how to deal with clients, dealing with investment can be a lucrative job for you. It is beneficial if you can become a licensed broker so you are guaranteed commissions on deals as well as having the ability to complete real estate sales yourself. Investing in real estate is a good sideline for people who have day job. As such, they can earn great money on top of their existing salary. For as long as your have persuasive skills and the ability to entice your buyer, you are guaranteed to have a good return on your money with real estate investing.

Should I Use a High Deductible Health Care Plan?

Expenses for medical services can be very costly these days. For a person to go without health insurance is a dangerous financial risk. If a major illness or accident occurs a family can find themselves facing enormous medical bills. Medical expenses quickly add up and the inability to pay them can wipe out someone’s finances entirely. Many hospitals refuse to see patients who are uninsured unless it is a dire emergency.

At this point the patient is usually just stabilized for transport to another hospital that accepts the uninsured. Often people choose to take the risk of going without insurance because they think that they will not be able to afford the insurance premiums. Or they simply choose to take the gamble of going without health insurance because they are normally healthy and seldom need to seek medical care. Most health insurance policies offer many different packages to fit a variety of budgets. Health insurance deductibles affect the amount required for the premium, choosing a higher deductible will result in a lower premium.

This option is better than having no insurance at all. With a higher deductible a person has more out of pocket expenditure initially; however once that deductible is met the insurance will then cover whatever portion of the expenses they are required to pay. The insurance policy will specify the exact amounts of the deductible, what procedures are covered by the insurance, and what portion the insurance will pay. Most people are surprised to find out how quickly they can meet their deductible within a few physician office visits. If a major illness strikes and hospitalization is required that deductible could be met in as little as one day. A bill for the deductible amount is going to always be a better option than having to pay the entire bill for a hospital stay out of pocket.

One benefit to having a deductible is that a person knows exactly what amount they will be responsible for paying. There will not be any big surprises because they know what to expect. For people living paycheck to paycheck surprise bills can really throw off their budget. By knowing the exact amount required to meet the insurance deductible they can plan accordingly. High deductible plans are a great option for those looking to save money on insurance premiums and most people are in a safe position to take advantage of these savings.

People with chronic illnesses such as diabetes might find it more beneficial to go with a lower deductible, however for those who are generally healthy there is no need to pay a high premium for insurance that they may not even use.

Another benefit to having a high deductible is being a healthier person. Knowing that they have a high deductible often encourages people to take better care of themselves to avoid getting sick in the first place. This is a win-win situation, they are saving money on their health insurance premiums while getting healthier in the process.

How Much do I Need to Save for Retirement?

A 45 year old man working a typical 9-5 job might be thinking more intensely about saving for retirement than a 21 year old that just landed his first full time job with benefits. At the age of 21, he might start contributing 4% of his income to his 401k with a more aggressive market approach. His 45 year old neighbor is struggling tirelessly to contribute 10% of his pay with a much more conservative approach. They both share one common interest: saving for retirement.
retirment saving
How much should an individual really save for retirement, and what is the ideal contribution to a company match plan? Many people have relied on and researched retirement planning calculators on the internet for years. The majority of these will calculate a percentage of income that one should be saving and deliver a figure that will support his/her lifestyle in 40 years. The calculator doesn’t take into consideration what everyone’s standard of living will amount to then. The sum of money that an individual should save for retirement doesn’t rely on income; it relies on money spent. A man could make $60,000 a year, but his current lifestyle requires an annual spending figure of $80,000. Another might bring home $80,000 a year, and his current lifestyle requires only $40,000. Should they both contribute the same amount to their 401k? Not likely.

Calculating a substantial amount of savings for retirement relies on evaluating an individual’s current spending and determining the standard of living he/she wishes to uphold at retirement. The retirement calculators that are based on income are not completely worthless. They provide a valuable resource for determining a figure of funds that will be saved after a number of years. Before utilizing these calculators, the individual must determine the ideal amount to save. This number will be derived from deciding how much to spend at retirement. Will they live lavishly, or will they live comfortably? Once a decision has been made on how much they want to spend in 40 years, then they can decide what to save. If the current budget does not allow for that level of spending, then they must discover other ways to save.

Here are a few frugal tips on saving money now for the future:

Stay healthy. One of the leading money guzzlers in retirement are health expenses. Prescription medications, knee replacements, high cholesterol, and cancer all come with a hefty bill. Regular physical activity and proactive health precautions may reduce these expenses.

Make friends with the neighbors. Retirees benefit from friends and family. Several people are willing to lend a helping hand to a senior citizen; a solid relationship will open this door.

Weatherproof the home. Energy costs are rising every year, and they might only increase in 20-40 years. Visit a local home improvement shop to find sealant for windows to prevent cold winter drafts. Ask about clearance items during the contrary weather season.

Being frugal will allow the individual to contribute much more to their company match plan for retirement.

Five Ways to Cut Your Grocery Bills

Gas prices keep rising and lowering (but definitely more rising). Our utility bills continue to increase, as does the overalls cost of living especially while food prices steadily continue to increase.

cut grocery bills

With that being said, we are looking for ways to save money and one of the easiest ways to save some quick cash is probably a way that you have never thought of before. Cutting your grocery bills will save a tremendous amount of money and it’s easy!

Here are five ways to cut your grocery bill, which means more money in your pocket for your mortgage payment, your utilities, or even a luxurious day at the spa (or golf course for you men out there!):

1. Clip Coupons – While it may not seem like 50 cents here and 75 cents there will save you money, it will if you know what to do and when. You want to save coupons and use them at the store when the store is having a sale on that particular item. In some stores, you can double or triple your coupons saving you that much more! Here’s how it works: let’s say you pay $2.50 for Prego spaghetti sauce and your favorite grocery store has it on sale for $2. Let’s say you have a coupon to receive 75 cents off that can of spaghetti sauce and let’s go on to say that the coupon doubles at the store for a total of $1.50 off the $2 sale price. That means you are paying only 50 cents for an otherwise $2.50 can of Prego spaghetti sauce. It pays to learn how to clip coupons and use them efficiently. Note: you can get easily coupons in your Sunday paper or online with the click of a mouse! And don’t forget to always be on the lookout for “Buy One, Get One Free” specials at the store and coupons. Match them together and that’s some savings to brag about (maybe even completely free!).

2. Stockpile During Sales – When items go on sale, stock up on them. Use your coupons, too. This means you will need to have plenty of room in your pantry – or somewhere! – so that you can store the additional items, but when the price goes up, you won’t need it saving you money on your grocery bill.

3. Purchase Store Brands – We don’t always have to have name brand stuff, do we? Sure, it’s nice sometimes, but store brand food is generally just as good and you can save a ton of money. This doesn’t only pertain to canned goods, this also relates to fresh fruits and veggies, frozen foods, baked goods and much more! In some cases, the store brand foods taste better than their name brand counterparts!

4. Avoid Convenience – Don’t purchase already cut-up carrots that are pre-packaged when you can purchase carrots individually and cut them up yourself for a lot cheaper. Avoid pre-made foods because in the long-run, you will save more cooking it from scratch at home rather than purchasing it in the frozen section especially in the long-term. Same goes for pre-cooked foods. It’s just better to buy the ingredients separately and make it at home. Next time you want the same meal, you’ll already have some of the ingredients on hand thus saving money!

5. Make a List – We all know that we spend more money at the grocery store when we go in without knowing what we need. By making a list of the things that we need (and sticking to it!), we are saving a ton of money on items that the household doesn’t really need such as extra junk food, an apple pie that looked too good to pass up, etc. So, check your fridge, pantry and cabinets before heading to the grocery store and make that list of the things you need to avoid excessive, unnecessary costs.

Utilizing the above-mentioned five ways to cut grocery bills, you will save a huge amount on your grocery bills each week. In fact, you will probably save more than you could have ever imagined you could save. When you go to the grocery store, make sure you are equipped with these five shop smart ways you can save money.

Do Young Adults Need Disability Insurance?

Many things go through the minds of young adults, but seldom do they think of being grievously ill or being prepared for the worst. Usually it is later life when these things are considered and dealt with accordingly. The chances of becoming disabled are considered remote, and therefore not something of which to be concerned.
disability insurance

This leaves many young adults unprepared for such an instance. Unfortunately it is in these years when most people are actually at a higher risk of a disabling injury. Everyone of working age needs to plan ahead of time to see that their bills would be paid if they were to become disabled.

Accidents and illness could potentially cause long lasting or even permanent disability. In the event of temporary disability, a policy would provide a portion of income that would help get bills paid until the illness has passed. The loss of employment resulting in no income for just a few months can have devastating financial consequences for the young adult and their family.

A big benefit in getting disability insurance while young is the reduced cost over getting it later in life. It may also be possible to get a policy during this time that cannot be cancelled by the company. It makes sound financial sense as it stays in force as long as the premiums are met in a timely manner. A policy such as this provides lifelong protection.

It’s no secret that a change in health comes with age. Medical history will play a big role in whether or not a person will qualify for disability insurance. Any kind of medical history will make an increase in the amount paid in premiums. This is where a policy purchase while in the health of youth makes so much sense.

Employers are the first place anyone should begin for any type of insurance. It could be readily available as an option in the company group insurance. Employees are responsible for inquiring about potential benefits they may qualify for as a current company employee. A quick trip to the human resources department will reveal what type of plans are available that can be automatically be deducted from earnings.

Most people are seemingly at their best during the young adult years. It is easy to overlook certain things at this age, particularly when it comes to topics of injury or death. However, it is the precise time to get prepared for all of the things that can catch us off guard. Disability insurance is not just for the elderly or frail. It is for all adults, young or old. These are the individuals that are smart enough to know they need it to take care of themselves should an unfortunate event occur.

Steal My ID by Identity Guard

In a new mock commercial by Identity Guard, which is featured below, they showcase an imaginary product called StealMyID.com, which helps people get their identity stolen. The video then asks if losing your identity is something you really want to do.

 

Steal My ID by Identity Guard
 

In the video it also mentions how all it takes is a name, and a social security number, to get access to some ones personal finances and in essence the ability to destroy their credit score. This brings up a good point in how important credit monitoring is, and how you should go over a credit card statement line by line to make sure that no one is using your account. Also it is important that your credit score is not harmed which can cause you to not get a loan for a new home, or even for a car payment. If you follow the video to the site www.stealmyid.com the site is also done up in a fake infomercialish way that while comical also further illustrates how important it is to not just give away your credit card information online. The site then leads you to http://www.identityguard.com which further discusses the problem with online identity theft as well as a launchpad for the purchase of their product line.

We are big fans of infogramics, especially when they teach a lessons and the Identity Guard site was full them, one of our favorites was this one, which has been reproduced below:

All in all a funny yet still informing commercial for a great product that actually works, so if you want to find out more watch the above video and check out StealMyID.com.

Tax Credits for Higher Education

Tax credits for higher education, are forms of educational assistance provided to students and or their parents to undertake payment of education expenses.

There are two types of recognized tax credits within the federal tax system overseen by the Internal Revenue Service and the federal government: The American Opportunity Credit and The Lifetime Learning Credit. To get access to this credit facility, one has to pay their post-secondary tuition for themselves, their spouse or their dependent. The credit may be claimed by the student or parent but cannot be claimed by both.

One can choose to claim either credit for each student in a single tax year, not both credits. For instance, one cannot claim The American Opportunity Credit to pay their child’s tuition and then claim the Lifetime Learning Credit for more school expenses. However, if one incurs education expenses on more than one student within the academic year, they can opt to seek either credit individually, with each student/year case taken separately.

The American Opportunity Credit

This is an improved version of Hope Educational Assistance Credit. It was created as a part of the 2009 Stimulus Bill, which was part of the federal government’s intervention process during the economic crisis of this period. Whereas it is improved, it does have a few limitations; one can only claim expenses incurred during the first four years of college. It is also temporary, unless the congress acts upon it, it will expire at the end of 2012.

Credit can be up to $2,500 per eligible student. 40% of the credit is refundable, meaning that; one may be able to receive up t0 $1,000 even if they owe no taxes. Expenses that meet this criterion include tuition, fees, textbooks related to the course and equipment like lab and measurement equipment.

The student must be pursuing an undergraduate course or other recognized educational credential. The student must also be registered as studying for a minimum of half the time of the projected study year. The full credit is generally available to Individuals who make less than $80,000 or $160,000 in the case of married couples wishing to file jointly.

The Lifetime Learning Credit

Like the name suggests, it is fairly flexible and open to any education activity that is taken after secondary level, or any additional job or skills courses taken thereafter.

Credit can be up to $2,000 per eligible student. The credit one has access to be limited to the amount of tax you are required to pay as part of the returns.

As mentioned above, this facility is not limited to degree courses but has a fairly wide educational access qualification basis. The expenses that can be covered by this facility include tuition and fees, textbooks and assorted equipment.

Taxpayers who make earn less than $60,000 or $120,000 for married couples wishing to file a joint return can access the full breadth of this credit as well.

Links:
http://www.irs.gov/newsroom/article/0,,id=218389,00.html
http://news.yahoo.com/tax-credits-higher-education-080023894.html

How to Juggle College Finances

With disposable income becoming a bigger and bigger problem both in the United States and globally and inflation and the economic situation increasingly unpredictable, investment in aspects of our lives like education is becoming harder to manage.

college finances

College education, of course, makes a critical the most important part of one’s education and is traditionally a major source of concern for the majority of families in the United States.

College education represents an expense process that covers many facets, and for a lot of people, the one thing that is focused on is tuition fees. Of course tuition forms a critical part of one’s college education but several other expenses play a role as well, without which the college degree may be encumbered or possibly not even achieved.

Apart from tuition fees, colleges have different fee structures that include registration, and access to different facilities at the university that may not be included in the tuition fees structure.

Daily living expenses are also important, as one needs to take into consideration meals, accommodation, transportation and things of that nature. Study materials, like text books and laptop computers cannot be ignored either.

All these and many more mean the study process for a college student is a difficult and expensive one for a lot of people.

However, there are a number of ways of reducing the cost implications covering the requirements of a college education.

Keeping the college choice within your state of residence or home states cuts back on transportation costs considerably and makes access to scholarships easier especially if you focus on those which are within your locality; people tend, surprisingly, to ignore these.

You can also consider the advantages, cost-wise, of using community college, which have particularly pocket friendly tuition rates and permit one to carry college credit accumulated in high school.

Applying for Free Application for Federal Student Aid doesn’t hurt at all, especially if you have more than one child attending college. You may just fall through the cracks or the criteria can include you because of the obvious implied financial strain.

Once in college, it is important for the student to remain focused on his or her studies and goals. All those extra semesters or papers carried forward imply additional costs that add to your financial load. Some universities also offer programs that help you save or recoup on certain costs like tuition, travel costs for visiting family as well as text books (http://www.usnews.com/education/best-colleges/articles/2011/08/24/colleges-offer-hidden-savings-to-students). It helps to be on the look out for such initiatives.

Being prudent with your money at this point in your life is always going to be a challenge but it forms an integral part of learning financial discipline. Look out for student discounts in college towns, which are usually on offer at restaurants, shops and clubs. Prioritize your technical needs, for instance, do you really need to have a printer in your room? Make the most of what the college does offer you, like meals which make an unnecessary dent in your personal expense account when you eat out.

When looking to cut costs or save, it’s more often than not, the little things that actually count and the same applies to college-related expenses.

Tax Filing Tips

Filing tax returns is the single most frustrating task for most Americans. Still, every citizen has an obligation to do it. Admittedly, it is not the simplest thing to do and the average person spends more hours than they can afford preparing their taxes. Add to that the many mistakes one is bound to make. With these tips, we hope that you will be able to less time preparing taxes and avoid some of the most common mistakes.

Tax filing tips
Tax filing tips

To help you along, here are the Income-related documents you need to have:
– Form W-2 for employers you and your spouse worked for during the year
– Forms 1099-MISC for miscellaneous income
– Forms RRB-1099 for Social Security/RR1 benefits
– Forms 1099-R for Retirement Plan Distributions such as pensions, IRAs and annuities
– Schedules K-1 for Partnership, Corporation and trust income
– Forms 1099-G for unemployment compensation

If you have investments, you will need to have these forms:
– Form 1099-B to declare the proceeds from sale of stock and other indices
– Form 1099-INT to declare interest income
– Form 1099-DIV to declare dividend income

Homeowners need Form 1098 for mortgage interest and Form 1099-S showing the sale of your home or other real estate property. If part of your mortgage debt was cancelled, you must indicate it in Form 1099-C. If the cancellation was on your main residential house, you are exempt from paying tax. You will need to fill Form 982 for this.

If you are not hiring a tax preparer, use tax software for your tax calculations. It is so much easier than doing the math on your own and will help you avoid many mistakes. Check every angle for deductions you could qualify for which can make a huge difference in the amount of taxes you end up paying, from medical and self employed health insurance to work-related, property, real estate, and state tax deductions.

To meet the deadline and avoid penalties, pay as early as possible. If you have no time to file by the due date, ask for an extension via Form 4868. Note that this is for filing only, not paying. Your payments must still be made by the IRS deadline.