Buying a car will probably rank as your second-most expensive purchase, behind investing in a home. This means that you should take special care when plunking down your dollars for a new ride. It is terribly easy to overspend on a new car, and that is a shame. A new car might be useful. It might even be necessary. However, it is never a good investment. That is because the value of a car depreciates the minute you drive it off the dealer’s lot. That is just a fact. However, if you need to purchase a car — and most of us do at some time — then you can at least take the following steps to make sure that you never overpay. Budget First First, never start shopping for a car until you determine exactly how much you can afford to pay for a vehicle. Take a close look at your monthly household budget. How much wiggle room is there for a new car payment? Be careful here: Never buy a car with a payment that will suck up all the money you’ve budgeted for your vehicle. Owning, operating and maintaining a car costs money. In addition to your monthly payment, you need to pay for insurance, gas, repairs and maintenance. That is not an insignificant sum. A good rule of thumb then would be to purchase a car with a monthly payment that is 5 percent lower than your total car ownership budget. This will give you room to spend on all of the other associated costs. However, if you find that you’ll be putting a lot of miles on the car, you might want to adjust your purchase numbers down even further. Buying a used car might seem to be the most frugal path to take, but that is not always the case. Used cars are not always the bargain that they seem. If you are financing that used car, you’ll pay higher interest rates on a used car loan than you will on a new car loan. That could eat up any savings from buying used. You also want to make sure that you are not financing a used car purchase beyond the useful life of the vehicle. Nothing would be worse than having to continue to make payments on a car that has already bitten the dust. Besides, newer cars today are coming out with lower price tags. You might be able to find a good bargain in the current model. Check around to see what’s available. Arming yourself Entering a car dealership is rarely a pleasant experience. Salespeople will descend upon you. After you find a car you like, it is hard to tell whether you are getting a good deal or if the salesperson is ripping you off. However, you can take steps to boost your odds at squeezing the best possible price out of dealers. Start your auto shopping by browsing dealerships without buying. Make sure to tell the salespeople that you are just researching different models and that you will not be making any purchases. This is a good way to get a feel for the cars that interest you and their price tags while avoiding high-pressure sales techniques. After you have done this and narrowed down your choices to a few options, do some online shopping. Again, see what prices you can find for the models that you like. Read some reviews, too. There are sites that rate cars and provide tips for car shoppers. Most dealers these days have online sales departments. Take advantage of them. These Internet sales teams will usually provide you with quotes for the models you like within three to five business days. By shopping around online, you can get quotes from a few more dealers than you might have otherwise been able to do by visiting each of them. Once you have the pricing information in hand, most on-floor sales staffs of dealerships you do visit will match prices from competing dealers. So come armed with this information. Invoice price is key It is important that you learn the invoice price of any car that interests you. Invoice price is the amount that dealers pay for a car. If you know this price — which you can find at a variety of Web sites — you again give yourself more negotiating room. If you know that your dealer paid $12,000 for a car, you now know that you should not pay $20,000 for it. At the same time, you should scour the Internet and newspaper advertisements for sales and incentives. Many dealers offer cash rebates if you buy a particular model. Others will offer 0 percent financing for a set number of months. Others will offer steep discounts depending on the time of year. All of these sales and incentives can help you reduce the price tag of your next vehicle. If you are ready to buy a car, don’t be intimidated. If you are a smart shopper, and you do your research before stepping on the lot, there’s no reason you should overpay for a new vehicle.

Purchasing a Vehicle

View Resource Purchasing a Vehicle
You’ve found a new job and are leaving your old company. This is good news. The salary is higher than your old job; the work is more interesting and the commute shorter. However, you still face the question of what to do you with the funds in your old company’s 401(k), 403(b) or 457 plans? You have several options. Unfortunately, many workers choose the worst one. They cash out the money in their retirement plans and spend the funds, maybe to pay down credit card debt or take an expensive vacation. Doing this might seem like fun. After all, you’ve worked hard to save money. Why not enjoy it? Problem is, cashing out your retirement savings plan comes with significant penalties. First, your former employer will withhold 20 percent of the money you’ve saved to pay federal taxes. That is right; you’ll receive just 80 percent of the money that you’ve saved. Secondly, if you are under 59-and-a-half when you cash out your retirement savings plan you’ll have to pay a 10 percent penalty on the money you withdraw. Finally, when you start working your new job, you’ll have to rebuild your retirement savings from scratch. Depending on your age, this can put a serious crimp in your retirement plans. Fortunately, there are other, better, options. Better choices When moving from one company to the next, you have the choice of transferring the funds in your previous employer’s retirement savings plan directly into a traditional IRA. This is a direct rollover, and there are several reasons why this is a better financial choice than cashing out your retirement savings plan. First, there is no 10 percent penalty for doing this no matter your age. That is because you are not taking out the funds in the plan. They are just moving to a new retirement savings vehicle. Secondly, you will not lose 20 percent of your retirement savings to federal tax withholding. This means that 100 percent of the funds that you saved while working for your previous employer remain yours; a definite bonus come retirement time. You might also find that your traditional IRA brings with it several new investment options. You can invest the funds in your IRA in stocks, bonds and several other investment types. Bringing Your Money With You You might also be able to bring the dollars from your former employer’s retirement savings plan to your new company’s retirement plan. You can then invest those dollars in your new employer’s retirement savings plan and continue growing your retirement nest egg in a single place. Be careful, however. Not all employers will allow you to transfer funds from a former retirement savings plan into theirs. Be sure to speak to your new employer’s human resources department to find out if this option exists. If it does, it is a good one. Again, you will not pay any penalties, and you will not have to worry about federal tax withholding. Best of all, you will not have to start building your retirement savings from scratch. Leaving it Alone There’s a final option available to employees as they move to a new company: They can leave the money they’ve built at their past company in that company’s retirement savings plan. Most companies will let you do this as long as you have at least $5,000 in their retirement savings plan. This option comes with one big benefit: It is easy. You will not have to make any plans for the money you’ve built up. You can let it sit where it is. This might be a good choice if you are happy with your previous employer’s plan. There is a drawback, though: You cannot add new dollars. You also might lose touch with what is happening at your former employer. What if the manager of the retirement savings plan has switched to an investment mix that is less successful? You might not even know it until the value of your retirement account begins to fall. If you are starting on a new career with a new employer, be sure to research the options for your retirement savings plan. Moreover, don’t make the big financial mistake of taking the money you’ve saved and running. That may seem like the easiest choice, but it is the one that makes the least monetary sense. You’ve earned that money. Don’t waste it.

Taking Your Retirement Plan with You

View Resource Taking Your Retirement Plan with You
Owning a home instead of renting is often a wise financial move. It allows you to reduce your overall monthly costs while you build equity in real property. The biggest financial hurdle you face before you can buy a home is gathering cash for the down payment. Saving for a down payment requires much financial discipline, and probably quite a bit of time, but it is a necessary step to achieving the dream of owning a home. How much do you need for a down payment? At the bare minimum, your down payment must be 3.0% of the purchase price of your home, which is the requirement to obtain a Federal Housing Administration (FHA) loan. If you are planning to use a traditional lender rather than the government-insured FHA mortgage, it will be wise to shop around and determine loan availability in your area. At the end of 2014, mortgage guarantors Fannie Mae and Freddie Mac started to lower minimum down payments for mortgages they guarantee down to 3% from 5%, which might increase their availability. Individual lenders will set their standards, so you’ll probably find different levels of loan availability between 3% and 20% down payment levels. If you can manage it, your target down payment should be 20% of the purchase price. That way, you can avoid having to pay mortgage insurance, which will save you thousands of dollars over the course of the next few years. You can also qualify for lower interest rates on your mortgage when you put 20% down. Moreover, the more money you put down, the more equity you will have in your home right away. What are available sources of down payment funds? Obviously, your income and any existing savings you have can make up all or part of your down payment. However, you should also consider other possible sources of money for your down payment: Down payment saving strategies

Saving for a Down Payment on a Home

View Resource Saving for a Down Payment on a Home
Qualifying for a mortgage loan today is no easy task. However, it is also far from an impossible one. Mortgage lenders and banks today only want to lend mortgage money to those customers most likely to make their monthly mortgage payments on time. Remember, banks and lenders do not want to get into the home-selling business. When a borrower defaults on their loan and loses their residence to foreclosure, which is exactly the situation that lenders face. They have to sell the foreclosed homes, and that takes much time and money. It should be little surprise, then, to learn that lenders today take a long look at the financial strengths and weaknesses of potential borrowers before approving them for mortgage loans. Here is what lenders will look at when determining whether you are worthy of a mortgage loan. Credit score Your three-digit credit score has become an important number. Lenders consider this score when they are determining who to lend to and at what interest rate. If your credit score is low — say, 640 or lower on the popular FICO credit-scoring system — you might not qualify for a mortgage loan from conventional lenders. If you do, you’ll certainly have to pay higher interest rates. That is because borrowers with low credit scores have a history of missing car loan, credit card or student loan payments. They might also have a bankruptcy or foreclosure in their past. Alternatively, maybe they are saddled with high credit card debt. All of these missteps will lower a credit score. Lenders are wary about lending money to borrowers with histories of missed payments. If your credit score is excellent, which means a score of 740 or higher on the FICO scale, you’ll dramatically increase your ability to qualify for the best mortgage and the lowest interest rate. Debt-to-income ratios Lenders will also look at your finances to determine if you are a good credit risk. Specifically, lenders want to determine the size of your gross monthly income — your income before taxes are taken out — compared to both your mortgage and other debts. To do this, lenders will consider two ratios, your front-end, and your back-end ratios. The front-end ratio takes a look at how much of your gross monthly income your monthly mortgage payment — including principal, taxes and insurance — will take up. In general, lenders want your mortgage payment to take up no more than 28 percent of your gross monthly income. The back-end ratio considers all of your debts, everything from your mortgage payment to your student loan and car loan payments to the minimum amount of money you are required to send to credit card companies each month. Lenders prefer working with borrowers whose total monthly debts swallow no more than 36 percent of their gross monthly income. The lender’s goal is to make sure that your monthly debts are not so burdensome that they’ll overwhelm you financially once you add a monthly mortgage payment on top of them. Employment Lenders will look at your employment history, too, before lending you money for a mortgage. Most lenders prefer to work with borrowers who have spent at least the last two years in the same industry. They are even more interested in borrowers who have worked with the same company for those two years. Lenders view such a work history as a sign of stability, and they prefer lending to borrowers whom they view as stable. However, what if you are self-employed? You’ll have to work a little harder to convince lenders that you have a stable stream of monthly income. You’ll probably have to send your lender copies of your last three years worth of tax returns to show them that your annual income, even though you’ve been self-employed, has been steady. If you don’t qualify If you do not qualify for a loan today, don’t panic. You can always work to improve your finances before trying again. It is possible, for instance, to boost your credit score. You’ll just have to create a new history of paying your bills on time. You’ll also have to lower your credit card debt. Improving your credit score will take months, if not longer, but if you make good financial decisions, you can make it happen. You can also better your debt-to-income ratios by paying down your debts and seeking ways to boost your gross monthly income. Maybe you’ll find a better job or get a raise. At the same time, you can make yourself look more attractive to lenders by holding down your present job for a year or two before applying again for your mortgage loan. In other words, don’t give up. If you get rejected for a mortgage loan, work to improve your finances. You can still be a homeowner.

Qualifying for a Mortgage

View Resource Qualifying for a Mortgage
During the past seven or eight years, it has become increasingly common for young adults to move back home with their parents after going to college or being out on their own. The recession forced the choice on many young adults who could not find jobs that paid sufficiently to allow them to pay their rent. Additionally, growing student loan debt, now averaging $35,000 for undergraduates who took out loans, is also making many young adults consider saving some money by living at home again. Advantages of Moving Back Home Rent costs less: Your parents will likely work out a reduced rent charge for you that is well below the market rate. Some may even let you move back home for free, especially if you have expressed intentions to use the rent money you are saving to get out of debt quickly or for saving towards a goal. Home cooked meals: Chances are, your parents will be happy to have you join the family for dinners at least some of the time. This saves you money because you are not dining out or making food for just one person. You may even be able to get leftovers to eat for lunch the next day. You can focus on financial goals: The money you save by living at home can free up your income to pursue your financial goals. Perhaps you want to get out of student loan debt within two years, or you want to save up a down payment so you can buy a house of your own instead of renting. Disadvantages of Moving Back Home You lose some of your freedom: While living away from home, you got used to being out from the watchful eye of your parents. Even though you are all adults now, they are still your parents, and you will still feel like they have some authority over your life. Reduces your urgency and motivation: If you did not have your parents’ welcome mat as a safety cushion, you would probably work harder to find a job that will allow you to pay your bills on your own. It can be tempting to be a little lazy about job searching and tight budgeting if you are living at home. Tips for How to Make Moving in With Your Parents Work
  1. Have a financial meeting with them to discuss what they would like you to charge you for rent. In addition to your rent, your parents might want you to contribute to utility bills, cable subscriptions, or other expenses related to living with them.

  2. Set expectations for how you will help with chores around the house. Your parents will likely want you to pull your weight with chores, and they may also have standards for how they want the public areas of the house to look on an ongoing basis.

  3. Openly discuss with your parents whether they want you to tell them when you are planning to have friends over, or when you are not going to be at home for specific nights. You are an adult so you do not necessarily need to ask permission for everything, but you need to respect them and their home.

  4. Set goals and a timeframe for reaching them. Perhaps you want to pay off your student debt in a year, or you want to find a job and save money towards a security deposit and first month’s rent for a place of your own. Whatever the goal, make it concrete, and give your parents updates on your progress.

  5. Touch base with your parents on a regular basis about how things are going. Be willing to get your own place if they think you have overstayed your welcome or if the family dynamics are making their life more difficult.

Saving Money by Moving Back Home

View Resource Saving Money by Moving Back Home
While you are away enjoying your vacation, your home is vulnerable to invasion from intruders looking to make mischief and/or steal your belongings. According to the FBI the difference in the percentage of burglaries in summer and winter, was 10 percent, with the greater number occurring in summer. There are steps you can take before going on vacation that will make your home a less likely target for thieves or intruders. Keep these things in mind before you go on vacation so you can rest easier while you are away. Basic Security Tips These basic, yet prudent, home security measures offers some degree of protection for your home and your family while you are enjoying a little time away from it all. The more occupied your home appears, the less attractive it will be as a target to criminals. Basic Home Precautions to Take In addition to the tips mentioned above, there are certain precautions you may want to take with your home, including these. Some extra vigilance can make a huge difference when it comes to the safety and security of your home and belongings. These simple steps and advice will help you have one less thing to worry about while you’re away from home on vacation – leaving you far more time to enjoy your trip instead.

Protecting Your Home When You’re on Vacation

View Resource Protecting Your Home When You’re on Vacation
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Social Security Benefits

View Resource Social Security Benefits
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In Retirement

View Resource In Retirement
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Employer-Sponsored Retirement Plans

View Resource Employer-Sponsored Retirement Plans
As a business owner, it is essential that you attract good employees. Likewise, you’ll also want to retain them as more knowledgeable, experienced, and skilled employees likely means increased profits. Further, when employees like what they do, it leads to higher employee job satisfaction and better customer service — the latter of which may give your company a competitive edge in the marketplace. Bureau of Labor Statistics research reveals that the average American holds a little more than eleven jobs throughout their working years. This number is rising, particularly with the millennial generation. In light of this, a business owner needs to ask themselves: 1) how can they attract top talent to their company and 2) how can they make their employees care about their jobs. The answers to these questions will be found by addressing several factors, including the compensation package, company culture, management style, and employee career development. Compensation Package First, as an employer, it is important to provide a fair compensation package to both attract and retain top quality employees. That said, it is obvious that an entry level employee would not expect to receive the same compensation package as that of a CFO. However, if two employees are performing the same jobs, have the same responsibilities and are performing equally, they likely expect to receive the same compensation. A fair compensation package would include competitive pay and a benefits package that includes disability, health and dental insurance, vacation time, and other amenities such as flex vacation time. Company Culture Technically, a company’s culture is a combination of several factors including its values, visions, beliefs, and habits. More informally, company culture relates to the degree of acceptance, flexibility, teamwork, and management supportiveness that make staff happy to come to work each day. The more satisfied employees are, the more they tend to get along better with their co-workers, and the increased likelihood that they will be happy to come to work each day. When prescreening job candidates, consider if they appear to be a good fit for your company’s culture. If not, there’s a good chance you will not see an optimal performance from this employee, and there’s a high likelihood you will not retain them either. Management Style In an April 2016 survey “Should Leaders Focus on Results, or on People?”, posted on LinkedIn by Dr. Travis Bradberry, good leaders were considered those that focus on results while exhibiting strong social skills. However, they show a balance of both. For instance, only 14 percent of people surveyed said that leaders who are results-focused, but had weak social skills, were considered great leaders. On the other hand, 12 percent were considered as great leaders if they had strong social skills but lacked in focus. Perceived leadership abilities climbed to 72 percent when people had both qualities. Employee retention and management style are crucial to the success of a business. Without an effective strategy for both, it can be more difficult to attract the right talent and reduce turnover. You can involve your employees in the recruitment process and improve your management style by asking them questions to determine what it was that attracted them to your company, what keeps them engaged, and what motivates them. Employee Career Development Staff development is also essential. This means it is important to provide training programs, educational opportunities, and coaching to your employees. You can attract talent by letting potential employees know that your company will help them in planning their chosen path, setting strong goals, and providing them with the support they need to achieve these goals. Doing this will increase engagement and retention. Job satisfaction is the best thing you can offer your employees. When they are satisfied with their jobs and are happy, they are more productive and willing to do what it takes to help your company succeed. This is a win-win for everyone.

Attracting and Retaining Quality Employees

View Resource Attracting and Retaining Quality Employees