This summer, many students will be taking on summer jobs. However, many are unaware of the tax consequences involved with employment. Additionally, many students fail to establish a savings goal.
For example:
1. Form W-4, Employee’s Withholding Allowance Certificate must be completed. Employers use this form in order to withhold taxes from your paycheck. The IRS website has a useful Withholding Calculator on to assist with completing Form W-4. Visit www.irs.gov.
2. Use the summer job as an opportunity to set a savings goal. The website www.YoungAmericaSaves.org is a very useful tool.
3. Remember that money received from tips are taxable and so are earnings from self-employment.
3. Do your research and find a good a savings account. The website bankrate.com is a great tool for finding the right account to suite your needs.
4. Lastly, parents should try to serve as role model for their children. Setting clear expectations and making the most of your savings will enable your children to follow a good example.
July 16th, 2011 | Tags: education, employment, personal finance, Savings | Category: education, employment, personal finance, Savings | Leave a comment
So you have a lot of credit card debt? So what now? Many people find themselves in this situation and feel helpless and hopeless. The key is to not give up. There are many resources out there to help you. Among them are:
- Credit counseling: There are several nonprofit agencies out there dedicated to helping you. Do not fall for those agencies that are asking you to pay up front. The real agencies will not charge for their services.
- Consolidation loan: This technique has been useful for many people. Consolidation loans can be obtained through many resources. Check with your local bank or consider peer to peer lending.
- Debt settlement: Consider contacting your credit card company and negotiate to settle your debt for a lower amount. For example, try to settle half of your debt. You can accomplish this by calling or writing to your credit card company. Explain the situation to them and see if they are willing to negotiate and settle a portion of your debt.
- Pay off your high interest cards: Prioritize your debt so that you are paying off your high-interest credit cards first. This will take some practice. Be sure to take into account all of the debt that you owe so that you can come up with the right strategy.
For more useful information on credit cards and balance transfers, visit the bankrate.com website and search on credit cards.
June 25th, 2011 | Category: credit cards, education, personal finance | Leave a comment
Credit card balance transfers are very common. We usually think we are getting a good deal if we are offered a zero percent APR balance transfer. This is a great offer. However, too often we fail to think about the long term effects of a credit card balance transfer.
For example, can you avoid incurring new charges on the old card? For many people this is a difficult task. Additionally, what do you plan to do with the old card? It is recommended that you keep the account open. This helps build up your FICO score.
Other important factors to consider are whether you will get approved for the new card. Applying is the easy part. However, the challenge is getting the approval in the first place. Lastly, be sure to consider fees that will be incurred as a result of the balance transfer. Most if not all major credit card companies charge fees for balance transfers.
For more useful information on credit cards and balance transfers, visit the bankrate.com website and search on credit cards.
May 25th, 2011 | Category: education, personal finance | Leave a comment
Many people have already discovered this great new way to save. What is it you may ask? Tax time is a great time to save because many people receive refunds. In 2010 President Obama created the tax time Savings Bond Program. The program gives tax payers the opportunity to put away part of their refunds into a U.S. Savings Bond.
The process is as easy as checking a box on your return. Those filing paper returns can fill out Form 8888 Allocation of Refund (Including Savings Bond Purchases). Tax time savings bonds can be purchased in any amount from $50 to $5,000 and up to three bonds can be purchased.
Some of the main reasons for saving using the savings bonds include:
- · The bonds are safe and secure.
- · They never lose value.
- · You can earn interest for 30 years.
- · There are never any fees or charges.
- · After one year, you can redeem them at a bank or credit union.
More information can be obtained by visiting the Treasury Direct page.
April 28th, 2011 | Tags: personal finance, Savings, Taxes | Category: education, investing, personal finance, Savings, Taxes | Leave a comment
I came across this great article on Americasaves.org. Many people have difficulty saving for one reason or another. In this article, the writer shares some great tips to help and encourage people to save. The topics that she discusses are listed below:
- Does the Cost of Living Keep You from Saving?
- Do You Find Yourself Making Impulse Purchases?
- Do You Need to Manage Your Time Better?
- Are You Carrying Credit Card Balances?
The full article can be read at the americasaves.org website by clicking on the attached link to the website.
March 1st, 2011 | Tags: credit card payment, education, investing, personal finance, retirement | Category: consumer laws, credit cards, education, investing, personal finance, Savings | Leave a comment
I recently came across an article about why women should save more for retirement. Interesting I thought. So I kept reading.
The primary reason that we should save more is because we tend to outlive men. And the longer we live, the more we need in retirement savings. This means that it is important to start now and get ready for retirement.
How do you get started? Listed below are a few steps to get you on the right track:
- Understand your Social Security benefits statement. – Visit the US Social Security Administration website: www.ssa.gov for more information.
- Review your retirement plan statement for your 401(k) or 403(b) plan – A financial advisor is a great resource for helping you to review your plan.
- Open up an Individual Retirement Account – many banks offer IRAs to their customers. Financial advisors can also assist with this process.
- Visit www.choosetosave.org , www.mymoney.gov , or http://investor.gov and get started today with an investment and retirement plan.
January 31st, 2011 | Tags: education, personal finance, retirement | Category: education, investing, personal finance, Savings | Leave a comment
I wrote this blog two years ago as a means of encouraging readers to prepare for the New Year. Well, two years later, this message is still relevant as the times have not changed much from the prior years. Therefore, this message bears repeating. As 2010 draws to a close, many are hopeful for significant changes in 2011. Among these is a better economic outlook. But what can you do now to make way for a better economic outlook?
- Keep enough cash available. I can’t stress this enough. This year has been a record year for layoffs. Even if you’re not in danger of losing your job, it is still imperative to keep enough cash on hand. Financial experts recommend having enough cash on hand to cover between 6 and 9 months of living expenses.
- Diversify your investment portfolio. In order to have a well diversified investment portfolio, it is critical that one purchase stock in both U.S. and international companies. Another way to diversity is to purchase investments in large and small companies or fixed income and stocks. A financial advisor can show you how to properly diversity your investments.
- Continue to live below your means. This one is self explanatory. At least I hope it is. Living below your means does not mean depriving yourself of the good things in life. It basically encompasses making wiser choices about everyday purchases. It’s about distinguishing between wants and needs.
- Pay off expensive debts. Basically what this means is paying off those high interest rate credit cards. If you’re having difficulty, your accountant or financial advisor can assist you with coming up with a plan. Another option is to contact the credit card company directly and ask them to lower your interest rate.
- Review your credit report. This is a high priority especially if you are considering refinancing your mortgage. Mortgage rates are at an all time low. Even if you are not planning on refinancing, reviewing your credit report on a quarterly or annual basis is a good habit to create. Check out www.annualcreditreport.com for more information on how to obtain a free copy of your credit report.
- Create a budget and stick to it. Even though I listed this topic last, it does not mean that it is the least important. As I mentioned in a previous blog, budgets build discipline. I always encourage everyone to create one. Not only will you see where your money is going, you will also see how much you have left for savings. If you need help creating and sticking to a budget, be sure to reach out to your accountant or financial professional.
With that being said, I wish you all a Happy Holiday Season and a Prosperous 2011!
December 20th, 2010 | Tags: credit report, debt management, education, personal finance | Category: credit cards, education, investing, personal finance, Savings | Leave a comment
The week of October 17th-23rd is designated as National Protect Your identity Week. This week is geared towards educating the public about identity theft and how to protect yourself and the ones you love. The website protectyouridnow.org has several resources that will help you with this endeavor.
Other useful tips that you can follow include:
- Use a shredder to shred all of your personal statements.
- Never carry your social security card in your wallet or purse.
- Never give personal information to people over the phone unless you initiate the call.
- Check your credit reports at least once a year and look to see that everything is accurate.
Let’s join together to educate each other and our communities about identity theft.
October 18th, 2010 | Tags: credit report, education, personal finance | Category: consumer laws, education, personal finance | Leave a comment
During the course of tax season, many people make mistakes when preparing their returns. Some of the most common involve the filing status, number of dependents, total income and deductions. Other mistakes such as computational errors are usually corrected by the IRS.
Corrections to your return should be made using Form 1040X, Amended US Individual Income Tax Return. If you have more than one return to amend, you will need to use a separate Form 1040X for each. Additionally, if you have other schedules to include, be sure to attach them to the Form 1040X.
The deadline for filing Form 1040X is three years from the date you filed your original return or within two years from the date you paid any taxes. Therefore, you have plenty of time to get your paperwork in order. But don’t delay or you will forget and will miss this important deadline.
For more information on amending your return, visit the IRS website at www.irs.gov.
August 29th, 2010 | Tags: personal finance, tax preparation, Taxes | Category: personal finance, Taxes | Leave a comment
Identity theft is so prevalent these days. It is too easy to have your social security number stolen. It has actually happened to me. Someone stole my identity and filed a tax return using my social security number. Luckily for me, I caught it early and was able to prevent any major damage to my credit file.
To help combat the effects of ID theft, the IRS has issued some useful tips for taxpayers.
Be alert. Be aware. And know your rights when it comes to identity theft.
August 22nd, 2010 | Tags: credit card payment, education, personal finance, tax credit, Taxes | Category: consumer laws, education, personal finance, Taxes | Leave a comment
