Showing posts from 2012

10 Numbers That Can Change Your Life

By Paul Merriman

At some point, every investor who is planning to retire must confront his or her financial future. For most people, basic retirement planning can be distilled into 10 numbers.

As I worked with thousands of people over the years, and I saw over and over that when these numbers come into focus, the future starts looking clearer and less mysterious.

As you work to nail down these numbers, I suggest you regard the process as an exercise in discovery. Some items are easy to determine, while others may require some digging and careful thought. I think you will do a much better job if you use a competent financial adviser to help you get the right numbers and see what they mean for you.

One: Your current cost of living. This is the foundation of everything that follows. You could go into great detail on this, but a quick-and-dirty approach may be enough to get the process started: Identify your current gross income and subtract whatever you are saving for the futur…

8 Ways to Boost Your Income Now

With salaries up only 1.7 percent for the year--a repeat of last year's meager 1.6 percent--many Americans must look beyond their regular jobs to boost their incomes. There are ways to make extra money, some of them new, others tried-and-true, says Randall Hansen, founder of the career development website Quintessential Careers. Couple your ingenuity with your skills and, in some cases, Internet-based opportunities, and you can expand your bottom line even in these tight times.

Crowdfund your invention. As recently as a few years ago, inventors required bankers or venture capitalists to realize their ideas and move them to the marketplace. Now, crowdfunding sites like and allow anyone to raise money from friends and strangers who want little more than to help bring an offering to life. Of the more than 30,000 projects successfully funded on Kickstarter since its 2009 launch, the vast majority have been the work of an individual, not compa…

The Five-Year Funk: OECD Slashes Global Growth Estimates

Three mediocre years after the last recession ended, one of the world's leading economic policy advisers is warning that another may be on the way, as dawdling leaders in Europe and the U.S. fail to deliver the comprehensive solutions needed to restore growth.
"After five years of crisis, the global economy is weakening again," says OECD's top economist in its semi-annual assessment entitled Global Economy Facing Hesitant and Uneven Recovery. Since the Paris-based think tank's last report just six short months ago, the outlook for growth has worsened in all but three of its 34 member nations — including a forecast for two more years of mild recession in the euro zone, as well as a call for just 2% growth next year in the U.S.

"The most troubling aspect of this was their take on the U.S.," my co-host Jeff Macke says in the attached video. "They took our 2013 growth rate down to just 2% — and that's a best-case scenario that assumes…

6 Ways to Screw Up Your Retirement Plan

Contributing to an employer-sponsored retirement plan is an important step toward a secure future, but experts warn that, like any other financial asset, it takes oversight as well as common sense to reap its benefits.

Avoid these six critical mistakes to improve your chances of having a successful retirement.

Mistake No. 1: opting out

One of the biggest mistakes is to decide not to participate, says Robert Gordon, senior financial adviser at Miami-based Investor Solutions.
"As the saying goes, 'you've got to be in it to win it,'" he says. "Be it a 401(k), 403(b), 457 or other similarly numbered options, the responsibility is on the employee to take the initiative and complete the paperwork."
In an attempt to encourage more people to take advantage of employer-sponsored retirement plans, the 2006 Pension Protection Act provides safe harbor to companies who offer automatic enrollment that requires employees to opt out rather than opt in, says…

‘Era of Uncertainty’ May Be Drawing to a Close


If economists, business executives and investors have been sure of one thing this year, it is that uncertainty — over economic policies, political leadership and central-bank actions — is largely to blame for the shambling global economic pace, spotty job growth and serial bouts of anxiety in financial markets.
But the bull market in "uncertainty" has likely peaked -- not that many have noticed amid the political noise and unsettled stock market, which is falling sharply Tuesday amid disappointing earnings and worries over Spain.

Like most overplayed market themes, there's a set of plausible facts and resonant conditions at the core of the uncertainty obsession:
A close and contentious presidential race, with economic philosophies at its core, is about to culminate.The "fiscal cliff," in which spending cuts and tax increases of up to $600 billion could be triggered, is just ahead in January.China is undertaking a once-a-decade l…

7 ways to save money in your 20s

There is a paradox that exists when you're in your 20s; you have the energy and freedom to do whatever you want, but not necessarily the funds to do so. Often the two sides are at odds with one another, but they don't inevitably have to be. There are a number of ways to exercise your youthful exuberance, whether it be venturing out into the world on your own or pursuing your passions, without hemorrhaging money.Here are a few tips to survive and thrive in your 20s without breaking the bank.Live with Roommates
If you attended college and shared a place with peers, why not continue to do so after you enter the workforce? It's a good way to begin the onset of personal budgeting and household running without having to incur the higher prices that come with a single-bedroom residence. Living with roommates will also allow you to build up some experience dealing with financial responsibility and living under the same roof as other people before you dive headfirst into…

What to Do When You're Denied a Promotion

If you were expecting to get promoted, but got passed over, you're understandably confused and probably frustrated. But how you react and what you choose to do next can greatly affect your career path, so carefully consider your actions.

Withhold the negative emotions. If you feel like you deserved the promotion, you probably are angry, confused, and have a short fuse. But keep it under wraps until you know the entire situation. After all, you may not know the whole story; maybe someone was better qualified than you, or maybe your boss envisions you in a different role down the road.

No matter what you're feeling, try to be diplomatic and neutral in your reaction. Flying off the handle won't better your position. Instead, take time to regroup and consider your next steps.

Find out truth. If you're comfortable talking to your boss about why you were passed over, you might find out some key areas you can improve. Perhaps you were deficient in one area that t…

Worried About Global Economy? Here's One Possible Refuge

As slowing global growth bites into multinationals' earnings, investors may be more willing to give small-cap US stocks a look.

The New York Stock Exchange.The Russell 2000 (^RUT) is up 12 percent for the year, trailing the 14 percent gain in the S&P 500. But micro caps are up 17 percent, in line with the Nasdaq's gains.
"I think you've got a lot of nervousness coming up to earnings. With small caps, you don't have to worry so much because they're more domestic and you don't have a lot of international exposure," said Lori Calvasina, small-cap and mid-cap equity strategist at Credit Suisse.

She said the Russell 2000 stocks generate just 19 percent of their revenues internationally. As for the S&P 500, 46 percent of revenues are from overseas sources.

Through Thursday, the S&P 500 lost 2 percent over a five day period, while small caps were down just 1.8 percent. The small-cap energy sector was actually up 0.3 percent in that s…

21 Ways Rich People Think Differently

World's richest woman Gina Rinehart is enduring a media firestorm over an article in which she takes the "jealous" middle class to task for "drinking, or smoking and socializing" rather than working to earn their own fortune.

What if she has a point?

Steve Siebold, author of "How Rich People Think," spent nearly three decades interviewing millionaires around the world to find out what separates them from everyone else.

It had little to do with money itself, he told Business Insider. It was about their mentality.

"[The middle class] tells people to be happy with what they have," he said. "And on the whole, most people are steeped in fear when it comes to money."

Flickr / C. Pajunen1. Average people think MONEY is the root of all evil. Rich people believe POVERTY is the root of all evil.

"The average person has been brainwashed to believe rich people are lucky or dishonest," Siebold writes.

That's why there's a ce…

The Worst Retirement Investing Mistake

William Bernstein has a gift not only for grasping the complex but for helping the rest of us get it too.
He spent the first chunk of his career as a neurologist practicing on the coast of Oregon but cut back on his work hours in 1990. A few years later he focused on a new fascination: investing. He launched an online journal (a sort of proto-blog) called and wrote "The Intelligent Asset Allocator," the first of several books. (He has also written for MONEY.)

Now he's an investment adviser for a handful of high-net-worth clients. Bernstein's writing often explores academic financial theory, but he manages to turn it into practical, plain-English advice.
His latest obsession, resulting in the short e-book "The Ages of the Investor," is what economists call the life-cycle theory, which dictates that your asset allocation should be tied to your earnings power throughout your career.

Bernstein, 64, spoke with senior editor George…

A College Degree Doesn’t Guarantee a Good Job: Gary Shilling

Anyone who has a kid in college knows that August can be the cruelest month. That's when the bill for the fall semester is due and usually it's higher than the bill for any previous semester.

Over the past decade college tuition and fees have been increasing much faster than the rate of inflation. The average annual cost for tuition, fees and room and board is $38,600 for a private 4-year college and $17,000 for a public 4-year college (for out-of state residents it's $30,000), according to the College Board.
These rising costs coupled with a sluggish economy are driving more students and their families to borrow for college. Outstanding student loan debt now tops $1 trillion, exceeding the amount of total credit card debt in the U.S.

An increasing number of those borrowers come from middle to upper middle class households, with incomes between $94,000 and $205,000. According to a Wall Street Journal analysis of recent Federal Reserve data, 26% of those hous…

15 Things You Should Give Up To Be Happy

Here is a list of 15 things which, if you give up on them, will make your life a lot easier and much, much happier. We hold on to so many things that cause us a great deal of pain, stress and suffering – and instead of letting them all go, instead of allowing ourselves to be stress free and happy – we cling on to them. Not anymore. Starting today we will give up on all those things that no longer serve us, and we will embrace change. Ready? Here we go:
1. Give up your need to always be rightThere are so many of us who can’t stand the idea of being wrong – wanting to always be right – even at the risk of ending great relationships or causing a great deal of stress and pain, for us and for others. It’s just not worth it. Whenever you feel the ‘urgent’ need to jump into a fight over who is right and who is wrong, ask yourself this question: “Would I rather be right, or would I rather be kind?”Wayne Dyer. What difference will that make? Is your ego really that big?
2. Give up yo…

Want to Live to 100? Sleep

Your chances of reaching age 100 could be better than you think – especially if you get some additional sleep and improve your diet.

New research from UnitedHealthcare looks at centenarians and baby boomers, asking the former about the “secrets of aging success” and evaluating whether the latter are taking the necessary steps to celebrate a 100th birthday.

The primary findings: Many boomers are embracing lifestyles that could lead to a long and rewarding life – with two exceptions. More than seven in 10 centenarians – 71% – say they get eight hours or more of sleep each night. By contrast, only 38% of boomers say they get the same amount of rest. And when it comes to eating right, more than eight in 10 centenarians say they regularly consume a balanced meal, compared with just over two-thirds (68%) of baby boomers.

The report – “100@100 Survey” – begins with some startling numbers. As of late 2010, the U.S. had an estimated 72,000 centenarians, according to the Census Bure…