This is the second installment in a mini-series from Ramit Sethi’s book, I Will Teach You to Be Rich. In case you missed the first post in this series, 3 Simple Steps Leading to Personal Wealth, be sure to check it out as well.
I struggled for a while with what to include in today’s post. There was a wealth of information in I Will Teach You to Be Rich, and it was an enjoyable read (how often can you say that about a personal finance book?), but I didn’t want to appear to be endorsing Ramit’s book since MoneyNing.com is an equal-opportunity promoter of all things related to personal finance. In the end, the section on credit cards won out because essentially, credit card debt is a very serious problem for many Americans, and probably quite a few others living outside the U.S.
According to the Federal Reserve’s Newsletter, the total U.S. consumer debt reached $2.5 trillion, with the total U.S. revolving debt (98% of which is made up of credit card debt) totaling $801 billion, as of December 2011. That’s a lot of people looking for a way to pay off those credit cards. You can win at beating the credit companies at their own games – and save money while improving your credit. Here’s what Ramit suggests:
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We hear a lot about the government entitlement programs, particularly in an election year. However, most Americans are unaware of what the programs offer to citizens and who is eligible. Here is a breakdown of four of the most common entitlement programs and what financial assistance they offer to those in need:
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Within the past decade, the amount of money put into youth athletics has skyrocketed. I grew up and saw this firsthand in baseball. Clinics, lessons, travel teams all ‘promise’ to make your child the next big thing, but do they really deliver? The reasons for putting kids into these types of activities are different. Some parents need a babysitter; some think their child is the next Babe Ruth, while some are just following what everyone else is doing. If you want to send your children to clinics or sign them up for special travel teams, you need to do your homework. There are a few ways you can do this.
Qualifications
Sometimes when I listen to the instructor during a lesson in progress at the local batting cage, I can’t even be certain he or she ever played baseball competitively. Check with other parents and kids who have used similar instructors or programs. Are they well qualified for the job? Check on levels at which they have played or coached. Anyone can claim to be a guru, but a sound background check can reveal plenty.
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Those of us steeped in the personal finance blogosphere find it incredible to think that there are those who have no knowledge of the Roth IRA. However, it is true that at one time I had no idea what the Roth IRA was — and I was probably about the same age as the college seniors who surprised Jeff Rose not too long ago, providing the inspiration for a Roth IRA movement.
Luckily, my research into finances and my time as a freelance writer allowed me to learn about the Roth IRA, which will give a huge boost to my retirement.
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The global marketplace is expanding at a phenomenal rate. Yet, the American education system is moving at the pace of molasses to meet the ever-changing needs.
Presently, the United States sits at the top rank of the world’s economy, but it isn’t a comfortable position. By 2020, everything may change – emerging markets are set to become a pivotal part of global economics, and China is on track to tackle the US and take the top spot from our fumbling hands.
What does all of this mean?
It means that if our education system doesn’t change with the times, our children will no longer have the ability to compete with the strength we once had in the global market.
1. Competition will be stronger
2. The dollar will be weaker
3. Unemployment will be higher
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Winning the lottery may not be all it’s cracked up to be. Statistics show 70% of lottery winners spend all of their fortune within a few years. Basically, if you didn’t know how to handle your money well before playing the lottery, you don’t magically get a visit from the Personal Finance Fairy who blesses you with mad money management skills overnight. Most people who play the lottery regularly view their lottery spending habit as an investment for a chance to live happily ever after. Their views on money are skewed, and even if they win, the sudden windfall can rather quickly turn into money lost.
In report after report, studies have found the majority of lottery winners actually win enough cash to get out of debt, yet wind up oweing more than before they hit it big after a series of bad financial decisions. Most aren’t prepared to manage such a large sum of money and are overwhelmed by the emotions that go along with a suddenly padded bank account.
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