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A Dozen Tips for Starting an Import/Export Business
Thinking of starting an import/export business? Jennifer Henzel, a Certified Import/Export Trade Professional offers these tips for getting started: 1. Many countries have set up offices (Consulates or Embassies) in foreign countries to promote...
Government Loans
Government Loans - How America Pays for School
These days, despite the rising costs of an American experience at college, less and less people are actually paying to go to college. What’s that you say? Yes, that’s right! Less people are paying...
Self-Employment - Managing you Money: Tips for Living with a Fluctuating Income (Part Two)
Part Two: The way you manage your money is one of the first things you'll change when you move from employment to self-employment. It's one thing to budget and manage your money on a regular income-as you do when you receive a salary. It's quite...
The Basics of Forex
Foreign exchange market is also known as Forex or FX market. To date, it is the world’s biggest “economic bazaar”. FX produces an average of over $1 trillion daily earnings. That is 30 times more than combining all the volumes of America’s equity...
Youth Entrepreneurship, A Disappointing Truth
The psychology of entrepreneurship can be very rewarding to one who dreams of starting their own business. The freedom of being your own boss has billions of people seeking financial independence and other entrepreneurial expectations. But is...
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Funding Your Retirement: The 401K and 403B Way
Saving for your retirement doesn't have to be a nightmare as long as you are
aware of your options. For now, we're focusing on 401K and 403B retirement
plans. These two plans are essentially the same except that for-profit
companies use 401Ks and non-profit companies, such as the government, use
403Bs.
An employee contributes to a 401K plan with pretax salary. This means that
this account appreciates without taxation until you retire or leave the
company. So, 401K contributions are not included in your reported income.
In essence, you receive an immediate tax deduction for your contribution.
Many employees offer an automatic payroll deduction, so there isn't any extra
effort involved for you. Matching contributions or partial matching
contributions are other incentives offered by employers. For instance, my
employer matches every one of my dollars with a quarter. Sounds like small
potatoes, but remember the beauty of compound interest.
Of course, there are rules and regulations. You are typically limited to a
percentage of your income or $10,500 annually, whichever is less. So what
happens if you leave your company? You have 3 options: leave it as it is,
roll it over into another tax-deferred retirement account such as an IRA or
withdraw it all. However, early withdrawal penalties, that is before age
59-1/2, are stiff. Usually, it's a 10% penalty plus any taxes owed. So, if at
all possible avoid withdrawing any funds before age 59-1/2.
Your 401K portfolio should be chosen carefully, weighing age and risk
factors. The older you are, the less stock you should have in your portfolio.
Many financial advisors suggest that your portfolio percentage of stocks
should be your age subtracted from 100. Therefore, a 25-year-old' s portfolio
should consist of 75% stocks. However, if you're not comfortable with that
level of risk, then simply chose fewer stocks. Do remember this: over the
last century the stock market has returned an average of 11% (this includes
all wars and the Great Depression). Your plan will most likely offer 4 to 7
investment options of mutual funds, stocks, bonds, etc. for your portfolio.
My company provides 10 options of which I have chosen 5.
Chose wisely and consider how much risk you are willing to take. Most of all,
you need to be comfortable with your choices. If you need further assistance
in choosing your investment options, check out www.morningstar.com or the
MorningStar books at your local library.
About the Author
MomsBudget.com - Providing financial resources for women who
happen to be mothers. Sign up for our newsletter by sending an e-mail to
momsbudget-subscribe@topica.com
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