Financial Planning, Retirement Plan, 401k, Investment Blog

Financial Planning, Retirement Plan, 401k, Investment Blog

Financial Education

Hiring a Career Coach- A Path to a Higher-Paying Job

Posted December 8, 2009 by Bernz

In today’s constrictive job market, contemplating a job change can be a scary proposition. Employers are laying off workers on a daily basis and more and more job seekers are searching for fewer and fewer jobs. Most employees simply want to hold on to the jobs they have for dear life and ride out the destructive wave.

However, this difficult employment market may be the perfect time to seek out a better job and the best way to do that is with a career coach. When the job market is contracting, it is the positions that require knowledge and skill that will remain the longest. Upgrading your education and skills can not only bring in a bigger paycheck but can solidify your position in the market and make you more attractive to potential employers.

It can be difficult to know what you need to upgrade and how to market yourself to potential new employers. That’s where career coaches come into play. A career coach’s job is to obtain a clear understanding of your strengths, weaknesses, and aspirations as it relates to the employment field. A career coach can help you fill in the gaps in your skills in your chosen profession and can lead you to leveraging your existing skills in a new direction. For example, if you have done general office work- filing, responding to email, and organizing for a small veterinary office, a career coach may help you realize that those skills are in great demand in the government sector, where wages can be substantially higher. (more…)

Posted in Career, Financial Education, Financial Goals | No Comments »

Emergency Fund: How Much Do You Really Need?

Posted June 23, 2009 by Bernz

Keeping an emergency fund available for unforeseen crises is a financial planning tip that is widely quoted. Any number of situations could come up where you may need to dip into this short term savings fund, such as loss of job (a more likely occurrence with the current economic situation), emergency medical expenses, or home repairs.

But how big does this emergency fund really need to be? Some financial planners suggest three months salary is a good general rule. If you would ask Suze Orman, (yes I do watch her show especially the “Can You Afford It” segment) she will say 6-8 months or even one year if you can afford is more advantageous. However, the right answer for you will depend on your circumstances and the risks that you are trying to cover. Some of the risks that people put aside savings for can be covered less expensively with insurance.

Take home repair for example. If your air conditioner or furnace were to quit for good, the expense of buying a new one might damage your current cash flow. (more…)

Posted in Financial Education, Financial Goals, Frugality, Investing in Real Estate, Retirement Planning, Saving Money, Wealth Building | 2 Comments »

Dogs of the Dow- Investing Strategy That Needs to be Retired?

Posted June 21, 2009 by Bernz

I was doing some research online about stock investing two days ago and came across this strategy and thought I should share my insights with my readers.

The Dogs of the Dow is an investing strategy first promoted 35 years ago by Michael O’Higgins, a fund manager who now runs his own firm. The strategy calls for choosing the 10 stocks in the Dow 30 index that have the highest dividend yields at the end of the year. You hold these stocks until the end of the following year when you re-balance your portfolio based on the new Dogs. A dividend yield is calculated by dividing the dividend by the stock’s price. Therefore, the stocks with the highest dividend yields have the lowest stock prices and may be ready for a jump.

Because all of the stocks in the Dow 30 are large cap, stable companies, the Dogs of the Dow strategy states that the companies chosen are likely to be solid in bad times and rise quickly in price in good ones. 2009’s Dogs are: Alcoa, AT&T, Bank of America, DuPont, General Electric, JPMorgan Chase, Kraft, Merck, Pfizer, and Verizon. (more…)

Posted in Financial Education, Investing Strategies, Stock Market Investing | 2 Comments »

The $787B Economic Stimulus Bill

Posted June 11, 2009 by Bernz

Ever since President Barack Obama took office in the January of 2009, there had been endless economic problems that faced his administration. His proposed solution? An economic stimulus plan that involved billions of dollars. On the short term, proponents of the program believe that it will provide tax cuts and create an estimated three million jobs in the United States. Over the long term, economists predict that it will stimulate growth by helping create economic activity.

In February, the $787 billion package has been passed. Though some sectors have lauded it, the economic stimulus has also been called “careless” and “wasteful” by some critics. This is because it contains a lot of the so-called earmarks for politicians. But a deeper problem persists. The $787 billion, as big as it sounds, may not be sufficient to spur economic recovery.

As the global economic condition takes a turn for the worse, the US is also affected. The US economy is already contracting in ways not seen since the Great Depression. With forecasts showing a vicious cycle, it is no wonder that economic contraction is difficult to stop despite everyone’s best efforts. (more…)

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The Double-Edged Sword of Mortgage Relief

Posted June 5, 2009 by Bernz

The financial news on television and in the newspapers is full of hopeful rhetoric on the help that is coming from the Federal government to assist homeowners who are struggling to save themselves from foreclosure. The purpose of the intervention, called the Homeowner Affordability and Stabilization Plan, is to keep people in their homes and stabilize the mortgage and real estate crisis that is affecting all investment markets.

This is good news for some homeowners but contains some risk for others. One way the programs tries to make home ownership affordable is to allow refinancing for homeowners who are current on their mortgages but do not have enough equity in their homes for a conventional refinance. This plan only applies to those who have their mortgages through Fannie Mae and Freddie Mac, so only a small fraction of at-risk homeowners will be able to take advantage of this plan.

The second part of the plan is for mortgage servicers to allow modification of the terms of the mortgage to ensure that homeowners can stay current on their payments. This is done mainly through interest rate reductions that are partially financed by the government. Each bank has some discretion as to how to manage these loan modification plans, but most require proof that the current mortgage terms are unaffordable to the homeowner. (more…)

Posted in Financial Education, Investing in Real Estate, Investing Strategies | No Comments »