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Borrowing from your 401k Plan – Is it always the wrong thing to do?

Posted April 7, 2009 by Bernz

When times are tight, sometimes we need to dip into our savings to make ends meet. If the money you are bringing in from your paycheck is not enough to pay your bills or the interest you pay on credit cards or other debts gets too high you will have to get the money from somewhere. Or even personal reasons such as health and family issues.

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Over the last few years, many people have used all of the equity in their homes by taking out home equity loans and now because of falling home prices they often owe more than their homes are worth. This has led consumers to look for other sources of cash to pay their growing debt and one of these sources is borrowing from their 401(k) plan.

I remember about 9 years ago when I had to borrow money from my 401K plan and use that money for down payment of a home. The original term of the loan was 15 years though I was able to repay that loan in a little less than 5 years time. It really was not a bad decision after all as my home have already doubled in value since. It was a decision that I had to make at that time for family reason.

More information on 401K plan and why you do not have to do what I’ve done………….. (more…)

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Financial Literacy- Does It Still Work?

Posted March 30, 2009 by Bernz

Financial literacy means being savvy with your cash flows and understanding your financial transactions in order to make better decisions that will protect and increase your wealth. Many feel that financial literacy is no longer useful or relevant in the face of our current economic meltdown. They feel that, no matter what consumers know or do, they will be hurt in this recession.

financialiqHowever, financial literacy is more important than ever. Understanding your financial position and how to navigate through tough economic times will give you a leg up in ensuring your financial security.

The people who will survive and thrive in today’s economy are those who have a handle on their personal finances. They know what they own and what they owe and they know where the cash is coming from and going. Every dollar that comes in has a name- meaning they know exactly where it is going.

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Posted in 401k, Debt, Estate Planning, Financial Education, Financial Goals, IRA, Index Funds, Investing Basics, Investing Strategies, Investing in Real Estate, Life Insurance, Loans, Mutual Funds, Retirement Planning, Roth IRA, Saving Money, Saving for College, Simple IRA, Stock Market Investing, Tax Reduction, Traditional IRA, Wealth Building | No Comments »

Retirement: Do You Plan on Working After Age 65?

Posted March 23, 2009 by Bernz

A generation ago, it was taken for granted that people would work hard at their jobs until their 65th birthday, then retire to a life of leisure. Most companies provided their long-term employees with retirement plans that made their post-work years comfortable. retirement

Today, however, workers are navigating a whole new employment landscape. Jobs are more transient than they once were. Workers are changing jobs and employers more often. Retirement packages are not a given any more and employees are lucky to find one that provides fully for the retired life. (more…)

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Posted in 401k, Career, Estate Planning, Financial Goals, IRA, Retirement Planning, Roth IRA, Saving Money, Simple IRA, Traditional IRA | 1 Comment »

Cleaning Up Your 401(k)

Posted February 25, 2009 by Bernz

If you are like most employees who have a company-sponsored 401(k) plan, you filled out all the paperwork when you first signed up, chose your investment funds from the list provided, and proceeded to forget it from then on. In the last 12 months, it is likely that every time you take a peek at your plan, it has gone down in value yet again. Best to just not look at it and hope for a miracle, right? Wrong!

401kkWhile there is not much that you can do about the global recession or the sorry state of the stock market, you can take charge of your retirement funds, especially your 401(k). Every 401(k) has an option to buy and sell the underlying investment funds every so often. You may be able to make changes to your plan every three months or even every day. Find out when you will be able to change out your investments and then take some time to know what’s going on with your existing choices.

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