HOW MUCH TO SAVE... FOR RETIREMENT?!

For Retirement, Start Saving Early and Build from There

Say that two young adults, Ben and Alice, have both started their first job — with new people, new responsibilities and new money in the bank account each Friday. Both work hard, but Ben also plays hard, eating out a lot and spending on vacations. Alice, meanwhile, makes sure to sock away a little bit of every paycheck in her retirement account, aware that times might not always be so flush.

Who do you think will be in better shape at the end of his career? Of course, it’s Alice: When it comes to retirement planning, it pays to start early and build over time.

But there’s hope still for Ben. Here’s some guidance on saving for retirement, no matter your age or how diligently you’ve been saving up to now.

Get time on your side
Retirement savings grow largely because of compound interest: The money put away in the early years will generate interest earnings of its own with each passing year. Because Alice has started investing at the beginning of her career, her savings will have more time to grow.

How much does time matter? If Alice invests just $100 a month beginning when she turns 25, and she earns an average of 7% on it each year until retirement at 65, she’ll end up with almost $265,000. For Ben to see similar results starting at age 35, he’ll have to invest about $220 a month — or $510 a month if he starts at age 45.

If you didn’t start saving right when you began your career, it’s OK. Just begin as soon as you can in order to take advantage of compounding interest.

Draw up a plan
How much is enough in retirement? Everyone’s answer is different and personal, but consider the 80% rule. That says you should plan to save enough so that for each year of your retirement, you can spend 80% of the amount you made in your last year working without exhausting your retirement fund.

To figure out how much you can save each month, take your monthly pay and subtract your regular monthly bills and payments, making sure to allow yourself enough money to have a little bit of fun. If you need to, take a side job and devote all of the money you get from that to your retirement savings. And remember that the amount of money you’ll actually need can change, so it’s smart to save even a little more than you think you’ll need.

Still unsure? Financial institutions like Tropical Financial Credit Union have advisors available to help with retirement planning.

Maximize your retirement benefits
If your employer offers a 401(k) and will match your contribution, put in enough to get the full match. So long as you can afford it, it’s getting the most “free” money available to you.

Beyond your 401(k), consider saving more in a separate individual retirement account — Roth or traditional — especially if you’re a Ben and waiting a bit to start saving. The primary difference between the two accounts is when you pay taxes: up front (Roth) or when you take distributions in retirement (traditional). Brokerage accounts are another investment type to consider.

It’s never too soon to start thinking about your retirement, not even if it’s the first day of your working life. And whether you’re a Ben or an Alice, there are ways to get to where you want to be.

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BREAKING UP WITH DEBT AND DIVORCING YOUR LOANS!

Getting an education is one of the most amazing accomplishments to have. To say you completed a 2 year, 4 year or even Doctoral program is a great accomplishment, but the student loans, those are another story. Often times College graduates find themselves buried in student loan debt and it’s so hard to come out on top.

But, it is possible!

Paying off college debt isn’t easy but it is possible and it all starts with YOU! First, find your motivation! Find what drives you. Is it the idea of getting rid of the financial stress from your degree? Maybe it’s the fact that you want to be debt free before your children go to college or it can even a short term goal of being debt free before you get married. No matter what your motivation is, find it!

Next, look ahead. Once you’ve found your motivation set a target goal. Is it 5 years, 6 months or even 15 years? What is the time frame realistically you would like to have your student loan debt paid off by?

Then, make a budget. You’ve set a goal now make that goal work with your budget. Look at budget and determine places that you can cut back or even eliminate… for a short period of time. Also, think about paying your loans bi-weekly instead of once a month or once every few months. This will help pay down the cost quicker.

Check! What’s next?

You’ve set yourself up for an obtainable goal and you’ve reviewed your budget, next try and search for student loan forgiveness programs. If you work for the government or even a nonprofit you might be eligible after a few years to forgive your loans! There are a few careers out there that qualify you for loan forgiveness programs, you just have to be in search of those programs.

Once you’ve looked into the forgiveness program, you will know what plans of action you can take from there. Can your loans be forgiven or do you have to continue paying back your loans? If you have to continue paying back your loans, don’t worry! It can be done! Oh and don’t forget about tax season! You may be eligible for a tax deduction on your student loan interest which will be great. And if you receive any money back from tax season, you should apply that directly to your student loans. After all, most of the money we receive is like “found” money so why not put it towards getting yourself out of debt?

But no matter what, be sure to continuously pay on your loans. While some months you might struggle just look at the bright side, the more you pay the quicker you pay it off!

^Alysha 

SPENDING FOR THE GOALS YOU HAVE

Often times we hear the word budget and we are taken back. We hate the idea of living life on a budget because we feel confined, like we are being held back. But having a budget is a reality no matter what stage of life you are in. Just think, if you’re a college student, you need to have a budget so you can pay for classes and if you’re a homeowner you need to have a budget in order to make your mortgage payment or to fix things around the house. And if you’re a traveler you need a budget for all those vacations you enjoy. It’s hard to get away from budgeting… but having a budget doesn’t have to limit you. Instead it can help you save for the goals you have.

Pay Today!

One of the best ways to k

eep your budget strong and to avoid spending money that you don’t have is to pay your bills on time. By doing so you avoid late fees and save money on interest too. So if you have a bill that you pay monthly like a credit card or your electricity bill, set up a reminder on your phone. This way you remember to pay the bill and don’t have the excuse of “Oh I forgot!”. I have a cell phone calendar reminder for my credit card and it helps me keep track and remember.  Especially since I have e-statements which makes it super easy to forget a payment.

Take out or Dine in?

I enjoy going out to dinner. It’s nice that you don’t have to worry about grocery shopping, cooking and cleaning but rather you can just enjoy a meal. But that gets expensive and quickly too. It’s easy to spend $50 on one night’s dinner. So it’s about finding that balance and compromise. While cooking dinner at home might be time consuming think about how much money you could be saving in the long run. Instead of paying $50 per meal your likely to pay $10-$20 per meal at home.  

While cooking can be time consuming and cleaning can be a chore, why not divide the tasks up with your family or your significant other? In my house it is known that I hate to cook, but I do it because I love to eat. Therefore, when I cook someone else does dishes. However,  when they cook  I have no problem stepping up and doing the dishes. This way we all have our part in the meal prep. 

To Do!

We all have hobbies or things that we enjoy but when we think of a budget, we think it’s time to cut out the fun and focus on the serious. I believe in a healthy balance of serious and fun. It’s important to create a place in your budget for fun. Yes, I know it might sound crazy but if you are not having fun, you’re not truly living life. So, look for deals for family fun, date night fun and even fun that you can have by yourself. There are many great sites for deals and discounts and living in South Florida, we have some great free resources available to us.

We have tons of beaches and parks that are free for you to hang out at. So plan a date night at the park and have a picnic or plan a beach day with your friends and make it a pot luck. Some of the best memories I have with friends are beach days and they cost next to nothing.

Sometimes you might have to think outside the box but there are ways to have fun while keeping within a budget. Like checking out your local library for books instead of buying them or renting moves from Red Box instead of seeing them in the theater. Or carpooling with friends so you’re not the only one always driving.

Think outside the box when it comes to things you like to do and have fun with them. But always have a place in your budget so you don’t have to be the one stressing over finances.

Tuck it away!

If you are not good at budgeting yet you still want to save money or have goals and dreams you are trying to accomplish, then budget backwards. Instead of budgeting for life and using left overs for your trip, budget for your trip and use the “left overs” for life. So If I know my trip is going to cost $5,000 and I have two years to pay it off, I know that I need to save roughly $200 a month for that trip. So each pay period I will tuck away $100. And then use the rest of my paycheck to pay my bills, rent and any other expenses I might have. The best trick I have found when I have a goal in mind is to deposit that money into a separate account. Because, if the money is out of sight, it’s out of mind.

No matter how you decided to save for the goals you have, be sure that you pay what needs to be paid, compromise where there’s room and tuck away money every paycheck so that you can enjoy the life you have!

^Alysha 

LETS GET PERSONAL... A PERSONAL LOAN THAT IS!

There are times in life when you want or need to spend more cash than you have on hand. You can borrow the money and pay it back a little at a time if you have reasonably good credit.

The most common way to borrow, if you don’t have a helpful relative, is to go to a financial institution. There are different types of personal loans available depending on what you plan to do with the money — just bear in mind that eventually you’ll have to pay it back with fees and interest.

WHEN A LOAN MAKES SENSE

You can take out a personal loan, for instance, to pay for a big project or consolidate debt. If you need a lump sum that you don’t plan to pay back within about a year, a personal loan could be the best answer. If you need funding relatively quickly, this could also be the right move. If your credit card interest rates are in the upper teens or higher, paying them off with a personal loan may work to your advantage. If you don’t have the time to save up money to meet your goals, borrowing might be the next logical step.

TYPES OF PERSONAL LOANS

Most personal loans are unsecured. That means you’re borrowing the money based on your creditworthiness alone, without putting up collateral such as a car or house. Unsecured loans present a higher risk for the lender, since it’s essentially relying on your financial reputation to guarantee repayment. So this option carries a higher interest rate than one secured by an auto or a home. If you don’t repay a loan backed by such an asset on time and according to the terms, the lender can take your collateral or foreclose on your property.

HOW TO GET A LOAN

Before you fill out a handful of online loan applications, check out the terms and interest rates to see what’s available, what’s affordable and what’s realistic. Understand that every time you apply for a loan, your credit score can take a hit, which may jeopardize your chances of getting the loan — or of paying a lower rate. Check available rates, including where you bank regularly. If you have a history with a lender, even just a checking account, it may be easier to qualify for a loan even if your credit isn’t great.

Before borrowing, it’s best to have a plan for how the money will be used and how you’ll pay it back. Taking out a personal loan can help consolidate debt, accomplish goals or even make a dream become a reality.

*Resource: Balance* 

HAPPY FATHER'S DAY!!!

“Close together or far apart dad is always in the heart”- Unknown.

Father’s Day is quickly approaching and that means it’s time to spoil dad! No matter if you live near or far, there are many great things you can do to show your father some love on father’s day!

Live near?

If you are fortunate to live near your dad, then take the time to really appreciate him this Father’s Day by planning a day for him.

*Take your dad to his favorite restaurant and share a nice meal with him, bring the rest of the family and laugh and bring up the good times.

* Plan a fun outing. Think about the one thing your dad enjoys, is it Fishing? Maybe a sporting event or even maybe there is a movie he’s been wanting to see. Whatever the case might be, plan an activity that your dad will love! Plan some YOU and DAD time or some family time. But, just be sure to do something that your dad enjoys.

Live Far?

If you live far, there are still many great ways to celebrate your dad this father’s day!

*You can mail him a care package with some of his favorite sweets and treats.

* You can make a father’s day card and mail it to him. Because of technology, we don’t take the time to send letters like we used to. I’m sure your dad would love to get mail that isn’t a bill.

* Skype, facetime or any other kind of video chat. Take some time out of your day to have a face-to-face conversation with your dad. Talk about the “good ole days” and maybe even plan a trip to see him.

* Surprise!!! Plan a surprise visit for the day or even the weekend if you can make it happen! What dad doesn’t love a surprise visit? A surprise visit would probably make him so happy to know you took time out of your busy life to appreciate him!

Must Give a Gift!

If you’re the child that must give a gift so that you’re father feels appreciated, do a little snooping. See what he needs this Father’s Day. Is his wallet worn? Maybe his watch is a little banged up? What about his sneakers are they in good shape? A great gift idea is something that he uses daily, this way you are always with him! If it’s a wallet, add a picture of you into the wallet so when he opens it up you’re the first face he sees. If it’s a watch maybe get it engraved with a funny joke you share. There are always ways to take every day gifts and make them personal… you just have to do some searching.

One thing I learned about my dad is he always loved when I gave him a photos of us. While he didn’t have a desk job, he loved carrying photos of my brother and I and showing them off to his co-workers and friends. If there was one thing my father was… it was a bragger. He loved to brag about us kids.

So while you might think a gift is small, if it’s something that comes from the heart, it’s going to be the biggest gift your father can receive.

Make it a memorable Father’s D

ay!

Alysha

IT'S A MONEY THING: DEMYSTIFYING MORTGAGES

Four Questions to Ask Yourself Before Signing a Mortgage

Asking the right questions is an important part of every financial decision you make, and home ownership is no exception. If you’ve been thinking about buying a place, preliminary research will turn up a long checklist of questions for you to ask at every part of the process. There are questions for your financial institution, questions for your mortgage broker and questions for your real estate agent. But what about the questions you should be asking yourself?

Owning a home is likely the largest financial commitment you’ll make in your life, and it’s easy to get caught up in details pertaining to debt-to-income ratios, the real estate market, current interest rates and amortization schedules. But financials are only a part of the picture. In order to make a truly smart decision, you need to acknowledge and accommodate some personal factors along with the financial ones. Asking yourself the following four questions will help you determine whether or not you’re ready to own a home:

1. Why do you want to own a home? 
Seriously, why is owning a home important to you? (Don’t answer with what you think you should answer; be honest with yourself.) Are you looking to build equity? Does it just seem like something a “successful adult” needs to do? Do you see it as an investment? Do you think renting is somehow inferior to owning? Are you just fed up with your landlord? Do you see it as a symbol of your freedom and independence? Do you have a Pinterest board of home renovation ideas you’re dying to try? Do you think it’s something that all (insert age here)-year-olds should do?

There’s no “right” answer to this question (even though some reasons might be more frivolous than others). By simply observing what surfaces when you ask yourself these questions, you’ll get some insight into why you’re contemplating buying a home in the first place. Are your motivations fueled by practicality or insecurity? Is it something you want, or simply something that everyone else seems to be doing? You’ll be able to tell if you’re in it for the right reasons.

2. Are you okay with staying put?
To make the most out of buying a home, you need to be in it for the long haul (which, in this case, usually means at least five to seven years). There’s a reason why short-term home ownership isn’t a thing outside of those real estate flipping TV shows—it’s a great way to lose a lot of money. Your home, like any investment, needs time in order for its value to grow (and that growth isn’t guaranteed, by the way). By selling your home after only a couple of years, you’re at the mercy of real estate market swings and your home may not have increased in value enough to break even—especially when you factor in closing costs and other additional expenses that go along with buying a home. If the thought of staying in one place for more than one year makes you feel panicky, then it might not be the right time for you to buy.

3. Are you happy?
Stability is key when it comes to buying a home, and so anything that threatens that stability could also potentially cause some major headaches once you’ve signed the mortgage papers. Do you love what you do for a living? Do you have job security? Do you enjoy living in your neck of the woods? Is your personal life stable?

You don’t want to be in a situation where you purchase a home and then find yourself faced with the need to change things up. A career change, the start or end of a relationship or a sudden onset of wanderlust could all interrupt your plans to stay put and build equity. Of course, life can be unexpected even when you’re happy—but generally speaking, if you’re pleased with where you’re at, dramatic changes won’t be looming around the corner.

4. Is your savings account up for the challenge?
Have you done your homework and figured out how much home you can afford, based not only on the monthly mortgage payments, but also on all of the other expenses, such as property taxes, insurance, homeowners association fees, and utilities, to name just a few? Regular monthly expenses aside, home ownership can serve up all sorts of expensive surprises, and you’ll want to make sure your savings account is up for the challenge. Save up for inevitable home repairs and maintenance—the financial responsibility of maintaining a household (appliances, heating, plumbing and landscaping) can take new homeowners by surprise. You’ll also want to beef up your emergency fund so that you have some flexibility and can continue paying your mortgage if you suddenly find yourself with health or job troubles. If your savings are healthy, you’ll also want to consider budgeting for moving expenses, furniture, and home upgrades before making the move.
________________

On the surface, home ownership can seem like a smart and appealing option, especially if your mortgage payments work out to be lower than what you would be paying to rent. However, rushing into a mortgage can set you up for a ton of stress (financial and otherwise). Before you buy, check in with yourself to make sure that you’re well prepared, that the timing is right and that you’re doing it for the right reasons.

SUMERTIME FUN ON A DIME

Summertime was by far my favorite time when I was growing up and in college. I loved having time off of school and having no responsibility.  The only problem was, my checking account drained pretty quickly during those summer months. At first I couldn’t figure out why but then I figured it out. During the school year I had a meal plan, and did lots of free activities on campus. During the summertime, I had no meal plan and everything cost money. There were no free BBQ’s, no free sporting events, and since school was out my part-time campus job also ended.

If I knew then what I know now!                                                                                                                                             

There are actually a lot of things that you can do living in South Florida that won’t cost you much but still allow you to have a fun time whether it’s during the summer, fall, winter or spring. Wait, what am I talking about, we live in Florida, its summer year-round!

Eat Cheap!

Eating out is one of the most expensive outings in South Florida. We have some great restaurants but the price of dinner adds up … and quickly too. There are ways to cut the cost without cutting the quality of your meals. You can always check out happy hours. Often times they have great specials on food (not just drinks) and if you order an assortment of appetizers you can have a meal for cheap! It’s nice because often times the same appetizers that are $10 are $5 during happy hour.

Look for local deals. Many restaurants have specials during the weeknights. Like Bonefish Grill, Tijuana Flats, and even Ale house's. So be sure to ask your favorite restaurants about week night special and be sure to sign up for e-mails from your favorite places. I get e-mails on a regular basis with discounts and coupons for restaurants such as Outback and California PizzaKitchen and who doesn’t love a free appetizer! Plus, like them on social media too, you never know what deal might pop up in your news feed.

Call around town! If you’re craving something particular, take the time to call restaurants and see what specials they have. Often times you might find specials on steaks and burgers at places you would least expect!

Oh and don’t forget to check out Groupon and Living Social for restaurant deals! They have amazing deals for cheap eats that are good!!

Fun on the town!

We have free beaches! Do I need to say that again? I was on a girls weekend to New Jersey once and it cost money to step foot on the beach. What is that? We have FREE Beaches! Pile into the car and take a drive, enjoy a beautiful day on the beach. Bring a cooler with food and drinks and maybe a football to toss around. Find volleyball courts and get a game started or take the time to build a sandcastle. Whatever makes you happy, do it on the beach! Maybe even start a water balloon fight. Hmm I think I need to make this one happen.

Everyone loves a good movie, so if you have a free afternoon, go check out the latest movie release. You’ll save a lot too! An afternoon movie could cost you about $9 while an evening movie will be about $12. Hey every dollar counts! Plus who doesn’t love sitting in a dark theater on a raining day or any day really!

Create your own fun!

Everyone loves a funny story, an embarrassing memory and even a crazy time so why not create it yourself! Have a pool party at a friend’s house, or host a pot luck night or even plan a themed dinner! The catch is to have all of your friends contribute. Themed parties could be something fun. You could do Indian night and have everyone cook at your house and make a dish there or bring an already made dish. Who doesn’t like try new foods? Pot lucks area always fun too, because you can hang out relax and eat. And who doesn’t love a day of fun in the pool? Play some pool volleyball, some Marco Polo and blast some music!

There are fun things happening all around us, we do live in Florida! Have fun this summer and we encourage you to share your stories of fun things you and your family like to do that don’t make you go broke!

Enjoy!!

-Alysha