Save now vs. save later
A penny saved is a penny earned, but a penny saved today is a penny earning more. It is important to start saving as soon as possible for events such as retirement due to the impact of compounding. If you start saving now you will need to save considerably less than if you wait a few years. Use this calculator to determine how much extra you will need to save if you wait.
5 Ways to Create a Budget That Works
In personal finance, you set financial goals so you can plan your budget around those goals. After all, they are your priorities, aren't they? Here is how financial planners work with budgets:
A budget has two main components: cash coming in (inflows) and cash going out (outflows). If you subtract the outflows from the inflows, the answer should always be zero. That is called balancing the budget.Click here for full article
Why Americans Don’t Save Money
Personal finance also helps you make better savings and investment decisions because it focuses on your goals. Your budget (or spending plan) should be built around your day-to-day expenses, including your short-range lifestyle and financial goals. These may include your goals for your family's well-being, shelter, food, clothing, and recreation. It should also provide for future personal lifestyle and financial goals as well.
Savings and investments should be used to match your short-, intermediate-, and long-range financial goals. You save and invest for a purpose, not just to accumulate great wealth. In fact, you save and invest for many purposes, and how you save and invest depend upon the purpose. For example, if you need to replace a household appliance costing a few hundred dollars in the next 12–18 months, you will save differently than you would if you were saving to pay for a child's education in 10–15 years. To make these decisions, you need to understand the relationship among investment risk, time horizon, and investment reward.Click here for full article
How to Save Money on Groceries
It will not do you a whole lot of good to compound the interest on your investments only to watch it get taken by the IRS. Fortunately, there are a few ways to compound your interest and avoid paying more tax than necessary.
Unless you invest in a tax-sheltered account, you will have to pay taxes on any investment interest at your regular income tax rate. Interest rates paid on savings/checking accounts and bonds, as well as dividends (shared profits), are all generally taxable. This could mean around 30–35 percent in both state and federal taxes. So a 10 percent rate of return could end up being closer to 6 percent after taxes.Click here for full article
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