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Never Cash Out Retirement Accounts When Switching Jobs

Switching jobs or careers is a hectic process. If you are looking for a new job while employed then you're trying to hide the fact that you're interviewing. You have to prepare for the interview, keep your nerves in check, get the job, turn in your two week notice, fill out paperwork with your new HR department, figure out the best and fastest way to get to work every morning...

It's a long list with a lot of moving parts.

Automate Your Finances to Win Big in Retirement

Financially preparing for your retirement should be a multi-decade process that results in a large healthy nest egg. I talked about how it wasn't a one year commitment in my previous post. It's not a 2, 5, or 10 year commitment either. You must start now and consistently save and invest money to have a secure retirement. Maintaining that consistent investment month after month and year after year is very difficult.

Do Not Load Up On Bonds When You Are Young

I personally am not a big fan of bonds. They do not earn a high enough rate of return for me to consider them worth my while. I am fairly young with decades until I am eligible for retirement. So, I can afford to ride out the stock markets up and down swings. I like being heavily invested in stocks and stock mutual funds instead of bonds because of their excellent long-term rate of return.

A Roth IRA Isn't a One Year Commitment

I have good news and bad news. Retiring is not an instantaneous event that happens when you snap your fingers together or decide to get serious about it. Saving and preparing your finances for retirement should be a long, sometimes arduous, process. That could potentially be seen as bad news -- we're all human, and most of us would rather not have to work at making retirement happen. We'd rather it be as easy as a click of a button.

The good news is by starting today you put more time on your side.

Mutual Funds With Loads Can Cost You Thousands

Mutual funds have become an everyday part of American investing over the past several decades. In 1970, there were only 361 mutual funds in existence. Today, there are over 8,000 stock and bond mutual funds for investors to purchase shares through. There are actually more mutual funds in existence now than there are companies who issue individual stock on the New York Stock Exchange. With that being said, navigating the mutual fund waters for an investor can be tricky. There are a lot of options.

Compare Actively Managed Mutual Funds to Index Mutual Funds

Last week we talked about mutual fund cost structure. Today we're going to look at the difference between actively managed funds and index funds. They share significant cost differences, so last week's post should come in handy.

Three Investing Rules Of Thumb You Should Always Keep In Mind

There are many rules of thumbs that guide people in all facets of life, and investing is no different. The world of investing has tons of its own rules of thumb that people have devised in the hopes of helping investors navigate the tricky waters of investing. While there are so many to pick from, I have highlighted three of the most popular investing rules of thumb.

Know Your Mutual Fund’s Cost Structure

Making the decision to start funding a Roth IRA is only the first step. It doesn't do much good to just set money aside in the account -- you need to invest it for your future retirement needs. Most individuals are best served to avoid picking individual stocks and instead focus on mutual funds. But making the necessary decisions around your mutual fund investments can be a challenging task due to the complex array of fees that can be associated with the funds.

When To Consider Averaging Down When Buying Stocks

average down when buying stocksInvestors are loss adverse. Studies have shown that investors do not like to lose money. Who would have guessed, right? So, because of that behavioral bias, we tend be emotional when it comes to selling our shares of stock. Investors tend to hold onto shares instead of selling them and recording the loss.

Why You Should Still Convert to a Roth in 2011

Even though you can still fund a Roth IRA for the 2010 tax year you've missed the unique opportunity to convert a Traditional IRA to a Roth IRA for 2010... kind of. The government changed the conversion rules. Those changes went into effect in 2010.

What Is A Beta Coefficient And Why You Should Care

One characteristic of stocks and mutual funds that is not talked about much among novice to intermediate investors is the beta coefficient. Many people are made immediately nervous when discussing the beta coefficient because of its roots based in probably and statistics and the difficulty of calculating the number by hand. Investors should not be weary of this number because it is given to you in most cases and it can help ensure that your investment portfolio is properly diversified.

Choose Investments for Your Roth IRA

Making the decision to open a Roth IRA is just the first step toward a secure financial future. After you open an account you will need to make investment selections. Do you want to invest in mutual funds? Individual stocks and bonds?

Should I Use My Tax Refund to Fund a Roth IRA?

With tax season upon us many individuals and couples in the United States will receive large tax refunds in the February to May time frame. Whether this is through intentional over-withholding of weekly paychecks or an unexpected result of various financial changes there is still a big check headed to many people. The question remains: if the government hands you a check worth several thousand dollars, what do you do with it?

There Still Are Dividend Aristocrats To Invest In

When the stock market is flat, dividends are the lifeblood of an investor’s portfolio that allow money to be reinvested, funds to grow, or income to be made. Dividends and dividend growth help compensate investors for waiting on a stock to appreciate. And, there are a few companies that have increased their dividends for decades. These are the Dividend Aristocrats as Wall Street calls them, and there is even an index that tracks their progress.

You Can Still Fund a Roth for 2010

It's January of a new year. You had the best intentions of making progress on your financial goals last year. You made resolutions 12 months ago. You made promises. It was time to start securing your financial future and retirement. It was time to start setting aside money in a retirement account every month, diligently, until you reached your goals. But life got in the way.

Roth IRA Investment Income, Dividends, and Distributions

It is a new year, but we can't simply move on from last year just yet. As the clock ticked down on the previous investing year you may have noticed an increase in your Roth IRA account balance. While you would normally see any growth in your account balance to be a positive thing you might also have some concerns about what was causing this growth.

Give the Gift of a Roth IRA

It's the holiday season and across the country people will soon be ripping open gifts on a short lived magical morning. Unfortunately by the time next Christmas rolls around most of those gifts will be long forgotten. Appreciated... yes. Remembered... probably not. But this holiday season you could give a gift to someone that could literally change their life forever. You could give them the gift of a tax free retirement. A gift that requires a small upfront investment that can pay out a much larger multiple of that original investment.

2011 Roth IRA Contribution and Income Limits Announced

The Internal Revenue Service announced the new contribution and income limits for Roth IRAs for the 2011 tax year in November. Let's take a look to see if the changes will have a significant impact on your ability to contribute to a Roth IRA in the upcoming year.

Should I Use My Roth IRA for an Emergency Fund?

Last week we gave three reasons why you shouldn't be afraid to open a Roth IRA. The third reason we listed was you can use your Roth IRA as an emergency fund. We promised to look at that closer in our next article, so let's get to it. For investors that are just starting out in opening a Roth IRA the thought of dumping $5,500 into an account and not seeing that money for years is a scary thought.

I'm Afraid of Opening a Roth IRA

So your interest has been piqued. You're considering a Roth IRA, but you're afraid to jump in the pool. Your toes are on the edge and you're looking into the deep end thinking $5,500 is a lot of money to sink into an investment account. The deep end is deep and you don't have your floaties on. But let's stop and consider these points:

  • You don't have to drop $5,500 into your Roth all at once
  • You can withdraw your Roth IRA contributions at any time
  • You can use the Roth IRA as part of your emergency fund

Let's look at these in depth.

Important Roth Information

Each year, the IRS updates the rules for Roth IRA. Here are all the details for 2015 along with updates for 2016: