Gone are the days when people would be satisfied with plain living and high thinking. This is an age when everyone wants to achieve high living with a little bit of plain thinking, or even better – with no thinking at all. And most of the time, it doesn't work out.

You would rather spend your time on the couch, in front of the plasma TV showing your favorite movie, with not a care in the world to disrupt your enjoyment, while someone else takes care of how to make your rich. Sounds good, eh? Really, who wouldn't want that kind of a lifestyle? But that isn't the way things happen in the real world do they?

Or maybe they do. Notice that I said it doesn't work most of the time. I didn't say it never works. For sometimes maybe it does.

What am I talking about? Is it some kind of hidden, poorly publicized, only-for-insiders, high-entry-barrier, niche type of business? For where else can this kind of thing happen with nobody knowing about it?

Not really. It isn't a niche business, no sir. Not by a far margin.

Because I'm talking about the largest market in the world. Yes, unarguably, positively, indisputably the largest. It's larger than the businesses of Microsoft, AOL and General Electric put together and then tripled. You know what I'm talking about, don't you?

Let's cut out this beating around the bush. I'm talking about foreign exchange trading, or forex trading as it is known briefly. It's a stupendously huge market, with worldwide daily trades often reaching or even exceeding a level of 2 trillion dollars. That is 2 followed by 12 zero-s.

The greatest traders on this market are national governments of countries around the world, huge multinational corporations, the central banks of many countries, the richest tycoons in the world, and so forth.

And the strangest thing about all this is even you and I have a chance to make money on that market. In a minute, we shall see how.

How does forex trading work, and how do you make money off it? Well, you know how the many monetary currencies of the world rise and fall every day, and their exchange rates against each other vary regularly? That's the effect you use to make money. Suppose you buy a hundred dollars worth of Euro, when the price of Euro is not so high. Suppose you get 90 Euros for 100 dollars. However, after you buy them, the price of Euro rises, and soon 90 Euros become equivalent to (say) 110 dollars. So you sell them back and get into dollars again, only 10 dollars richer than when you started! This is the essential principle of forex trading. Child's play, isn't it?

Except that it isn't. For one thing, that was only an example. The forex market doesn't really rise or fall so sharply. Most changes are well below 1% for a single day. So if you invest 100 dollars in the morning, you aren't likely to see much more than US$1 in profits before going to bed. So given your meager capital, how are you going to make any money at all

The foreign exchange market is widely known as "Forex". Here brokerage firms and banks are linked over an electronic network. This network enables them to convert the currencies of countries all over the world. It is the largest and the chief liquid financial market in the world. Dollar volume of dealing of currencies daily goes beyond $1.9 trillion dollars in the currency market. Sometimes it goes beyond even the total volume of all U.S. equities and future markets.

The Forex is often considered as being dominated by the government central banks, and commercial and investment banks. That is why private investors prefer to deal on the currency exchanges. It is easy for them to access via various technological innovations like the Internet.

Widely traded currencies include US Dollar, British Pound, Swiss Franc, Japanese Yen, Canadian Dollar and Australian Dollar. Trade in Forex is done for five days a week, round the clock with constant access to dealers throughout the world. It is not centered on any physical location or any exchange, as it is with the stock or future markets. Transactions take place between two corresponding persons over a phone line or through an electronic network.

Background

In the very beginning, there was a barter system i.e. exchange of goods with one another as per individual requirement. But its obvious limitations led to the establishment of mostly accepted channels of exchange.

Consequently, metal coins came to the scenario. However, paper form of governmental IOUs required approval in political administrations during the Middle Ages.

Prior to the First World War, most of the central banks moved ahead to support their currencies with convertibility to gold. But at times, this resulted in political instability due to devastating inflation. This was due to the expanding supply of paper money with no gold coverage. Therefore, Forex controls were initiated to protect local national interest.

Later on, during the Second World War, the USA introduced the Bretton Woods agreement in July 1944. As a result, this agreement led to a system of fixed exchange rates that re-established the gold standard to an extent and also stabilized the dollar at USD 35/oz. It also fixed the other prominent currencies to the dollar and thus made it permanent.

The last few decades have witnessed the developing of Forex trading into the largest global market. By now, all the restrictions from the capital flows have been put off in several countries. It has resulted in the independency of the markets to settle Forex rates as per their perceived values.

There are a number of reasons due to which Forex trading has gained popularity. The most prominent include available leverage, utmost liquidity round the clock a day and extremely low dealing cost, which relate to trading. Certain basics of Forex trading are as follows:

Margin Trading: Here trading is done generally on a margin basis. A larger position in the market can be acquired by a relatively small deposit.

Base and Variable Currency: Trading is done with the combination of two currencies. But two sides of trade are always there i.e. long (bought) and short (sold). Not always, but generally, the trade currency is with the highest value.

Spot and Forward Trading: This means that if no further step is taken, then, dealing will be settled after two business days.

Being involved in the Forex market you may have heard the term Forex broker many times before. But do you really know what this individual does or what it means? A Forex broker is one who assists not only traders and firms, but also individuals involved in the Forex market. The Forex broker's assistance can be in providing information or may be actually trading for the person or company they are representing. A Forex broker does charge a fee for any services they provide, depending on which one it is.

A list of services that a Forex broker can provide can range from general advice to real time quotes to news feeds. There are different ways that these brokers can give advice. Some Forex brokers use their own personal experience and understanding. While others rely on software to provide the information their service provides.

There have been some advantages and new benefits allowed for Forex brokers and the Forex market since the Internet has evolved. Because of this the individual Forex broker can better provide accessibility to the Forex market, impossibility in previous years. This meant that only banks or large financial institutions would have any access to the Forex market.

There has been a huge growth since then of Forex brokers, which can make it hard to choose, especially for beginning or new traders to the market. The best advice when looking for your Forex broker is to get as many referrals and recommendations as you can. This can better help you decide in finding a reputable and competent Forex broker.

In the instance where you cannot get a referral or recommendation, it is up to you to do your own thorough and careful research. You should find out the amount of trades they are conducting and with how many clients. Of course you should also find out the Forex broker's amount of experience. The most important thing to look for in your own research is a Forex broker who has learned by experience over several years and has the right amount of instinct to give the right advice. Of course you should also examine what kind of services and what variety they provide, such as mini accounts, market intelligence, market analysis, news feeds and real time quotes.

When deciding if you would like to use a broker or not, you need to take all advantages as well as disadvantages into consideration. This is a personal decision, one in which referrals and recommendations are highly recommended when looking, or at the very least extensive research on your part. Choosing the right Forex broker, in the end, can make the difference between success and failure in the Forex market

Recently Forex trading has become one of the most looked after occupations that will allow you to earn a living from home or anywhere else. If you are really considering entering the forex trading world you must, by all means, learn and understand a number of indicators that will lend you a big hand on predicting with a high probability the directions forex markets may take as you analyze the price charts for any currency pair you are trading at the moment. Two of these great indicators are: “Bollinger Bands” and “Fibonacci Retracements”.

“Fibonacci retracement levels” are based on a sequence of numbers discovered by the noted mathematician Leonardo da Pisa in Italy. These numbers describe cycles found throughout nature and when applied to technical analysis can be used to find pullbacks in the currency market.

“Fibonacci retracement levels” are a quite effective way “to see the future” (at least in the world of forex markets), with this I mean that it involves anticipating changes in trends as prices near the levels indicated by the Fibonacci ratios. After a significant price move (either up or down), prices will often retrace a significant portion of the original move. As prices retrace, support and resistance levels often occur at or near the “Fibonacci Retracement levels” (See my other articles on “Fibonacci trading” for more details about this).

The interpretation given to “Bollinger Bands” is that prices tend to stay within the space formed by the tracings of the upper and lower bands. The distinctive characteristic of “Bollinger Bands” is that the spacing between the bands varies based on the volatility of the prices. During periods of high volatility, the bands widen to become more forgiving. During periods of low volatility, the bands narrow to contain currency prices. The common use is that the bands are plotted two standard deviations above and below a simple moving average. They indicate a "sell" when prices are above the moving average and a "buy" when prices are below it. The bands are used by some forex traders in conjunction with other analyses, including RSI, MACD, CCI, and Rate of Change.

Forex trading on the Global Foreign Exchange market can be quite lucrative. Instead of restricting your trading to smaller markets within your own country, FX trading allows you to trade on a global scale.

In recent years, forex trading has grown increasingly popular, as it has many advantages that make it a wise choice for investors and those wishing to diversify their portfolios even further.

Advantages of Forex Trading

There are considerable advantages when it comes to forex trading, making it a desirable option when pitted against stocks and other types of trading. First, it is important to note that when engaging in this kind of trading, you need to realize that proper research is the key - forex trading is definitely not for beginners.

Here are some of the advantages. These are considered when pitted against margins trading.

# The spread rates are less than in futures trading.
# The margin requirements are low. A forex trading margin can be set at 1%.
# Since the market spans the globe, forex trading can occur over 24 hours. You can trade in markets in Asia, for example, when others are closed.

Of course, there are other advantages, so it is best to educate yourself with the ins and outs before you start trading on the Global Foreign Exchange market.

Getting Started FX Trading

So, do you think you want to start forex trading? When considering if this is something that you want to do, it helps to weigh the pros and the cons. You may want to do some research and contact someone knowledgeable who can help you set goals and help you learn the process, because as with any kind of trading, there is a learning curve and it is best to minimize costly mistakes as best as you can.

Margin Trading

It is helpful to note that forex trading is usually done on what is known as a margin. Since it is a main feature in currencies trading it is worth explaining further. Basically, margin trading means that you can control more than what you have. Most places require a deposit present in your account as a sort of security deposit, and this rate is usually/typically set at 1%. So, what this means is, if you desire to trade 1,000,000 USD worth of currency, you need to deposit 10, 000 USD.

Forex Trading Considerations

Trading on a global scale is a new concept for some. As a result, beginning traders don’t tend to gravitate towards it, as it seems complex and difficult to them. However, given the advantages of this type of trading over futures trading, for example, it is worth considering. A good investment program is one where multiple levels of trading are occurring.

If retirement is at hand, you might probably be worrying on questions such as, will my money last throughout my retirement? How much retirement withdrawal of cash can I make from my portfolio every year? How should my money be allocated? How will inflation affect my purchasing power? All these questions sometimes make it a little challenging for people to look at retirement positively, however you can feel a lot better if you plan your retirement withdrawal, which can give respond to those questions running through your mind.

How much retirement withdrawal to make from your portfolio every year is a crucial question, because it leaves you the dilemma that withdrawing too much may give you funds that will not last through your entire retirement, and on the other hand, if you withdraw too little, then you may end up eating cheese and macaroni for dinner every night for no reason. It is also essential to remember that the United States government has placed a minimum required distribution (MRD) requirements on a lot of retirement tools such as 403(b)s, traditional IRAs, and 401(k)s. Retirement calculators become a very good tool to use to determine the amounts that would be safe for you to withdraw, entering different withdrawal situations into the retirement calculator is simple and its results are revealed right away.

Planning your retirement withdrawal is an important step to take so as not to end up in hot water. A lot of formulas will help you plan the percentage that you should take from your portfolio, but they depend on average rates of return and inflation. When to start the retirement withdraws is just as important, whether the market is rolling or bending in your first retirement years can make a big difference.

So, since you won’t be able to predict the future, what would be the right percentage of retirement withdrawal then? A research study showed that withdrawal periods longer than fifteen years considerably reduced the possibility of success at withdrawal rates exceeding five percent. The study also concluded that: younger retirees who expect longer payout periods should prepare on lower withdrawal rates; owning bonds reduces the probability of going broke for lower to mid-level withdrawal rates, and most retirees would profit with at least 50% allocation to stocks; those who desire inflation-adjusted withdrawals must agree to a significantly reduced retirement withdrawal rate from the initial portfolio; it is most likely too conservative to withdraw 4% or less form a stock-dominated portfolio; and for a fifteen years or less payout periods from a stock-dominated portfolio, withdrawal rate of 8% to 9% appears sustainable.

According to the study, a “safe” retirement withdrawal rate would amount to, between four percent and six percent of a retiree’s first portfolio. And withdrawal rates of above five percent, raise the possibility of the retiree to go broke in their lifetime. A lot of studies as well, agree that the existence of bonds offer a measure of stability absent in all-stock portfolio.

Many people retire after they find themselves financially stable enough to support all their needs. There are also some who consider first how much they have already saved for them to say that they are already ready for retirement. Well, money matters really play a vital role in retirement and to become financially secure after retirement takes time, effort and of course, proper planning.

The concept on financial retirement planning is not something that is fresh or new to the people’s ears. It has been around for more than a decade now, and many successful retirees have considered financial retirement planning at some point in their lives. Now, if you are thinking about retiring from work, but you want to make sure that you will be financially stable when the right time to retire comes, knowing everything that is involved in the planning is definitely one of the best moves you can make.

So to start with your financial retirement planning, simply note that you are dealing not just with money here, but for a better future. Note that and if possible, save as much as you can as early as possible. As what many retirement experts have said, the sooner you start saving, the more time your money has to grow.

Set certain goals that are realistic and make those goals an important part of your financial retirement planning. You can project your possible expenses based on your needs. Consider how much your life after retirement will cost and try calculating everything that is involved. Settle only when you find out that everything is tackled and solved.

You can also consider a 401K plan as a special part of your financial retirement planning. The 401K is after all one of the best and easiest ways for saving after retirement. But before you consider the plan, make sure that you have understood everything that is involved in it, how it works and how you will benefit from it. There are also the IRA retirement plans for you to take. But as mentioned, know first what the plans entail and how they work to support everything you’ll need after retirement.

As you go along the financial retirement planning process, try to look at your asset allocation. It has been maintained that how you divide your portfolio between stocks and bonds will have a big impact on your long term returns. And, speaking of long term returns, several retirement experts have noted how important the decision of paying attention to the stocks and bonds is. According to them, stocks offers the best opportunity for you to achieve high returns over long periods of time, while bonds should not be considered heavily even in retirement for that will increase the inflation level, thus destroying the purchasing powers of the interest payments of your bonds.

Finally, when considering a financial retirement planning, it is best to consider yourself working part-time even after retirement. What you will earn on your part-time job will help increase what you’ve saved for your retirement. It will even keep you socially engaged.

If you think that you will be financially secure when you decide to retire just because you invest in a retirement plan, think again! Did you know that there are common mistakes on retirement planning that you should know about in which you can also use as a guide to reevaluate your status? If you are making these mistakes, you could be in a big trouble.

Here are some of the mistakes of retirement planning:

-Not taking full advantage of your company retirement benefits – it is wise that you invest money into your company retirement plan as much as you can afford.

-Withdrawing money from your retirement plan – Be very aware when availing of loans or withdrawals, because aside from losing interest, you could face penalties or early withdrawal fees.

-Not actively monitoring your investments – it is extremely important to keep track of your investments in order for you to be aware of any discrepancies.

-Relying on Social security for your retirement income – social security may provide a considerable share of your retirement income, still it can be of great help if you have other means of income as a back-up in case there are other unexpected expenses that might come up. In addition to social security, it would be best if you have a company pension or retirement plan and personal savings.

-Relying on your spouse’s retirement plan – this is one of the most common mistake of retirement planning people do. It is possible that a spouse with a retirement plan could die leaving the other spouse with no income. Instances like divorce or illness can also bargain the only spouse retirement, therefore both spouses should have a separate retirement plan to best secure your retirement days.

-Forgetting to review your plan regularly – always conduct periodic review of your retirement plan to ensure that you are making the most of your plan.

-Practicing poor asset allocation – poor asset allocation can sometimes be a financial suicide. The secret is to broaden your horizons so that if one investment decreases in value, another will hopefully increase.

-Not checking your booklet/financial advisor- there are plenty of highly regarded brokers and financial advisors who have the expertise about how your portfolio should be set-up and maintained, but there are also who aren’t and are simply ill informed. So, be aware and make sure to check up on credential and track records on anyone you wan to entrust your retirement savings.

-Relying too heavily on your stock – your company stock is one of the excellent ways to save for your retirement. But, it is also best to have a good investment mix in your retirement account.

-Not taking retirement planning seriously – this could be the worse mistake you can make with your retirement plan. If you start early on retirement planning, you may be able to retire early and keep the lifestyle you like once retired.

A lot of people imagine retirement as a time when they can finally do all the things they’ve been postponing for one reason or another. A number look forward to traveling and exploring exotic places or spending more time with their loved ones. Others plan on starting their own businesses or a new career in a completely diverse field.

Whatever retirement denotes in a person, each and everyone one of them is going to need money to fulfill their dreams. But will benefits from their Social Security, or employer-sponsored retirement plan, or personal savings be adequate to allow them to achieve their goals? When to retire is a critical decision because timing will really affect the amount of benefit they will need and will resolve the options available to them, that is why approaching retirement with the right retirement strategies can help a lot.

People most of the time talk about retiring earlier or later than age sixty-five, which is until recently the full Social security retirement age to get maximum benefits. However, sixty-five is no longer normal retirement age, less than eleven percent of members’ age sixty-five began receiving lifetime income from their TIAA-CREF retirement annuities in 2001, compared to 1981’s twenty-nine percent, the more reason for excellent retirement strategies.

Although with advances and healthier lifestyles, life expectancy is at its peak, however, one usual mistake of retirement strategies is underestimating how long one lives. Unless one has a critical health problem, one should assume that they’ll need income for at least twenty to thirty years, while at the same time considering the effects of low levels of inflation on their purchasing power. So as you plan for retirement, use this retirement strategies as a guide:

-Look into your life expectancy, the longer you live the more money needed.

-Approximate how much money you’ll need in retirement, estimating retirement expenses to about eighty percent of expenses before retirement is suggested, if you plan to travel a lot, then you’re going to need an additional ten percent.

-Compute a balance sheet to assess assets and liabilities which you will have accumulated by retirement.

-Make an educated guess on your retirement income sources such as Social Security benefits, retirement accounts and pensions, investments, personal savings, and income earned before retiring.

-Live a modest lifestyle. Working hard today towards saving now will achieve goals of retiring sooner, although it means making a few sacrifices, it will pay off in the long run.

-Make the most of your tax-deferred and tax-free savings opportunities.

-Invest constantly.

-Finance your traditional Roth IRA to its fullest.

-Speak with an experience financial planner about your objective and the best way to reach them.

-Take some risks and expand your stock range.

-Compute for how long your investments will double.

-Get all other paper work in order.

The right retirement strategies will help one to have a better way of living after retirement, a few sacrifices may be made but it will all be worth it.

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Did you think you have done your part in saving for retirement? If you worry that you don’t have enough money saved for retirement, you are not alone. But, that doesn’t mean you don’t have to worry anymore. About 77 percent of baby boomers are setting aside too little for their retirement, which is not a good sign, if you might ask.

We are all aware of the fact how important saving for retirement purposes is. You have always dreamed of having happy golden years, haven’t you? But, how will you be able to outlast on your retirement years if you haven’t saved anything to keep a lifestyle you wanted? Talking about financial security when you retire, means you have to save steadily throughout your working years. Even if your retirement is just within your arm’s reach, you should not stop saving for retirement.

To help you save for your retirement and live a better life with less, if not without, financial issues is to follow these simple tips:

-Keep your eyes on the prize – keep yourself reminded that you are saving. If it helps, post a picture of your dream house or anything you wish to have on the refrigerator or any place where you can easily see them.

-Pay yourself first - one of the first rules of saving money is to pay yourself first. You can write a check to your savings account or have money automatically transferred from your pay check. If your employer offers a 401k or other pre-tax retirement plan, contribute the maximum as most employers match a certain percentage. You can also make automatic investments to many mutual fund companies.

-Keep paying loans – if you currently have a monthly loan payment and you finished paying them, continue to make the same regular payment s to your savings or investments account.

-Put away unexpected money – when you get a raise, receive a refund, cash incentives and gifts, invest some, if not all, of the money.

-Adjust your withholding tax – be certain that your W-4 form is filled out to your best advantage. It is better to have extra money each pay period than wait until tax time just to get your refund.

-Put your money to work for you – make it a point to have the equivalent of approximately 3 months worth of expenses in a savings account.

-Reduce monthly fees – remember that a monthly bank checking fee of $10 make $120 a year and it can make a difference. Eliminate services that you are paying, but don’t use, like premium cable channels or call waiting.

-Cut corners – if you save a little by bringing your lunch to work and put it your account it could get bigger and bigger without you noticing it. There’s a lot of ways you can get savings such as clipping coupons, and more.

Saving for retirement security is never a bad idea. So, if you have little extra dollars that you don’t have anything very important to spend it to, save it. Any little amount that you save, in the long run it will grow. It’s never too early or too late to start saving for retirement.

How financially secured are you for your retirement? To help you find out what it takes to work towards a secure retirement or create your retirement plan, you can make use of retirement calculators. The retirement calculators, which are available as added feature to the many websites covering up retirement issues, are free of charge.

Planning carefully your retirement finances the earliest possible time, could mean better days ahead. Although many of our younger workers of today don’t give so much thought about retirement planning, sooner or later they will come to realize the importance of a secure retirement. And for those who already knew and wanted to prepare for it, retirement calculators can be an additional help to planning investing strategy in order that you will have enough to see you through retirement years. This is why retirement calculators are sometimes called retirement planner.

After you have made your calculations that show you’re on the right track does not mean that’s it! - You’re secure. No, not yet. It is advisable to update your calculations every three to five years since the results from your previous assumptions are likely to change every few years. Just remember that you shouldn’t rely your retirement planning on retirement calculators alone. Everything computed isn’t fixed. Are you ready to secure your golden days? Do your computation now. It’s very easy to find these retirement calculators and it’s just a mouse-click away. Just look it up on the internet and voila, you’re ready to go.

Using these retirement calculators is not very difficult. Most of the websites with this feature often have instructions how to work on them. Note that not all calculators have the same input requirements, so follow the instructions carefully. These are the basic information required to make your calculation:

Current Savings - The total savings you have set aside for your retirement.

Annual Retirement Income – The amount you need to live on once you retire (after taxes). This amount should cover all living expenses for a year and should not be less than 70 % of your current income if you want to maintain your current standard of living.

Annual Yield – It is your expected rate of return. For stocks or mutual funds, consult a prospectus.

Other Income – The amount you’ll enter here can include Social Security, employer-funded pension plans, or other external source of income.

Inflation Rate – This is the average expected annual inflation rate over the period encompassing your remaining working years and retirement years.

Current Age

Current Tax Rate – Enter your current federal tax bracket.

Retirement Age –Know the official retirement age. For those who were born in 1960 or later, 67is the official retirement age.

Retirement Tax Rate – The tax bracket you expect to be in, once you retire.

Withdraw Until Age – The number of years you need your retirement income.

Inflate Contributions – Do you like to increase your investment amounts to account for inflation over the length of the investment period? Clicking on Yes will increment the investment each year by the exact amount of inflation. Selecting No will make each investment an equal amount.

Are Annual Contributions Tax Sheltered – Yes, if your investments are in a tax deferred account such as a 401(k) plan or a retirement IRA. No, if your investments are subject to federal income tax each year.

A retirement plan is an arrangement to provide individuals with an income or pension during retirement when they are no longer earning a steady income from employment. Not all our lives that we work to earn a living and survive, you know. The time will come when we need to rest from work, not for a vacation, but to live the rest of the years enjoying the savings from previous years of hard work. Now, this makes the idea of retirement plans great. Through these plans, retirees will still be able to manage to keep the kind of lifestyle they want on their golden days.

Retirement plans may be established by employers, insurance companies, the government, or other institution such as employer association or trade unions. The Employee Retirement Income Security Act ,or ERISA, covers two types of retirement plans; defined benefit plans and defined contribution plans. Among the two types of retirement plans, there are also other types of retirement plans, which are referred to as hybrid plans, such as cash balance plans, combine features of both defined and defined contribution plans.

Here are the descriptions of different types of retirement plans:

Defined Benefit Plan

A defined benefit plan promises a specific monthly payout at retirement, according to a fixed formula that usually depends on the member’s salary and the number of year’s membership in the plan. For example, 1 % of average salary for the last 5 years of employment for every year of service with an employer. The benefits in most traditional defined benefit plans are protected, within certain limitations, by federal insurance provided through the Pension Benefit Guaranty Corporation (PBGC).

Defined Contribution Plan

On the other hand, defined contribution plan does not promise a specific amount of benefits at retirement. Instead, it will provide a payout at retirement that is dependent on the amount of money contributed to the employee’s individual account by the employee or employer or both, and the performance of the investment vehicles being utilized. The employee will then receive the balance in their account that is based on contributions, plus or minus investment gain or losses. The fluctuation of the value of the account is due to the changes in the value of the investments. 401(k) plans, 403(b) plans, employee stock ownership plans, and profit-sharing plans.

Hybrid Plans

A cash balance plan is a defined plan made by the employer with the help of consulting actuaries, a group of business professionals who deal with the financial impact of risk and uncertainty, to appear as if they were defined contribution plans. They have notional balances in hypothetical accounts where, normally, each year the plan administrator contributes an amount equal to a certain percentage of each participant’s salary; a second contribution, which is called an interest credit is also made. These are not actual contributions and further discussion is beyond the scope of this entry.0

Target Benefit plans are defined contribution plans made to match or look like defined benefit plans. This would only work if all actuarial assumptions are actually realized.

In August 2005, the people of the gulf coast United States suffered record losses of life, homes and businesses from Hurricane Katrina. Merely months before, thousands lost their homes and lives in Southeast Asia during a reckless Tsunami. Although it is hard to imagine the threat of natural disasters and emergencies until we find ourselves involved in one, it is always smart to plan ahead. Use the following three tips to help gauge whether you and your family are financially prepared for an emergency situation or disaster:

1. Start an emergency savings fund.

Many individuals and families find it difficult to save for the future. While it is important to save for your retirement or your child’s higher education, you cannot forget to plan ahead in case of an emergency. Insurance can help during a time of crisis, but very rarely does an insurance claim cover 100% of the damages incurred from a natural disaster or other emergency. By putting away small amounts of money each week, month or pay period, saving for an unexpected event can be very easy. Plus, with automatic online transfers and direct deposit, banks and credit unions can automatically transfer money from your paycheck each week to make your emergency savings much easier to swallow.

2. Stay insured.

Disasters do happen and it never hurts to be prepared. While it is easy to think, “it’ll never happen to me,” the monthly insurance cost will seem like pennies should you find yourself in an emergency situation without any insurance helping to repair or rebuild your home. If you live in a region traditionally prone to certain natural disasters such as earthquakes, floods or hurricanes, it is important to look into the specific types of insurance designed to financially protect you from the danger most common to your area.

3. Know what you own.

If you are a victim of a disaster or emergency and you place an insurance claim on property or belongings, your insurance company will want to know exactly what was lost. It is important to keep track of your most valuable belongings as well as proof such as photos and deeds to property. Make a list of all of your valuables, and be specific. Be sure to take pictures of the current state of each of these belongings, like your car and the different facets of your property, as proof of damage should a disaster strike. Make copies of your photos, as well as your family’s important documents. Keep these items in a locked safe or safety deposit box where at least one copy is out of harm’s way at all times.

Money is a very important factor when preparing for retirement. Many of today’s retirees go back to work because they are either bored in doing nothing on their home, or yearning to go back to work because of financial matters. Retirement jobs impose a significant constructive impact on the finances of a retiree. Below are the four factors of why most retirees prefer to go back to the work force.

Financial Factor - the possibility of earning additional earnings is one of the most significant factors why retirees tend to take retirement jobs. Because not only does retirement jobs extend their retirement funds, retirement jobs can make a retiree have enough money for a few extravagances that they want to experience.

Love of Work Factor – there are some retiree who chose to go back to work because for the love to work. Retirees whose works involves resourcefulness and self-sufficiency, like artists and proprietors, tend to go back to work. It is because their jobs are a great part of their existence.

Friends Factor – there are some retirees who want to go back to the work force because they are bored at staying all day on their homes. These are people who are sociable and are fond of mingling with other people. Retirement jobs offer a flamboyant social moment in their retirement.

Apprehension Factor – people who are devoted completely on their profession prefer working at retirement jobs as much as necessary. The fear of doing nothing but eat and sleep all day renders them to look for retirement jobs.

Some time ago, retirees would not consider going back to work. These days more and more retirees make most of their retirement years by having retirement jobs. If you are a retiree and want to go back to the work force the best place to look for a retirement job is your previous employer. Ask your previous employer if they have any sort of part time retirement job that they could give you. Recent studies show that most of employers allow their older employees to decrease their working hours more willingly than allow them to take full retirement. More and more employers these days are interested in hiring retirees because of their experiences and expertise. There are even some employers that set up atypical recruitment courses for retirement jobs to catch the attention of the retirees. Making some of them consider taking the retirement jobs.

More and more retirees choose to integrate retirement jobs in their retirement. More and more employers are hiring individuals who want to go out of retirement, thus, creating more and more retirement jobs for the retirees.

If you are considering of going out of retirement, it is advisable that you begin planning or start looking for a retirement job that you want as soon as possible.

Finding the right bank for your needs can be a tough decision, but it is important that you choose the right establishment to handle your money. Choosing the wrong bank can cost you time and money, and although choosing your nearest bank might seem convenient, you could be missing out on the best deals.

Different types of banks

Although there might seem like there is a limited choice, if you are looking for a simple bank account then there are a large number of institutions that you can look at. As well as traditional banks there commercial banks, credit unions, private banks and online banks but to name a few. You should look at all these options to make sure that you get the best deal to suit your needs.

Service features

The first thing you need to consider when choosing a bank is what sort of service features you are looking for. You need to determine your needs and then compare these with the list of products that a particular bank offers. If you are in the market for a simple checking or savings account then there are likely to be a lot of potential candidates. However, if you are looking for something more specific then there might only be a few likely sources. You need to look at the level of service the organisation can provide and whether this meets your needs.

Convenience

Although automatically choosing your nearest bank isn’t always the best option, convenience is a factor to take into consideration. If you need to use branch services then you need to consider how close the nearest branch is to your home or place or work. You also need to look at whether they offer online or telephone services, and what their hours of work are. You may find a bank with great services, but if the branch is 20 miles away and they are rarely open then you won’t benefit from these services.

Size

Banks and financial institutions greatly vary in size, so you need to consider what sort of bank you want to use. If you want to use a small banking corporation that offers more personal service, then you might have to sacrifice cheaper rates. You should compare the costs and levels of service in the small and large banks in your area to determine the best balance for you.

Fees and rates

Perhaps the most important aspect when looking for a bank is how high their fees and rates are. Many banks are similar in terms of products offered and service levels, and most of the major chains will have a branch near you. However, the thing that might separate the winner from the loser is the rates and fees they can offer you. If you are looking for a particular account or product, look at the costs for each bank. If everything else is equal, then go for the bank with the lowest fees and rates. Banking is all about saving yourself time and money, so the bank with the best rates and a good service level is usually the best choice.

When you live below your means, you find that things work a bit better. I understand the basic idea of living within your means, but you need to take it to another level in order to thrive financially.

For those of you who are living beyond your means, living within your means is a good goal to have. But it is simply the first step. Living within your means is spending what you make. Not more than you make.

Living below your means is saving. It is spending less than you make. Now, doesn't that sound good.

And this doesn't mean that you have to sacrifice and do without just to get by. It means that you have money to do with as you please. There is no need for a credit card when you have the money in the bank.

Find ways to cut your spending and your bills. Look at what you are actually spending each month. I was surprised to find that my husband and I were spending hundreds from the ATM each month with no idea where it was going. Once we made the ATM off-limits, we were not only able to better control where the money goes, but we cut back our spending drastically. We don't miss what we were spending the cash on, because we really don't know where it was going.

But now we know where it is going. It is going where we want it to.

A great way to live below your means is to forget about a portion of your income. If your employer offers the benefit, have a portion of your paycheck automatically put in savings, with the rest going into your checking. If you never see the money, you won't miss it. You are living below your means without having to sacrifice a thing. It may mean that you can't spend as much at the mall later in the month, but it also means that you are building savings.

Don't just stop at making it from paycheck to paycheck. Wouldn't it be great to have enough money that you don't wait for the next paycheck to roll around. If you don't spend it all each month, eventually, you will know what it is like to do more than make ends meet. You can tie them together.

Budgets never sound like a good idea to most people. They seem to rank right up their with a diet and an annual check-up. However, they have benefits that far exceed the work that you put into them.

The word budget sounds like it means that you will never get to spend what you want to spend again. However, it is the exact opposite. It will allow you to spend your money as you really want to, instead of on your debt. It will allow you to retire. It will allow you to send your kids to college. It will allow you a better life.

Let's first look at what a budget is. It is simply a spending plan. It is a way to spend less money than you make. It doesn't have to be a complicated thing. It is simply a way to plan your spending for the week or the month.

The precut budgets don't often work for people. Those that assign how much you will spend based on someone else's budget ideas will not work for everyone. A budget that says you will save $500 each month will often fail. The reason is that finances are flexible.

They have to bend a bit.

It is better to really take a look at what you are actually spending right now. Then look at where you can cut back. Then implement ways to do it.

It is as simple as that. But the key is knowing where you are already spending your money. If you skip this step, you won't know where you can really save. For example, if you just budget $100 for groceries because it sounds like a good amount, but you really spend $300 a month, you probably won't be able to cut that back by that much.

To make a budget work, you need to realize that your finances are ever changing. This isn't something you do once that will work forever. It is something that you constantly look to. You are constantly adapting it. This is how it begins to work.

It sounds like a lot of work,but it really isn't. Simply make lists or keep your information in a notebook or on a computer program. Spend no more than one hour at a time on your finances. Try to spend 15 minutes a night (or less) updating your checking registar and writing down your spending for the day. Look at your goals often.

Budgets are difficult to get off the ground. But give it three months. And track the changes you are making. When you see where you were and where you are now, you will find that bothering with a budget is well worth the time spent. In the end, it saves you a lot of worry and time.

When it comes to finances, you have to have some goals. Otherwise, why would you be motivated to pay off your debt and save for your future.

Goals are what keep us looking towards the finish line, instead of focusing on each step we are taking. They push us forward.

Setting your financial goals isn't a difficult thing. However, it does mean that you have to take the time to write them down and keep them in front of you every day. This is scary for many people. Something written means that if they fail, it is evident.

But you can't start out with the idea of failure in mind. You can reach your goals. It isn't difficult. But first, you need to work on them a little bit.

Start by taking the time to sit down and write out your financial goals. Goals are things that can be achieved. You need to be specific. Try to organize them in order of completion. You can easily expect to be out of debt sooner than you can expect to retire -- for most people. Keeping the goals in order allows you to check things off as you complete them.

Once you know what your goals are (paying off credit cards, saving for retirement, saving to buy a house), you should keep them in sight. Writing them down will not make them come true. You need to focus.

Break your goals down into actions that you can work on each week. For example, if your first goal is to pay off credit card debt, you need to break that down. Make a list of things you can do to make this happen.

It could say:

1. Pay off first credit card with money from savings account.
2. Pay $100 extra a month on 2nd credit card to pay it off by June 2007.
3. Put holiday bonus towards paying off 2nd credit card early.

And so on.

The idea is that you are actively working on your goals. Without that work, you won't get anywhere, you just have your goals.

Break your goals down by time as well. Don't simply say you are going to retire in 20 years and would like to have enough money to live. Decide how much you need to contribute each year in order to live well. Then work to exceed this.

The more focused and detailed your goals are, the better chance you have of achieving the goals. Don't go crazy with them, just make it so that you know what you need to do to get where you want to be. Think of it as a road map that tells you each road you need to take.

Your goals will change with time. This is alright. Finances are flexible. Money is never fixed. Adapt and move on. Create new goals. Be accountable and make a committment.

One of the best tips I have ever received on keeping a goal is to review it frequently. Put a list of your goals inside your checkbook so you look at it every time you think about spending money. Look at it weekly to see where you are and what you can do next week to make a dent. Believe me, once you have a goal complete, you will be empowered to complete the next one. It is a good feeling.

Bobby Brown and Whitney Houston give Mike Tyson a run for his money in the “Jack up your life in the 90s contest”. Chalky lips and all, these two were the poster children for what you don’t want your kids to become when they grow up. What was most ironic was that everyone thought that Bobby was corrupting Whitney, who does an amazing “church girl with the raspy voice” imitation. But church girls don’t usually know that “crack is whack”, and they don’t get caught hauling weed onto an airplane. Well, at least she didn’t have box cutters and shaving cream; people who smoke weed don’t usually have the motivation to hijack an airplane.

They were once young and attractive, now they look old and tired. They were once beautiful songbirds, now they just look like jailbirds. Life is getting harsh for these two, and it could get harsher as the “King of R&B” (haha) and his weed-tottin ex-babymama find themselves on the other side of a nasty divorce.

Besides learning that crack is whack, we can learn other lessons from Whitney’s confessions. Drugs and bad relationships have huge personal and financial consequences. As a Finance Professor who teaches students Personal Finance on a regular basis, I thought I would “peep game” and take a quick visit to the Bobby-Whitney School of Life to see what we can all learn from their experience:

Lesson 1: Watch who you decide to marry

The wrong partner may not only ruin you financially, they can also take away other valuable assets beyond money, such as your reputation, well-being and peace of mind. As young as they think they are, their latest pictures show skin of leather and more wrinkles than a wet Barbara Bush. These two people spent the best years of their lives with someone that they may not have wanted to be with. That’s more painful than losing cash.

Lesson 2: Determine if your partner has a financial venereal disease

I created a test for the Financial Irresponsibility Virus (FIV). If you or your partner has a positive score, you are FIV positive. Destructive financial habits such as drugs or alcohol make it very easy to become FIV positive. I am not one to say that the drug rumors are true. But if there were drugs in this relationship, that is a quick way to end up in the poor house.

Lesson 3: Size does matter (meaning the size of your partner’s bank account) – but too much size can be a pain

Some people are excited to have a mate who is well-endowed (financially), but sometimes you are rewarded on the front end but punished on the back. All that extra bling in their account can dull the shine on your smile when you get out of bed every morning. Your partner should make you wealthy in many ways, not just financially.

Lesson 4: Don’t spend your time with an enabler of your financially destructive habits.

If you overeat, overspend, or gamble too much, then it might not make sense to “hook up” with someone who does the same thing. You might be as happy as two pigs in a mud puddle, but when the piper comes to collect payment, the payment will be eternal. Find someone who complements you and improves you, not someone who accentuates the parts of you that happen to be most destructive.

Bobby and Whitney have performed a valuable service. By watching them jack up their lives, it has reminded me that my life is not so bad. Perhaps one day, Bobby will rise back to the top of the charts, and Whitney will once again be cranking out number one hits. Yeah, you’re right. Even I thought that last line was funny.

In the grand scheme of things, putting your money in a savings account is probably the easiest and most common way people get their money to “work” for them. Unfortunately, more than likely, you’re money won’t be working too hard for you.

First off, what do I mean by having your money work for you? Essentially, having your money work for you means that you use the money you have to make additional money for you. In the case of a savings account, your money is working for you by earning a small amount of interest each month.

For example, if you have $1,000 in a bank account that yields (also known as “earns”) 2% annual interest, or .00167% per month, after the first month your balance will be $1,001.66.

However, thanks to the power of compounding interest, the next month you will earn the same percentage (.00167%) on both the original $1,000 and the earned $1.66. That means after the second month you will have 1,003.33.

I know this all doesn’t seem like much (and it’s not) but savings accounts are great places to start when you’re trying to build up your funds.

The nice thing about savings accounts is they are relatively easy to access and provide very little barrier between you and your own money.

Unfortunately, you pay for that by not earning as much as you would elsewhere. But, you’ve got to start saving somewhere, and a savings account is a great place to start

Claims against bad credit loans are nothing but mere exaggerations, for each one who has suffered the consequences of a growing debt due to continually applying for bad credit loans without being able to repay them, there are hundreds of people who have used bad credit loans to face financial difficulties and have succeeded in solving their problems.

Debt Trap is Debtors Fault

The debt trap is probably the only trap set by the same one who falls into it. Failing to understand that a loan should not be used to finance purchases or payments unless you have certainty of a surplus in your budget, can easily lead to debt accumulation. When requesting a loan, you should also make sure that your income to expense ratio will remain positive on your income’s side for the duration of the loan.

Unexpected situations always rise and you need to arrange savings in order to face them. You can’t be sure why you will need extra cash but chances are that you’ll need it. So, it is best if you are prepared. Otherwise, late payments or missed payments will make you incur in punitive fees, higher interests, you’ll be forced to refinance on worst terms or request additional funding and eventually you may have to file for bankruptcy unless you learn to take control over your finances.

A Temporary Solution but not Cost-Free

Personal Loans for people with bad credit should only be taken in order to solve a financial problem. The repayment plan should be as short as possible which will reduce the overall cost of the loan. If due to a small income you need to apply for a loan with a long repayment program, as soon as your credit gets better, you should refinance your loan in order to get better terms.

The idea is to flee as soon as possible from a loan which won’t only be expensive but will also affect your ability to get finance because a bad credit personal loan on your credit report isn’t a good mark in the eyes of other lenders.

Search Online for the Best Terms Available

Don’t go for the first offer you receive, there are many lenders out there dealing with bad credit personal loans. Each one has different requirements, different interest rates and different repayment plans. Request loan quotes from them and compare what they have to offer. Be careful with hidden fees and costs that some lenders like to conceal in the fine print of the loan contract. If you do this, you’ll be able to get the best deal available for you and cut the loses due to bad credit to a minimum.

It can be really difficult to get finance when your credit is less than perfect. Having large personal loans and credit card balances that have became too much of a burden is not an uncommon situation. Many soon end up being unable to meet the monthly payments of the loans and the minimum payments on the credit card balances. Then, penalty fees start making your debt even bigger and unless stopped at some point this can easily lead to bankruptcy.

However, if your credit is bad due to past delinquencies or credit problems, even if you have your debt under control, you won’t be able to get finance through an unsecured personal loan easily. Bad Credit implies too much of a risk to lenders which can only be overcame by providing a security, some sort of collateral. You probably already knew that but you may object that your property is already securing your mortgage. That’s when cash-out refinance loans come in handy.

Cash-Out Refinance Loans

A cash out refinance loan can solve your lack of cash problems because it will provide a considerable amount of money you’ll be able to use either to meet your current needs or for reducing your current debt. You can even get the money you need and save money at the same time. We’ll explain this later.

Basically, a cash out refinance loan is a mortgage loan that will be used to repay the outstanding mortgage loan. However, since the refinance loan will be requested for a higher amount than the original loan, the remaining amount can be used for whatever purpose you want.

If you are in a hurry, use it to fulfill the needs you couldn’t meet due to the lack of funds. But if it isn’t an emergency and you have some time, you can use the money to reduce your outstanding debt. The money you obtained from the refinance loan is cheap finance, if you use it to pay off expensive financing like unsecured personal loans, pay day loans, and credit card balances, this will enhance your credit stance and improve your credit score. You’ll then be able to get cheaper finance from other sources and use the money for whatever you originally needed.

Moreover, refinance home loans can be obtained at a lower interest rate than the original mortgage loan. If there is not much difference between your credit situation when you requested the mortgage loan and your current credit situation, or if your current situation is better, you’ll probably be able get a refinance loan for a lower interest rate than your previous mortgage. You can also get a lower rate by shortening the loan term. This may increase your mortgage installments slightly but will definitely get you a lower rate and you will save thousands of dollars over the whole life of the loan.

CFL stands for Compact Fluorescent Light. It was about 7 or 8 years ago when we tried our first compact fluorescent light bulb. They were expensive, did not light as soon as you flicked on the switch and were were fairly dim...

A few weeks ago we ran across a CFL that turned on immediately, and was very bight. It got us wondering, were CFL's now ready for prime time as a way to save money? Let's take a look.

Assume the average home has 40 light bulb sockets. A 75 watt incandescent bulb costs about $.25 cents(on sale at Wal-mart) and lasts about 900 hours. If you keep your lights on for an average of 3 hours a day, then you would need to spend $10 a year for new light bulbs.

The electricity to run those lights would be a different story.

The national average for a kWh of electricity is about $.10 cents. A kWh will run ten 100 watt light bulbs for 1 hour.

In one year you would use 82,125 watt hours of electricity (75 watts x 1095 hours) or 82 kWh per incandescent bulb. Multiply this times 40 bulbs and your total annual electric use for lighting would be 3,280 kWh. At $.10 cents per kWh you would spend $320.80 on electricity every year.

The total cost for 1 year of incandescent lighting would be $330.80

Now let's calculate the cost of an a compact fluorescent.

A 20 watt CFL is as bright as a 75 watt incandescent. We just bought a 3 pack of GE 20 watt CFLs for $2.52 each at Wal-Mart. The life of these CFL's is 8,000 hours. Using the same 3 hours per day you would need to replace your bulbs only once every 7 years! The cost of 40 CFL's would be $100.80 Prorated they would only cost about $14.40 per year.

Here is the good part.

At 20 watts per bulb you would only use 21.9 kWh of electricity per year per bulb. The total cost of electricity for 40 bulbs for one year would be only $87.60! Add in the cost of the bulbs and the total annual cost for CFL's is only $89.04

That is a savings of $241.76 a year. The other advantage is only having to change your light bulbs only once every seven years!

Keep your eyes on Wall-mart and Sam's Club. They are participating in a cooperative, nationwide educational program called Change a Light, Change the World sponsored by the U.S. Environmental Protection Agency’s ENERGY STAR program. You might get chance to but CFL's at even better prices.

It really seems as if those who save money come by it easily. For so many people, saving money is just a dream -- they just can't seem to make it happen.

Saving money is difficult. Those who have gotten into the habit of saving are often able to keep saving, despite upsets in their life. In other words, life doesn't get in the way of their savings. There are many tips out there that will help you establish savings.

If you understand how to save, you have a very good chance that you will be able to get out of debt with very little sacrifice. There are many saving techniques that don't cause any major sacrifices from you. But you need to realize, that all savings methods won't work for you. Financial management is an individual process.

The first thing to look at is streamlining your money. You don't have to change anything you are currently doing, you simply get it at a better price.

So many people simply pay their bills without ever looking at them. Take the time to make sure that you are receiving the best deal for what you want. I recommend that you do this on a yearly basis. For example, call your credit card company and ask for a better interest rate. This will save you time and money. You are still receiving the same service, you are simply paying less for it.

Go from your bills to your daily living. For example, if you buy a bottle of water from the vending machine every day for $1, you pay around $24 a month. You can go to the store and purchase 12 bottles of water for $4.00 and take them to work with you. You save $15 a month without sacrificing anything. You are streamlining.

What prevents streamlining from working? Laziness and bad habits. Most companies offer you something cheaper for three months at a discounted rate because they know that most people will never cancel afterwards.

With streamlining, you can find ways to save money without even changing your lifestyle. There are many areas you can streamline and pay less for the exact services you are currently receiving. By making an effort to streamline at least once a year, you can find the money to save without any sacrifice.

The Basics As I outlined in my previous article on budgeting (see, my other articles on Ezine Aticles), setting the budget is relatively easy, sticking to the budget is the tough stuff.

It is a bit like going on a diet I suppose. The thing about being on a diet is you are always thinking about the things you cannot have rather than the things you can have. So it is not surprising that most people go off the rails when dieting - that cream cake was just too tempting this time.

In just the same way, if you have set a budget and put some cash in the bank to pay for it later, it will always be tempting to spend next month's money today i.e. to go off the rails. Sticking to budgets is hard when you have been loose with money to date, but you have to do it - there is no choice.

Think of it this way. If you stick to the budget, things will steadily get better; if you do not then things will quickly get a lot worse. It is one incentive at least.

The principle is outlined clearly by Mr Micawber in Charles Dickens’ David Copperfield:

“if a man had twenty pounds a-year for his income, and spent nineteen pounds nineteen shillings and sixpence, he would be happy, but .. if he spent twenty pounds one he would be miserable” The quote is famous, what is not so famous is that having said this Micawber then borrows money off David Copperfield for a drink then gives him an IOU in his wife’s name.

So just knowing what to do is not enough – the principles have to be followed.

Planning for Success The principle here is very simple: failure to plan is planning to fail.

Clearly, you can deduce from this, the one thing that blows the budget time and time again is thoughtless, or unplanned, shopping. If it is food shopping then going to the shop without a plan, without a pre-established list is a recipe for failure.

Recent reports have suggested that one in six people now discards more than 10 per cent of their average weekly groceries shopping because the goods are either past their sell-by date or are no longer fresh. Salad and fresh vegetables are the most likely items to be thrown away. This is of course the result of not thinking through your weekly purchases and planning to use what you buy before you need to throw it out.

For example, when putting together your weekly food shopping list, plan the list around daily meals for the coming week and involve everyone. If you live with a family, or just a partner, everyone implicated in the budget has to be involved. It then becomes much less of a fight and strangely enough can be a very positive experience being something that you can all do together - not to mention a subject of much heated debate.

You need to know the price of things in the shop. Do not buy on the basis of it looking nice, look at the price and assess the value for money: the value to you. Get to know the prices of things so you can estimate spending before you go in the shop.

The key is in fact value for money, this is not necessarily about buying the cheapest option it is about value to you and if buying two food items today reduces your overall spend over two weeks - then spend more today and buy two to save money for next week.

Enough about food shopping, I will be covering it again in a later article along with another on assessing the value of purchases.

Focussed Shopping (not grazing) The other substantial risk to budget adherence is of course non food shopping. The advice here is simple - give it up. This is very much a man / woman thing. Men generally will not take too much persuading to give up shopping, for women however browsing in shopping malls is a pleasant pass time and a good opportunity to pick up some great bargains in the sales (because we are cutting back aren't we?).

Unfortunately the truth is that even the best bargain is expenditure nonetheless. If you have run up debt as a result of past spending sprees you may not need to spend money on clothes for at least a year. So don't! Buy what you 'need' only and go directly to the shop you need to buy it from, buy it, then leave the shop and the mall (if applicable).

Do Something Else There are pastimes, other than shopping, which do not require expenditure and you should look them up - they will keep you occupied, stop you thinking about all of the things you do not have and save you a fortune.

I will be covering this in more detail in a later article, but consider this: if you live near the seaside (in the UK you are never more than 75 miles from the sea), taking the kids to the seaside for a picnic will cost next to nothing, but will keep the whole family occupied for a day. However, make sure you pre-plan the day and take everything you need with you, bought at supermarket prices - not at local tourist shop rates.

Review & Revise Another general principle in all of this is to be constantly aware of the budget that has been set and to constantly review set figures and performance. If you have changed insurance providers to reduce costs make sure you review it again next time it comes up for renewal (normally every year). Equally gas and electric consumption can be reduced and you should resist the siren call of direct debit and standing orders. Sometimes discounts can be obtained by using direct debit and it is difficult to argue against that, but service providers (e.g. gas / electric) can make mistakes and with direct debits you then have to get the money back after they have made the mistake and the money is with them. Remember 9 tenths of the civil law is possession.

In particular, not using automatic payments will stop you going overdrawn by mistake and will make you focus every month on each individual item of expenditure and make you think about ways of reducing it further. Discuss this with your partner at least once a month and maintain a continual focus on your money and where it is going. An annoying and painful process I know, but one of the secrets of successfully sticking to your budget nonetheless.

Reward This is all very miserable stuff really. It is like outlining a manifesto to be miserable, a new stoic philosophy along the lines of some of the more extreme religious philosophies. Spontaneity is spurned and it seems you will never be happy again. If it seems that way, then it will fail; you will fail.

Just going back to the diet analogy, the successful dieters set themselves short term targets and provide themselves with rewards when they hit those targets. They also have a long term objective they are working towards with a big reward in the end.

If you are dealing with debt, a long term target may be simply to be debt free. A worthy target with a wonderful reward in the end: perhaps you should sweeten the deal with an affordable holiday to celebrate what could be years of careful budgeting.

Equally you may be working towards a house purchase – a mountain to climb for many people these days. You need to set yourself some success staging posts along the way.

For example, in dealing with the food budget problem, always aim to under spend on your target budget amount. Put at least some of the saving to one side. This under spend could now be used for trips to the pub etc. This will make you think twice about over indulging during a normal week as it will jeopardise a treat later in the week or (more likely) later in the month.

You can get a great deal of leverage from this by careful spending - that drink, meal or trip to the cinema will be so much sweeter when you have worked extra hard to earn it.

Better still make the reward some time off, or new clothes – something with lasting value. You need to decide what will turn you on.

With respect to the long term objective, never lose sight of this. If it is a new house – hang a picture of your ideal home on the wall or put a small picture above the TV to keep it fresh in your mind always.

Never forget your objective and last, but not least:

Forex brokers seem to be a dime-a-dozen these days. Furthermore, it seems like everyone is calling foul about his or her broker. Indeed a lot of brokers are less than honest. Here's what you should look out for.

Q. Where can I find an honest broker offering a 1 or 2 pip spread?

A. That depends. For a mini-account or a micro-account, you can't. The smallest spread I've ever seen (that was legitimate) was 1.5 pips offered by Interactive Brokers. However, they required that you have an account size of $25,000.00.

The only other broker that I know of that comes close is Oanda. They offer spreads that get very low during times of high liquidity for very small accounts. However, during other times of the day, the spread on the EUR/USD can get as high as 6 pips.

If a broker is willing to give you a fixed 2 pip spread and let you trade an account that is only $200 in size, that is a problem. I can almost guarantee you there is some shading of the price going on. In other words, you aren't getting the real price. You've getting a price that will be more favorable to the broker. That means you'll have more losing trades. The old phrase, buyer beware, has much meaning in the forex broker world.

Q. Why shouldn't I use 400:1 leverage?

A. The higher the leverage you use, the harder it's going to be for you to make money. The more leverage you use the more value each pip has. Since the pips are worth more, you have to risk fewer pips per trade to avoid risking your account's wellbeing.

Here's the problem. When you risk fewer pips, you'll get stop too close to the market's current price. Then any market "hiccup" will take you out with a loss. If you had lower leverage, you would have had more room for the trade, and it may have very likely become a winner.

Many new forex traders are trying to trade with these really tight stops (10 to 15 pips). That's way too close. Decrease your leverage and give your trades some room to breathe. You'll probably find that you have more winning trades.

Q. When I'm shopping for a new broker, what should I look for one their website?

A. Actually, you shouldn't be looking for something. You should be looking for the absence of something. What exactly? Hype.

Anywhere on the website (especially on the homepage), do they talk about how easy it is trade forex? Do they make it sound like making money is easy? These are problems. Immediate cross that broker off your short list.

You should also look for something else. Do they make a big deal of the fact that you can open an account for next to nothing and trade at very high leverage? Those kinds of brokers are like sharks. They try to take your money. Avoid them.

In summary, avoid brokers that heavily advertise high leverage, trade with lower leverage, and lastly, avoid any kind spread that seems too good to be true. It is

Forex is an abbreviation for Foreign Exchange, the system by which one currency is exchanged for another. For such reasons, an exchange rate needs to be established between currencies of all countries. Generally, all currencies are expressed in terms of U.S. dollars, while the U.S. dollar itself is commonly quoted in the Japanese yen, British pound and the Euros.

Here is an example to depict why foreign exchange service is required. A person traveling from the U.S. to Australia would require the Australian currency during his stay there. He would then be required to go to a money exchanger and get dollars exchanged for Australian Dollars at the exchange rate existing on that day.

How Forex Trading Works

All trades related to foreign exchange are based on purchasing one kind of currency against another. This gives rise to the concept of pairs like the Euro/U.S. Dollar. The first currency in the pair is referred to as the base currency (the one that provides a baseline for the purchase or sale) while the second one is termed as the counter or quote currency. While buying, an exchange rate specifies how much should be paid in the counter or quote currency to obtain one unit of the base currency whereas selling involves how much shall be received in counter or quote currency upon selling one unit of the base currency. The 15 important currency pairs are EUR/USD, USD/JPY, GBP/USD, USD/CHF, USD/CAD, AUD/USD, EUR/JPY, EUR/GBP, EUR/CHF, GBP/JPY, AUD/JPY, CHF/JPY, EUR/AUD, GBP/CHF, and NZD/USD . Foreign exchange quotes are a relation between currencies. For example, quote USD/JPY 108,91 would mean that 1 U.S. Dollar costs 108,91 Japanese Yens. The forex market is considered the largest and most liquid market in the world, trading around $2 trillion on an average every day. It is larger than all equity markets combined.

The forex market does not have a single centralized location as the exchange market operates through the electronic network. The prime location where forex is handled includes U.S., U.K., Australia, Japan and Germany. Exchange markets work all the time as their twenty-four-hour operation period is started in the Far East, in New Zealand (Wellington), passing the time zones in Sydney, Tokyo, Hong Kong, Singapore, Moscow, Frankfurt-on-Main, London, then finishing the day in New York and Los Angeles. As a result, the forex markets operate 24 hours a day, 5.5 days a week. Trading sessions imply the period of trading activity from the time the market opens until it closes. In London, the standard trading session is from 7am to 6pm. In New York the session extends from 9.30am to 4 pm. ( EUR (Euro), USD (American Dollar), JPY (Japanese Yen), GBP (Great Britain Pound), CHF (Swiss Francs), CAD (Canadian Dollar), AUD (Australian Dollar), NZD (New Zealand Dollar) )

The sheer number of currencies traded brings an extreme level of volatility on a day-to-day basis. Exchange rates fluctuate rapidly, offering opportunities for profit risk to astute traders. Yet, like the equity markets, forex offers plenty of instruments to mitigate risk allowing the individual to make profit in both rising and falling markets. Forex also allows highly leveraged trading with low margin requirements in comparison to its equity counterparts.

Leverage - An Important Concept:

To trade on the forex market one can open either a standard or a mini account. It is possible to deposit small margin money with the concerned bank and then borrow up to 100 times that sum in standard accounts and 200 times the sum on mini accounts, to trade in foreign currencies. When the amount of initial margin deposited is small relative to the value of the contract, the transaction is known to be 'leveraged' or ‘geared’. This may work against the investor or in favour of him. If the unrealized gain/loss of the net total open position falls below the margin balance, the account would be under margined and all open positions could have to be liquidated. To avoid liquidation of positions, it is best not to use the entire account balance as margin for open positions. Instead, it is better to leave enough funds in the account to withstand a market movement against the open positions. Stop loss orders should be used to limit downside risk.

Margin Trading is trading with a borrowed capital. Marginal trading in an exchange market uses lots. 1 lot equals approximately $100,000, but to open it, it is necessary to have only a small part of the sum. In marginal trading, each transaction has two obligatory stages; buying (selling) of currency at one price, and then selling (buying) it at another, or same price. The first transaction is called opening the position, the second one, closing the position. When you open a position, you can choose the number of lots you want from 1 to 10. The deposit sum for one lot will vary from $500 to $2000, depending on the credit leverage you choose. Leverage is a financial mechanism that allows crediting speculative transactions with a small deposit. A trader wanting to trade in 4 lots of USD/JPY would require a margin of $4,000. The total transaction value of $400,000 divided by a leverage of 1:100, calculates the margin requirement

If you trade, you may have heard of options. Trading options carries high risk and has many disadvantages for beginners and even seasoned traders. Therefore, it is wise to be cautious if you are considering options trading.

An option is a contract between two parties giving the taker or buyer the right, but not the obligation, to buy or sell shares at a specific price on or before a specific date. To have this right, the taker pays a premium to the writer or seller of the contract.

There are two types of options available: call options and put options.

Call options give the taker the right but not the obligation to buy the shares at a specific price on or before a specific date.

The put options give the taker the right but not the obligation to sell the shares at a specific price on or before a specific date. The taker of a put is only required to deliver the underlying shares if they exercise option.

There are a few advantages in option trading:

Put options allow you to hedge against a possible fall in the price of the shares you hold. You can consider taking it out as insurance against a loss in the share price.

By taking a call option, the purchase price for the shares is locked in. This gives the call option holder until the expiry date to decide whether he or she will or will not buy the shares. This is also applicable to the taker; he or she has to decide whether or not to sell the shares before the deadline.

The ease of trading in and out of an option position makes it possible to trade options with no intention of ever exercising them. If you expect the market to rise, you may want to buy call options, and if you are expecting a fall in the market, you may decide to buy put options. This means that you can sell the option prior to the expiry date to take a profit or limit a loss.

Options also allow you to build a diversified portfolio for a lower initial outlay than purchasing shares directly.

The income generation for options can get you profits over dividends by writing call options against your shares. By writing an option, you receive the option premium up front. While you get to keep the option premium, it is possible that you could be exercised against and have to deliver your shares to the taker at the exercise price. This strategy uses stock bought on margin.

By combining different options, or stocks with options, you can create a wide range of strategies.

You can earn extra income by writing options against shares you already own or are purchasing. This is one of the simplest and most rewarding strategies.

Using options gives you time to decide. Taking a call option can give you time to decide if you want to buy shares. You pay the premium, which is only a fraction of the price of the underlying shares.

The option then locks in a buying price for the shares if you decide to exercise. You then have until the expiry date of the option to decide if you want to buy the shares. This is the same as to the put option.

Keep in mind that, same as any other trades do not trade what you cannot afford to lose

Pip stands for percentage in point. It is the smallest price unit of a currency.

In Forex (foreign exchange), each currency has different value of 1 pip. 1 pip is equal to 1 point at the last number on each currency pair. For example, if you see Eur/Usd are traded at 1.2945 then price moves to 1.2946. We could say that price is moving upward for 1 pip. And if price moves to 1.2950 then we could say that price is moving upward for 5 pips.

Other example, Usd/Jpy are traded at 117.10. If price moves to 117.11 then we could say that price is moving upward for 1 pip. And if it moves to 117.15 then we could say that price is moving upward for 5 pips.

What is Lot?

Lot describes the standard unit size of a transaction. There are some unit sizes that used in forex. Those are:

1. Standard Lot. In standard lot, 1 lot is equal to 100,000 unitsMini Lot
2. Mini Lot. In mini lot, 1 lot is equal to 10,000 units.
3. Micro Lot. In Micro lot, 1 lot is equal to 1,000 units.

But some brokers may offer no fixed size of lot that allow their clients to trade in units.

What is Spread?

Spread is the difference between the sell quote (bid) and the buy quote (ask). If Eur/Usd quotes read 1.2910/1.2912 then the spread is 2 pips.

How to calculate profit?

Let’s us assume that we are using Standard lot. It means that 1 lot is equal to 100,000 units. Let’s see how to calculate your profit in each currency pair.

• Eur/Usd Let’s say we buy Eur/Usd when the rate is 1.2908/1.2910 (bid or sell quote=1.2908 and ask or buy quote=1.2910). It means that we buy euro and sell dollar exactly at the same time at 1.2910. Why it has to be 1.2910? Because that’s the value of buy quote.

Now Eur/Usd is moving to 1.2920/1.2922. And we decide close the order. It means that we sell in order to exit the trade at 1.2920. Why it has to be 1.2920? Because that’s the value of the sell quote.

Our trade is ended with profit of +10 pips (1.2920 – 1.2910).

How many is +10 pips in dollar? Let’s calculate it.

In cases where the dollar is not quoted first (such as: Eur/Usd, Gbp/Usd, Nzd/Usd, etc), then we are using this is the formula:

(1 pip value/exit value) x (lot size) x (exit value) = profit or loss in dollar.

So, our profit would be: (0.0001/1.2920) x (100,000) x (1.2920) = $10

Note:

The number of 0.0001 is came from 1 pip is equal to 0.0001 in Eur/Usd pair.

• Usd/Jpy Let’s say we buy Usd/Jpy when the rate is 117.07/117.10 (bid or sell quote=117.07 and ask or buy quote=117.10). It means that we buy dollar and sell yen exactly at the same time at 117.10. Why it has to be 117.10? Because that’s the value of buy quote.

Now Usd/Jpy is moving to 117.20/117.23. And we decide close the order. It means that we sell in order to exit the trade at 117.20. Why it has to be 117.20? Because that’s the value of the sell quote.

Our trade is ended with profit of +10 pips (117.20 – 117.10).

How many is +10 pips in dollar? Let’s calculate it.

Everyday there are thousands of people who need quick cash and don't know where to turn. Maybe money is just a little tight and you need to be able to buy food and diapers for the baby. Maybe, you are getting ready to move and you need some extra cash to help out with deposits and moving expenses. If you are in a situation like this or need cash for any other reason, this article will help you to find the information you need on payday loans. In particular we will be discussing no same day fax payday loans. The companies that offer these types of loans specialize in helping people who have a need for emergency cash.

There are many sources available online that offer information on payday loans. The advantage of the same day no fax payday loans is that it enables you to get your money in a timely manner with the least amount of red tape. The last thing you want to have to do when you have an emergency need for cash is have to jump through a bunch of hoops and fill out a lot of paperwork. With the services offered you will be able to handle everything from your home or office and as long as you have a checking account with direct deposit available and you are currently employed you can actually receive the cash you need within as little as one hour from the time you apply. So if you are in need of some emergency funds to hold you over, you should read further.

There is no need to feel bad about it, or feel like you are a bad person just because you need a little help. A lot of people have been in your situation. I earn a solid six figure income now, but I have been in the situation before where I had too much month at the end of the money. You are not alone, even Donald Trump has been broke on more than one occasion! No one will know about your situation, the transaction is handled in the strictest confidence to protect your privacy.

No matter what your situation may be the people that process these transactions know and understand the circumstances that come up that can cause a person to need an emergency loan. Trust me; there is nothing they haven't seen before. If you need a little help to get you through or you need an advance on your paycheck, just give it a try today.

Are you familiar with Section 457 retirement plans? Heard about the concept before? If yes, you’ve probably have encountered it the time you were planning which of the retirement plans available is best to consider. Well, just like the rest of the retirement plans, the Section 457 covers a lot of things that are worth knowing.

On the most basic, the Section 457 retirement plans are a type of non-qualified deferred compensation plan that only certain governmental and tax-exempt companies and organizations can offer for their employees. The purpose behind this plan is to allow employees to set aside funds for their retirement. And, it is interesting to know that although the 457 retirement plans are non-qualified plans, they somehow mimic a qualified plan for the reason that they offer a number of tax benefits for employees in the same way the qualified plan does.

What benefits are given? The Section 457 retirement plans basically provide the tax benefits that generally include pretax salary-reduction contributions, as well as tax-deferred growth of the investment earnings.

There are two forms of Section 457 retirement plans. The first is the so-called “eligible” Section 457 plans, and the second is the “ineligible” Section 457 plans. On one hand, the eligible plans cover certain restrictions on the amounts deferred. These plans are also subject to favorable tax treatment. On the other hand, the ineligible Section 457 retirement plans are those that provide or offer a greater degree of deferral and are specifically designed for executives.

Whatever form you may consider, it is important to note that both of those above mentioned forms have set certain limits on the amounts to be deferred. For instance, in the eligible Section 457 retirement plans, the amount deferred annually by an employee cannot exceed the littlest of 100% of his or her compensation. If we will put that into figures, here’s what the deferrals will look like:

-$14,000 for tax year 2005
-$15,000 for tax year 2006

After 2006, it is expected that the applicable dollar amount will be adjusted for cost of living surges in increments of about $500.

So that’s said. Now in terms of distribution, it has been maintained that in the Section 457 retirement plans, the distributions can only be made after the calendar year that the employee reaches age of 70 ½; after severance from employment; and after an unforeseen emergency. The distribution, however, can be rolled over into an IRA or other forms of eligible plans, but this time it must be under the same rules that apply generally to the rollover to the eligible plans. In addition, employees who consider Section 457 retirement plans can also rollover their plans into another Section 457 plan without even incurring the income tax placed on the amount rolled over.

If retirement is at hand, you might probably be worrying on questions such as, will my money last throughout my retirement? How much retirement withdrawal of cash can I make from my portfolio every year? How should my money be allocated? How will inflation affect my purchasing power? All these questions sometimes make it a little challenging for people to look at retirement positively, however you can feel a lot better if you plan your retirement withdrawal, which can give respond to those questions running through your mind.

How much retirement withdrawal to make from your portfolio every year is a crucial question, because it leaves you the dilemma that withdrawing too much may give you funds that will not last through your entire retirement, and on the other hand, if you withdraw too little, then you may end up eating cheese and macaroni for dinner every night for no reason. It is also essential to remember that the United States government has placed a minimum required distribution (MRD) requirements on a lot of retirement tools such as 403(b)s, traditional IRAs, and 401(k)s. Retirement calculators become a very good tool to use to determine the amounts that would be safe for you to withdraw, entering different withdrawal situations into the retirement calculator is simple and its results are revealed right away.

Planning your retirement withdrawal is an important step to take so as not to end up in hot water. A lot of formulas will help you plan the percentage that you should take from your portfolio, but they depend on average rates of return and inflation. When to start the retirement withdraws is just as important, whether the market is rolling or bending in your first retirement years can make a big difference.

So, since you won’t be able to predict the future, what would be the right percentage of retirement withdrawal then? A research study showed that withdrawal periods longer than fifteen years considerably reduced the possibility of success at withdrawal rates exceeding five percent. The study also concluded that: younger retirees who expect longer payout periods should prepare on lower withdrawal rates; owning bonds reduces the probability of going broke for lower to mid-level withdrawal rates, and most retirees would profit with at least 50% allocation to stocks; those who desire inflation-adjusted withdrawals must agree to a significantly reduced retirement withdrawal rate from the initial portfolio; it is most likely too conservative to withdraw 4% or less form a stock-dominated portfolio; and for a fifteen years or less payout periods from a stock-dominated portfolio, withdrawal rate of 8% to 9% appears sustainable.

According to the study, a “safe” retirement withdrawal rate would amount to, between four percent and six percent of a retiree’s first portfolio. And withdrawal rates of above five percent, raise the possibility of the retiree to go broke in their lifetime. A lot of studies as well, agree that the existence of bonds offer a measure of stability absent in all-stock portfolio.

Many people retire after they find themselves financially stable enough to support all their needs. There are also some who consider first how much they have already saved for them to say that they are already ready for retirement. Well, money matters really play a vital role in retirement and to become financially secure after retirement takes time, effort and of course, proper planning.

The concept on financial retirement planning is not something that is fresh or new to the people’s ears. It has been around for more than a decade now, and many successful retirees have considered financial retirement planning at some point in their lives. Now, if you are thinking about retiring from work, but you want to make sure that you will be financially stable when the right time to retire comes, knowing everything that is involved in the planning is definitely one of the best moves you can make.

So to start with your financial retirement planning, simply note that you are dealing not just with money here, but for a better future. Note that and if possible, save as much as you can as early as possible. As what many retirement experts have said, the sooner you start saving, the more time your money has to grow.

Set certain goals that are realistic and make those goals an important part of your financial retirement planning. You can project your possible expenses based on your needs. Consider how much your life after retirement will cost and try calculating everything that is involved. Settle only when you find out that everything is tackled and solved.

You can also consider a 401K plan as a special part of your financial retirement planning. The 401K is after all one of the best and easiest ways for saving after retirement. But before you consider the plan, make sure that you have understood everything that is involved in it, how it works and how you will benefit from it. There are also the IRA retirement plans for you to take. But as mentioned, know first what the plans entail and how they work to support everything you’ll need after retirement.

As you go along the financial retirement planning process, try to look at your asset allocation. It has been maintained that how you divide your portfolio between stocks and bonds will have a big impact on your long term returns. And, speaking of long term returns, several retirement experts have noted how important the decision of paying attention to the stocks and bonds is. According to them, stocks offers the best opportunity for you to achieve high returns over long periods of time, while bonds should not be considered heavily even in retirement for that will increase the inflation level, thus destroying the purchasing powers of the interest payments of your bonds.

Finally, when considering a financial retirement planning, it is best to consider yourself working part-time even after retirement. What you will earn on your part-time job will help increase what you’ve saved for your retirement. It will even keep you socially engaged.