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AFC Student Blog Series Part 2

Beginning the journey to my AFC
I am very particular as to where I choose to study so it is important that I first find a quiet and comfortable spot otherwise my mind will wander because the chatter around me is too loud and sometimes a word in others’ conversation will catch my attention. I also have to make sure the temperature is right because my mind will wander off again as I grow cold or hot.

For these reasons I make sure to carry ear plugs and a light jacket along with snacks to curb my appetite until I take a break to eat. When I eat, I make sure to only take the time to eat and not study while I eat otherwise my food will get cold and I lose my appetite which will come back later to bite me because I did not eat appropriately in the first place. I make sure to take a break every four to five hours before eating. Having a routine makes it easier for me to keep track of time so I do not feel as if I am wasting time because my actions are automated like when a portion (10%) of my paycheck automatically transfers to my savings account.

In order to find a spot I make sure to leave my apartment because there are too many distractions there such as the television, my bed, the refrigerator, and the impulse to clean so I venture off to the campus library.

Once I find the right spot I take out my study materials and get started…

More to come next week.

Nadia Marquez, Master of Science Student in Personal Financial Planning at Texas Tech University

April 4, 2014 at 5:28 am, by admin | No Comments | Category General


AFC Student Blog Series

I’m Nadia, a graduate student studying personal financial planning at Texas Tech University. I’m currently enrolled in the AFC® University program through Texas Tech and studying for the Accredited Financial Counselor certification as I prepare for graduation this May. I enrolled in the AFC program, because I believe that this certification will provide me with a solid foundation of knowledge and help define and propel me towards my future career. 

Through this blog I hope to share my experiences with you – what I am learning and how it is preparing me for my future!  Stay tuned for more AFC Student Blog posts each Friday.

Nadia Marquez, Master of Science Student in Personal Financial Planning at Texas Tech University

March 28, 2014 at 10:40 am, by admin | No Comments | Category General


Building a Strong Financial Foundation with Real Estate

One of the primary problems many find themselves facing at retirement age is having a fixed, predictable income with so many other unknowns. Ideally, when you’re done working, your money will start working for you in the form of equity, interest, dividends, etc. However, as often as not, people are reaching retirement and finding the reality is not as enticing as what they’ve been told or sold by their financial advisers.

The problem with any form of predicting anyone’s financial future is that even the most educated guesses are just that: guesses. Even the Federal Reserve is subject to the rise and fall of the economy and the massive fluctuations that are inherent in macroeconomics. So, with so many things working against you, how can you make your investment/retirement portfolio work for you?

The answer may not be all that surprising, but here it is: real estate. If you do find that answer does surprise you, that makes sense. Since the housing crash, many people have chalked up real estate investments as just another thing that is sucking up money. As housing prices fell, so did investor trust in the market?

As with so many other things in the financial arena, it is all about buying low and selling high. Margins are key here. While the price of the home you buy is obviously a factor, the more important thing to consider is the potential equity that can be leveraged from the property. Some of the highest equity targets can be found in foreclosures. Some of the best deals can be found at auction on sites like this one.

In incorporating these investment properties, it is important to conduct a cost/benefit analysis like you would with any financial deal. Each property is unique, and the profit potential for each varies widely. Do your homework by researching comparable sales and property values in the area. In some cases, you may find that you want to get the home inspected or appraised before deciding to invest. We’ve all heard the term “you have to spend money to make money”. This is not always the case with investment properties, but many times it is a tough reality.

Make sure to factor repair/renovation costs into your financial plan when looking at prospective investment targets. If you are planning on flipping the house, then there is a lot of equity to be had by focusing your funds on key areas of the home (kitchen, bathrooms, master bedroom, curb appeal etc.).

The same is true if you are looking at renting out the property and using it as a long-term investment. You may be able to fetch a good price with minor repairs, but funneling money into carefully selected projects can result in a higher monthly payment and may be worth the upfront costs.

In addition to the financial costs associated with these projects. There is also the factor of time and effort. You may be retired or working toward retirement and the prospect of earning sweat equity is not all that enticing. Just because you aren’t dedicating all of your time and effort toward it doesn’t mean it can’t be profitable.

Pick your battles and decide when it makes sense both personally and financially to allow someone else to tackle the projects yourself, or hand them off to a capable professional. Obviously, outsourcing construction projects represents another cost you will have to factor in, but if you choose your properties carefully, there is a pretty penny to be made.

So when you’re looking at your financial portfolio, ask yourself if your money is working for you or against you. If you don’t like what you find, perhaps it’s time to mix things up and find a solution that can result in some predictable, sustainable form of income.

Joe Givens is a real estate professional turned blogger. When he’s not writing about foreclosures or repairing drywall, he is probably watching Band of Brothers for the millionth time.

February 24, 2014 at 12:37 pm, by admin | No Comments | Category General


The Gold Standard for Retirement

With debt at an all-time high, many people are anxious and looking for ways to protect their investments – especially the investments meant to supplement their retirement. For those who hold and individual retirement account, a degree of safety can be found in a gold IRA.

What is a Gold IRA?

A gold IRA works the same way as a standard IRA account – however, with a gold IRA, people can hold precious metals like gold, silver, and palladium in their account for diversification. Physical gold coins and bars are stored in an IRS sanctioned depository, rather than being held by the IRA owner. While investors aren’t able to squirrel away gold in safety deposit boxes, they can feel assured their gold is secure, and cannot to be lost or stolen. Once retirement age is reached, the metals are shipped directly to the investor.

What Kind of Gold Can I Invest In?

Section 408(m)(3) of the Internal Revenue Code allows IRAs to own certain precious metals – in coin or bullion form – as long as they meet applicable fineness standards. Case in point, an IRA can own American Gold, Silver, and Platinum Eagle coins as well as Canadian Gold Maple Leaf coins ­– but not the South African Krugerrand, as it’s only 22-karats and doesn’t meet purity standards.

Why Should I Invest In Gold?

Investing in gold can help you create a safe future, one where you can spend your golden years enjoying life rather than pinching pennies. Here are the top reasons why a gold IRA is a wise choice:

  • Diversification: Diversification is arguably the most important component to help an investor meet their long-term financial goals while minimizing risk. Portfolio protection is particularly important as the last several years has seen global economic uncertainty and stock markets more volatile and risky than ever before. Investing in precious metals is an easy way for an investor to diversify their portfolio, protecting it from the decline of other markets.
  • Inflation: Inflation’s a nasty thing. As each year goes by, more dollars are required to buy everything from food to gasoline. Thanks to inflation, the dollar’s value is ever-changing and the Fed is forced to keep churning out paper currency to keep up. Precious metals, however, tend to hold value above inflation as more gold, silver, etc. can’t be made on demand. Gold is essentially recession proof! Having investments in gold and silver can help an investor maintain their purchasing power even as the dollar declines.
  • Liquidity: Besides being an outstanding source of value, gold is considered a liquid asset as it can effortlessly be converted into cash or goods when needed.
  • Tax Deferred Growth: One of the best reasons to own physical precious metals through a Gold IRA is the ability to grow your investment on a tax-deferred basis. This means you no taxes are paid until the investor takes possession of the gold!

Sometimes making an investment can feel like a roll of the dice. If you’re worried your retirement portfolio is a gamble, consider adding gold to your IRA – it’s always in high demand and minimizes risk by maintaining its value. When it comes to retirement, you want to make sure that your money is there, and gold is the perfect way to do just that.

David Parkman is a financial writer for American Bullion and enjoys saving money almost as much as he does spending it. When retirement comes, he plans on using his nest egg to travel the world with his wife.

February 4, 2014 at 3:46 pm, by admin | No Comments | Category General


Tips for Managing Your Money During Retirement

The economy is fluctuating on a daily basis and it goes without saying that it makes managing your finances during retirement challenging. Financial planning and smart money use is essential to retire in comfort and fully enjoy the freedom that you have earned. In order to achieve this goal, it all starts before retirement:

Foundation planning is essential

The success of any action or plan is often founded in the planning that goes into it; so much so that many idioms have been created around it: “Look before you leap” and “Failing to plan is planning to fail”. To this goal, using a retirement calculator to ensure you’re saving enough for your savings to last, to afford healthcare, and maintain a high quality of life. One of the stumbling blocks many people don’t plan for are taxes; many forms of retirement cash flow do not ha­ve taxes automatically deducted unlike a working income. Without proper foresight this can create unwanted surprises come tax season. Once you have determined your cash flow income, budgets, emergency funds and saving goals should be developed to provide a framework upon the foundation that planning for retirement has created.

Budget in Cash

David Ramsey advocates for a monthly envelope cash budget; this is a form of accountability, restraint, and awareness of how money is being spent on a day to day basis. Envelopes are created for different costs such as food, entertainment, or travel and spending in that area ceases once the cash is gone. Actual money can be substituted with monopoly money if a credit or debit card is used to continue receiving points, miles or other benefits from using plastic. There are two advantages to this method: long term plans are easily created from a standard monthly budget and it is very tactile and accountable. However, not all things are best planned for in cash.

Emergency fund and Short-term savings goals

Even though the learning curve for technology intensive tools is a little bit steeper for people looking to retire right now (baby boomers), Mint.com is a great free tool for managing goals, budgets and providing a birds-eye view of personal finances. With Mint, or a similar tool, it is easy to create and track different saving goals. Two main goals that should be created in any retirement plan are an emergency fund and short-term savings goals.

Emergency funds are fairly straight forward; they need to be liquid and accessible at any place or time. A rule of thumb for the amount to save is about 6 months’ worth of funds at your current standard of living. An important thing to consider is your individual needs; some people may need more savings because they have higher risk health conditions or participate in higher risk situations. Short-term savings goals are much more flexible and unique to the individual. These can either be saved for in a traditional account or low-risk vehicles such as FDIC-insured CDs that mature in time for your vacation or other short-term deadline. Saving in such a manner maximizes the return of your funds and ensures it isn’t used for anything else by accident or temptation.

Be patient about collecting your social security benefits

Lives are often measured by birthdays – 18 you can vote, 21 drinking becomes legal, 25 lowers car insurance, and nothing beyond that until 55 for senior discounts. Fortunately, there is one more landmark before the Century Club: at 62 your ability to collect social security begins. But wait, the benefits claimed from social security can be increased if they are delayed even a single year. Steven A. Sass, program director of the Financial Security Project, talks about the advantages of postponing your collection of social security. He asserts that you can receive an additional 6% or more from your social security claims by waiting a year or more. In addition, the money will be worth more since it increases to match inflation.

The end goal is to make your money work for you so you don’t have to work during retirement. This period of life should be filled with joy, new experiences, and rewards for overcoming the trials and tribulations from a lifetime of hard work. A comfortable financial establishment can be built, but requires careful planning, a framework of budgets and goals, and finally, furnished with cash flow from savings and benefits earned.

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- Louis Mack is a retirement planning expert from NewRetirement who is only about 4 years away from his own retirement. He plans on spending it puttering around his organic garden and yelling at teenagers to get off his lawn.”

January 28, 2014 at 10:15 am, by admin | No Comments | Category General