Your Money University

  How to Approach Investing 49. Pay Attention to Fees The fees you pay in your funds, also called expense ratios, can eat into your returns. Even something as seemingly low as a 1% fee will cost you in the long run. Our general recommendation is to stick with low-cost index funds. 50. Rebalance Your Portfolio Once a Year We’re not advocates of playing the market, but you need to take a look at your brokerage account every once in a while to make sure that your investment allocations still match your greater investing goals.  Here’s how to rebalance .

  How to Prepare for Rainy (Financial) Days 42. Make Savings Part of Your Monthly Budget If you wait to put money aside for when you consistently have enough of a cash cushion available at the end of the month, you’ll never  have money to put aside ! Instead, bake monthly savings into your budget now. Read more on this and  other big savings mistakes —and how to fix them. 43. Keep Your Savings Out of Your Checking Account Here’s a universal truth: If you see you have money in your checking account, you will spend it. Period. The fast track to building up savings starts with opening  a separate savings account , so it’s less possible to accidentally spend your vacation money on another late-night online shopping spree. 44. Open a Savings Account at a Different Bank Than Where You Have Your Checking Account If you keep both your accounts at the same bank, it’s easy to transfer money from your savings to your checking. Way too easy. So avoid the problem—and  these ...

  How to Get Properly Insured 40. Get More Life Insurance on Top of Your Company’s Policy That’s because the basic policy from your employer is often far too little. Not convinced? Read how extra life insurance  saved one family . 41. Get Renters Insurance It, of course, covers robberies, vandalism, and natural disasters, but it could also cover things like the medical bills of people who get hurt at your place, damages you cause at someone else’s home, rent if you have to stay somewhere else because of damage done to your apartment—and even stuff stolen from a storage unit. Not bad for about $30 a month!

  How to Best Build—and Track—Your Credit 37. Review Your Credit Report Regularly—and Keep an Eye on Your Credit Score This woman  learned the hard way  that a less-than-stellar credit score has the potential to cost you thousands. She only checked her credit report, which seemed fine—but didn’t get her actual credit score, which told a different story. 38. Keep Your Credit Use Below 30% of Your Total Available Credit Otherwise known as your credit utilization rate, you calculate it by dividing the total amount on all of your credit cards by your total available credit. And if you’re using more than 30% of your available credit, it can ding  your credit score . 39. If You Have Bad Credit, Get a Secured Credit Card A secured card helps  build credit  like a regular card—but it won’t let you overspend. And you don’t need good credit to get one! Here’s  everything you need to know  about secured credit cards.

  How to Save Right for Retirement 33. Start Saving ASAP Not next week. Not when you get a raise. Not next year. Today. Because money you put in your retirement fund now will have  more time to grow  through the power of compound growth. 34. Do Everything Possible Not to Cash Out Your Retirement Account Early Dipping into  your retirement funds  early will hurt you many times over. For starters, you’re negating all the hard work you’ve done so far saving—and you’re preventing that money from being invested. Second, you’ll be penalized for an early withdrawal, and those penalties are usually pretty hefty. Finally, you’ll get hit with a tax bill for the money you withdraw. All these factors make cashing out early a very last resort. 35. Give Money to Get Money The  famous 401(k) match  is when your employer contributes money to your retirement account. But you’ll only get that contribution if you contribute first. That’s why it’s called a match, see? 36....

  How to Shop Smart 28. Evaluate Purchases by Cost Per Use It may seem more financially responsible to buy a trendy $5 shirt than a basic $30 shirt—but only if you ignore the quality factor! When deciding if the latest tech toy, kitchen gadget, or apparel item is worth it, factor in how many times you’ll use it or wear it. For that matter, you can even consider the cost per hour for experiences! 29. Spend on Experiences, Not Things Putting your money  toward purchases  like a concert or a picnic in the park—instead of spending it on pricey material objects—gives you more happiness for your buck. The research  says so . 30. Shop Solo Ever have a friend declare, “That’s so cute on you! You have to get it!” for everything you try on? Save your socializing for a walk in the park, instead of a stroll through the mall, and treat shopping with serious attention. 31. Spend on the Real You—Not the Imaginary You It’s easy to fall into the trap of buying for  the person yo...

  How to Keep Debt at Bay 22. Start With Small Debts to Help You Conquer the Big Ones If you have a mountain of debt,  studies show  paying off the  little debts  can give you the confidence to tackle the larger ones. You know, like paying off a modest balance on a department store card before getting to the card with the bigger balance. Of course, we generally recommend chipping away at the card with the highest interest rate, but sometimes psyching yourself up is worth it. 23. Don’t Ever Cosign a Loan If the borrower—your friend, family member, significant other, whoever—misses payments, your credit score will take a plunge, the lender can come after you for the money, and it will likely destroy your relationship. Plus, if the bank is requiring a cosigner, the bank doesn’t trust the person to make the payments. Bonus tip for parents: If you’re asked to cosign a private loan for  your college student , first check to see if your kid has maxed out federal l...

  How to Amp Up Your Earning Potential 18. When Negotiating a Salary, Get the Company to Name Figures First If you give away your current pay from the get-go, you have no way to know if you’re lowballing or highballing. Getting a potential employer to name the figure first means you can then push them higher. 19. You Can Negotiate More Than Just Your Salary Your work hours, official title, maternity and paternity leave, vacation time, and which projects you’ll work on could all be things that a future employer may be willing to negotiate. 20. Don’t Assume You Don’t Qualify for Unemployment At the height of the recent recession, only half of people eligible for unemployment applied for it. Learn the  rules of unemployment . 21. Make Salary Discussions at Your Current Job About Your Company’s Needs Your employer doesn’t care whether you want more money for a bigger house—it cares about keeping a good employee. So when negotiating pay or asking for a raise, emphasize the  in...

  How to Get Money Motivated 9. Draft a Financial Vision Board You need motivation to start adopting better money habits, and if you craft a vision board, it can help remind you to stay on track with your financial goals. 10. Set Specific Financial Goals Use numbers and dates, not just words, to describe what you  want to accomplish  with your money. How much debt do you want to pay off—and when? How much do you want saved, and by what date? 11. Adopt a Spending Mantra Pick out a positive phrase that acts like a mini rule of thumb for how you spend. For example, ask yourself, “Is this [fill in purchase here] better than Bali next year?” or “I only charge items that are $30 or more.” 12. Love Yourself Sure, it may sound corny, but it works. Just ask  this author , who paid off $20,000 of debt after realizing that taking control of her finances was a way to value herself. 13. Make Bite-Size Money Goals One study showed that the farther away a goal seems, and the less s...

  How to Budget Like a Pro 4. Set a Budget, Period This is the  starting point  for every other goal in your life. Here’s a checklist for building  a knockout personal budget . 5. Consider an All-Cash Diet If you’re consistently overspending, this will break you out of that rut. Don’t believe us? The cash diet changed the lives of  these three people . And when  this woman  went all cash, she realized that it wasn’t as scary as she thought. Really. 6. Take a Daily Money Minute This one comes straight from LearnVest Founder and CEO Alexa von Tobel, who swears by setting aside one minute each day to check on her financial transactions. This 60-second act helps identify problems immediately, keep track of goal progress—and set your spending tone for the rest of the day! 7. Allocate at Least 20% of Your Income Toward Financial Priorities By priorities, we mean building up emergency savings, paying off debt, and padding your retirement nest egg. Seem like a...

  First Things First: A Few Financial Basics 1. Create a Financial Calendar If you don’t trust yourself to remember to pay your quarterly taxes or periodically pull a credit report, think about setting appointment reminders for  these important money to-dos  in the same way that you would an annual doctor’s visit or car tune-up. A good place to start? Our  ultimate financial calendar . 2. Check Your Interest Rate Q: Which loan should you  pay off first ? A: The one with the highest interest rate. Q: Which savings account should you open? A: The one with the best interest rate. Q: Why does credit card debt give us such a headache? A: Blame it on the compound interest rate. Bottom line here: Paying attention to interest rates will help inform which debt or savings commitments you should focus on. 3. Track Your Net Worth Your net worth—the difference between your assets and debt—is the big-picture number that can tell you  where you stand financially . Keep an...

 

  The 5 Elements of the Zacks Method for Investing 1) Valuation -  There is plenty of empirical evidence showing that stocks with low valuations will outperform the market over the long haul. As simple as it sounds, it is never easy to find objectively 'cheap' stocks even after the type of market we have recently witnessed. We look for companies that are trading at reasonable Price-to-Earnings [P/E] and Price-to-Book [P/B] multiples relative to their peers and their own history. We say 'reasonable' instead of 'low' because many 'low' multiples are simply 'value traps' and the analysis has to be done in the context of prevailing and expected interest rates. 2) Management Effectiveness -  It is very important to get a sense for how effective the company's management is in utilizing the resources available to them. This can be done a number of different ways, but our research shows that Return on Equity [ROE] does a good job of capturing this at...

  Rules guide the acquisition of money. These rules will work for anyone. Rule No. 1: Live on less than you earn. If you consistently keep more than you spend, you’ll have a surplus of money. Simple, right? Rule No. 2: Maximize your ability to earn from your current job. Your single-biggest source of income is your current job. Most jobs will pay you more money as your skill rises. So the quickest way to make more money is to improve your skills. Put yourself on a skill development track that will make you world-class at your job. If you don’t know how to do this… no problem. Here’s what you do… Offer to take the most successful person at your company out to lunch. You’ll ask this person about their work habits. Acknowledge their success and ask them, “What do you do that’s different from everyone else?” Don’t interrupt them. Just listen and take notes. By the end of the lunch, you’ll have the beginning of a blueprint you can use to become world-class at your job. If your current e...

That is, following are the top 14 reasons why Panama remains the world's best place to think about reinventing your life overseas: #1: Outside Panama City, the cost of living is affordable. Note my disclaimer. Panama's capital city is no longer a bargain or a budget destination. However, outside Panama City, Panama can be downright cheap. You could retire to the beach in Las Tablas, for example, on the country's Azuero Peninsula, on a budget of US$1,100 per month or even less. #2: The sun shines year-round. Panama City can be too hot and sticky for some tastes, but, again, look beyond the capital, and you find pockets of near-perfect climates in some regions. If you prefer cool mountain temperatures to steamy sea-level ones, consider Boquete or, less discovered and more affordable, Santa Fe. #3: The expat's path is well worn. This country has been attracting foreign retirees, expats, and entrepreneurs in growing numbers for nearly two decades. Panama offers many and ver...

  Rule #1: Never try to call the bottom It’s OK if you buy something and then it goes down more. Just don’t use what’s called “leverage” (i.e., borrow. In this case, you can go broke). Rule #2: While some say, “Buy when there is blood in the streets,” I don’t like to do that It’s OK to wait until there is some decent data out there, like stabilizing cases in the U.S., etc. Rule #3: Don’t fight the Fed The Fed always wins. Always. Rule #4. Look at what’s changing: drones, robotics, oil, delivery, etc. There are probably opportunities here that nobody realizes yet. Rule #5: The 3% rule If you are buying stocks (as opposed to mutual funds or ETFs), never put more than 2–3% of your portfolio into any one investment. Being able to sleep at night is core to investing. If I am too dependent on one stock, then I have trouble sleeping. Warren Buffett would disagree. He made a ton of his money when, in 1962, he put 1/3 of his hedge fund into American Express while everyone else thought Amex ...

W hat the makeup of the S&P 500 may look like in the future. We know tech stocks are in a downtrend. We know energy stocks are in an uptrend. In fact, about a decade ago, energy made up about 16% of the S&P 500. In the 1980s, it was around 30%. This means there’s a lot more room to run, not just in the energy sector, but in others like industrials, mining, and consumer staples. The point is, we believe we’re at an overall shift out of growth and into safety and value in the months ahead. It may not be the same as in the 1970s or 2003, but it will probably look similar.

  Lithium is in great demand as long as electric vehicles use the same method to store electric energy in fuel cells.

  The emptying of the U.S. Strategic Petroleum Reserve (SPR) will be an issues in the future. The U.S. established the SPR after the 1973 oil embargo. It consists of 60 large salt caverns spread across four states. In total, it can hold as much as 727 million barrels of oil. It was intended to insulate the U.S. from oil supply shocks. Certain key industries – and the U.S. military – had access to this oil in times of national emergency. When the price didn’t cooperate, Biden unleashed the taps. He pledged to release 180 million barrels of oil in six months starting in April. You can see what effect that had on oil prices in the chart above. Today, the SPR sits at its lowest level in about 40 years. The White House claims it plans to refill the SPR when oil prices are consistently around $70 a barrel. That effectively puts a floor on that price. However, there are some monsters lurking in the shadows waiting to wreak havoc on the oil market. While asking them to pump more oil, it si...

  Gold performs well with depressed “real” interest rates. And “real” interest rates are not the same as the nominal rates we see with the Fed Funds rate or the 10-year Treasury bond. In simple terms, the real interest rate is the current Fed Funds rate, less the current rate of inflation.  When the real interest rate is negative, investors lose money. And it’s all due to inflation.

  Us dollar looking to leg down to 70 as the chart shows further resistance at a lower level. We should see weakness as the US has further problems.

We are potentially looking at a further peak in inflation as Xmas and the energy costs push inflation up, further increases in interest rates are needed. Having further borrowing for energy costs that are distributed to the public will push up inflation even further!