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Most people hesitate to use a financial planner to help them manage their finances. They often think, “Our parents managed their finances all by themselves. They never took advice from – far less hired the services of – a financial advisor!” And therefore, people attempt to manage their earnings, their expenditures, their taxes, and their savings, all by themselves! They fail to realize that things are a lot different today than they were when their parents managed their money.

Nowadays, people frequently run out of money. With spending traps everywhere, they often end up spending more than they earn. A recent article in the National Public Radio highlighted that a majority of today’s working class doesn’t have a personal financial planner. Therefore, many of them don’t realize that their expenditures are frequently running far greater than their earnings. This is the primary reason most people end up deep in debt.

Given the frenetic pace of life today, not to mention the overwhelming demands at work, people do not have the energy, time, or temperament to keep tabs on their finances. Moreover, markets today are flooded with investment schemes, savings plans, retirement options, etc. How does one know that the investment option they chose to put their life’s earning into isn’t a Ponzi scam? No doubt, the internet is a vast resource of knowledge, and those who are interested can take the time to pour over all the technical jargon. However, investment products today can be extremely complex. You can go ahead and buy investments that you don’t fully understand, only to realize later the risks you underestimated.

In the vast, intricate world of money, unless you’re a suitably qualified professional, managing your own finances is akin to standing by a ticking time bomb. Financial planners help you see what you don’t or are unable to see. In only half a dozen meetings with their financial planners most people are surprised, often shocked, that instead of working their way out of debt, they’re actually getting deeper into it. A thorough financial plan helps uncover many important financial details that people don’t ordinarily comprehend. A financial planner helps one see their financial situation in clear light, and then suggests the best possible course of action to meet one’s financial goals.

Financial advisors may not provide specific investment advice – invest in this stock, or that fund. Instead, they help organize one’s financial life, evaluate risks, and help with asset allocation and diversification. They can even tell if you have an investment that’s underperforming or is too much risk.

Financial planners can help you structure your investments based on your financial goals. For instance, a young couple will want to plan to save for the arrival of their children, their schooling, college, and finally retirement. A financial planner will help put all of their life’s goals into perspective, to make sure that they’re able to save sufficiently to meet all of their goals, and yet be able to live life comfortably.

According to the National Bureau of Economic Research (NBER), a semi-official arbiter for recessions in the U.S., the great recession of 2007-2008 started in December of 2007 and ended in July 2009. However, even four years after the recession has formally ended, the recovery still appears to be a work-in-progress. According to a recent news report in the National Public Radio, as many as 12 million people are still out of work, and wages are barely even growing. Even though a few sectors of the economy, like Autos, Technology, and Energy, are showing some degree of growth, sectors like Housing, Banking, and Airlines are still struggling to stay profitable.


In times like these, is it really possible for young individuals to gain financial independence? And if so, does it really matter which industry one belongs to? The answers to these questions may not be as straight forward as one might expect, chiefly because a lot of factors that affect financial independence today are not within the control of the ordinary citizen. Consumer sentiment is not as malleable as companies or industries would like it to be. Given the severe impact of the 2008 financial meltdown, no matter how good a product or service, in the near term, people will remain skeptical of buying. Mortgage interest rates, another factor that affects how and when an individual is able to gain financial independence, is also out of the realms of control of the ordinary individual.


In tough financial times such as these, managing one’s career effectively is one of the best ways of working towards financial independence. How one shape his or her career is largely dependent on their individual choices. Most people tend to look at a career from a short-term perspective. They often are unable to differentiate between a job and a career.


A job helps an individual earn money so they can pay their bills. It is a short-term measure towards avoiding the pain of not being able to pay your debt. It may or may not interest you, and you may not be engaged in the same job five years from now.


A career, on the other hand, consists of a series of jobs that an individual takes up to build his or her skills towards better employment opportunities that not only offer higher pay and prestige, but a lot more job satisfaction. In other words, five years from now, you may be in the same company or industry, but earning more and taking on more challenging roles.


Essentially, a job helps you earn some easy cash quickly. In contrast, a career provides a pillar of support with both experiences and learning that will drive your professional life for many years, not only helping you earn more, but also adding to your overall happiness and well-being.


No matter the financial difficulties of the times, keeping one’s focus on shaping a career will always pay rich dividends. A temporary side job disconnected from your career may sometimes be necessary to supplement an income and pay those bills, but it is important that one does not lose the motivation necessary to pursue their career goals.

On June 19, 2013, Federal Reserve chairman Ben Bernanke stated that the central bank of the United States would begin to wind down on its bond-buying program. No sooner did the Harvard-educated economist make the announcement than mortgage rates began to rise. Many people who had been waiting to buy their dream homes were caught unawares. Even those who were in the process of making an offer on a carefully selected home saw rates climb by almost a percent or more in just a few days. With mortgage rates expected to climb even further in the coming months, should prospective homebuyers bite the bullet and buy their dream house, or should they wait it out in the hope that rates will ease?

While there’s little one can do about which way the interest rates move, it is essential that homebuyers reassess their options. In an environment of uncertainty, a lot of people tend to put off their home buying plans. While first time homebuyers continue down the path of renting a home, investors turn to buying up properties at reasonable prices and turning them into a rental property. This often turns out to be a profitable and convenient option even for homeowners who are looking to turn their private home into a rental property.  No question, renting your home to strangers can at first sound like an extremely intimidating and difficult proposition. Doubts abound: will the tenants pay on time, what happens and who is responsible for any damage to the property, how does one manage the general wear and tear that is so prevalent in rental homes, etc. However, with the right information and advice and a firm resolve, one can not only overcome these issues, but also make a tidy profit out of renting out a home.

For many homeowners, renting out their home is not an option. They may have young, growing families that need space and freedom to live in. Moreover, relocating to another area or state may not be an option, given their jobs and their children’s schooling. In such instances, many families find it convenient to rent out a spare room for a short period of time.

Holiday seekers and vacationers often look for bargains and many of them prefer renting directly from a homeowner, rather than approach franchise rental properties. Short-term rentals are equally popular for out-of-town or overnight stays. Families can earn as much as $6,000 a year simply by renting out a spare room.

No matter which way interest rates go, in tough times like these it is imperative that people utilize their assets effectively. Renting out a home or even a spare room can help homeowners supplement their household income and improve their financial condition.


The 4th of July has long stood for freedom and many Americans today are seeking financial freedom from mounting credit card debt. Wouldn’t it be great if one Independence Day the fireworks served as a personal symbol, celebrating your financial freedom from credit card debt and high interest rates once and for all? This could become a reality in the coming years if you take responsible steps to reduce your debt now.


One of the most effective and most immediate ways to overcome credit card debt is to maintain the lowest possible interest rates on any outstanding balances. You may think it’s not worth the hassle, but the monthly fees your cards accrue each month are only keeping you perpetually in debt. Here are 3 ways to lower your interest rate and take a step toward climbing out of credit card debt.


1. Call your credit card company and renegotiate. A great starting point to lower your interest rate is to call your credit card company and discuss lowering the rate. Before you call, however, take the time to arm yourself with knowledge about your credit score and current market rates. The more information you have when you call, the more likely they will treat your request seriously. If the customer service representative is hesitant or refuses to lower the interest rate, ask to speak to a manager to discuss the details. When all else fails, threaten to take your business elsewhere.


2. Shop around for a better interest rate. Many credit cards feature introductory APRs, and depending on your current interest rate it may be the best choice. Depending on your credit score, you may be able to find a much better deal if you start fresh with a different company. Another option is transferring the balance to another card you currently have if the interest rate is lower. Be careful to factor in balance transfer fees when considering if the lower interest rate will pay off in the long run.


3. Consider Forbearance or Debt Management Plans. As a last resort, credit card companies are willing to restructure the repayment terms or interest rate due to some type of financial distress. This could be the result of losing a job, medical problems or being ‘underemployed’. The two main types of restructured plans are Forbearance Plans and Debt Management Plans. In some cases, the interest rate can fall to zero or payments can be withheld for a number of months. It is a great tool to get back on track with your debt payments, but please note that credit card companies may report it to the credit bureau, affecting your credit score.




In his State of the Union address earlier this year, President Barack Obama announced a withdrawal of 34,000 troops from Afghanistan, decreasing America’s military presence in the area by half. But even as thousands of military members return from their overseas deployment, they face financial pressures that are no different than for ordinary U.S. citizens. According to a June 2013 survey conducted by USAA, 65 percent of respondents were experiencing some degree of personal financial stress.


How can men and women in uniform alleviate the stress associated with their financial condition? Here are a few tips that will help military families overcome their financial hurdles.


Pay off your Debt


Paying down debt is the number one way to ensure that you don’t spend more than what you earn. The USAA survey stated that though 22 percent respondents owed nothing to their credit card companies, approximately 37 percent had more than $5,000 of unsettled debt. Paying off debt quickly not only helps reduce the amount owed, it also reduces the interest payable each month. Service members deployed overseas often receive an extra $500 – $600 per month, which can be of great help in paying down their debts.


Have a 6-month Emergency fund


Military life is full of uncertainty and involves frequent moves. Moreover, 49 percent of service members do not have a working spouse, according to the report. To cover for any unanticipated costs, military members must set aside a six-month emergency fund. This will not only help them stay prepared for emergencies of any nature, but also lend to their peace of mind.


Saving for Retirement 


No matter if you’re an ordinary citizen or a military commando, saving for retirement is one thing you cannot ignore. The military offers all of its members a regular savings program known as the Thrift Savings Plan. The federal government’s equivalent of a 401(k) plan, the Thrift Savings Plan is an automatic savings plan that allows the member’s money to grow tax-deferred. Furthermore, when it comes to saving for retirement, service members must start early. The longer you save, the more your money grows.

In the Desert News story A mother’s advice: 5 steps to greater financial security, we learn that financial independence is important and something one should think about at a young age. One way to get started on the right financial track is to leave your credit cards at home. It is essential to always use cash since a typical credit card purchase is 112 percent higher than paying for the item with cash.

Financial independence is essential since there really is no job security. Financial vulnerability motivates people to invest and purchase real estate.

One should understand that whether you work for a company, are self-employed, or own a business, you have to be in business for yourself. The difference is who the customer is. For most employees, the customer is the boss. Your boss is who is buying your services. A business owner on the other hand has many bosses who are his or her customers. That gives a business owner a substantial advantage over a traditional worker.

Many people find it more challenging to have one boss than many bosses. Anyone who has a successful business has many customers who would have to stop doing business with him or her before no longer having a job. The value of a business owner isn’t decided by one person’s opinion or by shareholders. Financial independence is essential to traditional employees. No matter your skill level and what you bring to the company, you may be unemployed without any prior warning. An employee in essence is always interviewing for a job.

Financial independence can help you avoid the rat race. Most people are excited about the idea of leaving the rat race. The right type of work can propel an individual to great things. Also, it will increase their overall level of happiness.

Many people enjoy working, but want to put an end to the need of working to support themselves. They want to make the world a better place, but sacrifice their dreams to pay the bills. Financial freedom allows people to pursue goals untainted by concern for money. They can chase opportunities that truly make their life worth living for, and can use their time to the best of their ability, unlike people working a typical 40 hour a week job.


Due to the current financial landscape, new financial issues are arising every day. For years, government-issued bonds were considered super safe. However, in recent weeks there have been various reports that have highlighted the skepticism surrounding the bond market. Experts frequently advise that investors need to diversify their assets. When it comes to long-term personal financial goals, there are several potential pitfalls that one should be aware of. Here are some valuable tips to consider when you are planning your finances for the long-term.

  1. 1.     Inflation

One of the most important things to remember when it comes to long-term financial planning is to account for inflation. Failure to do so will mean that you don’t have enough money for retirement. Annual inflation has been around 2.55 percent for the past two decades. One should note that safe investments like bonds and savings accounts offer returns lower than inflation. Therefore, modest risks are needed to make sure you save enough money for the future.

  1. 2.     Recalibrating Investments

The market is always changing. Just because your portfolio looked good ten years ago doesn’t mean that it will continue providing great returns without being recalibrated with today’s market. One should meet with a financial planner to update their portfolio regularly to make sure that their investment strategy matches their long-term goals.

  1. 3.     Plan for Long-Term Care Costs

The old adage goes, “hope for the best, but prepare for the worst.” Most people need to plan for long term care. Studies show that most senior citizens will eventually reach a point where they cannot take care of themselves. That is why it is important to plan for long-term care.

  1. 4.     Avoid Heavy Reliance on Social Security

Social security, which was signed into law by FDR helps to keep seniors from poverty. One should not expect their social security benefits to provide for an extravagant retirement. The average social security payment is around $1,200. However, a one bedroom apartment at an assisted living community can cost well over $3,000.

  1. 5.     Updating an Estate Plan

Many people draft a will and then don’t think twice about it. As a result, the estate doesn’t go to who they really want. It is essential to look at your will every year and make any necessary changes. Updating your estate plan is especially important if beneficiaries have passed on. Furthermore, if the estate’s executor is no longer living, changes to the will are necessary.

There are many reasons why people start a home business. Some people want a new challenge, while others have been laid off and cannot find a job. No matter why you are starting a home business, it can be an excellent idea for the following reasons.

Managing expenses

If your family is struggling to get by, a home business can help you reduce costs. A home business allows you to use your basement or a spare bedroom instead of paying for an office. The savings can be put into growing the business. In addition, many of the things a home business owner purchases can be deducted from their taxes.


Many people start a home business so they can spend more time with their children. This can also help them eliminate expensive daycare costs. Furthermore, working from home allows people to save time and resources since they don’t have to commute to work. The extra time and money can always be brought to use to build an online presence for your product or service to market it effectively to potential clients.

Tax Write-offs

Running a home business will allow you to deduct expenses that are necessary for running your business, like mortgage payments, repairs, real estate taxes, and electric. Federal law in regards to tax deductions notes that the home has to be the main location of business where meetings are held with clients, and it must be a structure that is divided from the living area based on the rules of the Internal Revenue Service.

Less Risk

There are fewer risks involved with running a home business. This allows a home business to be built gradually. An individual can even continue working while growing their business. When sales start to increase, the owner can leave their job to dedicate more time to the business. A home business does have its own unique risks, but these are usually less than with a traditional business.

Professional Development

Starting one’s own business allows the owner to develop skills and take on work in an area that drives him or her. Often times when working for someone else, you have to work on projects that the company needs done rather than the ones you love. A business owner can develop new skills, such as marketing skills, communication skills, and public speaking skills, that he or she would not develop while working for a company.

Paying off student loans is a major concern for many young people in the United States. On average, an individual who becomes a librarian should be able to pay off his or her student loans in 22 years, according to the Baltimore Sun. However, there are ways to pay off student loans faster.

The best advice for paying down student debt is to pay more than the monthly minimum every month. If possible, try to double your monthly student loan payments. Not only will you pay off your student debt quicker, you will also pay less in interest.

Loan consolidation is another tool for paying off student loans. This method can help reduce interest rates. Some banks offer loan consolidation which will combine your student loans while lowering interest rates. Student loan payments can even be automatically deducted from your bank account. The best part is that you won’t have to worry about forgetting to pay your student loan on time.

Anyone struggling to pay off student loans should consider a graduated repayment plan. This will reduce your monthly payment in half. Another option is an income-based repayment plan. This plan allows an individual to set up payments at 10 or 15 percent of their monthly income. Depending on their plan, this will help erase unpaid balances within 15 or 25 years. However, one should be aware that these options will extend the length of the loan and result in the borrower paying more interest.

According to a 2012 survey, college students are borrowing twice the amount of money they did ten years ago. However, approximately 50 percent of these students drop out before they have earned their degree. In addition to the loans they took out, they only have a partial education, which makes matters worse. The best advice for students planning to drop out of college is to make slow and steady progress towards the goal – a degree. This not only keeps the student loan repayments at bay, it also improves your chances of finding employment in your own field.

The most important thing is to avoid defaulting on your loan. Defaulting on your loan will destroy your credit for many years and will end up costing you money. The reality is that defaulting on student loans can make it a challenge to establish oneself financially. An individual that defaults on a student loan will be viewed as a higher risk when obtaining a loan. For instance, you may not be able to obtain a home loan if your credit score is low because you defaulted on student loans. However, deferments and income based payments are available which will help you avoid defaulting on your loan. Anyone who is struggling to make his or her student loan payments should contact their lender to discuss alternative repayment options.

Creating a personal budget provides many benefits. Often, we want to save for our future, but it can be difficult. Savings offers financial flexibility and should be the first item in your budget. In a recent USA Today article entitled Lolo Jones gets support from U.S. bobsled teammate, the two-time Olympic hurdler notes that she receives a check of only $741.84 to train for the Olympic bobsled team. This illustrates the importance of personal budget planning, and that even Olympic athletes need to develop a personal budget.

Here are some real benefits of creating a monthly budget for yourself:

Helps Increase Savings

Developing a personal budget will help to increase savings. A budget will help you reduce unnecessary expenditures and place the money in savings, which will help you reach your financial goals. The easy way to save successfully is to have the money you want placed in savings to be taken out of your paycheck before you even see it.

There are many things that we want to purchase. The best way to increase savings is to come up with a personal budget. Savings can’t be what remains after you spend. It is essential that you pay yourself first.

Establishes Spending Boundaries

According to survey conducted by, only 60 percent of Americans actually track their expenditures against a planned budget. Establishing a budget puts boundaries on spending and helps to increase savings. Many people purchase items they don’t need and will never use. It is important to have the will power to stick to your budget.

Provides for Emergencies

Creating a personal budget will help you plan for the unexpected. Many people who spend without creating a budget don’t have any money left over for emergencies. Your budget should allocate money for things like car repairs, unexpected medical expenses, and home repairs. Budgeting is a great way to make sure that you don’t spend every last dime that you earn.

Set Common Goals

A personal budget helps reduce marital stress. Research has shown that developing a budget can improve a relationship. Creating a financial plan regularly also allows you the opportunity to discuss your views on how money should be spent. Moreover, budgeting can help your entire family achieve its goals, including paying for college and saving for retirement.