Category: Investing Page 1 of 4


Tips For Property Investing In Commercial Real Estate

Investors often choose real estate as one of the best types of investment to make. Property investment can include both residential and commercial property.  Many investors begin with buying residential homes because that is what they know the best. However, buying commercial real estate could bring much bigger profits even though it costs more initially than most residential houses.

Here are some tips and hints on property investment in commercial real estate:

#1: Don’t Think Small, Buy Big

When it comes right down to it, managing an apartment building with 50 apartments isn’t really that much harder than managing one with only 5 apartments. Most investors believe that bigger is better, so if you get the chance to buy a large apartment complex or a large business office, if you can afford the investment, then do it. In order to handle those large buildings or office complexes that could be a great deal for property investment, be sure you have a partner or two to share the expenses and help you to make the deal.


#2: Don’t Rush Your Transactions

Property investment deals involving commercial real estate tend to take more time than when you are buying residential real estate. That means you need to not get impatient and to take the proper amount of time to check things out, make your deal, and then do the proper research to get it fixed up and sold. Time is money, but if you rush things you could also lose money. It’s best to know exactly what you are doing and do it right the first time so you won’t lose all your hard earned money.

Tip #3: Don’t Buy Just Apartments

Many people’s minds go to apartments when they think of property investment. However, when buying commercial property as an investment, you should branch out and look at things like business offices, strip malls, industrial areas, etc. Pick one as your niche and then learn to be the best investor in your field. However, if you truly like dealing in apartments, there is nothing wrong with property investment in apartment complexes.

#4: Learn all the formulas for commercial vs. residential real estate

When purchasing residential properties you may have memorized certain formulas like purchasing a house at 75 percent of its after repaired value. However, property investment in commercial property has different kinds of formulas than residential housing and you have to learn them and get savvy in them or you will look stupid.

#5: Relationships Are Vital

If you want to succeed in property investment deals in commercial real estate then your relationships with fellow investors, along with lenders and anyone in the housing world are vital. A lot of times commercial real estate isn’t even advertised in the normal ways and you will only find out about the great deals by knowing and talking with others.  Plus, you may need someone to go in with you on property investment deals since commercial properties can be very expensive and it helps to have some financial help.

#6: Get Your Financing Set Up In Advance

Speaking of financing for property investment in commercial real estate, getting a loan for them is different than getting one for residential property investment. Of course, the down payment is higher since the properties cost more, but many times there isn’t any personal liability if there ends up being a bad deal. Still, it works far more in your favor if you get your financing all approved and ready before you start trying to make any deals or offers when you are doing commercial property investment.


#7: Be Ready to Lose Your Due Diligence Money

When you submit and have an offer for property investment in commercial real estate you will get a certain amount of time for due diligence tasks. You need to do things like get the property inspected, get an appraisal, and there can also be required tests that have to be done on certain kinds of commercial real estate properties. It is possible to spend a few thousand dollars, and then suddenly discover that it’s not a good deal after all and you want to back out. Of course you don’t want to be stuck with a bad property, but to avoid this try to find out as much about the property in advance.

#8: Having Good Partners Helps You Get the Deal

It is difficult for just one person to have enough money or credit to be able to get a loan on a commercial real estate property investment deal. That’s why it is a good idea to have a partner or two for those big deals. That way you can pool your money and buy the property that you both want to own. It also helps later on because you can split the costs of things like maintenance or other expenses.

#9: Know How to Get Your Questions Answered

Then, it’s also important in any kind of property investment situation to know where to go to get any type of questions you have answered correctly. Things like knowing what regulations cover the business property you want to buy or knowing about environmental studies or all kinds of other things big and small can really help you when it comes to property investment in commercial real estate.

Know where to go to get these answers such as to the local state or government offices, real estate offices, or similar places. It can mean the difference between making a good deal and getting stuck in a bad one.

If you follow these hints and tips, you may not always have total success in your property investment deals in commercial property, but it can help you to have a better chance to do so. In all cases it is always a good idea to do your homework, be prepared for anything, watch your back and make sure you totally understand everything that goes into property investment in commercial real estate.

IRA Certificate

IRA Certificate of Deposit

The world of retirement investing is loaded with acronyms, abbreviations, and complicated finance terminology. It’s enough to push many would-be investors out of the space entire, and certainly just enough to confuse those that think they have it all worked out. From IRAs to CDs, there seems to be a complex acronym, or even several acronyms, for almost every financial product and service.

But despite the inherent complexity of the industry, beneath the complex terms and confusing short names is a relatively simple concept. From savings accounts to IRAs, there are several main options when it comes to retirement financial planning, each boasting its own set of positives and negatives, its own set of hurdles for would-be investors, and its own range of return on investment potential.

Finding the ideal option for your retirement certainly isn’t a simple task. Given the importance of having a healthy savings account at the time of your retirement, alongside plenty of assets too, it’s understandable that many people fret about how well prepared they are for their non-working years. Some switch between investments hurriedly, while others worry a lot about their financial state.


The reality is that any retirement preparation option is better than doing nothing, and any consistent investment is better than flitting from one investment to another in search of key opportunities. This doesn’t mean that you shouldn’t worry about retirement – only that it’s important for you to take key action, even if the action you’re taking may not be the most efficient or effective investment.

In this brief guide, we’re going to look at IRA Certificate of Deposit investments, and explain how they can help you prepare for your retirement while keeping your finances safe. Combining two of the most popular retirement investments out there – IRA accounts and CD accounts – this form of retirement financial planning remains a highly regarded, effective, and time-efficient investment.

Firstly, it’s important to clear up exactly what an IRA certificate of deposit is. Most investors are familiar with certificate of deposit accounts, known as CD accounts to most. Similarly, it’s tough finding an investor that isn’t familiar with IRA accounts, which are a common form of retirement investment account. Despite this, many are completely unfamiliar with the joined type of account.

In short, an IRA certificate of deposit is an IRA account that’s subsequently invested into a CD, allowing the account holder to pool their IRA holdings into a high-interest CD account that has backing from the FDIC. This results in extra security for the contents of their IRA, while giving account holders additional income from the CD’s earnings, alongside FDIC insurance backing.

The end result of this is a retirement-based investment account that’s backed by the FDIC’s deposit insurance program up to $150,000 in value, and is able to earn a relatively high rate of interest due to its IRA – individual retirement account – structure. It’s the best of both worlds, and it’s a reality that a surprisingly slim number of investors are familiar with, many not even knowing it at all.

It sounds like a dream come true, particularly for investors that want to maximize their returns for retirement while simultaneously keeping their money safe. But is it? Are there any downsides to a shared IRA and CD account that aren’t well known? Unfortunately, despite their value, there are a few key downsides to IRA certificate of deposit accounts that aren’t widely reported on.

The first is the fact that they’re generally not high-performing investments, bringing in little interest over time and frequently being outperformed by other investment options. This is a reality that’s far from uncommon to FDIC-backed investments. Due to their lower risk factor, these investments tend to have significantly lower returns than others. It’s not a surprise, but it can be a potential pitfall.

This becomes an issue when savings invested for retirement grow at such a slow rate that they’re being outperformed by inflation. The end result of this is an investment that despite growing, has become less valuable than it was when it was opened. As a result of consumer price index hikes, your $100,000 investment may only have a true value of $90,000 after it’s reached maturity.

To protect against this, many people who invest heavily in CD accounts and IRA CDs combine them with a balanced portfolio of higher-risk investments in order to increase their returns. The ‘risk’ factor of other investments, despite being higher than an FDIC-backed CD account, isn’t a major issue, as these investments tend to earn greater amounts of interest, producing big returns.

There are also age-related downsides to IRA investments, many of which are the product of key investment regulations. People aged over 70 are unable to continue contributing to an IRA, and must begin using their IRA certificate of deposit investment. This is unlikely to be a major issue, however, as most people aged above 70 are likely to be retirees with an existing investment.

Despite the sea of acronyms, it’s far from difficult to piece together your own portfolio of high-risk investments and secure retirement savings options such as IRA certificate of deposits. Balancing an adequate amount of risk, return potential, and overall interest, an IRA certificate of deposit is a key instrument in your financial future, and one that you can begin saving for right away.

Property Work

How To Make Your Property Work For You

If you are looking for easy ways to make some extra money, then consider some of the following way to make your property help you do so:

1. Rent Out Your Garage Or Parking Spaces

It’s possible to earn a few hundred dollars a month if you have some garage space, or a parking space you aren’t using. This is particularly true if the property is close to an event center or sports arena or even an airport or train station where there is a demand for parking all the time.

Try listing your parking spaces on websites like ParkatmyHouse or YourParkingSpace. You can determine what the going rate is for a parking spot per day or week or month and list it accordingly. Or, just list your parking space in a local paper or even put up a sign beside your garage. Your property can be making you at least a few bucks this way if you are anywhere near an area where people work, shop or travel.

2. Rent Out The Property For Use As A Photo Or Film Shoot

Depending on where the property is located, it could be that magazine companies or movie making organizations could want to use it as a backdrop for a photo shoot or movie filming. If you have a particular kind of property that the company is interested in, it could be a great choice that will net you some cash. Try listing the property with an agency that deals in finding properties to use for photo shoots or movie productions. They will take a percentage, but you could still make a few bucks this way.

Property value

3. Host A Yard Or Garage Sale

Another way to use property to make some cash is to hold or host a yard or garage sale. You can clear out all the stuff you own that you don’t want anymore and put it up for sale and make money that way. Or, you can offer up your yard to host someone else’s sale for a percentage of the proceeds or for a straight fee.

4. Rent Out A Spare Room

Another way to make money that people have used for hundreds of years is to rent out a room to someone like a college student or other person. You can charge a weekly or monthly rent, and split the cost with your tenant for things like Internet or TV service. You will be doing a service for someone while making money with your real estate.

Renting out a room in can be either long term or short term leases. For instance, a college student may only need it for one semester, but someone else may only need a room for a week or so while they are in town on business. Or, you could find someone who needs a place to stay while their own home is being renovated or repaired. There are lots of ways to advertise a room for rent such AirBNB and similar websites, in the local papers, in magazines or put a sign in the window. Take a look at what other places are charging so you know how much rent to ask.

5. Have A Tupperware Or Other Kind Of Sales Party

Another way is to start a home office and do sales parties like Tupperware, Pampered Chef, Pure Romance, Mary Kay cosmetics, etc. There are many kinds of these companies where you can become a salesperson for them and then get a percentage of the profits. Plus, it can be a fun way to meet other people and have something to do even if you don’t need the money that much. Besides money, this use can net you some free products and discounts so choose one of the sales at home companies that you like the products for double benefits.

6. Swap Your House With Fellow Holiday Goers

This doesn’t make money with your real estate, but it can save you some money if you go on vacation. This is a new and interesting trend where two people swap their homes and locations for the length of their vacation in that area. However, you have to be very careful to screen the people who will be using your estate if you don’t want to be scammed or ripped off and come back to find your things stolen.

7. Become A Tutor at your

Tutoring at your property is yet another way to make you some added monthly cash. If you are good at a particular subject, then you can advertise to do tutoring for the local college or high school. There are also places online that specialize in listing tutors and you can sign up for one of these. Tutoring is usually paid by the hour and you should be sure of the rate you wish to charge and get the contract for the tutoring in writing so you can be sure of being paid and so your client knows what to expect for their money. This may not make any money over the summer when school is out, but it could make you a few bucks during the timeframe that schools and colleges are in session.

8. Use Your Property to Create a Home Office

If you are always at home alone and don’t work outside the house, consider making a home office. You can go online and make money in several ways. Some of these ways involve signing up at survey sites where you can earn money by taking surveys like eRewards or YouGov. Or, you could do some writing or editing by signing up online at several places like odesk or guru. Don’t just sit around and play on social media when you can actually make a few dollars doing things online in your property.


How To Do 401k Rollovers

What Is A 401k Rollover?

If you have a 401k with your employer and decide to leave that employer or retire or somehow need to change over your 401k, then this is possible and is not hard to accomplish. The money in your 401k belongs to you, not your employer and you don’t want to lose the right to keep whatever money is in the account when you decide to leave your employer. Enter what is called a 401k rollover.

401k rollovers are when someone take their money from one 401k account and moves it into another account. There are some easy ways to do this where you won’t be subject to the penalties of an early withdrawal. Since a 401k is funded with pre-tax dollars, if you don’t do a rollover the right way, you will end up paying a lot of taxes and penalties for early withdrawal.

Options for 401k Rollover

There are three main options for a 401k rollover. These are rolling it over into another employer’s 401k plan if you change jobs, put the money into a brokerage account IRA, or put the money into a mutual funds company account.


New Job 401 K Pros and Cons

There are pros and cons of all three types of 401k rollover. The pros of doing a 401k rollover into a new job are that there is no maximum or minimum as to the amount of money that can be moved from one account to the other. However, there are a few cons.

If you join an employer’s 401k plan then you have to follow its rules and regulations. It is also possible that you may have to pay a percentage for each investment you make, depending on the type of new employment you take. If you instead invested it on your own, you could possibly avoid that issue.

401k Rollover to a Brokerage IRA

The next 401k rollover is to put the money into a brokerage IRA. This can be done at most banks, as well as at places like E Trade, TD Ameritrade, or Trade King. These IRA brokerage accounts are also very flexible when compared to some of the other types of 401k plans. You won’t be restricted to just index funds or mutual funds.

There are 1000s of different kinds of stocks or mutual funds to choose from and with a brokerage IRA it’s possible to get things like mutual funds, individual bonds, individual stocks or other kinds of investments that could prove to be very lucrative. So, if you want flexibility, this is a good choice.

There are a few cons to a brokerage IRA account to do a 401k rollover. Cost is one of these, as ever private investment is going to cost you money in the form of an investment fee. However, if you choose properly, not all of these account charge high fees.

401 k Rollover Into a Mutual Fund Company IRA

Or, your third possible choice is to do a 401k rollover into an IRA that is held by a mutual fund company. These could include Vanguard, Ameritrade, Fidelity or others. The cheapest way is to put your funds right into their funds and then there is likely not going to be a fee. However, if you would rather be flexible, they you may want to put some of your money into other companies, stocks, or bonds. There are various types of these plans and each one may have their own requirements for investments you make.

Steps to Doing a 401k Rollover

So, after you have decided what kind of 401k rollover you are going to do, there are a few steps to follow to get it done. Here they are:

1. Check Your 401k Rollover Eligibility

First, you must check to see what type of 401k eligibility at your old job. You don’t want any surprise fees or repercussions. Plus your old employer has to agree to release the funds.

2. Get the Proper 401k Rollover Forms

Once you know that your 401k funds are free and clear and the old employer releases them. Now you need to get all the correct 401k rollover forms to switch over your funds. These can be found at your old employer or you may be able to download them online.

3. Get Requirements for New 401k Provider

Next, you will need the forms from your new employer or other source of the place where you are doing the 401k rollover. Each type has its own unique requirements you need to follow so make sure you have all of the forms you will need to do the 401k rollover.

Make sure you fill out all of the forms properly. There is a lot of information to put on them so check each section carefully. Also, be sure to pick “direct rollover” as this makes sure the funds will go directly into your new 401k rollover account. This may happen by check or wire in most cases.

4. Submit the Forms and Check on Them

Once accomplished, you now need to submit your filled out forms. These will need to be turned in to the new location either in person, fax or mailed. But don’t forget about it after you do it. You should check up on things to make sure it all went into place correctly. It is up to you to make sure everything goes smoothly because no one else is likely to do it for you.

All in all, doing a 401k rollover properly is vital as it may be a large amount of funds that you have and you don’t want to lose a dime of your hard earned investments. Be sure to determine which of the 401k rollovers are the best for your situation, get the proper paperwork, fill it all out and turn it in. This will help you to keep on funding your future retirement through your chosen investments.


Certificates of Deposit

A certificate of deposit (CD) is a savings certificate, which is simply a receipt to provide proof of ownership for a deposit. The certificate may be issued for either fixed or time deposits and is issued by the deposit location (bank, credit union, etc). Usually, an individual will make a fixed time deposit which lasts for up to five years. The deposit is locked into the account and there will be a guaranteed fixed interest rate. The interest rate that you receive exceeds the typical rate for a standard savings account.

How Certificates of Deposit Work
There are two different types of certificates of deposit, small and jumbo. Small certificates of deposit will be any amount under $100,000 USD. Jumbo certificates of deposit will be any amount over $100,000 USD. The main difference between the two is that only the small certificates of deposit are insurable by the FDIC (Federal Deposit Insurance Corporation).

Once you determine how much you plan to invest with the certificates of deposit you will need to determine the period of the certificate. You can choose anywhere from half a year to 20 years. The term of the certificates of deposit will play a very important role in the overall value of the deposit. You have to make sure that you choose a sufficient length of time to see considerable returns but do not set the length too long if you may cash it out early. Early withdrawal of the certificates of deposit funds can lead to a significant penalty that will limit the amount of profits you make from the investment.


The only other serious controllable factor of the certificates of deposit investment is the interest rate. You can choose to have a fixed interest rate for the deposit. You may be able to lock in to a generous interest rate but this will depend on the current market. Keep in mind that if the market increases in value then you lose out on interest that could have been made with a variable interest rate set up. If you are looking to set up a long term certificates of deposit then the interest rate will likely be more generous so locking in may be worthwhile.

The Safety of Investing in Certificates of Deposit
If you are looking for a type of investment that eliminates any risk then a certificate of deposit would be a great choice. If you invest in any certificate of deposit under $100,000 USD through any bank that is insured by the FDIC then there is no risk of losing your money. You will be provided with a guaranteed return of your money with the specified interest rate being accumulated to the total value of the certificate.

If you are investing in a certificate of deposit over $100,000 USD then you cannot receive FDIC insurance so there will be some risk with this type of investment. As long as you invest through a trustworthy bank then there should be nothing to worry about though.

What to Know Before Investing in Certificates of Deposit
Before investing in a certificates of deposit you will need to read up more on exactly how they work. You should have a decent understanding on the terms of this type of investment so you can maximize your potential return. One thing to consider will be if you want to invest in a callable certificate of deposit.

Callable deposits may be terminated by the issuing bank, which means that the individual must create a new deposit. If you have this type of certificate of deposit then it is likely that the bank calls it if the interest rate goes down. This forces you to lose out on your higher interest rate if you have a fixed deposit. Only the bank, not the investor, is qualified to terminate the deposit if it is callable.

There are two things that you need to make sure you factor in when deciding on what investment to make in a certificate of deposit. This includes making sure that you use a reputed source for the certificates and that you know the difference between fixed and variable interest rates. If you invest in a certificate of deposit through a broker then check the reputability of the bank that will be issuing the certificate. You will also want to make sure that the bank is FDIC insured for deposits under $100,000 USD when investing in a small certificate of deposit. This will guarantee the safety of your investment. Also, checking the reputability of the certificates broker would be a good idea.

Certificates of deposit are a great choice of investment. They are very low risk and can provide you with a considerable return upon maturity of the certificate. If you are looking to lock up an investment that will guarantee you a return then this is definitely worth considering. Make sure you spend some time reading up on the various options for certificates of deposit before investing so you know how to best set up the certificate for your needs.

Bank CD Rates

When it comes to secure, stable investments, a certificate of deposit, frequently referred to as a CD, from a major bank is possibly at the top of the heap. Renowned as a low-risk form of investment, a certificate of deposit with a relatively high interest rate can be a worthwhile way to store cash that’s unlikely to be used in the short to near term, or even as a way to secure long-term cash assets.

In general terms, a CD is a fairly similar form of investment to a savings account. Investors deposit their money into an account, which is later locked off for the bank to access. These ‘lock’ terms are generally between three and fifty months, although longer-term CDs may extend for over ten years at a time. Generally speaking, these long-term CDs offer lucrative interest rates for their investors.

Unlike a bank account, however, CDs are always held until maturity – funds that are withdrawn in the middle of a maturity period can encounter fines, the forfeit of interest, or may even be held by the bank in question without release. Generally speaking, the incentive for the investor is the high interest rates offered in comparison to a savings account – CDs tend to offer much higher returns.

Bank CD

We’ve looked at some of the top CD interest rates, and walked away with some interesting data on how banks classify and manage their CDs for consumers. From differences between business and personal CD rates to interesting statistics about how the FDIC can protect your investment, read on for a primer on worthwhile interest rates, ensuring your investment is safe, and finding a good CD.

Certificates of deposit are generally regarded as fairly low-risk investments. In fact, the Securities and Exchange Commission – the United States’ leading body on financial regulation – flat out calls them as such in many of their financial primers. But despite the low risk of many CDs, there’s still the possibility than your investment could fail potentially leaving you mightily out of pocket.

This is particularly common in higher-interest certificates of deposit, which often operate outside the bounds of the FDIC – the Federal Deposit Insurance Corporation. This federal corporation is one of several protective organizations in the United States, and is designed to eliminate risks for people that plan to invest in savings accounts, term deposits, and certificates of deposit accounts.

Unlike other financial organizations, many of which fail to ultimately protect the people that they supposedly insure, the FDIC does protect those that invest in banks which operate under it. Since the formation of the FDIC in 1934, not a single depositor has lost their deposit when it was stored as part of an account in a bank, investment firm, or credit union protected by FDIC insurance.

So while there may be higher bank CD rates available at a non-FDIC bank, it’s worth considering the risk of this investment against the relatively lower risk offered by an FDIC bank. Insurance is available for deposits of up to $250,000 – larger deposits may also be covered in some cases. This isn’t a huge amount, however for most CDs and other investment accounts, it’s welcome security.

Generally speaking, bank CD rates change based on the current economic conditions. Periods in which banks expect investors not to withdraw their investment may also come with higher rates, although this isn’t always true. Longer deposits, such as those held for over five years, also come with a higher rate of interest, allowing depositors to let their money ‘appreciate’ in value over time.

There’s also an interesting split in interest earnings between personal and business CDs. While the business banking world may be renowned for its more lucrative rates of return, it’s individuals that win out when it comes to certificates of deposit. The average interest rates for personal CDs, for the most part, are higher than their business counterparts, often by a relatively healthy margin.

However, this isn’t always the case, and in many credit unions and banks it may be better to operate as part of a smaller LLC or corporation than as an individual. The rates offered to individuals vary, so it’s always best to investigate. In certain cases, however, significantly better interest rates may be available when you structure your investment as part of a small company or personal corporation.

Standard certificate of deposit rates, as of now, range from a meagre 0.50 percent low-rate interest to fairly worthwhile 1.24 percent interest rates, most of which come from smaller banks. It’s worth noting, however, that many of the smaller banks offering better interest rates are covered by FDIC insurance. This can make them a lucrative investment for those with capital available to deposit.

Other banks, particularly those limited to a specific region, may offer better rates. Recent studies of smaller banks, particularly regional and city-based banks, revealed that rates span all the way up to 1.8 percent APY. On a national level, taking into account all banks and credit unions offering a CD service, the average interest rate is in the league of 0.75% APY – not a highly lucrative offer.

If you’re considering investing in a CD from a major national bank or smaller credit union, it’s very important to do your due diligence. Checking financial stability, interest rates, and other conditions isn’t just a useful task – it’s a necessity. With this information on your side, a smart deposit strategy, and the right amount of available capital, a certificate of deposit can be a stable, worthy investment.

401k Rollover

401k Rollover

In the last thirty-six months, the United States unemployment rate has snowballed from a stable five percent to over nine percent in total. It’s a startling figure, and one that’s resulted in the loss of large amounts of income for thousands of US families. Hundreds of thousands of former success stories are in positions of limited long-term financial outlook, and thousands more are likely to join them.

In situations like this, it’s difficult to know how your long-term financial planning will pan out. The vast majority of professionals fail to plan for recessions and involuntary redundancies, leaving their retirement investments in employer-backed 401k accounts and other long-term funds. While it may seem like all hope is over for these investments, the reality is that it’s fairly easy to recover them.

The 401k account is one of the most popular forms of retirement financial planning for American professionals, having been opted into en masse since the early 1980s. Over the last thirty years it’s gone from a moderately popular retirement savings strategy into the most popular in the country – as of 2011, sixty percent of all American households with middle-aged parents had a 401k account.

401k Roll over

Despite some shortfalls, many of which have been reported on extensively during the last decade, a growing number of households still opt for a 401k plan for their retirements. But what happens if an employer lets you go? What happens if the economy forces you out of your job? What happens if it no longer becomes realistic to work due to a decrease in demand, an injury, or a workplace lawsuit?

The answer, for the vast majority of 401k account holders, is to perform a ‘401k rollover’ and use your existing 401k savings as the basis of a new retirement planning account, all without the ever-common burden of transfer expenses and fees. This allows account holders to access a collection of benefits that would be made unavailable should they withdraw from their 401k before transferring.

There are several options available for households and professionals looking to ‘roll over’ their 401k into a new account. These include the employer-based rollover, which involves transferring into the retirement account set up by a new employer, and the IRA-based rollover, which requires that your 401k is transferred into an individual IRA account. These options are both discussed in detail below.

In the event that you’re offered a job with an employer that uses 401k retirement plans, you might be able to roll your current 401k plan over to your new employer. This is a fairly simple process – your account is simply transferred to the new employer’s 401k plan, which is subsequently used as an operating basis for new investments. Generally speaking, there is no minimum balance for this.

Is this the best option for you? If you’re uninterested in managing your own 401k, then rolling it over into a new employer-based plan is an intelligent option. The fund will be managed for you, with your investment cared for under the guidelines of the plan itself. This offers low flexibility, although the simplicity of this investment option makes it popular amongst most employees.

The second option, of which there are two variations, is to roll your 401k over into an IRA, either a brokerage-backed IRA or a mutual fund-backed IRA account. This allows your retirement savings a great deal more flexibility, particularly in the type of investments that can be made with them. Most 401ks offer limited investments in stocks and index funds, while mutual funds offer greater variety.

This includes ETF investments – exchange traded funds – and individual stocks and bonds, all of which are considered ‘out of bonds’ under an employer-sponsored 401k. Using a brokerage-based account, you can select the exact type of investments that are made using your retirement savings. This allows you to effectively limit or extend the amount of investment risk you’re willing to take on.

The alternative, a mutual fund-based IRA, offers slightly less investment flexibility, albeit with a substantial decrease in costs. As a brokerage account is tied to an individual broker, every sale, no matter how small or significant, is charged and individual fee. When several small investments are made in close succession, this can result in hefty compounded fees and a limited return as a result.

Generally speaking, all of these rollover options are fairly simple to execute, with most able to be streamlined and prioritized through your current 401k provider. It’s generally a case of filing forms to begin the rollover process, and later authorize the retirement savings to transfer from your older 401k account – one that’s held with the terminated employer – into your newer 401k or IRA.

There’s a question on every former employee’s mind throughout this process, and it’s one that’s very difficult to answer. Which one is best for me? With three key options available, two of which use an individual IRA rather than a standard 401k, it can seem difficult to choose. If you feel uncertain, it’s best to speak with a financial advisor – they can assist you in planning well for your retirement.

However, all three of these options offer a relatively low-risk, potentially rewarding way to prepare effectively for your retirement years. From employer-sponsored 401ks to rewarding individual IRA accounts, there’s always an option out there to suit you. Finding that option, however, might take a great deal more thought, planning, and introspection than many ex-employers expect it to.

Tax Deductions

14 Easy Ways to Save Money on Tax Deductions

Taxpayers were all looking for ways to save money on taxes. While paying taxes is a duty of every responsible citizen, you don’t necessarily need to pay as much as you are right now. One thing that should keep you motivated while preparing your tax return is the allowable tax deductions. If you know about the items that can qualify for a deduction, you can actually save money by avoiding overpayment of your taxes. What many of the tax payers fail to recognize is the tax laws are really setup with ways to help you.

The National Internal Revenue Code of 1997 details certain items that may be deducted from your taxes, including business or professional expenses and premium payments on health and hospitalization insurance. The goal of tax planning is to increase the amount of these legitimate expenses for a given taxable year, within the bounds allowed by law.

Tax planning is a great way to start for availing tax benefits and savings. If you are looking to maximize your savings, then you need to keep an account of your incomes and expenditures and prepare all your saving plans in advance. To plan your savings, a key factor that is crucial to your tax saving plan is the income earned per annum as well as the income tax laws governing the country.

On November 2010, 10th anniversary issue of Entrepreneur magazine, writers Lyre Pore – Villafaña and Iris Cecilia Gonzales shared 14 Ways to Cut Your Taxes. Ways that most tax planner commonly do to legally increase allowable tax deductions. And I’m also sharing it with you here. Please CONTINUE READING…


1. Book expenses that don’t have to be paid until the following year.
According to Tax lawyers Serafin Salvador Jr and Martin Mijares an enterprise on accrual basis may enter into contracts for various expenses such as gasoline, merchandise and security services, with its suppliers (or) contractors, so that it can already accrue an expense deductible in the current year although payments it to be made at a future period. This mean that you may deduct from your gross income for 2012 the purchase of goods and services you used this year, although, payment will not be made until 2013.

2. Accelerate tax deductions by reducing the depreciable life of building and other fixed assets.
According to Salvador and Mijares, the taxpayer is allowed to adopt a plan or method of apportionment of the cost of the fixed assets provided it is reasonable and has due regard to operating conditions during the taxable period.

3. Treat customs duties as an expense.
To increase the total deductible from the current year’s gross income, Salvador and Mijares suggested that instead of capitalizing custom duties and taxes paid on imported equipment, raw material, and other supplies, it’s better to consider treating these amounts as expenses in the period the duties and taxes are paid.

4. Treat interest paid for the purchase of fixed assets as outright expenses.
According to the tax code, a company my treat interest incurred on the purchase of property used in trade of business either as an expense or as capital expenditure. When an expense is capitalized, it forms part of the cost of the acquired property that will have to be taxable over several years. To lower the income of the current year, increase the amount of expenses by claiming the interest as an outright deductions from gross in the year the interest is paid or incurred.

5. To increase the amount of deductible losses, write off fixed assets that are no longer used.
There are instances when a company may be allowed to write off idle or obsolete assets that are not yet fully depreciated, and claim the amount as a deduction from gross income. Check with the Bureau of Internal Revenue or a tax planner to determine the requirements for writing off fixed assets.

6. Establish and contribute to a pension plan.
By establishing and maintaining a pension trust, the employer may actually be able to advance the deduction for retirement costs pertaining to employees who will be retiring in the future.

7. Carry over the net operating loss.
The tax code allows an enterprise to deduct from its gross income the net operating loss of the business over three years immediately following the year of such loss, provided that there hasn’t been a substantial change in the company’s ownership. For instance, if a company lost P1 million in 2011, it can claim this amount as a deduction in the years 2012, 2013, and 2014.

8. Choose the recipients of your charitable donations.
To receive a tax benefit when contributing to a particular cause, consider giving to organizations that are allowed by law to accept donations that can then be deducted from taxable income.

9. Consider legal structure of the business.
The organization of the business has a huge implication on taxes if the taxable income is P500,000 and below. At this level, an enterprise registered as a sole proprietorship will be slapped an income tax ranging from 5 to 30 percent. On the other hand, if it were set up as a corporation, it would have to pay a flat rate of 32 percent regardless of whether the taxable income is P100,000 of half a million.

10. Amortize pre-operating expenses.
Startup companies are allowed to amortize their pre-operating expenses over a period of five years. For example, if an entrepreneur spent P100,000 to set up his company in 2011, he can subtract P20,000 from his gross income in each of the five years from now until 2016.

11. Properly substantiate all deductions.
A major reason why taxpayers end up paying so much in taxes is poor substantiation for allowable deductions. For transportations and travel expenses, substantiate the claim for deductions with the documents containing information about the date of travel, its purpose, person who incurred the expenditure, places traveled, amount of expenses, and means of transportation used.

12. Withhold the necessary taxes.
Income payments such as salaries of employees, rental of office space, and payments to suppliers – are considered valid expenses only when withholding taxes have been properly deducted and remitted. An entrepreneur must be firm with supplier who request the taxes not be withheld from their collections. Companies that fail to withhold taxes from payments to suppliers will not only be required to pay the withholding tax themselves plus surcharge and interest; they will also be disallowed from claiming such payments to suppliers as deductions from their gross income.

13. Declare your input tax.
A businessman will enjoy a deduction if the declares the amount of merchandise he uses for his business. Let’s say the business is an office supply store. All you have to do is declared the total amount of VAT you paid when you purchased your supplies. This amount will be deducted from your own VAT.

14. Comply with all the requirements.
Aside from ensuring that proper withholding taxes have been collected and remitted, make sure that your company has complied with all other requisites for deductibility. When claiming deductions for bad debts, for example, be prepared to prove that the company has exerted all efforts to collect the debt. Be ready to support claims for bad debts with letters to the delinquent customers, reports from collection agencies, and ruling from the court.

You would want to retain as much of your hard-earned income, so you might as well take the time to know the factors that can give you more savings, such as certain deductions or expenses you have incurred throughout the year.

It will be a good practice if you keep good records and you understand what deductions to declare and save money during tax time.

The 14 tips mentioned above may not be the best ways to save money but certainly these are good ways to save money on taxes.

If you like this Best Ways to Invest Money post on ways to save money on taxes, please share with your friends on Twitter, Google+ and Facebook. THANKS!

Mr Buffett


Now let us switch the gears and talk about the master investor, Warren Buffet.  A man of simple tastes, Buffet relies very heavily on fundamental analysis.  I cannot recall who told me this about Buffet, either a friend or a relative, that Buffet is confident about all the companies in his portfolio, so much so to the extent that he would not flinch if a stock lost 1/3 of its value overnight because its financials and fundamentals dictate it to be in fact a solid company.  I cannot say that the following information is absolutely verified by Buffet as I have not had a sit-down with him yet, but after reading a biography of his, I do believe it captures his investing philosophy.


Buffet believes that when investing in a company, the ultimate goal of that investment is to completely own that company.  So under ideal conditions, you would have enough money to own 100% of that company and your money would be safe in this.

Following are some general guidelines and prudent factors to keep in mind, which Buffet follows with his investments:

1.) The company in mind must be able to reasonably predict its earnings

2.) A company with predictable earnings has good economics, which leads to lots of free cash flow, which can be used to by businesses or buying back shares.

3.) These good economics are shown by a combination of the following:

– Consistent improvements on the company

– High returns on shareholders’ equity

– Strong earnings

– A consumer monopoly (which will be discussed later in detail)

– Good management

4.) Always invest while the price is low in order to increase return

5.) First choose which company to invest in, and then let the price and the required rate of return determine when or if to buy.

6.) Investing at the right price in a good business should produce a minimum rate of return of 15%.

Along with these rules are some more specific codes Buffet follows:

Investing should always be approached with a business mentality – i.e. All emotion should be purged from investing.

Always attempt to learn and master one industry, and then do not stray from this industry.

Stocks do not represent so much a market price, as much as a distinct company with certain operational standards behind it.

Dividends are best utilized when reinvested into the company.  This is due to tax avoidance on these payouts.  Also, corporations can often reinvest this money at a higher rate than can an individual, although they must be reinvested prudently.

Holding a stock is better than withdrawing from it, for tax-avoidance reasons.

One topic Buffet especially cares about is the capability of a company to reasonably predict its earnings.  Encompassed in this area is the company’s EPS (earnings per share) and the EPS annual growth rate.


Buffet is a large advocate of deciding on what company to buy before it hits a favorably low price, that is, “don’t aisle shop!” This idea of knowing the company you will be investing supports the idea that one should be knowledgeable of the industry in which it operates.

According to Buffet, there are two types of businesses: commodity type businesses and consumer monopoly types.

In commodity type businesses, the price of the product is the single most important factor and as a result, significant cash is spent on manufacturing improvements.

Commodity type businesses are often recognized by:

– Low profit margins

– Low return on equity, often less than 15%

– Difficulty with sustaining name brand loyalty

– Many competitors in the industry

– Excess supply

– Erratic profits

Consumer monopoly type businesses on the other hand are stable with predictable earnings.  One key indicator of a consumer monopoly business is to ask whether another fictional company, with a huge amount of cash could compete with it.

These companies often have a high wealth in intangible assets, not in PPE (property, plant, and equipment) and   other fixed long-term assets.

These companies are also nearly debt-free most of the time.  This idea of NOT being leveraged is why Buffet is a large opponent of derivatives and why Buffet steered clear of the CDO and subprime market during the mortgage crisis.

Aside from many other guidelines and rules Buffet adheres when investing, there are 9 specific questions Buffet asks when investigating companies:

1.)    Does it have a strong consumer monopoly?

–       Does it have strong recognizable products?  Does it have to be carried by the distributor, lest he lose money in opportunity costs?

–       If involved in an acquisition, is the acquired company also a consumer monopoly?

2.)    Are the earnings strong and rising?

3.)    Is the company conservatively financed?

4.)    Does it have a high return on equity?

–       ROE should consistently be at least 15%

–       A healthy ROE indicates good management

5.)    Does the company reinvest its earnings?

6.)    How much money is spent maintaining current operations?

–       If a company must use its money to constantly update operations, this is a sign bad sign as that money could be going towards share buybacks or acquisitions

7.)    Does it reinvest money in new opportunities?

–       Good management will often use excess capital to buy back shares

–       One of the most important aspects of management is how profitably it employs its retained earnings

–       Warren prefers minor expenses into research and development

8.)    Can the company adjust prices for inflation?

9.)    Will the value added by retained earnings increase the market value of the firm?

–       Personally, this is the most important question for me.  I am interested in the relationship between the inherent value of a company and its effect on the stock price.

Buffet believes that one sometimes discovers these companies as “conceptual toll bridges.”

1.)    Businesses with products that are used up quickly and with brand-name appeal.  These are sorts of products that effectively lose money for the merchant because they are always bought.  Trademarks and copyrights have immense carrying power.  Some examples of companies that carry these sorts of products are:

Coca cola, Hershey’s, Wrigley’s gum, Advil, Gillette, Hanes, etc.
Pharmaceutical companies often have these characteristics
A good way to identify these products is to walk through a supermarket and identify popular products.

2.)    Communication businesses

Advertising has created conceptual toll bridges in today’s environment
Newspapers work similarly

3.)    Typically these conceptual toll bridges apply more to services than products

As I mentioned in my last post, I would like to thank ALL of you who have been reading and commenting on this blog.  Initially, I did not know where I would go this or who it would cater to but with your support and ideas, I know that we can cultivate a great atmosphere where we can exchange ideas and whatnot.  Keep posting your comments and let us stir our minds towards greatness!!


Different Ways Of Investing In Gold Safely

For years, investors have known gold to possess intrinsic value and safe investing features. Since properties, currency and shares are prone to inflation as well as their prices may go up and down with the market, it is far better to invest in gold and silver like gold since the prices will always be expected to increase. Gold, as a commodity, not only has long-term store of value but also provides a hedge against inflation. In last one 10 years, the price of 1ounce gold has shown a dramatic increase from $300 to $1,500 and is likely to raise much more. This makes gold investments very profitable.

Are you interested in making safe investments in gold in gold but don’t know the tips for doing so? Simply check out the tips mentioned here.

Strategies for Investing In Gold Safely:

1) If you’re keen on possessions then you can certainly purchase physical gold in the form of bars, coins and bullion. Gold bullions are made from 100 percent pure gold and they are sold in increments of just one oz. hence they are popular type of investments with regards to purchasing physical gold. Various nations sell bullion coins that are denominated in local currencies. American Golden Eagle is the local bullion currency in the usa which is easily available at local outlets as well as on online websites.


2) Women especially prefer to purchase gold jewelry. This is due to the fact most jewellery pieces are marked and priced based on the weight and quality (pureness) of metal used in it too as the cost of labor included in making it. You will get the rarest ornament pieces from jewelry auctions and online websites (they offer discounts top). However, purchasing ornaments online will need focus on your part because you will have to determine the purity and price of those items, think about the interest in brand and find out the shipping cost of gold. If you buy excellent quality jewelries, you can make profits by reselling it.

3) Exchange Traded Funds (ETFs) are second most popular types of investments after physical gold. In the event you can’t figure out what to know about gold investing, you are able to seek advice from an ETF expert and invest your hard earned money in it. Look for an online brokerage firm and open up an account there. Evaluate the current market prices of gold ETFs by making use of symbols like SGOL and FLD. They possess ETFs prices at 1/10th the price of an ounce of gold whereas PHYS and IAU have their ETFs costing 1/100th of the cost of an oz of gold.

Firstly, determine the amount of ETF shares you want to purchase and appropriately, divide neglect the amounts. You may make use of the online screen of your brokerage account to purchase ETF shares. The process of buying ETFs is just like purchasing stocks or shares. The broker may offer discounts of $5 to $10 on share trades. Here you must remember that gold ETFs don’t supply you interest amounts or dividends because the profits or losses incurred by investors depends upon the fluctuating selling price of 1 ounce of gold. Thus, you should use ETFs for either short term trading of gold belongings or for making long term savings.

4) If your luck is at peak, you can consider investing in stock exchange and mining companies. You can invest in shares of Barrick Gold (ABX) the largest gold mining company. One benefit of purchasing stocks is you can easily sell or buy them with little fuss.

5) Lastly, there are gold mutual funds which are ideal for group of businessmen. Mutual funds directly track the cost of gold and cost of shares of gold mining agencies and are collectively owned by some people. Look for company that offers lower investments and lets you invest in an automated monthly schedule. Put smaller amounts in gold investments for a long period of time to be able to gain maximum profits. If you are a first time investor, you should collaborate along with other experienced traders of the market to stop losses.

6) You can also buy possessions on monthly installments. You can set up an automatic investment scheme that deduces money from your banking account and directly transfers the profits incurred by you there. This will prevent you from going out of budget.

If you would like more information regarding shipping cost of gold, please check at well-known dealers or visit trusted websites to find opinion from the specialists.

If you want extra information on topic “payday loans“, then you are welcome to check out the author’s website Febs2010– in which you’ll find all types of specific information on the said topic.

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