Twila Van Leer

Don’t Let Mistakes Sabotage Your Retirement

April 11, 2012 By Twila Van Leer

The time to start planning for retirement is long before retirement becomes an immediate issue. And avoiding the pitfalls that trip up many Americans in their pursuit of financially healthy retirement years is essential. A recent Wall Street Journal column by Veronica Dagher posted five such mistakes.

Watch Your IRA Accounts

Don’t be complacent about your 401(k). Many employees who simply have their employer deduct the maximum possible amount to a 401(k) without asking any questions may be missing out on more productive alternatives, according to financial experts. In some instances, the fees charged by an investor’s 401(k) may be excessive. Investing in another alternative, such as a Roth individual retirement account could offer more choices and lower fees. Look at the entire financial picture before making decisions.

Careful Planning

Have a plan. Random decisions on retirement maybe counterproductive. There is the temptation to live in the moment, making decisions “on the fly.” Over the course of the usual working career, that could result in savings that will fall short when the job is done and retirement income has to cover all the bases. Start with small goals, if necessary, such as putting 5 percent of gross income into savings each month, then increase gradually until you are saving 15 percent, and do it within a year if possible. A pattern of constantly shorting the savings cushion seldom can be reversed as retirement looms.

Cut Back Expenditures

Think seriously of scaling back now. Downsizing your home and boosting savings often are two sides of the same coin, the experts suggest. Putting on blinders and delaying such moves until suddenly the 60s are upon you is a sure-fire way to ensure unpleasant surprises when the time comes. Thinking you still have time to reduce spending when retirement is just a few years away may result in too-tight budgets that complicate retirement for too many. As age inevitably takes a toll, you could be unpleasantly surprised to find that illness or other complications end your working days prematurely. Such seemingly small things as eating out less often and reducing optional spending will help you be prepared for living on less.

Consider Who You Are Bank Rolling

Resist the temptation to sacrifice your retirement security to pay for your kids’ college. When the offspring walk off with a diploma, you may find yourselves in the mid-50s. In some instances, the kids go into careers debt-free, but Mom and Pop suddenly find they are facing retirement without an adequate cushion. Although the urge to help the children get a higher education is hard to resist, if it isn’t financially feasible it may mean that those children will be called on to help you make it through retirement. Alternatives are paying only a pre-determined portion of the higher education costs or encouraging your students to get their education at a state or community college, if possible. Look ahead when they are still in public school. Save if you can while children are small to help alleviate the stress when you are suddenly faced with tuition and other costs. Encourage the kind of scholastic achievement that can lead to scholarships and other assistance.

Recognize Your Limitations

Don’t be fooled into thinking you will live forever. The plans you made for retirement can quickly go awry if one of the partners dies before you expected he or she would. Many a widow, particularly if there are still children at home, has been forced to sell the family home and retrench spending to the point of penury. Term life insurance for both partners is the most feasible way to avoid this kind of financial shock. Finding out the hard way that you are under-insured is a double-whammy for a surviving partner mourning a loss. A will should be prepared well before anything but a tragic accident could be expected to take either of the partners. Both spouses should be well informed about family financial realities and decisions should be made, as nearly as possible, well in advance.

Charting a course for something as tenuous as retirement is tricky, but those who are realistically preparing for the eventuality will be least likely to find themselves swamped when it comes.

Save money by ordering your personal checks online and saving up to 50% off.

Home Buying On The Upswing

March 8, 2012 By Twila Van Leer

After years of near-moribund status fueled by a prolonged recession and problems in federal assistance programs, America’s housing market trend appears to be up, at least in the Beehive state.

home-mortgages — Get The Best Mortgage Loan For Your Home

Alan Blood of Capital Financial Group, based in Bountiful, Utah, says that figures for the population-heavy Wasatch Front area of Utah show that there is reason to hope the market is stabilizing. Although there has been a 30% decrease in the number of homes on the market however there has been a 5 percent increase in loan applications in recent months. Good prices and quicker sales are evidence of a reviving market.

“At least in Utah, where $200,000 is the median price for a home, that’s good news for everybody,” said Blood. He talks about housing market realities every Friday from 9 to 10 a.m. on local K-TALK Radio, AM 630. (Visit K-TALK.com for details.)

A graduate in economics from BYU, Blood became a mortgage broker. He also received a degree in Law by attending Brigham Young University’s Law School. With the law degree under his belt, he re-examined his career goals. He found the study of law useful to continue his career in mortgage brokering which he really enjoys.

Based on long experience, Blood can offer some suggestions to those who are in the throes of buying a home or considering it in the near future:

Don’t Buy Too Small

It’s probably the most common mistake first-time buyers make, he says. Especially if the buyers are a new family with potential for growth, a small home can quickly become inadequate, calling for a new purchase in only a few years, before the initial costs of home-buying are recouped. There is little equity accrued, so too much of the new purchase goes into the front-end process, he says. If possible, it is wiser to look ahead at least ten years to allow for equity growth before taking the plunge again. The average time a family stays in a new home, according to Fannie Mae figures, is 4.2 years. And, also on average, the typical family makes six moves in a lifetime.

Don’t Focus Only On The Interest Rate

It’s understandable that with a long-term loan, the tendency would be to consider the interest rate to be the most pertinent consideration the buyer needs to look at.

In reality, the advantage of a very low interest rate can quickly be cancelled by higher closing costs. Spread over 30 years, for instance, the difference between an interest rate of 3.5 percent and 3.75 percent is just $3,250 —approximately $27 per month. “It takes your about 10 years to break even,” Blood says. Looking at every element of the purchase costs is essential to get the best deal overall.

Mortgage Brokers Can Help Get The Best Deals

“No bank will always have the best deal every day. Mortgage brokers work with as many as 18 banks in any given day,” Blood notes. Interest rates and other variables involved in a home purchase change frequently, often within a day’s time. In addition, federal law requires that mortgage brokers give the best rate a buyer can qualify for, a standard that banks and credit unions are not obliged to observe.

Gather Facts

In general, Blood advises that home buyers go into the search armed with as many facts as possible. It’s one of the most complex and demanding purchases a family is likely to make and it deserves some study and research. Begin the process educated and enlist a good broker to make recommendations. As the market continues to improve over the next few years, these are the buyers who will benefit from the rebound, he says. Contact him for more information about mortgage loans.

Entrepreneurs On The Rise

February 18, 2012 By Twila Van Leer

It is a survey finding that surprised even the experts. Since 1996, entrepreneurs in the 55-64-year-old age group have initiated more new businesses every year than those in the 20-34 age range.

Dane Stangler, senior analyst for the Marion Kauffman Foundation located in Kansas City, Mo., which conducted the survey, said its results were surprising even to him. They shatter the stereotype of the young college graduate (or dropout: Bill Gates of Microsoft, Mark Zuckerburg of Facebook) as the expected founder of a new business. The involvement of baby boomers who should logically be considering retirement instead of new ventures is a growing trend, Stangler said. The number of Baby-Boomer entrepreneurs continues to rise over the younger age groups each year. The foundation’s research was reported in an AARP publication.

The reasons for the phenomenon are, of course, multiple and complex. For one thing, Americans are living longer and more healthfully. Full retirement at the usual age isn’t appealing to many who have spent their normal career years cultivating skills that can be transferred to a business they control themselves.

The AARP article points to Doug Wolf, a man in his 50’s who had spent his career years in the medical field, working at hospitals as an MRI or CT technologist. When he tired of the job, he determined, despite a bad economy, to strike out on his own. He started, wisely, by researching franchises he felt would work for him. He paused for awhile over the possibility of opening a bird feed store, but ultimately opted for a carpet cleaning business. Among the reasons: carpet cleaning is a useful service; it is year-round and indoors. So despite discouragement by some of his family, he stepped out and joined the ranks of middle-aged first-time business owners.

The franchise of choice for the 21st Century seems to be a home-based, computer-supported business. Multi millionaires such as Donald Trump, Robert Kiyosaki and Warren Buffet, all are involved to some degree with businesses like this.

From the entrepreneur’s standpoint, the advantages are obvious. What other business offers — for an initial investment in the neighborhood of $500 — the lure of low overhead (you probably have no additional housing expenses for the business beyond your own home) no need for expensive advertising and the prospects of unlimited growth, which translates into unlimited wealth.

Those who have already succeeded are proof-positive that age doesn’t need to be a factor if you have the desire.

5 Essential Tips For Small Business Startups

February 6, 2012 By Twila Van Leer

Any small business starts with a good idea. But pampering it along until the good idea bears fruit is tricky.

Paul Wheeler of Manchester, Vt., who with a partner made Life Is Crap a successful business that markets millions of dollars worth of merchandise, shares some pointers on how to negotiate the rapids of getting started until you come to more peaceful waters.

Tip #1 – Ask Experts For Assistance

Before you launch your small business, be absolutely certain you have your idea firmly in your grasp. False starts make expensive lessons. Focus on what it is you want to do. Research to learn what is available that will move you toward your goals. Find out what the competition is likely to be. Be certain before you begin that you and those you may be working with have the skills necessary to achieve your goals. If there seem to be gaps, look for advice. Communicate with others who have experience in the area you are looking at. There is much available just through a search of websites that represent people who have ideas similar to yours. Borrow from them, but be wary of such things as copyright, intellectual ownership and other legal realities that could land you in hot water. Many businessmen who are dealing with the same kinds of things you want to do are often willing to give you a little of their time. Ask. Wheeler advises that “The ability to recognize what you don’t know is first and foremost.”

“You don’t personally have to have expertise in everything,” he adds. “Look for the best help you can get.” In his case, that involved gathering a small group that represented artists (they sell clothing and other items printed with “Life is Crap” messages) and others with business and marketing experience, Their business is based on humor, so it was essential that the creative element share that sense of humor. If you find yourself mismatched with any of those you will be working with, remedy it sooner than later. Too many points of disagreement can be fatal to even the best ideas. When you are sure you have found the right combination, let others do their jobs. “Let them flourish,” Wheeler says.

Tip #2 – Be Consistent

Stay consistent. If you are discouraged too soon, your business will be affected. Look ahead to plot where you are going. Set achievable short-term goals and stay committed to them. Make adjustments when you need to, but don’t jump from one thing to another. “Do it without losing sight of the underpinnings of your business,” the Vermont small business owner advises.

Tip #3 – Have Faith That Things Will Work Out

Wheeler acknowledges that a bit of luck now and then helps. One of the new twists for “Life is Crap” involves putting designs on Life Is Crap checks. And that little venture was pure serendipity, he says. He was attending a trade show and chanced to meet someone in the check printing business. A little casual conversation and voila! But the key element here is that Wheeler was in a place and at a time when other creative people were gathered. Even serendipity needs a hand sometimes.

Tip #4 – Have Empathy For Your Customers and Employees

He lists a number of qualities that he believes will help people starting a business: Have empathy for employees and customers. Identify with people. Hone your analytical skills and if you feel you are lacking, find someone who can do the job for you. Be able to laugh at yourself. Learn to really listen to others. Recognize that they may have something important to offer. Cultivate humility and patience. Try to stay fresh and open to innovation because things change. .

Tip #5 – Love What You Do

Most of all, you “need to really love what you’re doing and come to understand it thoroughly. If you are ready to “work morning to night,” he says, “You’ll probably make it. But people who have great ideas go bankrupt every day.”

Higher Education One Of Victims of Bad Economy

January 10, 2012 By Twila Van Leer

It has long been apparent that higher education has a direct correlation with what a person can expect to earn during his or her lifetime. But there is growing concern that the high cost of higher education may be nudging some young people out of the matrix. With the amount of their tuition checks constantly rising, the number of students borrowing to pay their college costs has doubled in the past decade, the College Board reports. The average cost of one-year tuition at a public four-year college is now $20,000, and at private non-profit schools, the average jumps to $35,000. Those numbers are lending themselves to a groundswell of discontent among young students who say they are being priced out of the prospects for the higher education they need to compete in today’s world.

One group of students recently expressed their concerns in a demonstration at New York University’s Washington Square. The group characterized themselves as “Casualties of Debt.” and their objective was to foster more understanding of their situation. Among the figures they tossed up for review: The amount of outstanding student loans in America surpassed credit card debt for the first time in August 2012. The indebtedness inevitably eats into the prospects of the better earning power they are trying to build, they complained. NYU, incidentally, leads the nation in student debt at $659 million and growing.

College tuition continued to rise even when other industries were cutting prices to accommodate a sluggish economy. During the 2008-09 school year, in-state tuition at public schools rose by 6.4 percent, while out-of-state tuition jumped by 5.2 percent. At private four-year universities the increase was 5.9 percent. College graduates are leaving school with major debt and, at this point in time, at least, moving into a depressed job market plagued by high unemployment, making the promise of increased earning power just empty promises for many of the graduates.

The New York demonstration, which was supported by MTV personality and filmmaker Andrew Jenks, may have had minimal impact, but it is an indicator of unrest among students and among those who would like to be students, but whose current personal finances don’t allow them to pursue the education that they are convinced would enhance their future earning power.