Category: Personal Finance

Postpone retirement till you qualify for Medicare One easy way to take care of your medical bills given that you don’t have health insurance in retirement would be to continue being employed till you are 65 and hence are qualified for Medicare. However the challenge here is to stay employed in a company that provides health care benefits till you are 65 given the current economic scenario. But what if you are fired? Check out then if you are covered under spouse’s health plan and COBRA continuation coverage through your former company which typically covers you for the maximum of 18 months. Employees terminated between Sept. 1, 2008, and Dec. 31, 2009 are eligible for a 65 percent subsidy toward COBRA premiums for up to nine months under the American Recovery and Reinvestment Act passed in February. Research shows that if you retire before you are eligible for medicare then you are  [...]

Health care expenses are increasing day by day. Also planning for health care expenses in retirement is one difficult task given that it is very difficult to predict health care expenses in your old age. Many companies earlier used to provide life time coverage but now this is a thing of past for many. Even people who retired with life time coverage are finding that this facility has been scrapped on account of cost cutting pressures. This is what happened to my neighbour and close friend Jack. Jack who retired at the age of 65 after 34 years in General Motors as Sales and marketing manager was considered to be one lucky person. He retired with two of the most sought after retirement benefits- pension and lifetime medical coverage. But then recently General Motors due to cost cutting pressures scrapped his retiree health care facility. He however was not the only one some 100,000 white-collar  [...]

Bury your credit cards Credit cards if not used sensibly can land you in a soup with debt accumulated that you will end paying for many months. True by spending on credit card the burden is postponed in the short run however some day you have to pay the money back. Also the interest charges will add further burden to your wallet. If you are one compulsive shopper who cannot use credit card responsibly then we suggest that bury your credit card before embarking on that great shopping trip. Paying by cash will help you to keep a track of the amount you have spent vis-a-vis your budget. With credit card you just keep on swiping getting to know the pinch only a month later when you receive your statement. However if you have the ability to use credit card responsibly then it can be a great boon. Even then we suggest that you use credit card only when necessary to avoid spending too much.  [...]

Christmas shopping So you have embarked on that great shopping adventure. Before doing so we suggest that first  make a list of gifts you want to buy or else you would end up just wasting your time at the shopping centre. We suggest that you always keep a stock of extra gifts like chocolates else somebody unexpected drops in or you forget somebody. In fact the best strategy would be to start shopping as early as possible. Another important way to save money is to look for sales. Keep your eyes and ears open for sales. A lot of money can be saved by buying during sale season. Also almost everything you want eventually goes under sales. Shop as much as you can during the sale season. There are people who shop all year around for Christmas. Typically you get excellent bargain in the post Christmas sales. Why don’t you use these sales to accumulate gifts for the next Christmas. Post  [...]

In the current bleak economic scenario Christmas shopping can bring in lot of stress both mentally and financially. There is stress of buying expensive gifts for everyone, stress of last minute shopping, stress of long lines at shopping centres, stress of family get together and many more. The biggest worry that haunts many families is the worry of impending huge credit card bills. Below are few practical tips that will keep you smiling even after the festive season. First of all budget for Christmas Christmas for many families’ results in huge credit card bills that takes months to clear. These families are typically those who don’t budget and plan for Christmas. If you plan ahead half of your problem will be solved. Ideally we suggest that one should start planning for Christmas as early as the beginning of the year. However as the saying goes better late than never, there is still  [...]

The interest rates have reached rock bottom levels and probably everyone you know is taking a loan. The fed has also made it clear that the interest rates will continue to be at such low levels for some time in future. Hence you are all tempted to take a loan to buy that dream house or car. At the outset yes it does look like the perfect time to take a loan but we would still advice you to ask yourself few questions before taking the plunge. First of all ask yourself why you need the loan and whether you really need to take a loan. What is the purpose behind taking the loan. Is it to buy that dream house that you always wanted or that dream car.  If yes should I take a loan or I can finance with my savings which given the current low interest rate regime is anyways not earning much. We suggest that you clearly demarcate between necessity and luxury. If you want to take a loan for something  [...]

In today’s world credit card have almost become a necessity. In addition of dispensing away with the need to carry cash, credit cards facilitate a wide range of transaction over internet. Like any other financial tool credit card if used responsibly can turn out to be of great convenience. This financial convenience however can easily land you in a financial mess if not used properly. Below are few FAQ’s regarding credit cards. How to find the right card All credit cards are not the same. The selection of right card is entirely based on your requirement. The factors to be taken into consideration are interest rates, annual fees, other fees, grace periods and aspects like cash back or other rewards for using the card. Be sure to check out the fine print to be sure that there are no hidden charges like closure fees, overseas transaction fees. These fees can vary, but are normally disclosed  [...]

As the gold prices soar to new levels the question still remains whether the gold is worth the price.  Is this the right time to invest in gold. Will gold prices continue to rise in future or is it another asset bubble. To answer these questions lets understand the dynamics of gold market. Like any other commodity gold price is determined by the forces of demand and supply. The supply of gold is more or less constant. It may increase slowly in the long run as new mines become operational and new technologies are developed to unearth gold. Hence the increase in the price of gold is entirely due to increase in demand of gold. So why is it that the demand for gold has suddenly increased? Demand for gold has increased cause other investments have lost their glitter. People are choosing to buy gold because they are looking for an investment that will not suffer when the alarm bells next  [...]

Retirement is a phase of life where an individual bears the fruit of his saving which he has toiled for in the 20-30 years of his working life. It is the golden phase of one’s life provided it is well planned and provided for. Financial planning at this stage of life assumes a totally different meaning. Below are enlisted few steps in retirement planning: Take a stock of where you are To enjoy a comfortable retired life it is important that you start planning for retirement from the time you are in your 30’s.First of all take Stock of where you are and estimate what your requirements would be in say the next 20 years of your life. Start by making a realistic estimate of expenses during retirement. You can estimate this by using a percentage of your current income. However this may not be very accurate as it doesn't take into account inflation and financial situations. A more reliable  [...]