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Written by MP Dunleavey
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Thursday, 11 March 2010 |
 Many of you have been following the Invest-Along-With-Ashley series, and we have a key update on the situation. As you may recall:
- Ashley was eager to start a retirement account—and learned her mom had opened a Roth IRA for her a few years ago.
- Next, Ashley committed to contributing $25 per month into her Roth. Excellent.
The key question now: Where is her money going?
In Ashley's case, her mom's financial planner picked a mutual fund for her Roth IRA (normally, you'd have more than one fund to balance your portfolio). Which fund was it?
Ashley did her homework and learned the fund's ticker symbol: AWSHX
Every investment—be it a stock, bond, mutual fund—is known by its ticker symbol. These codes look funny (Ashley's looks like, "Aw, shucks"), but they are just abbreviations.
Coca Cola Company stock = KO
Walmart Stores stock = WMT
Vanguard 500 Index fund = VFINX
AWSHX stands for the American Funds Washington Mutual fund. To learn more, enter any ticker symbol into any financial site (or Google it). If you go to Morningstar.com, a top research firm, and look at a snapshot of Ashley's Aw, Shucks fund, You'll see a chart of its performance, and you can scroll down to see a list of its holdings. (Remember, a mutual fund holds many stocks and/or other investments.)
Now, it's your turn! Look up the ticker symbol of an investment you own—and tell us what it is, and what you like or don't like about it.
MP owns FFFFX, a Fidelity target date fund.
Amanda owns a few Calvert and Oppenheimer funds, including the Oppenheimer Value Fund - CGRBX. |
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Written by Denise Schipani
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Wednesday, 10 March 2010 |
 Denise Schipani is a mother of two. She’s the Mom Advice columnist for American Baby, and blogs at www.ConfessionsofaMeanMommy.com
So many money tips these days strike me as obvious. Brew your own coffee! Borrow books from the library! Shop the clearance racks!
Golly, y'think?
Like my grandmothers before me, frugality is in my genes. I tear Brillo pads in half—and napkins. I wash Ziploc bags. I'll show you my $7 jeans if you show me yours! But in these credit crazy times, when a $5 coffee is normal and you can spend $3 on a box of frozen, crustless PB&J sandwiches, the temptation to overspend—especially on food—can be overwhelming. Here's how I keep grocery costs in check for a family of four:
- Make a no-budge budget. I get in and out of the grocery store on about $100/week. That means knowing what we have, what we need and never buying extras just because they're on sale. Something else will be on sale next week.
- Buy only what you'll eat. A 2008 study by the Environmental Protection Agency found that Americans waste about 30 million tons of food each year. That's like throwing money in the garbage. I get a quarter of a pound of deli ham, exactly enough for three or four sandwiches for my sons on weekdays. It's PB&J—with crusts—after that.
- Forget brand loyalty. I’ll buy anyone’s bread, crackers, corn, jam, etc. (within reason)—as long as the price is right.
- Browse the just-past-sell-by rack. If you’re going to stir-fry peppers, who cares if they’re yesterday’s bruised ones?
- Convert the kids. Precious frugal mom moment? When your seven-year-old says, “Mom, if the Fruity Cheerios are on sale and you have a coupon, can you get some?”
Denise Schipani is a mother of two. She’s the Mom Advice columnist for American Baby, and blogs at www.ConfessionsofaMeanMommy.com |
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Written by Gerri Detweiler and Mary Reed
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Tuesday, 09 March 2010 |
 This post is a follow-up to Debt Diets Part I and Part II."
Mary Reed and Gerri Detweiler are co-authors of "Debt Collection Answers: How to Use Debt Collection Laws to Protect Your Rights." They also answer debt questions at DebtCollectionAnswers.com
Bankruptcy is a painful choice and a complicated one. But if you’ve trimmed your spending to the bare bones and you’re still weighed down by too much debt, it may be time for the most drastic of our three debt diets.
The beauty of bankruptcy is that once you've filed, all attempts to collect your debts stop. That's why it's sometimes called "bankruptcy protection."
There are two types of bankruptcy: Chapter 7, liquidation, and Chapter 13, reorganization. A bankruptcy attorney can tell you which one may work for you.
Chapter 7, Liquidation: This option is typically best if you have a lot of unsecured debt (e.g. credit card and medical bills), and few assets.
Credit card and medical debt other kinds of unsecured debt are wiped out (discharged). But in return, the court may sell some of your assets—like your car—and give the money to creditors.
Remember that some types of debt—like student loans, unpaid income taxes, and child and spousal support—cannot be erased.
In Chapter 7, you get a choice about how to handle any secured debt you may owe, like your car loan and mortgage. You can:
- Formally agree to continue paying the debt.
- Buy the asset that secures the debt—i.e. pay off your car—assuming you and the lender can agree on its current value, and that you can pay for it with one lump sum.
- Return or surrender the asset to your lender so it can be sold and the cash applied toward what you owe.
Chapter 13, Reorganization: This option could be best if you have assets to protect (like your home), and have some money to pay off part or most of what you owe.
You keep your assets in exchange for paying all or some of your debts, depending on the type, under a plan the court must approve. Once you’ve completed the plan—usually in 3 to 5 years—any remaining dischargeable debt is wiped out and your bankruptcy is over.
Filing for bankruptcy can be a huge relief if you’ve got a ton of debt, but it will leave scars: Your bankruptcy will be in the public record for years to come, and your credit history will take a big hit for up to ten years.
However, you can begin rebuilding your credit once your bankruptcy is filed, and you embrace better money habits.
If you need help deciding whether this is the right step for you, read When is Bankruptcy the Right Choice?
Resources
Find a federally-approved credit counseling agency. You must complete a consultation with one no less than 180 days before you file bankruptcy. To find an agency, go to http://www.uscourts.gov/bankruptcycourts/approvedagencies.html.
Find a board certified bankruptcy attorney. Locate one in your area at http://www.abcworld.org/search or at http://www.nacba.org. |
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Written by MP Dunleavey
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Monday, 08 March 2010 |
 Today is International Women's Day today—in case you forgot. It sounds like one of those faux holidays recognized only by the U.N. and feisty women's groups.
That's partly true, but there are a number of reasons to take note of the recent accolades—and ongoing challenges—facing women today.
- And the winner is... Kathryn Bigelow, as the first woman to be named Best Director at the Academy Awards last night (her film "Hurt Locker" also won Best Picture).
You'll be hearing about Bigelow's triumph in testosterone-driven Hollywood for weeks. But as girls, let's just savor one delicious, vicarious thrill: Bigelow beat out James Cameron—her ex-husband.
Hah.
- In the "two steps back" category, however... New studies document the financial hurdles facing working women with kids.
Working moms earn nearly a third (31.9%) less than working fathers, according to "Decisions for Work," a study released today by researchers in London on behalf of the International Trade Union Federation.
This on top of a similar study co-authored by Stanford sociologist Shelley Correll last year called, "Getting a Job: Is There a Motherhood Penalty?"—which found, why yes, moms are typically paid less than men with kids and less than women who have no kids.
You win some, you lose some—and you keep reading DailyWorth so that professional and financial parity is something we'll all celebrate when we're relaxing on our fat, well-invested nest eggs in a few years. |
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Written by Amanda Steinberg
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Friday, 05 March 2010 |
 Back in May 2009, when DailyWorth was just learning to crawl, we published a post called "Sell Your Friends"—inviting our readers to promote their friends to the DailyWorth community.
Good karma. Good business.
It was such a success, we want to do it again. Let's take a break from all this talk of inflation, mutual funds and taxes to support and promote the women in our lives.
Reflect on the women you're already supporting...
Appreciate one who is helping you...
Think about who around you—at work or at home—could use some financial guidance, a job lead, or an entrepreneurial boost...
Now let's take it public.
We'll start. Here are some banners of women and organizations who have really helped DailyWorth grow by promoting us on their blogs and in the media. Thanks, ladies.
Your Turn!
Tell us about a woman-owned business that you love, and why. Links encouraged. |
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Written by MP Dunleavey
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Thursday, 04 March 2010 |
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 You may have heard the phrase, "A mutual fund is a like a basket of stocks." (Here, we compared a mutual fund to a box of wines.)
Now it's time to explore what that really means, as part of our new Investing 101 series.
When you buy shares of a particular mutual fund, you're pooling your money with thousands of other investors (that's the mutual part).
All that money—typically millions or billions of dollars in a single fund—is then used to buy stock in different companies, bonds, real estate or other investments.
Most mutual funds are "actively managed," which means that a team of investment experts decides what goes into the fund. Index funds are "passively managed", and simply mirror what a segment of the market does.
You probably chose certain mutual funds for your 401k account or IRA. While the amount you contribute each month may be small, say $200, you are actually buying a tiny fraction of all the investments (stocks, bonds, etc.) within those mutual funds.
How do you know what's in your mutual funds? (For those of you into the Invest-Along-With-Ashley, she's working on this, too.)
According to Morningstar, Inc., a top investment research company, there are about 8,000 different mutual funds. Each one, you might say, is a different flavor, because each contains different ingredients. Think Ben & Jerry's, but on a very large scale.
There are mutual funds that are invested primarily in stocks, bonds, overseas companies—or some combination of the above, plus a few things we haven't mentioned yet. Everything except pistachio.
To learn where your money goes in each fund, get your funds' ticker symbols (the code used to look up all investments), and plug it into the search box on Morningstar.com.
Tell us what you find! We're all about swapping investing adventures. |
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