The news may be too much, but there are financial matters to review, if you just set aside time

Many people react to the bombardment of news on the economy, the European debt issues, the presidential campaign and legislative gridlock by wanting to shut it all off! That is understandable, but not often the best solution

It is one matter to just not open investment statements; it is a wholly different matter to postpone addressing financial issues

So, while you may not want to review re-balancing of your investments to match your long-term allocation or hear about the dismal returns on bonds, there is more that you can still address

We have suggested a list at: finance health day your own financial planning focus

It is like a “mental health day” but for your personal finances.
After you look at the list, let me know what you think, what you decide to do,
and if we can help you or anyone you know accomplish what is needed now. Thank you,

Steven

Web-Based Financial Planning Tools for College Students and others

In advising a senior going to study abroad, I learned that he did not know how to obtain his own credit card, how to set up banking before and during his trip and how to manage the entire process. This was a surprise, as some many web sites seem loaded with information.

However, the bank sites tell you some but not all of what you need to do. Similarly, college sites may mention ATMs without connecting to Handbooks may suggest Parents may have no clear understanding of

No single place gives you a complete road map, let alone telling you how to connect all the resources to get your answer, so you have to turn the web into your own tools.

The first step is contacting the overseas college for local banks, currency exchanges and connecting to close by ATMs and banks. The next step is getting your own credit card or a additional cars on your parent’s account. Then you get to finding a US bank into which your parents can deposit or from which they can wire so you have funds in you bank at college.

The key is to link all the information that is on the web to create a plan for your study abroad, using the web sites to answer and obtain all you need

Summer of 2011 to do list: investing, estate plan, refinance, taxes and planning matters

For this summer, we have suggested financial matters for you to review:

1. Asset allocation and investments – taking all IRAs, 401(k)s and taxable accounts as a single portfolio, reviewing the allocation and checking to see if it is time to rebalance;
2. Interest rates, investing and inflation – rates are likely to stay low, inflation is likely to stay low as well (there is no wage component, in fact wages may be deflationary now, there is only commodity inflation), so that leaves looking at any investment that equals or beats the 10 year Treasury bond at a 3% yield: good municipal bonds, dividend paying stocks, or packaged stocks like Berkshire Hathaway or the Permanent Portfolio mutual fund;
3. Refinancing – rates are back down some, so that you can bring a 30 year loan down to a 4.5% 25 year loan, or 4.25% 20 year, or 3.75% 15 year fixed;
4. Home Equity Line of Credit – rates are still under 3% and no closing costs, so be sure to set one up so you have a fall back source of funds to cover the unexpected
5. Estate plan – reviewing your wills and trusts, and any letters to fiduciaries, to be certain that you account for such matters as the portable credit, which requires an election at the first death;
6. Tax planning – reviewing your information for 2011 against 2010 and checking your options to be you minimize your 2011 and 2012 taxes (e.g., max out 401(k), 402(b), ESPP plans, convert to Roth IRAs in low income years, etc.); and
7. In fact, you could do a Finance Health Day (you own financial planning focus) – please check out Finance health day….

Let me know if you have questions or comments, or if anyone you know wants to ask about any of this material. Also check out Time Saving Tips…

Coming soon…. credit card benefits with real value

Time saving ideas that pay off in tax planning, investments, technology and daily routines

Ben Franklin taught us that “time is money”. In addition, we all know that we have limited time, so every instant is important to us. In fact, each minute involves a choice about how you spend that time.
However, the best use is often hard to sort out. Moreover, tracking time minute by minutes can cloud the real issue, which is what the best use of your time may be.

Tracking your time: However, as a starting point, Laura Vanderkam suggests keeping a journal of how you spend each day. This can show you how much time you spend, say, checking your e-mail every 15 minutes. If you can evaluate your habits with some clear-headed objectivity, you may find ways to spend your time better.

What is your time worth? Here is a financial perspective on the use of your time. Ms. Vanderkam “what is your Minimum Wage” as way to have you test your use of time financially. Her example is the difference between buying and making your own tortillas. When she factored in the time spent against any cost savings, she arrived at a wage of $1.40 per hour. So, was that a good decision for the use of your time? Maybe if your tortillas taste so much better… but often, tortillas are tortillas.

Here are two more taken from my experience: driving an extra 25 miles to save ten cents per gallon on gas probably nets out to the same total expenditure, after factoring in the gas used to get there, let alone the time. Replacing the brakes or McPherson struts on your car may seem to save money. However, when you factor in six hours or more spent, and the clean up, you have a fairly low minimum wage calculation. It is often better hire an expert and spend time with family.

Dangers of Technology: Another author suggests three time wasters from new technology: texting, remote access and last minute preparation. Geoffrey James finds that each of these appears to save time, but embodies significant risks. For texting, the response is immediate and you have a full record of the communication. That may not be to your advantage in business or personal relationships. Remote access may mean you are never really on vacation, never really relax and recharge, so return in less than par shape. Easy access to information makes last minute work tempting. So much can be reviewed easily. However, this process is usually rushed, and rarely forms permanent memories like long-term studies. Therefore, technology in general can be good, but there are some technologies, or at least the ways in which we use them, that do not save you time and make you more productive.

Now, some ideas that payoff
One time saving idea that pays is gathering your tax information as it comes, saving you from hunting for it last minute. Also, saving each year’s information in an organized manner will save time if ever questions arise or, worse, you have an audit to counter. Finally, if you let your tax preparer know about any changes during the year, you have a chance to react and adjust your tax planning, rather than being told what you should have done when it is too.

The same holds true for evaluating any other financial change. Address it at the time, and save the documentation. For example, when you get a new document, you can now scan and save files on your computer (but be sure to have backups). This way, your information is more easily retrieved and searchable, so you can find the correct item quickly.

Investing: This is an area where too much attention is not the best use of your time but also risks making investment errors. Please see our comments at Faults of the individual investor…. Too much attention can lead you to override your long-term plan so spend the time on other matters. Your portfolio will be better off.

If you create or update your estate plan, be sure to change your beneficiary designations right away. You may even choose to fund trusts you have created, saving time for your executor (or the attorney she hires). See Estate planning overview…

If you have suggestions, or questions, let us know.

Time Management Ideas – a Financial Planning side line

The article below suggests time management tips for use of voice mail. (This leaves us all more time for investment, financial and other planning work.)

Of course, you can always e-mail, text or just hope for a live conversation!

Let me know what you think…..

Thanks,

Steven
Stop Wasting Time on Voicemail

1:43 PM Friday November 20, 2009

Tags:Time management

Every time you make or receive a phone call that involves leaving or listening to a message, you’re wasting time. You can’t write as fast as people speak, so transcribing phone numbers, addresses, and other information from a voicemail message is tedious. When you have to leave a voicemail for someone, you’re forced to listen to Robotic Voice-Mail Woman trod through the instructions on how to wait for the tone before you can start.

There are two ways to cut this unnecessary voicemail overhead out of your day:

1. Get your voicemail messages transcribed automatically and emailed to you. Instead of calling your voicemail and having to listen to messages directly, you can receive text transcripts via email on your smartphone or desktop. Several online services can store, convert, and email you voice-to-text transcriptions of your voicemail messages. I use the free (but invitation-only right now) Google Voice service to do just that. In addition to a host of other features, you can forward your existing cell phone’s voicemail messages to Google Voice. Google stores them, transcribes them, and can email you both the playable audio file and the text transcription. Google Voice’s transcriptions are far from perfect; in fact, most times they’re laughably inaccurate. (There’s even a blog dedicated to bad transcriptions, entitled “GV Screwups.”). However, the transcripts are good enough for you to get the gist of the message without dealing with time-consuming playback.

If you don’t have an invitation to Google Voice, several other pay-for services offer voicemail transcription services, like Jott Voicemail, YouMail, CallWave, and MessageSling. Almost all of these services are built to work with mobile phones, and whether or not they work may depend on whether your carrier allows call-forwarding.

2. Bypass unnecessary voicemail instructions with One-Star-Pound. Every time you need to leave someone a message on their mobile phone, you have to sit through this time-wasting, robotic script: “To page this person, press five now. At the tone, please record your message. When you are finished, you may hang up, or press one for more options.” You can skip through this drawn-out greeting and get straight to the beep, but the key to do so varies depending on the carrier. Blogger Jeremy Toemon came up with a three-key combo that works on major U.S. mobile phone carriers. Toemon explains the three steps and why they work:

Step One: Push 1. If your friend is on Sprint (or possibly Verizon, but not always), this skips the greeting and you are done; leave a message. If you hear a message that says “One is not a valid option” skip to Step Three below, otherwise continue to Step Two.

Step Two: Push *. If your friend is on Verizon, you’ll hear the beep and can leave your message.

Step Three: Push #. This works for both AT&T and T-Mobile subscribers, and you’re all set to go.

One-Star-Pound: Train your fingers now and never listen to “at the tone, please record your message” again.

How do you cut down time spent dealing with voicemail? Let us know in the comments.

Let us know if you have questions or comments. Thanks,

Steven