Monthly Archives: October 2015

7 Frugal, Fabulous Alternatives to the Diamond Engagement Ring

Are you engaged? Getting engaged soon? Hoping to get engaged someday? No matter where you are in the process, it’s worth thinking about how you want to make the statement.

Many couples are finding that they don’t want to go the traditional route of offering the bride-to-be a diamond ring. Some choose something else because they want to make a statement, others because they disapprove of the diamond industry — and even others because they simply like another option better.

If you’re considering doing something non-traditional, there are many ways to personalize your engagement and make it stand out from others. Here are some frugal ideas for you. (See also: 7 Smart Ways to Save on a Wedding Dress)

1. Rings

Even if you choose to use a ring to symbolize your engagement, it doesn’t have to be a diamond. These options work if you like the symbolism of the ring but want more flexibility in the material.

  • Wooden Rings
    • There are so many wooden ring options to choose from! Many people like the fact that wood is a natural material and that trees symbolize both growth and rootedness — two ideas that are foundational to a marriage. Wooden rings sound like they might be big and clunky, but they can actually be delicate, with mother-of-pearl inlays and more. If you want a unique engagement ring, these might be for you.
  • Other Clear Gems
    • If you like the look of a traditional diamond engagement ring but you don’t want to spend the money on a stone, don’t want to support the diamond industry, or you want to be able to get a new ring in a few years, consider a cheaper clear gem. Moissanite is the most common diamond alternative, but there are actually quite a few other choices.
  • No-Stone Rings
    • If you are fine with a stoneless ring, there are about a million options out there. You can get something delicate — maybe simply a knotted piece of gold — or something much more elaborate. Really, you can make the ring look like anything you choose! The only downside of this option is that people often use rings without stones for promise rings. If you don’t mind explaining your engagement ring to people you meet, though, it can be an awesome choice.

2. Other Jewelry

Don’t like rings, but like the idea of a gorgeous piece of jewelry as an engagement gift? Consider a different piece of jewelry. Really, the options here are endless, but here are two of my favorites.

  • Lockets
    • A locket is a great choice for a piece of engagement jewelry because the idea is so romantic. No matter what you put inside of it, the recipient will keep it close to their heart. It can also be a great choice for folks who can’t wear rings at work, or for keeping your engagement quiet for a while. You can use a traditional locket, with a photo or something special inside, or you can get a more modern clear one, so that everyone can see the symbols of your love.
  • Personalized Bracelets
    • Bracelets are a great, inexpensive engagement option. You can choose from various metal options or engraved leather. Have one etched with a short handwritten message, so your own words in your own writing are always visible on your beloved’s wrist.

3. Non-Jewelry Items

Maybe jewelry really isn’t your thing. That’s okay, too, because there are some fun engagement options that don’t involve jewelry at all. These are great for people who cannot wear any jewelry when they work, so they can keep a symbol of love with them even when they’re on the job.

  • Engraved Wallet Cards
    • These engraved wallet cards fit easily into a wallet, allowing a beloved to see your loving words anytime they take it out. They are highly discreet and can make for a fun secret between lovers. They are also a great choice for people who want to say more than can be engraved onto a ring. Give your lover all your words of love when you get engaged, and let them carry your love with them.
  • Tattoos
    • These have become increasingly mainstream over the last few years, but they are still a great engagement option. If you want your love to last forever, why not tattoo it onto your skin? Tattoos also give y

10 Guaranteed Ways to Retire Rich

Retiring comfortably — never mind wealthy — may seem out of reach to many people, given current savings rates. Consider that median savings accumulated by workers ages 51 through 60 years is $49,000, while the number for people ages 30 through 40 is $30,000, according to professional services firm Towers Watson.

Don’t let the statistics scare you. With a little advance planning and self-discipline, you can have a golden nest egg at retirement. Here’s how:

Rule 1: Spend less than you earn

The formula for retiring rich starts with you actually putting money in the bank. Social Security alone isn’t enough to have you living the good life during your golden years.

Money Talks News founder Stacy Johnson recommends you spend only 90 percent of the money you make and sock away the remaining 10 percent.

If you have zero savings right now, concentrate on building up an emergency fund in a savings account first. Once your rainy-day fund is full, put that 10 percent you’re not spending into a dedicated retirement fund.

If you’re currently spending more than 90 percent of your income each month, you may want to read about how to save $1,000 by summer.

Rule 2: Start saving early

Thanks to the power of compounding interest, a little money saved now can go a long way at retirement time. But to get the most benefit, you’ll want to start saving as early as possible.

Let’s say you’re 20 years old and can manage to put away only $100 a month into your retirement fund. Assuming you average 8 percent returns, you’ll be closing in on having half a million dollars – $463,806 to be exact – by age 65. Even better, over that 45-year period, you’ll only have invested $54,000 of your money to get all that cash in return.

If you wait until you’re 40 to start saving $100 a month, and get that same rate of return, you’ll put in $30,000 of your money and get $87,727 in return by age 65. Not bad, but wouldn’t you rather have half a million?

Rule 3: If you start late, make up for lost time

Maybe you’re 55 and think you’ve missed your window of opportunity to retire rich. Don’t wave the white flag just yet!

The government allows those 50 or older at the end of the year to make catch-up contributions to their retirement funds. You can contribute an extra $6,000 to your workplace retirement program, such as a 401(k), for a total annual contribution of $24,000. IRA catch-up contributions are $1,000 for a total allowable contribution of $6,500 each year.

You might think there’s no way you’d ever have $6,500, let alone $23,000, to invest in a single year, but you could be surprised at when and how you come into extra cash. You may benefit from a loved one’s estate, downsize your home or sell a boat or other large toy that no longer fits your lifestyle. When you find yourself on the receiving end of a windfall, don’t blow it on a vacation; put it in a retirement account if you want to retire rich.

Rule 4: Don’t leave free money on the table

If someone tried to hand you $100, would you say no?

That’s exactly what you’re doing when you fail to take advantage of a 401(k) employer match. Your company is basically giving you free money with the only string being you need to pony up some of your own cash for the retirement fund too.

You won’t get rich by passing up golden opportunities like this for extra cash. If your employer offers a 401(k) match, make sure you are taking full advantage of it.

Rule 5: Minimize your taxes

The rich stay rich, in part, because they’re savvy enough not to let Uncle Sam take too much of their money.

When you’re investing your retirement money, be sure to use tax-sheltered accounts such as IRAs and 401(k)’s whenever possible. In addition, be smart about which type of account you use.

Traditional retirement accounts let you invest money tax-free now and pay the piper once you make withdrawals in retirement. Meanwhile, Roth IRAs and Roth 401(k)’s tax you now and make the withdrawals tax-free.

You’ll probably want to discuss with a financial adviser the best option for your particular situation, but generally, Roth accounts are preferable for younger investors. In theory, you should be making more when you’re 65 than when you’re 25. As a result, your tax rate now may be lower than the rate you’d pay at retirement. However, if you’re within a few years of retirement, you may want to consider a traditional account to get the tax benefits now.

Rule 6: Take a little risk

You could put all your money in bonds and sleep well at night knowing you’ll probably never lose any of your money. But with that approach, you’re not going to retire a millionaire either.

Stocks and real estate are where the money is to be made, but then there is always the risk of a housing bubble bursting or the market crashing. Take heart, though, in knowing that stocks and real estate have historically appreciated in the long run.

Rule 7: Stay informed about your investments

Don’t mistake taking a risk with being dumb.

A smart risk may be investing in an emerging market fund. A dumb move may be pouring your life savings into a speculative currency.

How do you know the difference? By researching available investments, weighing your options and selecting the amount of risk that works for your unique situation. For example, those nearing retirement age may want to minimize their level of risk, while recent college grads can be more daring because time is on their side.

For more help on investing, read Stacy’s advice on how to open a mutual fund and how to select a good investment adviser.

Rule 8: Break free from the herd

When the stock market crashed a few years ago, too many people freaked out and sold their investments.

You know what? Those people took a bad situation and made it even worse. Many sold their investments right when the market was bottoming out, and then they missed the rebound.

The people who are going to retire rich are those who snatched up stocks at bargain-basement prices in 2009 and then saw their value climb by double digits in the following years. Same thing goes with the housing market. When the bubble burst, the smart people were the ones who were buying houses, not selling.

It’s easy to follow the herd, but if you want to be rich, you need to keep a cool head and make rational money decisions even in the midst of a crisis.

Rule 9: Work longer

Or at least wait to file for Social Security. While you can file for Social Security benefits as early as age 62, you’ll get a lot more money if you wait until you’re 70.

Once you hit your full retirement age, you can get an 8 percent bump in your benefits for every year you wait to start receiving payments. However, you’ll want to file by age 70 because there is no benefit to waiting longer than that.

You may be worried you’ll have one foot in the grave at age 70, but don’t fret. According to Social Security actuarial data, at age 70, you should still have an average of 14 to 16 years left to suck all the marrow out of life.

Rule 10: Maximize your income potential

Finally, if you want to retire rich, you need to maximize your earnings. That means no more settling for a dead-end job that pays pennies.

Look for ways to increase your income, which can, in turn, increase the amount of money you are saving for retirement. Consider these options:

  • Does your current field offer some form of credentialing that could increase your opportunities for a raise or a transfer to a higher-paying position?
  • Is there someone in your workplace who could serve as a mentor and help advance your career?
  • Are you eligible for one of the government-funded workforce development training programs?
  • Did you start a college program and never finish it? Will those credits transfer?
  • Could you use an online degree program or vocational classes through a community college to earn a degree or upgrade your skills?

Regardless of which option you choose, don’t fall into the student loan trap. If you do decide to go back to school, look for ways to make college affordable and try to pay as you go rather than going into debt.

Retiring rich may sound like something reserved for the one-percenters, but by making these smart money moves, you too can have plenty of cash to carry you through your golden years.

How’s your retirement saving going? Share with us in comments or on our

5 Big Mistakes Millennials Make With Credit Cards

For new cardholders and those just beginning their journeys into the complicated world of credit ratings and credit cards, managing and understanding the many types of credit cards and their terms can become confusing.

While several areas of life allow wiggle room for trial and error, credit scores are less forgiving.
It’s very easy to make a simple mistake that can cost not just a significant drop in your credit score, but also thousands of dollars in the future. That’s why it’s important to beware of these five common mistakes millennials often make with credit cards.

1. Carrying Balances and Paying Just the Minimum

A common belief is that to build a positive credit rating, you have to get a credit card and also carry a balance from month to month. The problem, however, is that credit cards designed for new cardholders generally carry high APRs – as high as 25 percent. If you carry a balance from month to month and only pay your minimum monthly payment due, you are paying considerable cash in interest on purchases, which can potentially create a mountain of debt you can’t pay down. Build your credit rating and save on interest by paying your balance in full each month, instead.

2. Maxing Out Credit Lines

A new line of credit can be exciting and provide an opportunity to make a large purchase you’ve had your eye on for a while. At first, it can seem like a simple plan – make the purchase and slowly pay it off. Maxing out credit lines, however, can signal to creditors that you’re at risk of defaulting on your balances. Spending too much or maxing out your credit lines also affects your utilization ratio, an important factor in your credit score. Utilization ratio is the percentage of the total available credit the cardholder has used, and a high ratio indicates a higher credit risk. It is often recommended that you keep your total debt-to-credit ratio below 30 percent, which means you may have to put off that large purchase you’ve been dreaming of for a bit longer.

3. Focusing on Fancy Rewards and Promotional Offers

Many credit cards tout a range of special perks and rewards designed to attract new cardholders. While many of these opportunities can be worth hundreds of dollars in cash, airline miles or points, it’s important to be aware of what those rewards might cost you. The interest rate plus any associated fees can be more than the rewards and perks are worth. New cardholders are often better off building a positive credit rating by making timely payments on cards with low interest rates, rather than seeking cards with extra rewards or special promotional offers. Those offers will always be around, and you may be in a better position later to take advantage of them without it costing you as much or damaging your credit history.

4. Using a Credit Card for Everyday Purchases

The only time it’s recommended you use your credit card for everyday purchases like groceries and fast food is if you are earning specific rewards for those types of purchases, and if you pay them off every month in full. If you carry a balance and use your card for everyday purchases, $20 in toothpaste and toiletries can end up costing several times that. If you are unable to pay for living expenses with cash, you may need to readjust or create a budget before taking on the additional weight of a credit card.

5. Not Taking Due Dates Seriously

Although it’s common for most companies, such as your cellphone provider, to impose late fees when a payment is late, ignoring due dates on credit cards can become far costlier. Late payments not only significantly affect your credit rating but usually come with late fees as well as penalty APRs. One late payment can end up in an APR that’s well over 20 percent. That penalty APR combined with a late fee of approximately $30 (and the effect on your credit rating) can cost you hundreds – even thousands – in the end.

10 Guaranteed Ways to Retire Rich

Retiring comfortably — never mind wealthy — may seem out of reach to many people, given current savings rates. Consider that median savings accumulated by workers ages 51 through 60 years is $49,000, while the number for people ages 30 through 40 is $30,000, according to professional services firm Towers Watson.

Don’t let the statistics scare you. With a little advance planning and self-discipline, you can have a golden nest egg at retirement. Here’s how:

Rule 1: Spend less than you earn

The formula for retiring rich starts with you actually putting money in the bank. Social Security alone isn’t enough to have you living the good life during your golden years.

Money Talks News founder Stacy Johnson recommends you spend only 90 percent of the money you make and sock away the remaining 10 percent.

If you have zero savings right now, concentrate on building up an emergency fund in a savings account first. Once your rainy-day fund is full, put that 10 percent you’re not spending into a dedicated retirement fund.

If you’re currently spending more than 90 percent of your income each month, you may want to read about how to save $1,000 by summer.

Rule 2: Start saving early

Thanks to the power of compounding interest, a little money saved now can go a long way at retirement time. But to get the most benefit, you’ll want to start saving as early as possible.

Let’s say you’re 20 years old and can manage to put away only $100 a month into your retirement fund. Assuming you average 8 percent returns, you’ll be closing in on having half a million dollars – $463,806 to be exact – by age 65. Even better, over that 45-year period, you’ll only have invested $54,000 of your money to get all that cash in return.

If you wait until you’re 40 to start saving $100 a month, and get that same rate of return, you’ll put in $30,000 of your money and get $87,727 in return by age 65. Not bad, but wouldn’t you rather have half a million?

Rule 3: If you start late, make up for lost time

Maybe you’re 55 and think you’ve missed your window of opportunity to retire rich. Don’t wave the white flag just yet!

The government allows those 50 or older at the end of the year to make catch-up contributions to their retirement funds. You can contribute an extra $6,000 to your workplace retirement program, such as a 401(k), for a total annual contribution of $24,000. IRA catch-up contributions are $1,000 for a total allowable contribution of $6,500 each year.

You might think there’s no way you’d ever have $6,500, let alone $23,000, to invest in a single year, but you could be surprised at when and how you come into extra cash. You may benefit from a loved one’s estate, downsize your home or sell a boat or other large toy that no longer fits your lifestyle. When you find yourself on the receiving end of a windfall, don’t blow it on a vacation; put it in a retirement account if you want to retire rich.

Rule 4: Don’t leave free money on the table

If someone tried to hand you $100, would you say no?

That’s exactly what you’re doing when you fail to take advantage of a 401(k) employer match. Your company is basically giving you free money with the only string being you need to pony up some of your own cash for the retirement fund too.

You won’t get rich by passing up golden opportunities like this for extra cash. If your employer offers a 401(k) match, make sure you are taking full advantage of it.

Rule 5: Minimize your taxes

The rich stay rich, in part, because they’re savvy enough not to let Uncle Sam take too much of their money.

When you’re investing your retirement money, be sure to use tax-sheltered accounts such as IRAs and 401(k)’s whenever possible. In addition, be smart about which type of account you use.

Traditional retirement accounts let you invest money tax-free now and pay the piper once you make withdrawals in retirement. Meanwhile, Roth IRAs and Roth 401(k)’s tax you now and make the withdrawals tax-free.

You’ll probably want to discuss with a financial adviser the best option for your particular situation, but generally, Roth accounts are preferable for younger investors. In theory, you should be making more when you’re 65 than when you’re 25. As a result, your tax rate now may be lower than the rate you’d pay at retirement. However, if you’re within a few years of retirement, you may want to consider a traditional account to get the tax benefits now.

Rule 6: Take a little risk

You could put all your money in bonds and sleep well at night knowing you’ll probably never lose any of your money. But with that approach, you’re not going to retire a millionaire either.

Stocks and real estate are where the money is to be made, but then there is always the risk of a housing bubble bursting or the market crashing. Take heart, though, in knowing that stocks and real estate have historically appreciated in the long run.

Rule 7: Stay informed about your investments

Don’t mistake taking a risk with being dumb.

A smart risk may be investing in an emerging market fund. A dumb move may be pouring your life savings into a speculative currency.

How do you know the difference? By researching available investments, weighing your options and selecting the amount of risk that works for your unique situation. For example, those nearing retirement age may want to minimize their level of risk, while recent college grads can be more daring because time is on their side.

For more help on investing, read Stacy’s advice on how to open a mutual fund and how to select a good investment adviser.

Rule 8: Break free from the herd

When the stock market crashed a few years ago, too many people freaked out and sold their investments.

You know what? Those people took a bad situation and made it even worse. Many sold their investments right when the market was bottoming out, and then they missed the rebound.

The people who are going to retire rich are those who snatched up stocks at bargain-basement prices in 2009 and then saw their value climb by double digits in the following years. Same thing goes with the housing market. When the bubble burst, the smart people were the ones who were buying houses, not selling.

It’s easy to follow the herd, but if you want to be rich, you need to keep a cool head and make rational money decisions even in the midst of a crisis.

Rule 9: Work longer

Or at least wait to file for Social Security. While you can file for Social Security benefits as early as age 62, you’ll get a lot more money if you wait until you’re 70.

Once you hit your full retirement age, you can get an 8 percent bump in your benefits for every year you wait to start receiving payments. However, you’ll want to file by age 70 because there is no benefit to waiting longer than that.

You may be worried you’ll have one foot in the grave at age 70, but don’t fret. According to Social Security actuarial data, at age 70, you should still have an average of 14 to 16 years left to suck all the marrow out of life.

Rule 10: Maximize your income potential

Finally, if you want to retire rich, you need to maximize your earnings. That means no more settling for a dead-end job that pays pennies.

Look for ways to increase your income, which can, in turn, increase the amount of money you are saving for retirement. Consider these options:

  • Does your current field offer some form of credentialing that could increase your opportunities for a raise or a transfer to a higher-paying position?
  • Is there someone in your workplace who could serve as a mentor and help advance your career?
  • Are you eligible for one of the government-funded workforce development training programs?
  • Did you start a college program and never finish it? Will those credits transfer?
  • Could you use an online degree program or vocational classes through a community college to earn a degree or upgrade your skills?

Regardless of which option you choose, don’t fall into the student loan trap. If you do decide to go back to school, look for ways to make college affordable and try to pay as you go rather than going into debt.

Retiring rich may sound like something reserved for the one-percenters, but by making these smart money moves, you too can have plenty of cash to carry you through your golden years.