PS2 Price Cut to Less Than $100

Game system now costs $99

Sony previously said it would make a major announcement this week, and now that time has come. The PlayStation 2 will now retail for $99, breaking that magical $100 mark.

Getting competitive

The PlayStation 2 first launched in Japan nine years ago. So why the drop in price now? The Nintendo Wii has been selling faster year-for-year than the PS2. I speculate the “big announcement” and sub-$100 pricetag are designed to compete with the Wii craze. Most video-game hungry customers won’t even need payday loans to afford the PS2 now.

Older system, new games

Sony assures customers that the library of games to go with your new PS2, should you chose to take advantage of the new price, is still growing rapidly. The company says 1,900 new games for the PS2 will come out this year.

Personal perspective

As a member of a household that contains a PS2, I can say this new pricetag is pretty remarkable. In fact, some of the games for the PS2 right now cost more than the consoles. For instance, my roommate purchased the game Rock Band II, complete with accessories, for $129.

Right now, used PS2s on craigslist are going for $80 to $85. That isn’t much of a price difference from a brand new one, but online sellers generally include games with the system.

More on PS2

The Sony PS2 is already the most popular gaming system in the world based on units sold. More than 136 million PS2s have sold worldwide.

"Demand for PlayStation 2 remains strong throughout the world," he adds, "and the new $99 price point will bring in new consumers who will discover how PlayStation platforms are an outstanding choice for their gaming and home entertainment needs." ... click here to read the rest of the article titled "PS2 Price Cut to Less Than $100"

Gary Sheffield Released | Dollars and Sense

Nobody’s safe

If the current recession economy has taught us anything, it’s that no matter how strong a position you think you have, no job is completely safe when companies look to downsize. I think there are better ways to handle the situation than putting people who depend upon every penny of their job earnings to be able to put food on the table, but then again I didn’t graduate from executive genius school…

Apparently, even potential Hall of Famers are in danger of recession cutbacks. However, I’m sure Gary Sheffield has something put away and won’t need to depend upon cash advance loans. Tom Gage of The Detroit News reports that the Detroit Tigers are prepared to eat the $14 million salary they owe the power-hitting outfielder/designated hitter for 2009.

That’s a shocker, baseball fans

Reports indicate that Sheffield didn’t see this coming. He had recovered from a shoulder injury and was ready to have a productive season. His first home run of the year would have been his ticket into the elite 500-home run club, an achievement that generally guarantees a player’s induction into the Major League Baseball Hall of Fame. However, in the post-steroids era, that’s no guarantee (as Mark McGwire and Raphael Palmeiro well know). Sheffield hasn’t escaped steroid suspicion, so we’ll see how the sportswriters view him, post-career. ... click here to read the rest of the article titled "Gary Sheffield Released | Dollars and Sense"

Surviving the Recession, Episode 3: Commute Smart (2)

More ways to save on daily transportation expenses

If you missed PART ONE of this “Surviving the Recession,” start there. You won’t need as many cash advance loans if you follow this plan…

• Stay home - Sometimes you have to go, but if you don’t, stay in more often. Read a book, exercise, watch TV, call a friend or three. Anything to keep your gas and entertainment budget more manageable
• Keep tires inflated properly - When tires are in need of air, the tread is not making optimal contact with the road. When tires don’t make optimal contact with the road, your care requires more gasoline to travel.  Keep tires aired up and you’ll have a smoother, more efficient ride
• Don’t suddenly stop or accelerate - Accelerate and decelerate slowly and smoothly. This places less stress on your engine, transmission and brakes, to name just a few. It also doesn’t burn as much gasoline. If you can make a habit of driving this way, your fuel savings will be significant
• Carpool - Share the road. Not only is this good for your gasoline budget, but it’s good for the environment because it means at least one fewer car on the road. Ask the Human Resources department where you work if they have a ridesharing or similar alternative transportation program. In some cases, your company may even participate in a larger program that awards prizes to conscientious commuters
• Ride your bike - If it isn’t practical to walk, biking is a fantastic option that’s great exercise. You’ll want to make sure you have proper safety gear (helmet, at least), a properly maintained bicycle and a route that is safe for bicycling
• Go biodiesel - Keep in mind, I’m not talking about ethanol from corn. The world has enough problems feeding everyone and corn prices are high enough as it is. Let’s not cause an artificial corn shortage, no matter what America’s previous president opinion was on the matter. With little modification, a regular diesel gas engine can be made ready for biodiesel fuel that comes straight from the grease trap of your favorite fast food restaurant. With federal tax incentives, the increased cost of biodiesel blends is all but offset, and for the environment, biodiesel has been proven safer than standard diesel gasoline. But you know what’s the safest thing of all to do? CONTINUE READING…

Related Video: ... click here to read the rest of the article titled "Surviving the Recession, Episode 3: Commute Smart (2)"

Global Web 'Phishing' Scam Yields First Sentence

A Romanian citizen was sentenced in Connecticut Monday to more than four years in prison as the first foreign defendant convicted in a global crime ring that stole hundreds of thousands of dollars from Internet users.

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Of Crossword Puzzles and Red Wine – A Study in Economics

How to stay normal when the whole world is crazy

How is it possible, I ponder, as I fill in the C, that the answer to the clue "Warm up" in the New York Times crossword turns out to be 'DEICE'? One of these days, I promise myself, I will get myself a No Fax Cash Advance and buy myself a new crossword dictionary, one with all the latest words, like DEICE which means 'Warm up.' I am sadly out of date and lagging behind in my English.

"We're going shopping!" The cry comes from the kitchen. I look around. There are only two of us here and WE'RE going shopping? The penny drops and I unwind from the couch with a grand operatic groaning performance.

Sunday night in the supermarket? "They've got specials for one night only!" And the whole town knew about it except for a few crossword fans who were busy with the really important stuff. The supermarket is standing room only. "DEICE" meaning 'Warm Up'? Oh you idiot, I tell myself. It's DE-ICE and everyone turns to see who is shrieking with crazy laughter. Of course it's DE-ICE. Serves you right. Now you are consigned to the supermarket. May as well be positive. Anyway DE-ICE wasn't exactly fair. The clue should have indicated that the answer was hyphenated. What's on sale? ... click here to read the rest of the article titled "Of Crossword Puzzles and Red Wine – A Study in Economics"

Hard times come to Yuppietown

Everyone came, but mainly to look

Today was "Open House" for the artists of Yuppietown, a small town of about 10,000 souls about 10 miles north of here. It was Sunday, so we slept late, ate a lazy breakfast and then drove up to take a look at the action and see how our daughter-in-law was faring with her jewelry sales. "Wow, there's nowhere to park!" was our first mixed feeling reaction – disappointment at having to walk an extra hundred yards and joy because Diane had so many visitors, and hopefully, buyers in her house. I didn't intend buying anything so I hadn't taken a Payday Loan and my wallet was empty.

Very few sales

Inside, the house was humming with activity and a large throng of people moving slowly from one display to another. Diane was standing in the entrance smiling at her visitors. I asked how it was going and she whispered, "So far they're only looking. Very few sales." A few minutes later a woman bought a pair of earrings and broke the ice. We hung around for a while and then walked across the street to another Open House. Here a photographer was displaying stunning mounted color photographs and on the lawn a woman had 3 tables loaded with her pottery. They both said, "No sales or very few sales and cheap stuff only."

Yuppietown

Yuppietown didn’t spring up overnight. It grew slowly and surely as the new breed of hi-tech men and women who were earning large salaries looked for a place to build their dream homes. They built large houses and planted lush gardens. These smart new generation techies got into all kinds of new industries, including many of the old established hi-tech companies. In the streets outside their cars carry company logos such as Microsoft, Intel, Advanced Materials, Comverse and many other lesser known companies. These men and women are enthusiastic and motivated and their children are high-achievers like their parents. ... click here to read the rest of the article titled "Hard times come to Yuppietown"

Future of Your Mortgage | Loan Modificaton Part 9

After your personal loan is altered

Fannie Mae holds the most mortgages in the United States.

By now you know that Loan Modification and Refinancing are achieved through lowering the interest rate on a mortgage. The federal foreclosure prevention plan says bankers and other lenders can lower the interest rate on a  mortgage to 2 percent in order to get payments low enough.

How low is low enough?

The lender reduces the interest rate until payments are only 31 percent of the borrower’s income, after the government pitches in its share. However, that 2 percent interest rate won’t stick around forever.

Interest rate terms

The new interest rate negotiated with your borrower will stay locked in place for five years. After the five years is up, the interest rate will slowly start to climb back up to the original interest rate on your mortgage.

However,  if your interest rate is higher than the prevailing interest rate available at the time you modify your loan, the rate will only climb up to the prevailing rate. Right now that is in the neighborhood of 5 percent.

Slow and steady

The interest rate will not suddenly jump back up to a normal rate after five years. Instead, it will climb at a rate of 1 percent per year until it is up to the rate where it will stay until the mortgage is paid. For some people, that could be up to 40 years because the federal program allows for mortgage terms to be increased to that length. ... click here to read the rest of the article titled "Future of Your Mortgage | Loan Modificaton Part 9"

Fox Nation Inflicts TheFoxNation.com Upon Us (Pt. 1)

Feed the masses conflict pie

America’s economy is in a difficult place. We all know that the underlying system is in need of repair, but how we get there is far from universally agreed upon. President Obama’s stimulus plans amount to a giant cash advance to scores of failing industries, but many pundits agree that the long-term costs of this cash outpouring will bury future generations in debt. Liberals and conservatives will have material for years to come… and now there’s another annoying voice ready to scream at you.

Howard Kurtz of the Washington Post reports that Fox Nation is going to swing its “fair and balanced” stick at the fat fastballs the government and its arch nemesis - LIBERALS! - offer up. However, thefoxnation.com has a gopher ball of a slogan:

“It’s Time to Say NO to Biased Media and Say YES to Fair Play and Free Speech.”

Sean Hannity and Glenn Beck aren’t biased, are they?

“We felt that giving people a real destination to go and express themselves would give them a feeling of belonging,” said Fox Senior Vice President Joel Cheatwood. “People feel they’re dictated to a lot by the media.” And Sean Hannity and Glenn Beck never dictate… right? Apparently you’ve never paid attention to your own network, Mr. Cheatwood.

Because they must have a purpose, FoxNation.com has conceived of Fox Nation as its outlet to aggressively attack the Obama administration. I question the public relations aspect of this strategy. Rupert Murdoch’s charges spent eight years worshiping the G. W. Bush White House, which would have sent most into an irreversible spiral of public shame. But not plucky Fox Nation! The foamy-mouthed trinity of Sean Hannity, Glenn Beck and Mike Huckabee are ready to decry government with one pinky and point the rest of their fingers at any group whose value base differs from their own. They’ll even shout YOU down if you don’t CLICK HERE to continue reading this story… ... click here to read the rest of the article titled "Fox Nation Inflicts TheFoxNation.com Upon Us (Pt. 1)"

WhiteFence Helps You Find Deals on Utilities

I’m a huge advocate of calling your utilities to ask for rate reductions. But some people are uncomfortable making these sorts of calls. It would be helpful if these folks had a way of using the internet to find better deals. WhiteFence is a web-based service that allows users to do just that. From the about page:

WhiteFence is a free service that helps people who are moving or looking to find the best deals on phone, internet, television, electricity, natural gas and other home services. By simply entering a street address into the secure site, people looking to save money or start new service can find the most comprehensive list of plans available for their specific address from over 400 nationally recognized partners.

WhiteFence targets two types of users:

• Those who are moving from one address to another. WhiteFence bills itself as a one-stop source for connecting utilities. (And even promises that you can keep your existing phone number after a move.)
• Those who are shopping around for a better deal.

WhiteFence also offers a price guarantee: “Our Best Price Guarantee means that you will receive the best price that each of our participating service providers offers (online or otherwise) for a product or service at your particular location.”

I was intrigued by the idea of WhiteFence, but it didn’t have a lot of info for the Portland area. I plugged in our address, and the only deal it suggested was bundled internet/phone/television from Qwest. None of the price-points worked for me. Out of curiosity, I contacted a WhiteFence spokesperson to find out more about the service:

J.D.: Are there particular regions or cities for which WhiteFence is best suited? Who is most likely to benefit from the service?

Spokesperson: Some cities have a broader array of services available than others, depending on what the local service providers decide to offer through WhiteFence.com. That being said, WhiteFence does offer the most comprehensive online service for comparison shopping of home services nationwide.  In some states, WhiteFence has added value. For example, in Texas people can search for energy prices which changes frequently due to the de-regulated energy market in that state.

J.D.: What does WhiteFence have planned for the future? Are there features coming that would be of interest to Get Rich Slowly readers?

Spokesperson: WhiteFence is planning to add a "deal of the week" feature on its site, which will point customers to the best current promotions available.  Additionally, WhiteFence is planning to add local community information so if you are moving and looking to switch your utilities, you'll also be able to look up neighborhood amenities, school and crime information for example.

I’m intrigued. Though WhiteFence can’t save me any money right now, I’ve bookmarked it for future use. It cannot hurt to check back every few months, right? Perhaps they’ll come up with some additional deals for my neighborhood.

Have you used WhiteFence (or a similar service) before? Does it offer a variety of suggestions for your location? Are the prices better than what you’re currently paying? Or would you rather get your rate reductions the old-fashioned way: by calling and asking?

—
Related Articles at Get Rich Slowly:

• I Want a Freeware Utility to…
• The Bargainist
• Ask the Readers: How to Rent Out Your Spare Room?
• The Best Time to Buy
• Get Quality Stuff For Cheap from Local College Students

Read more about WhiteFence Helps You Find Deals on Utilities…

A 3-Minute Survival Course for Economic Mayhem

Don't get swept away by something you don't understand

Call it what you like – tsunami, implosion, melt-down or earthquake, it all amounts to the same thing -a devastating happening right in the middle of a system we had built and used successfully for many years. Then came the blow. Do you remember when an undersea earthquake ripped up a piece of the ocean bed and caused that gigantic and fatal tsunami that caused havoc and death in the Indian Ocean in 2004? Do you remember how the world was stunned by the devastation? It triggered aftershocks and other earthquakes around the globe and it all happened in a very short amount of time.

Devastation grew and grew

I remember hearing a radio news broadcast at about 9 in the morning reporting half a dozen deaths. By lunch time the number of deaths was up to 150 and at 8 that evening the news reported a "few hundred." Final count: more than 225,000 people in eleven countries.

I knew people in one of the devastated areas and I took a hurried Cash Advance to buy a shortwave radio to keep up with the news.

The force of the eruption

An event of this type takes shape over a period of time and then erupts with incredible force. What happened to global economies this past year is similar; it had been brewing for some time. When it hit, it was like a tsunami which caused other economies to start crumbling as well. The domino effect. We are all familiar with that scenario. But now we have to deal with it. ... click here to read the rest of the article titled "A 3-Minute Survival Course for Economic Mayhem"

Financial Independence: The Final Stage of Money Management

This is the last of a five-part series about the “stages” of personal finance. These stories have intentionally been less polished than most articles at Get Rich Slowly. This is a chance for me to think out loud, to explore an idea with you in an informal way.

In February, I wrote that I was entering the third stage of personal finance. As I made my way out of debt and began to save, I had noticed that many people passed through similar phases of financial development. We took similar steps along the way. In my own journey, the progress looked like this:

• Initially, I was fumbling in the dark, spending compulsively and accumulating debt.
• Eventually I saw the light and began to repay my debt.
• After a hard slog, I reached the light at the end of the tunnel: my debt was gone and I began to save.
• Now I’ve entered new territory. I have a plan, and I’m sticking to it as I reach for my eventual destination: Financial Independence.

Financial Independence is my ultimate goal. It’s the state in which I will no longer have to worry about money. I would have enough saved so that I could do whatever I pleased. But what exactly does this mean?

Defining Financial Independence
One of the underlying philosophies of this site is that different things work for different people. We each have different goals, different strengths, and different weaknesses. Though Financial Independence is the goal for many Get Rich Slowly readers, we each mean something different by it.

In Yes, You Can…Achieve Financial Independence [my review], James Stowers states: “No person is free, in an economic sense, who does not have adequate investment income entirely unrelated to work.” In other words, Financial Independence means that you earn enough from non-work income to fund your current lifestyle. I think this is the traditional definition of the term.

But the classic Your Money or Your Life offers a little more nuance:

When you are financially independent, the way money functions in your life is determined by you, not by your circumstances. In this way money isn’t something that happens to you, it’s something you include in your life in a purposeful way…Financial Independence is being free of the fog, fear, and fanaticism so many of us feel about money.

If this sounds like peace of mind, it is. Financial bliss. And if this sounds as unattainable as being rich, it isn’t.

[...]

Financial Independence has nothing to do with rich. Financial Independence is the experience of having enough — and then some…The old notion of Financial Independence as being rich forever is not achievable. Enough is. Enough for you may be different from enough for your neighbor — but it will be a figure that is real for you and within your reach.

Another view of Financial Independence is presented by George Kinder in The Seven Stages of Money Maturity. Kinder argues that when you understand what you want to do with your life, you can make financial choices that reflect your values. In his view, the final two stages of money management are what he calls Vision and Aloha. (Note that Kinder’s approach contains a spiritual element. He uses language in his definitions that some may find odd.)

With Vision we understand further that money is a conduit through which our souls flow into the world. We have produced as much as we personally need. We discover within us a capacity to reach out farther than we have ever imagined toward meeting the needs of our families and communities. We find no obstacle between what we want to accomplish and what we do.

[...]

Aloha conveys kindness, generosity, at-one-ness, and compassion…We give without expectation of return, understanding that living is giving. We know both the limitations and the power of money, yet money no longer agitates us. We rest calm before it. In that calmness we can serve one another from the natural generosity that lies within and waits to be offered tot he world.

In some ways, Financial Independence is just another term for retirement. Think about it. Most people retire at 60 or 65 because that’s when they have enough saved to last the rest of their lives. If they don’t have enough saved, they continue working. If they manage to save the money earlier, then they retire earlier. When you retire, you’re essentially declaring that you are financially independent.

Moving forward
What will Financial Independence, the fourth stage of money management, mean to me? Will it be a purely monetary state in which I have enough investment income to do whatever I like? Will it be the point at which I have “enough”? Or will it be something deeper, more spiritual, as suggested by George Kinder?

I don’t know. In fact, I don’t know if I’ll ever actually reach this goal. But I intend to stick to the path, working my way through this third stage of personal finance, hoping one day to reach that destination.

Your turn: What does Financial Independence mean to you? If you were financially independent, what would you do? How would it change your life? Is this one of your goals? Why? If not, why not?

—
Related Articles at Get Rich Slowly:

• Fumbling in the Dark
• Lighting the Way
• Toward Financial Independence
• The Light at the End of the Tunnel
• Tips for Financial Independence

Read more about Financial Independence: The Final Stage of Money Management…

Internal vs. External Frugality: Different Ways of Saving

So I am trying to kick off one of my planned 2009 projects, which is to methodically go through each major expense area and explore ways to save money there. I started out last week with on housing costs (here and here), and still have a few ideas left. But while brainstorming an outline of future posts, I noticed that there seemed to be a divide in the types of strategies out there.

One set of ideas usually has to do with reducing the amount paid for a specific item or service. I call this external frugality, because you aren’t changing anything about yourself, just the price tag. For example, to save on what you pay for your house, you could look for a buyer’s agent rebate to save something like 1.5% of the purchase price, or carefully shop for mortgages with the lowest combination of closing costs and interest rate.

Another set of ideas usually involves either changing the type, amount, or quality of something. I call this internal frugality, because you are changing your consumption habits. An example of this would be realizing that you don’t necessarily need to same house as everyone else. You could look in more “up-and-coming” neighborhoods, or live in an older house with less square footage.

There are plenty of other examples out there:

External: Calling a cable company and asking for a lower rate.
Internal: You cancel cable completely. You could read more, watch episodes on your computer, or use a low-cost Netflix plan.

External: You find a cheaper long-distance plan, or switch to VoIP.
Internal: You get rid of your landline completely.

External: Learn ways to haggle down the price of a car.
Internal: Don’t own a car. Use public transportation.

I don’t think either or worse, but they are different. In general, it would seem like external frugality is at least initially easier to implement, as you don’t have to actually change your habits. However, I can also imagine that in many situations using internal frugality would lead to both greater absolute savings and also more enduring lifelong savings. But changing habits is really tough.

Next time you think you’re being frugal, examine if you’re doing it externally or internally.

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Did Builder's Clout Trap Couple In Dream Home?

Bob and Jane Cull’s house in Texas was built by one of the most powerful and politically connected homebuilders in the country — and it was defective. They’re now 13 years into a legal odyssey, and still have no recompense.

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Planet Hospital Lures Patients Who Want to Save on Medical Care

Prices drive sick people to other countries

A new type of business has sprung up as uninsured Americans desperately try to find ways to afford the medical care they need. Planet Hospital and other firms like it aid people with medical travel planning.

They are like travel agents, but the purpose of the trip is to get a specific medical procedure at the best price. In another country.

Plight of the uninsured

Sandra Giustina is a good example of how this can help people in need of medical care. She needed surgery for an atrial fibrillation. She lives in Las Vegas, and the going rate for the procedure at U.S. hospitals was about $175,000. She knew she couldn’t come up with that kind of money and would never be able to pay off a personal loan in that amount.

She started looking into how much the procedure would cost in other countries. She was able to get the surgery she needed for less than $10,000, including travel costs, in India.

A growing trend

Experts say 6 million Americans will leave the country for the purpose of medical procedures next year.

“Medical care in countries such as India, Thailand and Singapore can cost as little as 10 percent of the cost of comparable care in the United States,” according to a 2008 Deloitte study. ... click here to read the rest of the article titled "Planet Hospital Lures Patients Who Want to Save on Medical Care"

Counting Stimulus Jobs Is No Easy Task

When President Obama signed the $787 billion stimulus bill, he promised it would create or save 3.5 million jobs. Federal and state officials are ramping up efforts to count those jobs, but it won’t be easy. In the past, government agencies have used different approaches. What’s needed now is a yardstick.

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Surviving the Recession, Episode 2: Frugal Facts (B)

Eat smart, eat right

You’re doing great! If you missed PART ONE of this article, be sure to check it out. Saving on food means eating right once you get it home; the more money you save, the less need there may be for payday loans in the long run.

• Cook large amounts and freeze extra - Because leftovers and pre-planning meals saves time and money
• Scrape out food jars to use it all - Every little bit helps. Here are some tips on how to do this.
• Cook from scratch - Yes, it takes a little bit more time and skill. But if you have those, cooking from scratch is better for you (avoids excess preservatives) and is cheaper than the pre-packaged convenience that Americans have become dependent upon
• Never eat out - I say never; it’s going to happen at least once in a while. But what you must avoid if you’re trying to save money is developing the habit of eating in restaurants. The convenience and social aspects are fantastic, but you’re paying for more than just the food when you’re there. You’re tipping the server and helping the restaurant keep up with its own expenses AND make a profit
• Eat from your own pantry - You bought it in the first place, so just… eat it!

• Bring lunch from home - Use microwaveable containers and bring leftovers to work
• Eat less - Here’s a revolutionary idea. I know I’m guilty of not doing this, but we should all pay attention to portion sizes. Meals Matter has great ideas about how we can visualize portion sizes in a commonsense way. Remember, treats are OK once in a while, but the average American consumes 300 cans of soda per year. We can do better
• Avoid vending machines - These foods are empty calories that will leave you hungry. Plus, the unit price you pay for items out of a vending machine is much higher than if you’d bought the same thing packaged in a store. You’re paying a convenience fee you don’t need
• Have a meal plan - If you plan ahead, you are much more likely to use your food efficiently and avoid impulse splurges. Make a worksheet if it helps you
• KEEP READING. These tips can help anyone!

Related Videos: ... click here to read the rest of the article titled "Surviving the Recession, Episode 2: Frugal Facts (B)"

Which are Reliable Indicators of a Strong Economy?

One of the fun things about living in an Information Age is that we not only have near-instant access to financial data, but also a multitude of data sources to look at. It seems there’s a new report every day with updated economic news and forecasts.

We’d like your input about the economic indicators that mean the most to you. Press “Yay” in the follow list for statistics that you think are serious reflections of a strong economy, and “Boo” for those you think are unimportant noise.

If you don’t know a term, or you’re just looking for a recent update, look here for a convenient list of many economic indicators. Or you could just ignore any terms that seem meaningless. That’s another benefit of living in an information age.

As always, if I’ve forgotten an important option, add it yourself, or leave a comment on this entry.

—
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The Impending Retirement Crisis

We haven’t even gotten through this crisis yet, and we have another one on the way? Seriously?

That’s what John Bogle–the founder of Vanguard and the creator of the first index fund–would have us believe. And, distressingly enough, the case he makes is pretty convincing.

Last month, Bogle testified before the House of Representatives about the upcoming crisis of failed retirements. His testimony included a number of noteworthy statistics:

We’re not saving enough

The median IRA balance is just $55,000, and the median 401k balance is just $15,000. Sure, if you’re in your twenties or thirties, having $70,000 saved up is excellent. But given that the largest portion of the investing community is the baby boom generation (who are now retired or retiring soon), $70,000 is nowhere near enough.

In short, most people simply aren’t saving enough. In fact, they’re not even close.

An asset allocation nightmare

One of the best things about 401k plans is that we’re allowed some options in terms of how we want to invest our money. Unfortunately (and perhaps unsurprisingly), a significant portion of investors are making rather poor decisions:
Nearly 20% of investors in their twenties have literally zero exposure to equities (stocks) in their 401k. In other words, they’re invested entirely in bonds and money market funds. With no access to the long-term growth provided by equities, it’s practically impossible for an investor to accumulate the money necessary to retire.
At the other extreme, more than 30% of investors in their sixties have greater than 80% of their 401k invested in equities. Such a high equity exposure is dangerous for somebody so close to retirement. I can only imagine how these investors are feeling after the last year in the market.

Delayed gratification? No thanks.

When changing jobs, 60% of all 401k participants cash out at least a portion of their 401k and use it on something other than saving for retirement. Not only are these investors hampering their ability to achieve long-term growth, they’re subjecting themselves to an extra 10% tax that comes with early withdrawals from retirement plans.

Apparently we just can’t wait to spend our money.

What can we do?

You and I aren’t John Bogle. We don’t have a free ticket to speak to the U.S. House of Representatives anytime we want, so we’re unlikely to play a major role in any system-wide investment industry changes. That’s the bad news.

The good news is that we can certainly make efforts to ensure that we don’t become a part of this mess.

1. Check your asset allocation. Make sure it’s in line with your age, your goals, and how much you’re going to be able to invest each year.
2. Make sure you’re saving enough. In the past, finance experts tended to recommend investing 10% of your gross income. In recent decades, that number seems to have jumped to 15% as a result of longer average retirements and increased late-in-life medical bills.
3. Get used to the idea of delayed gratification. Money in your 401k is not meant to be spent before you retire. No exceptions.

What about you? What retirement-savings pitfalls are you taking extra care to avoid? And what are you doing to avoid them?

About the author: Mike writes at The Oblivious Investor, where he reminds readers that long-term investing success has nothing to do with short-term fluctuations in the market. Subscribe to his blog for daily updates.

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Supplement income with payday loan until you get government help

The need to make use of a payday loan until government help comes in

The best support you may have with your finances maybe from a payday loan, until the government help reaches you. Are you juggling with your money desperately, to keep that last hold on to your possessions? Now you hear the government is easing things up for you with their new policies but when is that going to happen? How will it benefit you?

Can’t I wait for the stimulus to help me?

If you still have problems with your bills and do not know how to keep up with them, the simple answer would be to take a cash advance loan from your income and try as fast as you can to get your finances straight. Maybe, like so many other people hit by the recession, you are hopeful that the government help will somehow help with your problems. But please, for your own sake, try to keep up with your bills and not wait until the government benefit reaches you. This is no time to relax and let things happen when it happens. You have to take action. You may not know this, but a small payment made on time, may help you prevent a big financial slide.

Where to find the money:

The government might help you save your home or other assets, with reduced payments in the way of interest, cuts and the like, but what do you do while waiting for that to happen? You may have to find money to tide you over until the government help comes in. Borrowing money from anyone is not easy these days. Your friends and family may have their own problems and may not be able to help. ... click here to read the rest of the article titled "Supplement income with payday loan until you get government help"

Goodbye flu virus, hello computer virus!

Here we go again in the fight against another malicious computer virus

Just when I thought I had made it through the winter without catching anything serious, along comes a new threat, and this time a shot in the arm won’t prevent it. Now there's a major battle going on between computer security groups around the world and the brazen author of a malicious software program called Conficker. This program began spreading late last year and quickly infected millions of computers with software code that is intended to control the infected machines and lash them together into a powerful computer known as a "botnet".

Now the author of the program continually updates his software and continues his cat-and-mouse game against international computer security companies by planting the latest versions.

Apply for a No Fax Cash Advance now and buy yourself the latest version of the best anti-virus program you can get for your computer. This guy is no monkey and his virus is no joke. You will lose everything in the blink of a micro-second or you will end up mailing viruses to all your friends, family and contacts. They will love you for your thoughtfulness.

This is serious

The spread of the malicious software is on a scale that matches the worst of past viruses and worms. It is horrific. Microsoft has already announced a $250,000 reward for information leading to the capture of the Conficker author. Botnets are used to send the vast majority of e-mail spam messages. Then the spam is used to transmit shady commercial promotions including schemes that frequently involve directing unwary users to Web sites that can plant malicious software, or malware, on computers. ... click here to read the rest of the article titled "Goodbye flu virus, hello computer virus!"

Goodbye flu virus, hello computer virus!

Here we go again in the fight against another malicious computer virus

Just when I thought I had made it through the winter without catching anything serious, along comes a new threat, and this time a shot in the arm won’t prevent it. Now there's a major battle going on between computer security groups around the world and the brazen author of a malicious software program called Conficker. This program began spreading late last year and quickly infected millions of computers with software code that is intended to control the infected machines and lash them together into a powerful computer known as a "botnet".

Now the author of the program continually updates his software and continues his cat-and-mouse game against international computer security companies by planting the latest versions.

Apply for a No Fax Cash Advance now and buy yourself the latest version of the best anti-virus program you can get for your computer. This guy is no monkey and his virus is no joke. You will lose everything in the blink of a micro-second or you will end up mailing viruses to all your friends, family and contacts. They will love you for your thoughtfulness.

This is serious

The spread of the malicious software is on a scale that matches the worst of past viruses and worms. It is horrific. Microsoft has already announced a $250,000 reward for information leading to the capture of the Conficker author. Botnets are used to send the vast majority of e-mail spam messages. Then the spam is used to transmit shady commercial promotions including schemes that frequently involve directing unwary users to Web sites that can plant malicious software, or malware, on computers. ... click here to read the rest of the article titled "Goodbye flu virus, hello computer virus!"

Oversaving Does Not Lead to Happiness

I love frugality. Frugality helped me to dig out of debt, begin to build wealth, and find more meaning in the things I already own. But at some point I crossed the line from frugal to cheap. I’ve spent the past few months seeking balance: allowing myself permission to spend on a few indulgences while choosing to cut back in other areas.

There’s new research that indicates this sort of conscious spending really does make us happier. This morning, Jeff V. pointed me to a New York Times article from John Tierney that explores this research. Tierney says that oversaving is a burden for our times.

Unlike some others who have complained about savers recently, Tierney does not argue that we should all rush out to spend in order to support the economy. He merely warns that oversaving does not lead to happiness:

"People feel guilty about hedonism right afterwards, but as time passes the guilt dissipates," said Dr. Kivetz, a professor of marketing at the Columbia Business School. "At some point there's a reversal, and what builds up is this wistful feeling of missing out on life's pleasures."

[...]

During the current recession, hyperopic Ants are presumably having a harder time than ever parting with their own cash, no matter how often President Obama and his economists urge them to do some stimulative shopping. But would these Ants — and the economy — be better off if they relaxed a little? I asked Dr. Kivetz for his advice to shoppers.

"Don't be too hard on yourself," he said. "Obviously you need to be responsible and conserve your savings. But it's been a depressing winter, and there's nothing wrong with indulging yourself a little. This is a chance to reassess the quality and the balance of your life and to think how you'll feel in the future. As long as you can afford it, it's not a bad thing to be enjoying yourself."

Now obviously nobody is encouraging to live beyond your means. Frugality is an important part of personal finance, and we all should certainly do what we can to curb costs. Instead, this is a reminder that money is a tool. If you’re meeting your goals for saving, it’s okay to spend some on the things that make you happy.

[The New York Times: Oversaving, a burdern for our times, via Jeff V.]

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