General (Personal Finance) Articles

Cheat Sheet / Updated 05-13-2022

Managing your money is crucial at all stages of your adult life — whether you’re interviewing for your first job, in the thick of your prime earning years, or enjoying your retirement. Some crucial aspects of managing your finances include taking stock of your finances, using a budget, building your savings, and investing your money.

Article / Updated 05-12-2022

Life can throw you some financial curveballs, but you don't have to be at the mercy of financial markets even if you're not able to control them. To protect against financial uncertainties, use the following strategies: Plan for life's certainties and prepare for life's uncertainties. Invest in and protect your ability to earn money; it's likely your most valuable asset. Adequately insure yourself, your stuff, and your income stream. Minimize or eliminate debt, and focus on building a great credit score. Maintain an emergency reserve fund. Invest for your goals, time horizon, and risk tolerance. Diversify your portfolio across a broad mix of asset classes. Monitor and rebalance your portfolio to maintain your target asset allocation.

Cheat Sheet / Updated 04-05-2022

You work hard for your money, and you should get to use your savings in your later years. In order to enjoy an enjoyable and stress-free retirement, you need to make the most of your finances and retirement planning. You can get on the right track by determining the appropriate age to retire, becoming familiar with Medicare, and understanding your pension and how it’s protected. © 2021 Eric Tyson and Bob Carlson. All rights reserved.

Cheat Sheet / Updated 03-10-2022

Everyone needs to know how to manage their money. Having that knowledge and know-how early in your life pays bigger dividends over the decades of your adult life. And everyone makes mistakes, so Personal Finance in Your 20s and 30s For Dummies can help you minimize bad decisions and maximize good ones.

Cheat Sheet / Updated 03-08-2022

Getting a handle on your personal finances can be tough. We’re constantly being urged to spend, spend, spend, while others encourage us to save, save, save! The good news is that you can create a healthy balance between the two. When you understand your personal financial situation, you can make smart decisions about what to do with your money.

Cheat Sheet / Updated 02-28-2022

If you’re searching for some helpful advice on how to manage your personal finances, congratulations! You’ve found it! If you’re like most Canadians, words like debt, RRSP, and credit score aren’t music to your ears. But no matter how much money you have, or how much you know about personal finance, there are many ways you can take charge of your money to improve your financial health. The following articles show you how, offering tips to help you tackle debt, understand RRSPs, and improve your credit score.

Article / Updated 12-21-2021

When you use a checkbook, you need to know basic addition and subtraction to keep it balanced. Balancing a checkbook means you've recorded all additions (deposits) made to your account and subtractions (withdrawals). Each deposit and withdrawal is called a transaction. The purpose for balancing a checkbook is to know how much actual money you have in your checking account at any given time. What's a checkbook register? Step one in balancing your checkbook is to mark down all transactions in your register, which comes with your checkbook. The register is a little booklet where you write down each transaction (check, ATM withdrawal, debit card payment, or deposit.) Your register probably will have at least six columns: Number: The check number. Date: The date you made the transaction. Description: To whom the check was written, or if you made an ATM withdrawal, or used your debit card. Amount or debit: The exact sum of the check, withdrawal or payment. Deposit: This is where you mark down any deposits such as paychecks, money gifts (from a super-wealthy relative, perhaps?), money you may have transferred from a savings account into your checking account, and so on. Balance: The actual amount of money that's in your account. You start with an opening balance (the amount of money you had when you opened the checking account). And then, by subtracting all checks, withdrawals, payments, and bank fees, and by adding any deposits or interest payments, you will arrive at your balance for that day. Checkbook no-no: A bounced check The lower your balance, the more important it is for you to be precise in recording all transactions; in so doing, you avoid bouncing a check. A bounced check is a check that the bank has returned (bounced back) to you because it's worthless; that is, the check is for an amount greater than the actual amount of money you have left in your account. For example, if you send the phone company a check for $100 but your actual balance is only $75, then that check will bounce. When the phone company presents that check to your bank for payment, it will get a notice that your account has insufficient funds. Your bank will charge you a fee, in the range of $25 to $50 (this is a fee that you should ask about when opening an account) and the other party's bank will charge them a fee, as well. So bouncing a check is not only embarrassing, it can be quite costly. Protect yourself against ever bouncing a check by having overdraft protection; ask your bank if it offers this service. The bank will then honor your bounced checks, but start charging you interest, usually at a high rate, from day one. To avoid bouncing a check, you need to know how much money is in your account, which you do by balancing your checkbook. (Going online or to an ATM to check your balance will not give you an accurate number if you have any outstanding checks, that is to say checks you've written that have not yet been presented to the bank for payment.) The most common mistakes when keeping a checkbook The most common mistakes when keeping a checkbook is forgetting to record each transaction, and forgetting to record it at the time it happens. Yes, your monthly bank statement will give you information on checks you've written, or an ATM withdrawal, or a debit card payment — but by the time your statement comes in, you could have written several more checks that remain outstanding. If you always keep more money in your account than you spend every month, you'll be safe. But if your balance is usually low by the end of the month the more careful you have to be in making sure you know how much money you actually have. To avoid making mathematical errors, buy a register cover with a built in calculator. Some even keep track of your balance for you, provided you enter all transactions. When your statement comes in, you should compare it to your register, fixing any mistakes, such as those times you took cash from an ATM and didn't record it when you got home. Of course, you can also just believe the bank and adjust the balance in your register to agree with the bank's closing balance on the closing date, which you can also do at any time by checking on line or at an ATM. But remember, your actual balance may be less than what the bank says if you have outstanding checks.

Article / Updated 10-26-2021

How a person relates to and feels about money has a great impact on how good they are at managing their money and making important financial decisions. For example, knowing that you have a net worth of negative $13,200 because of credit-card debt is useful, but it’s probably not enough information for you to do something constructive about your problem. A logical next step would be to examine your current spending and take steps to reduce your debt load. Practical solutions to common financial quandaries abound in books and on the internet, but money also has a touchy-feely side. For example, some people who continually rack up consumer debt have a spending addiction. Other people who jump in and out of investments and follow them like a hawk have psychological obstacles that prevent them from holding on to investments. What you learned as a child affects you today How you deal with money as an adult could be, in part, related to what you learned from your parents when you were growing up. I was fortunate — my parents taught me a lot of things that have been invaluable throughout my life, and among those things were sound principles for earning, spending, and saving money. Unfortunately, in many families, money is a taboo subject — parents don’t level with their kids about the limitations, realities, and details of their budgets. Some parents I talk with believe that dealing with money is an adult issue and that children should be insulated from it so they can enjoy being kids. Others readily admit the many holes in their financial knowledge and thus don’t feel comfortable teaching their kids about personal finance. In too many families, kids hear about money only when disagreements and financial crises bubble to the surface. Thus begins the harmful cycle of children having negative associations with money and financial management. Philosophical and psychological aspects of money And then you have those somewhat philosophical and psychological issues relating to money and the meaning of life. Saving more money and increasing your net worth aren’t always the best approaches. Many people attach too much significance to personal wealth accumulation and neglect important human relationships in their pursuit of more money. Some retirees have a hard time loosening the purse strings and actually spending some of the money they worked so hard to save for their golden years. Balancing your financial goals with other important life goals is key to your happiness. What’s the point, for example, of staying in a well-paying, admired profession if you don’t care for the work and you’re mainly doing it for the financial rewards? Life is too short and precious for you to squander away your days. So as you educate yourself about managing your money, please consider your higher life goals and purposes. What are your nonfinancial priorities (family, friends, causes), and how can you best accomplish your goals with the financial resources you do have?

Cheat Sheet / Updated 09-24-2021

Only the most charmed souls make it through life without facing some sort of personal or economic upheaval. But you can take action today to prepare and safeguard your finances from any chaos that may arise. Learn how to keep your cool (and your cash!) in the midst of crisis.

Cheat Sheet / Updated 07-07-2021

A lot of financial advice ignores the big picture and focuses narrowly on investing. Because money is not an end in itself but a part of your whole life, connecting your financial goals to the rest of your life is important. You need a broad understanding of personal finance to include all areas of your financial life: spending, taxes, saving and investing, insurance, and planning for major goals such as education, buying a home, and retirement. The following keys to success aren’t a magic bullet, but they can help you get started thinking about the big picture.