Finance is Personal

Posted by Wayne on February 23, 2008 – 9:58 am

From personal experience I know how difficult it is to make even the most basic personal financial decisions - choosing a bank, a credit card, a loan, a broker, etc. - it’s downright nerve racking!  Even after you make a decision you go over it in your head a thousand times: “Was this the right car?”, “What happens if that trade doesn’t work out?”, “Could I have gotten a lower rate on this loan?”, and the list goes on.

You really can’t blame anybody for feeling this way - I mean, we all work so hard for our money (I don’t know about you, but I didn’t win the lotto or inherit an estate), so we don’t want to waste what we’ve worked so hard to put together.   And that’s what motivated me to stay up until the wee hours of the morning the other night, and it wasn’t to rack my brain over a financial decision.  It was to scour TickerHound looking for personal finance related questions and answers.

I wanted to see what concerns you and some of your fellow TickerHounds had about managing your money, and not just when it comes to the market either.  I was looking for questions about house payments, credit cards, taxes, loans, etc.  It actually inspired one of the TickerHound Challenge questions this week (you’ll see below).

So while this list of questions is by no means complete, I think it highlights some important personal financial tips that could help put your mind at ease when managing your own finances - or at least they’ll help you sound really smart at the next family gathering when someone asks you for advice  

So here goes…

Back in December slick asked, “What happens to my 401K when I switch jobs?“  - great question that I’m sure plenty of people can relate to.

RobSmith replied:

You speak to your HR person (or whoever is in charge of 401k administration) and have them transfer the old account into an account with your new 401k management company (it’s usually just a matter of transferring the account from on brokerage to another) - fairly straightforward and happens all the time…not to worry slick

It was a pretty simple answer, but it’s obviously something you won’t know how to do unless you’ve gone through the (sometimes) annoying process of switching jobs.

Here’s another one:

Will asked, “What are the maximum annual contributions for IRA’S and Plan 457’s for the year 2008 under 50 years of age?”

CUWu answered:

Hey Will, I believe the annual contribution limits for a traditional IRA is $4,000 this year and will bump up to $5,000 in 2008. As for Section 457 plans I believe the maximum contribution is $15,500. However, if you’re over the age of 50 you can make “catch up” contributions to both of these ($1,000 for traditional IRAs and $5,000 for 457 plans).

Rock solid answer CUWu!  This also drives home another important point - your answers on TickerHound don’t need to be full blown essays.  A very simple, concise and accurate answer is all that’s necessary when sharing your knowledge with other folks out there.

This next one is dedicated to some of the more novice TickerHound community members:

Sherry5432 asked, “How do I go about purchasing shares of stock?”

This may seem like a simple question but for someone who’s never done it before (if you look back to your first time opening a brokerage account, I’m sure you’ll agree) it can be a real challenge.

So click here if you’d like to see how some of the TickerHound members answered.

This actually works well with one of last week’s TickerHound Challenge Questions.  We asked, “What criteria do you use for selecting a full service broker?”

EthanR answered:

I would tell a novice investor to look for someone who seems to have their best interest at heart, and is not just trying to churn your account, or sell you the stocks that make his company more money.

Again, a solid answer and it didn’t have to be overly complex…MNSL also supplied a great answer, click here to read more.

And for some of the more experienced TickerHound investors, here’s another question we asked that might be helpful for you:

“I’m planning for retirement but looking for growth, what do you suggest?”

The Best Answer went to MNSL and here’s what he had to say:

Invest 25% of money into financial company shares with strong balance sheet, less debt and continues earnings. There will be great opportunities in this year especially in USA.

Invest 25% of money into food related companies that include animal production companies where there are good demands for food products and with good consistent earnings. There are outstanding companies in animal production sector with less debt, with more than 20% return of investment, with good earnings throughout the world including emerging markets even today. You can watch for some ETF as well.

Invest 20% in soft commodities which are not appreciated yet.

Allocate 10% to invest in companies who declaring dividend very often between 10% to 20% through out the world. If you just hold outstanding companies with more than 20% dividend for five years you have double your investment. In the meantime if there is capital gain you will get more than 200% return.

Keep 20% in cash. You can use this money when there is a big correction in any type of market. For example People bought oil, maize, gold commodity instruments for cheaper price when market is down. Now they are selling whenever there is a record price. You can buy when oil comes down to $ 50 per oil barel and can sell whenever it reaches to $100 per oil barel.

Pl Avoid putting money in some hot commodities, stocks and real estate at the moment. You can take capital gains whenever you stocks become very expensive with higher P/E more than 30. Then you can invest back when it is becomes cheap. Finally closer to retirement keep 70% of your money in cash.

Click here to read some of the other amazing answers to this question.

Other Personal Finance Questions…

This barely scratches the surface of the types of questions that we have floating around the TickerHound community.  In fact, we’ll be making it much easier to find them in the coming weeks with our “super charged” Search feature that we’re putting the finishing touches on.

The new Search technology (powered by Google, I’m proud to say) will help you find the information you want, even faster!

But until then, you can click here to read some of the other Personal Finance questions we have on TickerHound.

Or click here to Ask a Question of your own now!