Economic downturn- Have you set your financial goals today? What are you waiting for? There are several factors you should consider to be alarming: 1) economy still looks volatile, 2) the Feds are continuing the tapering by reducing Bond buyback to $40 billion per month, 3) emerging markets still on slow footing- major uncertainties about Chinese economy.
There are talks from new Fed chairwoman Janet Yellen wanting to kick start inflation… Yellen gave her first indication of her views on the issue. “Most measures of wage increase are running at very low levels,” she said. Yellen went on to provide insight into her thinking on how high is too high for wages. “In fact, with the productivity growth we have and 2 percent inflation, one would probably expect to see, on an ongoing basis, something between—perhaps 3 and 4 percent wage inflation would be normal.”
Click here for the full report from CNBC‘s senior economics reporter, Steve Liesman (follow him @steveliesman)
Here are ways to shield yourself from the economic downturn and minimize the monetary affects on your future strategy.:
1- Review and analyze your budget,
2- Cut and control your spending
3- Increase contribution to your savings account.
Take control of your financial well being: 5 Essential Steps to being Financially Stronger.
Take action! Especially during an economic downturn.
Make it a great day!
— New addition to our blog: Weekly financial tips that will help you budget, save, invest, and manage your finances —
This week’s saving tip:
Changing your old incandescent light bulbs to LEDs (light emitting diodes) saves energy and is environmentally friendly – also lowers your monthly electric bill.
Yes, the initial costs to install all those light fixtures around the house is substantial at first, but over the long run it will translate into savings.
The highly efficient LED light bulb consumes a fraction of the electricity burned by conventional incandescent bulbs, yet it emits a soft, natural-looking light. LED lamps have a lifespan and electrical efficiency that is several times better than incandescent lamps, and significantly better than most fluorescent lamps
LEDs can be purchased at Home Depot or Lowe’s. Make a difference, start saving now!
Click Here for a full review on best LED Bulbs (courtesy CNET)
A 401k retirement plan allows employees to defer a part of their pay. That deferred amount is deducted from their paychecks and placed into the employer’s tax qualified plan. Federal income tax is not due on the deferred pay, or the plan’s earnings until the employee withdraws the funds from the plan. Here are the key factors:
- It’s Employer-sponsored investment account- Your employer partners with a financial services company to administer your plan. That company then gives you a limited number of investment options
- No income limits
- No penalties for cashing out in retirement (10% penalty if withdrawn before 59 1/2)
- Annual contribution: $17,500 (2013,2014)
401k retirement plans are the easiest way to save for retirement. The limited investment choices are a good thing because it simplifies your investment decisions. The money is automatically taken out of your paycheck. If your employer offers a 401k retirement plan and you’re eligible, you should definitely contribute. It’s never too late to start saving. If money is tight, then here’s a guide on how to budget, and save for retirement.
To conclude, work with a financial advisor and set clear financial goals. Make sure you have a yearly review of those goals, and adjust according to market trends and conditions. Happy investing!