My Personal Finance Blog » Family finance

Four Family New Year Resolutions For A Fit, Flourishing 2011

admin — Sat, 25 Jun 2011 23:49:33 +0000

There are four areas of life that need to be taken care of to ensure your family’s fitness in the coming New Year (and many more that follow). They are physical, emotional, financial and spiritual fitness.

Here are some ways you can resolve to bring more fitness and prosperity to your family in 2011.

1. Physical Fitness

The usual tips that people offer you are that you need to eat healthier, get more exercise, give up smoking, etc. But unless a person has a compelling reason to do these things – unless you know your “Why” – its unlikely that you’ll ever get down to doing them.

One of the ways that works best for me to get to my “why” is to learn more about the benefits of exercise and diet. When you know how much they can improve your life, you not only give yourself a compelling “why”, but you’ll wonder why you didn’t start earlier.

Other ways to motivate yourself are to look at your kids and imagine what you would need to do for yourself so you can be around for them for a long time to come. Unless you take care of your own physical well-being, you can neither be a good role model to them nor an inspiration to yourself.

2. Emotional Fitness

Emotional fitness involves getting rid of subconscious beliefs and blocks that are limiting you and your family from being the best you can be. It requires an effort to uncover and reprogram old mental and emotional programming that no longer serves you and is holding you back from your best life.

Stress management, meditation, therapy and other methods are the popular ways to get emotionally fit. However, today there are also many new techniques such as Emotional Freedom Technique (EFT) that are so easy to do that even kids can benefit from them.

Take the time to learn EFT and practice it regularly with your kids. If you’re inclined towards yoga, meditation and other Eastern energy practices, incorporate them into your family’s routine. For kids there are a number of stress-relief techniques, such as guided meditation, that can make it easier to deal with emotional stress and growing pains.

3. Financial Fitness

In these days of economic turmoil, getting a financial education should be one of the primary tasks you should set for you and your family. Stop listening to what the media and the Government are feeding you about the financial situation and learn to manage your own family finances.

As a family you need to learn how and where to invest your money for the best returns in the next 10 to 20 years. Learn entrepreneurial skills and teach them to your kids. Read Robert Kiyosaki’s books, such as Rich Dad’s Guide to Investing, and Rich Dad’s Conspiracy of the Rich: The 8 New Rules of Money, so that your family is well-prepared for future economic upheaval.

The days of depending on the Government to take care of you and your family are gone. In the New Year and those to follow, families will have to ensure their own security. Make the effort to overcome any outdated beliefs to wealth that you may have and teach your kids to prosper in the new world.

4. Spiritual Fitness

Whether you’re an atheist, agnostic or a religious person, believing that there are higher powers at work than just our own, is a prerequisite to spiritual fitness. For those who prefer a non-denominational approach to spirituality, the Law of Attraction, as taught by Abraham-Hicks, is a good place to start.

Whatever your beliefs, learning to channel the good within for the benefit of your family and the world at large, will make you happier, no matter which way you look at it.

We hope these tips will help you bring balance into these four areas of your life so that, this New Year and all the rest will be exceptionally wonderful for you and your family.

2011 Income Tax Rates – Australian

admin — Sat, 25 Jun 2011 16:39:15 +0000

1st July 2010 starts a new financial year in Australia. With the new year, a new reduced rates of income tax is has been implemented by the Government. The following savings are a sample of what can be expected, the major beneficiaries are the middle income earners as you can see from the amounts below.

$600 per week the savings are $2.00

$900 per week the savings are $8.00

$1,200 per week the savings are $7.00

For the low income earners the low income tax offset has increase to $1,350 from $1,200, this means that the taxpayer can have extra earnings of $1,000 with out effecting their tax payable.

The new tax brackets are set out below for the 2011 financial year.

Taxable income Tax on this income

$1 – $6,000 Nil
$6,001 – $37,000 15c for each $1 over $6,000
$37,001 – $80,000 $4,650 plus 30c for each $1 over $37,000
$80,001 – $180,000 $17,550 plus 37c for each $1 over $80,000
$180,001 and over $54,550 plus 45c for each $1 over $180,000

The above rates do not include the Medicare levy of 1.5%, which is subject to income thresholds. Nor does it include any income tax offsets, these apply to the taxpayers individual circumstances.

There is a common misconception that as you move into a higher tax bracket, all of your earnings are taxed at the higher tax rate, thankfully this is not the case, only the income above the tax bracket is taxed at that rate.

Using the chart above if your income was $85,000, only $5k would be taxed at 37% not the full $85k.

Calculating Expected Family Contribution for FAFSA

admin — Wed, 22 Jun 2011 01:08:39 +0000

It’s that time of year again when college parents across the country are forced to grapple with the complicated process of completing the FAFSA application in order to determine how much federal financial aid they may be eligible for. This aid takes the form of grants (Pell Grants, Federal Supplemental Educational Opportunity Grants, SMART Grants and TEACH Grants) or loans (Perkins Loans and Subsidized Stafford Loans) and is determined by the following formula:

Cost of Attendance
minus Resources (employer educational assistance funding, VA educational benefits, scholarships, non-family funding)
minus Expected Family Contributions
= Financial Need.

The Expected Family Contribution amount is determined as follows:

1. Parents’ Contribution From Income which = Parents’ Adjusted Gross Income plus Exempt Income plus 401(K) Plan Contributions plus IRA Distributions plus Workers’ Compensation Benefits plus Military Allowances plus untaxed Social Security Benefits plus Child Support plus Veterans Disability, plus Veterans Pension Benefits received minus Income Protection Allowance minus Federal Income Taxes minus Social Security Taxes minus State Allowance minus Employer Expense Allowance. Multiply this amount by 22%-47%.

2. Plus Parents’ Contributions From Assets which = Total Parents’ Assets minus Annuities minus Cash Surrender Value of Life Insurance minus Retirement Accounts minus Financial Aid minus Personal Assets (cars, computers, various equipment) minus Family Residence minus Family Farm minus Family Business (100 of fewer employees). Multiply this amount by 2.64%-5.64%.

3. Plus Student’s Contribution From Income which = Student’s Adjusted Gross Income plus Exempt Income plus 401(K) Plan Contributions plus untaxed Social Security Benefits minus Income Protection Allowance minus Federal Income Taxes minus Social Security Taxes minus State Allowance minus Employer Expense Allowance. Multiply this amount by 50%.

4. Plus Student’s Contributions From Assets which = Total Student’s Assets minus Annuities, minus Cash Surrender Value of Life Insurance minus Retirement Accounts minus Financial Aid minus Personal Assets.

Adding items 1-4 results in the Expected Family Contribution, which is the amount that the parents’ and college student are expected to contribute to the cost of college. Of course, the devil is in the details, but this gives you an idea as to how to determine what, if any, you can expect to receive in financial aid. Whether that financial aid is in the form of grants or loans depends on your income level. As a general rule, individuals may qualify for grants and subsidized student loans when their income level is below $50,000.

Capricorn Weekly Horoscope for 2011

admin — Tue, 21 Jun 2011 15:24:23 +0000

You always try to excel yourself and this week it will be the dominating force of your life. You love to mingle pleasure in your work and this really helps you to be recognized. A lot of things will happen in your life this week, from academic pursuit to travel. This week will be a busy week for you and a lot of things will surround you such as financial matters, family issues, and issues related with your career. You should start planning for your future. Overall, this week will be spent in balancing your professional life with your personal life. If you want to know more about Capricorn weekly horoscope for 2011, read on…

For Family life: You will have a busy week ahead. Some family issues will come to you urgently and you have to sort them out within this week. If there is any elderly and young member in your family, it is better to sit and talk with them during the first half of the week. Your family members are very supportive to you and they offer you peace and comfort, when you return home after a long and tiring day. August 8 is a very good day, when you will enjoy with your near and dear ones. Some invitations may also come to your way this week.

For Romance: Your love life is very interesting this week. If you are paired, you will enjoy a blissful romantic life with your partner. You may have to sit and talk with your loved one, if there is any issue, which needs to be solved out. Your partner is always beside you and he or she will support you, whenever you will need them. If you are single, this week may not be a very good week for your romantic life. Even though, you may meet with a couple of potential singles this week, but they will not meet your criteria.

For Friendship: Your friends will help you, if you really need it. Your friends are always around you and you will find them always beside you. August 3 to August 5 is an ideal time, when you can go for shared hobby trips with your close friends. You may also plan for a pleasure trip this week with your close friends, but you always have to remember that nothing comes without a price tag.

For Career and finance: A good news might be waiting for you this week. This week may prove a highly profitable week for you. Always prepare making decisions for critical situations. Pay attention to your actions in the work place, because it will be responsible for your promotion or hike.

Some interesting facts about Capricorn weekly horoscope:

Most dominating traits: Steady, organized, and practical
Leading keyword: I use
Most compatible sign: Aries and Leo
Lucky numbers: 1, 2, 4, 8, 10, 13, 17, 19, 22
Lucky colors: Brown, Green, Grey, and Black
Lucky day of the week: Saturday
Lucky stone: Dark Sapphire and Garnet

Extreme Home Makeover Finance Version

admin — Sun, 19 Jun 2011 19:35:11 +0000

Not too long ago I read a story about the “Extreme Home Makeover” houses. It seems several of them fell into foreclosure over the years. It makes me wonder if bailouts – big government or the average person – are ever the right way to go.

It would be easy for me to start talking about the right way for the show to find people and the right way for the houses to be built. But I have to get my own house in order before I start judging other people and their home situations. It is that whole beam and speck issue for me.

When the economy tanked, many of my freelance writing jobs followed it down the drain. We began to do what most Americans do – live off credit. We have been down that road before and recognized the symptoms early enough to begin the process of pushing things back on track. Right now the finances are so tight that you can hear them squeaking! Something has to give if we are going to survive to 2011.

5 Steps for Getting the Finances in Order

1. Pay cash. The easiest way to force your family to stay out of debt is to buy with cash. That means that if you do not have the money then you do not make the purchase. It is always the first thing that we do if we feel things getting out of control.

2. Make the cut. This means that we temporarily turn off all those services that are not essential to living – cable, extra phone lines, and bug treatment for the house. As individual items they may not be worth much, but when you add them all up they can make a huge dent in the budget.

3. Start selling off those items that you do not need. The extra car can give you cash to survive a few months PLUS you can cut out that insurance for that car from your household budget.

4. Get creative. Plan out menus that take advantage of everything in your freezer and pantry. You may find that you can skip a few trips to the grocery. Also plan out all your errands so that you can cut back on the gas you use up.

5. Be honest – with yourself, with your spouse and, YES, with the kids. The family needs to face finances as a family and working together will make the experience easier to manage.

Times have been tough on many people because of the economy and because of the way society as a whole consumes. Getting finances in order in my own home is the best thing that I can do to help the economy. After that, I will put together my plan for “Extreme Home Makeovers.”

Job & Financial Loss – Importance of Family-Nurturing Communication When Economy Fails

admin — Sun, 19 Jun 2011 01:42:57 +0000

Job Loss Impact: Strategy for Focusing on Nurturing Communication within the Family When Finances are Wiped Out

First Observation

When your family’s finances change drastically there is a corresponding change in the family dynamics especially the verbal dynamics. If the change happens quickly without the opportunity to adjust, your family could find itself in a type of Communication Crisis Mode.

Family members can become testy, rude, short-tempered, yelling, and generally mean-spirited. Unable to do the things of the past can bring out the worse in behavior; Mom has to give up nail appointments, lunch with the girls; Dad must give up golf lessons; teens who’ve always had extra money in the form of an allowance may now need to get a job. Everyone loses those little “fringe benefits.” Big things are relinquished too; it’s a time of great upheaval, turmoil, and disappointment. Who do you blame? Who was expecting the bottom to drop out in a strong and healthy economy?

The Family Emergency Mode: “Extra Care Because We Care”

Lost finances put a lot of pressure on everyone in the family. This is a time for manners, courtesy and consideration especially to the laid off member of the family which in most cases will be either parent. Dad or Mom, whomever lost their job,already feels at their lowest point. One minute there is relative calmness then panic. It’ll usually happen several times a day in the first few weeks. They need to be handled with loving care.

Evaluate your family’s manner of speaking with each other in the past. This takes a lot of objectivity and must be done without finger-pointing. If there has been a level of testiness before the money loss, you’ll need to spend more time discussing the need for a change into a supportive-crisis management mode; in other word to love on each other and “lighten-up.” Realization that extra care is needed when speaking to each other. Family members must put this in place. You must face it head on before too many days go by even if it seems very uncomfortable to get started. Do it! The frustration of the situation can cause charred relationships not easily mended.

Visit JBHGroup to get more advice for your family communication; having experienced three cycles of job layoffs and financial loss, there is much wisdom to be found there.

Improve Your Family Finances

admin — Sat, 18 Jun 2011 06:49:14 +0000

It all starts with a simple step – make a budget! The most important thing about improving your family finances is to get a clear picture of exactly where you stand. Once you know that, you have a clear understanding of the positive and negative aspects of your financial position you can identify clear steps to take in order to move forward, and improve your finances.

A budget is the backbone of any financial endeavour – whether you are running a business or a household. You must be clear about what financial responsibilities you have, as well as be clear about what your income sources are. The key here is to be completely open and honest with yourself – if you’re not, the whole exercise is futile.

It’s also important to identify financial goals for yourself and a clear timeline in which you want to achieve them. Examples may include going on a holiday, buying a car, paying off existing debt, or buying a house. No matter what the goal, make sure you have a set date you want to achieve it.

To speed up the achievement of your goals, take steps to increase savings, income streams (if possible) and reduce your level of debt. Your personal debt is money you give to someone else each time you have income, so obviously if you reduce those debts, you’ll improve the amount of investable (not disposable) income.

Pay off your credit cards, then cut them up to make sure you don’t run them up again. Pay extra – as much as possible – on your debts to repay them earlier. This will usually save you money because the longer you have these debts like a car or personal loan, the longer you are charged interest. The more you pay on the debt, the less interest is charged and you can pay it off quicker because you are reducing the principal amount of the loan.

If you’re like most people you will have multiple interest incurring debts. You can attack your debt using a number of strategies. Personally, I like to repay smaller amounts first, because the psychological impact of removing a debt from your list of liabilities is fantastic. Plus, the amount you used to pay on the smaller debt can then be snowballed onto other debts – reducing them quicker. Other people may like to repay any extra they have on the debt which is incurring the highest amount of interest. The bottom line is that you should do whatever suits you and your goals.

How To Make A Budget For Family Financial Stability

admin — Wed, 15 Jun 2011 15:21:45 +0000

Keeping control of your personal finances is, in theory, a fairly simple process. It is only human nature that makes home budgeting and financial control so difficult for many people. However, for the sake of this article, we will consider the simple side of the household budget equation, which is making a budget in the first place.

A good starting point in your quest to make a home budget, is to take stock of your current and recent situation, and list out all your monthly outgoings.

If you only do this from memory, there is a chance you will miss one or more important items. You probably have several sources of information on what those regular outgoings are, and whether they are easy to find depends on how well organised you are with your paperwork. It is worth checking back over at least three months bank and credit card statements, and jot down what your regular payments are out of those. At the same time, you can also make a note of items of expenditure that may recur later on.

Another source of information will be the bills and receipts that you have received over the past quarter. If you have not kept such documents and records before, then now is a good time to start. The good organisation of your important financial documents, and orderly filing of bills and receipts, will stand you in good stead for controlling the family budget when it is set.

Going over what you have spent over the last quarter will cover most if not all of your regular payments. However, it is important to think about whether you have any quarterly, annual, or new commitments that may not have shown up in your previous search. This part of the process in making your budget should give you a list that includes utilities (eg water, electricity, gas and telephone), insurance payments, mortgage and loan repayments, and credit card payments.

The regular payments you have so far found will form the core of your household budget. You can now turn those into a formal list, either on paper or on a spreadsheet, and put the amounts into the next column, with a heading notifying the month. Before moving on to the next phase, add a further 11 columns on the paper or spreadsheet, with the headings changed to appropriate months until you have a column for each calendar month for a year. I have prepared an example budget spreadsheet to help you.

For each of the items listed, decide whether they are monthly, quarterly, or yearly, payments, then repeat the monthly amounts in all the columns that apply. For example, monthly payments will go in all 12 columns but quarterly in only in the four columns when payment is due.

The next stage is for you to consider what other necessary expenditure will come out of your income every month. These other expenditure items probably do not show up as regular payments in the first stage, though individual payments may. These items may include food, household goods such as detergents, car maintenance, petrol (gasoline), and fares, which are essential to you, and you need to budget for each month.

Again, list these items in the budget list, and then enter amounts in each monthly column. What you will have then will be the “essential expenditure” part of the budget. This, if you like, is the unavoidable part of your budget. At least, it is unavoidable in the short term.

On top of that essential expenditure, though, we all have discretionary, unnecessary or indulgent expenditure, on things we like to spend on but do not actually have to.

However, before considering your non essential outgoings, there are two things it is advisable to do:

1. Total your monthly essential expenditure for each of the next 12 months, and

2. Write (or type) in your monthly net income at the top of your budget form.

Hopefully, “2″ is much higher than “1″, and you still have some income left to spend on non-essential things that make life more pleasant, plus some regular savings too.

Now that you know that you have money spare to spend on non-essentials, such as holidays and eating out, then you can also list those. You will then have a complete picture of your spending and income patterns, and have a basic budget from which you can plan ahead and keep your finances under control. If all goes well, you can also budget to save a reasonable amount each month, putting you well on the way to financial stability.

It’s Easier to Finance a $5,000,000 Apartment Building Than a Single Family Investment Property

admin — Sat, 11 Jun 2011 12:07:40 +0000

Funding has dried up for residential investment property (1-4 family), but it’s plentiful for large multi family projects.

1. Funds are available for large multi family properties, but not for residential investment homes.

President Obama said during his Economic Recovery Act Speech, “there is no money available for you speculators” and he meant it. Try to get a loan for a residential (1-4 family) non-owner occupied property and see the results for yourself. There are no more stated income loans available for residential investors. If you have been in the residential investment game for a while, you already know it, if you are just starting out; you will experience this problem on your first residential investment deal. Its cash, hard money at 12% and a 65% LTV or you’re done.

The good news is that government backed funds are plentiful for larger, multi-family properties. This presents tremendous opportunities for those who know how to access the funding sources.

2. You don’t have to personally qualify for the loan the properties qualify.

Imagine that! Anyone who has ever attempted to purchase a residential investment property (1-4 family) has encountered the issue of personally qualifying. Sure the rents may cover part or the entire mortgage, but the lender only considers a percentage of that income toward your ability to pay the new mortgage. You need, tax returns, financial statements, proof of funds for down payment, etc. Not only that, but of course your FICO score becomes a big factor. Get through all of this and every time you buy another residential property your FICO score drops and you are viewed as more of a risk to the lenders. The more successful you become in this arena, the harder it gets……

With commercial financing, the properties qualify for the loan, not you. The loan is not reported to the credit bureau’s. The more successful you become, the easier it gets…..

3. Most loans on large multi family properties are fully assumable.

Ever try to assume a residential loan without having to qualify for it? Not happening, at least not since the early 80′s when FHA and VA loans went from “fully assumable” to “qualifying assumable”. It’s the same as having to secure a new purchase money mortgage, so unless the interest rate is very attractive, it’s never done. The first home I ever purchased was a little bungalow for $25,000. It was 1980, I was 20 years old and didn’t qualify for a $200 limit MasterCard, but I assumed a $23,000 VA loan, no questions asked. The same criteria hold true to this date for large multi family projects, but very few know about it.

The financing on many large multi family buildings are fully assumable. Remember, the properties qualify not the buyer. You can buy 100 + unit apartment complexes without qualifying, no verification of funds, no credit report, no tax returns, just knowledge.

4. You ARE NOT personally obligated to repay the loan.

Try getting a residential mortgage and tell the lender that you don’t want to personally guarantee the loan. Not happening! We are accustomed to all loans carrying personal guarantees. It’s incorporated into every residential mortgage, by every lender in the country. Of course they want recourse if you default, they get the property and then have the right to a default judgment for any balance that may be due after they liquidate the property. Residential loans carry “FULL RECOURSE” to the mortgagee.

Larger commercial loans are “NON RECOURSE” to the borrower. The property and its ability to generate cash flow is the lenders security, not you personally.

5. Multi Family Properties are built to CASH FLOW, single family homes are not.

Single family homes are designed, built and price for owner occupants, not for cash flow. Study the numbers on almost any single family home and you will discover that after you pay the mortgage, taxes. Insurance, utilities, maintenance, etc, you will lose money every month. Single family homes are terrible for cash flow despite what the residential guru’s on TV tell you.

Multi family properties are designed, built and priced to do one thing and one thing only, “make money”. Lenders lend based on the fact that there are sufficient funds to cover the debt obligations, not on what your credit score is, or what the house down the block sold for or what your personal income was last year, etc…..

6. Professionals manage the property- No tenants and toilets to deal with.

With residential investment property YOU generally have to manage it. The property has negative cash flow to begin with; there probably is no budget to hire a management company to run it. You go from watching the guru on TV sitting by the pool telling you how great your new lifestyle is going to be once you buy a couple of homes, to fielding leaking roof calls and clogged drain problems on Saturday nights.

With the larger properties a professional management company handles all of that for you. It’s budgeted in just like taxes and maintenance. The lenders require a professional management contract be in place at closing. They handle all the problems; they are staffed for it and deal with repairs, collecting rents, renting vacant units, etc. They send the funds to you. You never have to deal with a single tenant, yet you reap the rewards. Now you have a lifestyle.

There are many more reasons to move from residential to large multi family including dramatically increasing the property’s value by simple rent increases, etc. I encourage anyone investing in residential property to take a good look at moving up to larger properties. It’s easier than you think when you acquire the knowledge.

Copyright (c) 2009 Joe Florentine

Family Financial Advice

admin — Thu, 09 Jun 2011 17:45:44 +0000

Again and again you hear from everywhere that financial planning is a key to your future prosperity and well-being. Any married couple should ask themselves why they live beyond their income and have financial problems. It happens because couple make several wide spread financial mistakes.

Most married couples talk about money on a weekly basis but they are too emotional instead of being strategic in their attempts to discuss important financial problems. But you must be serious and methodical like running a business and your financial tactics will become wiser and more successful.

Some financial advice may be of great use for married couples and they should not ignore it even if they dislike advice.

If you have separate account and one joint account for household needs it does not mean absence of unity in your marriage or that you demonstrate lack of trust in one another. It shows your wise approach to your family financial affairs and that you give each other freedom.

In order to be financially secure, you should track your spending, unless it will be impossible to set financial goals and plan your budget.

Of course everything must be discussed regularly especially financial aspects of your family life. Ask for a financial planner’s help if you need.

Save at least 10% of your income and invest in a retirement account because you both want to have a steady retirement lifestyle.

Pay off existing debt together in accordance to the made plan. You should never separate from your spouse’s debts. Try live debt free rationalizing your budget.

Do not fall in financial infidelity like many couples do and be honest about the cost of your purchases. Big financial secrets can destroy your relationship.

Read this article carefully once more and try to practice the tips in your everyday family life.