4 Reasons Why I Will Not File For Bankruptcy is a post from: Faithful With A Few. If you enjoy it, please subscribe to the Feed.

Most of the people who I talk to have debt. Debt is one of the major reasons behind this country’s economic growth over the past 40 or 50 years. Many people use credit cards to buy gas, computers, clothing, and a host of other items. On top of that, many people will borrow money to buy furniture, education, cars, and houses at some point in their life. It has pretty much become a way of life in this country, and I am no different.

When counseling clients (or just speaking with friends & acquaintances) about their finances, I will sometimes mention that I am currently paying off over $100,000 in debt. Oftentimes, the topic of bankruptcy will come up. They want to know why someone who doesn’t own a home, or other expensive assets, wouldn’t simply file for bankruptcy and get a “fresh start”.

Why I Will Not File For Bankruptcy

There are four basic reasons that I have for choosing not to file for bankruptcy (for the record, my wife agrees with this decision, but I will just speak of myself in this article)…

Integrity (I Gave My Word)

The main reason why I won’t file for bankruptcy is because of my word. When I signed up for all of those loans, I not only received the money (or line of credit), but I also received an obligation to repay that money according to the terms of the various agreements!

All of those agreements have a few things in common. I asked (sometimes begged) for money, they said ‘yes’ as long as I agreed to pay the money back, I gave them my word by signing a contract, I gladly spent the money, and now I’ve been paying it back every since.

By signing those agreements I put my word and integrity on the line. If I try to get out of those obligations, I will fail to keep my word and end up dishonoring God in the process!

To me, that is the strongest argument against filing for bankruptcy. I knew exactly what I was getting into when I signed those agreements, and I have an obligation to pay them back. It really bothers me when I see people trying to weasel their way out of an arrangement which they not only agreed to, but from which they also greatly benefited! They enjoyed all of the benefits of the arrangement, but when it came time to “pay the piper”, they claim that they should not be held responsible to keep their word! I don’t want to be one of those people if I can help it.

Protection Against Making The Same Mistakes

I have known plenty of people who have either filed for bankruptcy or have taken out debt consolidation loans, and have gone right back to their old habits once their credit cards were cleared. It takes time for most people to change their horrible money habits, and taking the time to pay off debt in a more conventional manner can give one a chance to develop good financial practices.

By not taking the easy way out, I have been forced to develop and revise a budget, look for ways to reduce my expenses, try to develop other streams of income, and set guidelines for evaluating purchases. Had I been given a clean slate directly after feeling the full weight of my debt, I may not have acknowledged and changed my horrible financial habits, which got me into this mess in the first place (most of our debt is from student loans, but we made some bad decisions along the way as well).

This concept not only works with finances, but it also works with our health, and even our ability to learn. Going on a quick, fad diet may help us drop weight pretty quickly, but it is usually harder to maintain the weight loss once you return to a more normal way of life. Likewise, it is much more beneficial to study a subject over time in order to let the foundational topics sink into our thinking, and then build upon that. If we decide to cram a day or two before we need to use the information, it will be much harder to incorporate it into our normal thought process.

So, by forcing myself to take the hard way out, I not only can identify what I did wrong, but I get a chance to develop a system that will benefit my family for decades after we become debt free!

Satisfaction (I Love A Challenge)

As I think about it, I think that even if I wasn’t convinced of my obligation to repay the loans, I would still choose to pay them back. I love a challenge, and having to pay off over $100k in debt is definitely a challenge!

I want the satisfaction of being able to look back over time and seeing the amount of progress that I have made. This is the same reason why I would never have surgery to lose weight (besides the very serious health risks) – I want to get into shape through discipline and making wise choices!

I want to pay off debt by making sacrifices, exercising discipline, making wise choices, and honoring all of my commitments. Since it won’t be easy to pay off this much debt – especially with one income – I feel that it is more of a challenge than if I only owed $10k or so.

To Serve As An Example

I also feel that I can point to my own situation to be an example for others in my situation. I managed to pay off a huge chunk of debt when I was younger (and making a little more than minimum wage), and I can look to that experience to give me confidence that I can do it again.

I want others (especially some of my clients) to see that I was able to overcome a mountain of debt, and avoid filing for bankruptcy to do it, and have them be able to use a small part of my experience as motivation. If I am telling them not to take the easy way out, I want to be able to assure them that it is worth it!

For some reason we humans are better able to take advice from someone if they have been through what we are currently going through. So if I want to convince someone that bankruptcy isn’t the answer, I need to be able to show them that the alternatives work!

Is This The Only “Right” Decision?

Keep in mind that this article is more about expressing my views on the subject, rather than giving a generic, one-size-fits-all piece of financial advice. Every situation is different, but for the most part, bankruptcy is a quick fix with a huge downside.

Of course there are people who are so crippled by their debt, that bankruptcy seems to be the only option to stop them from being homeless. Each case is different, but please be sure to make this decision with a lot of prayer, reflection, and wise counsel.

I plan to take a more detailed look at the subject of bankruptcy, from a biblical point of view in the near future. You may be surprised by how much the bible has to say about this topic, even though the actual word is never used.

Reader Questions

1. Have you even been in a situation where filing for bankruptcy seemed to be the best solution?
2. If you refused to file, what was your reason?
3. Have you ever declared bankruptcy? If so, was it a struggle to make that decision?
4. Also, how long was it before you recovered financially?

photo courtesy of FreeDigitalPhotos.net

Related Posts:

• Why A Consolidation Loan May Be Worth Considering
• Considering Bankruptcy To Pay Off Your Debt? Here Are Some Other Options
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© 2012, Khaleef Crumbley. All rights reserved.

5 Reasons Why You May Need An Accountant For Your Small Business is a post from: Faithful With A Few. If you enjoy it, please subscribe to the Feed.

The following is a guest post about the benefits of having an accountant for you small business…

When small business owners hire an accounting professional it is more common to hear them complain about it being an expense or a necessary evil, but this needn’t be the case. By asking the right questions, and taking advantage of you accountants knowledge, you could actually make your business more profitable.

5 Benefits of Having An Accountant For Your Small Business

Debt Management Advice

Accountants are financial experts, so if you feel your business needs help managing your debt then you can ask them for their advice; most professionals will be more than willing to help, or at least be able to refer you to someone who can. Your accountant can advise you of the best ways to move your debt around so as to pay minimal interest; they will also be able to recommend a sustainable debt repayment plan.

Remember it is in the best interests of your accountant to make your company as profitable as possible, which leads onto…

Accounting Software

By hiring an accountant, you don’t need to waste money on expensive accounting software. Many small businesses are duped by advertisers into buying software they really do not need.

Cheap software, or even a well-designed spread sheet, will be able to calculate accounts payable and receivable for a small company, anything more complicated can be done by your accountant.

Tax Advice

One of the major benefits of having an accountant is gaining access to their knowledge of the tax system. Ask your accountant about the best legal ways to pay no more tax than you have to.

Your accountant will also offer tax help when it comes to completing your returns (great for when you have a question about filing status or some other simple topic), or they can even provide professional tax preparation if you require.

Business Expenses

You can even ask them about business expenses you may be entitled to claim back. There are certain caveats surrounding business claims for things such as company car mileage, mobile phone use and internet use and your accountant will be able to work out what you are entitled to.

They may also let you know about less well known expenses you could qualify for such as claims on fixtures and fittings, utility bills, staff magazine subscriptions and so on.

Bookkeeping Advice

One of the biggest reasons for flawed small business accounting is mismanagement of records. Small business owners often end up paying more tax than they are due, because they give their accounting professional a poorly organised or incomplete set of records.

Ask your accountant about the best way to organize your records; they will be more than happy to oblige as it makes their job easier.

When looking for ways to save money, skimping on how you manage your finances is usually not a wise choice!

photo by jannoon028

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© 2012, guest. All rights reserved.

The Importance Of Social Media For Small Business is a post from: Faithful With A Few. If you enjoy it, please subscribe to the Feed.

The following is a guest post about the importance of social media for small business…

Social Media For Small Business

The most successful of entrepreneurs are those who not only scout emerging opportunities, but seize them before their competitors.While it is the case that social media and networking has been wildly popular for some time, it is only recently that small businesses are beginning to integrate such sites into their primary marketing strategies.

The world of social media seems now to have developed readily into a sphere from which visible business growth can begin to flourish. Increasingly, more and more small businesses are setting up Twitter and Facebook profiles and as a way to communicate with their customers.

As social media is becoming more and more vital to industry, companies are seeking to ensure that they are covered against the luring away of their most able employees. Speaking with insurers such as Hiscox – Business Insurance Specialist is a good way to see that your business is covered against any loss that social media could have on your business.

The Scale of Social Media Presence

A study by the University of Massachusetts at Dartmouth highlights that an astonishing 74% of businesses listed on the 2011 ‘Inc. 500’ now has a presence on Facebook, with almost as many also present on LinkedIn. The study^* went on to recognize and analyze a change in companies’ behavior in social media, noting a shift from blogging to the more interactive services mentioned above.

Marketing and business strategy is founded on the careful study of customers’ habits and this increase in the use of social media to promote businesses reflects the most recent and important example of this in today’s market. This shift shows a positive and new approach to research and is a prime example of how small businesses and entrepreneurs can capitalize on the broader practices of larger companies in their own industry.

When we take a look at the figures surrounding the use of social media, it is no surprise that businesses are moving swiftly onto these sites. HeBS Digital published information in 2012 which showed that nearly half of internet users participate personally in social media.

Those internet users are now estimated to spend 17% of their time on the web browsing social media pages. Crucially it also found that 44% of those using the social media site Twitter claim to have interacted with a brand on the site following some kind of online promotion or discount offer.

Responsible Use of Social Media For Small Business

The statistics which focus on use of social media are hard to ignore, but the implications of integration into social media are not necessarily as purely positive as it might seem. The coverage your business can receive from an online presence is considerable, but it is important for small businesses to bear in mind the responsibility  with which this comes.

Your use of social media is likely to become the primary point of engagement with customers on the internet. Therefore it is essential that you operate your page in the same manner which you operate in all others aspects of running your business, for instance on the shop floor.

When small businesses make the move to social media, it is important that they do so with an amount of conviction and commitment. The reputation of a small business can be hugely affected by its presence online and it is essential that social media usage does not ignore this.

Customers nowadays are always looking for vibrant and buoyant services and a boring and unchanging Facebook page is likely to put them off.Likewise, if businesses have an account with Twitter, it is wise for them to post regularly.

Not only does this ensure that the company is interacting positively and regularly with its customer base, but it shows its audience that it is an active and positive business and really believes in the platform.

With such an array of free advertising and marketing opportunities, reaching customers is no longer about the size and wealth of a company. Rather it has become about the ability to entice customers and to outdo competitors on a level playing field.

The internet has made the market a more equal place, but in doing so it has intensified competition. In order to stay ahead, small businesses must adapt in line with the development of the web.

*[This study is sourced from http://www.umassd.edu/cmr/studiesandresearch/2012inc500socialmediaupdate]

Photo by Vichie81

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© 2012, guest. All rights reserved.

Roundup for the Week of 4.23.12 – Eating In Edition is a post from: Faithful With A Few. If you enjoy it, please subscribe to the Feed.

This past week has been good for us financially because we have not really been eating out! I’ve been planning and preparing meals at the beginning of the week and actually following through. That has been great because that is our biggest pitfall when it comes to our budget. Since I’ve spent a little less time at the stove (or going to restaurants  ) this week, here is a list of some of the great articles I’ve read:

Financial Samurai gives us the best states for unemployment benefits and asks, would you work if you could make $1800/month doing nothing? 

Squirrelers educates us on the phrase “Sell In May and Stay Away”. I have never heard of this one, and it was great learning something new!

Eric @ Narrow Bridge gives us 5 Frugal Tips That Go Too Far. Although I am not really guilty of these, I was thinking about making my own deodorant 

Sense to Save shares her plan to max out her IRA this year. This was really encouraging to me, especially when I realize I am not getting any younger and would like to be able to pour into my retirement account.

Novel Investor reviews the book Millionaire Teacher .

Jason from Live Real, Now shares his vision for an economics class for thugs . This provided some well-needed laughter for the week, as well as made me wonder what other ‘demographic’ could use some economic advice?

Money Crush gives some advice to those who “wish they could”  and often don’t! I have been a “wisher” in the past, and advice like this has helped me break that mold.

Carnivals

Articles from KNS Financial’s Faithful With A Few blog have appeared in the following carnivals recently:

Totally Money Carnival – Millionaire Teacher Edition

Carnival of Passive Investing #16

Festival of Frugality #330: Before You Take Out a Lion Edition

Financial Simplicity Carnival – The Easter Edition

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© 2012, Sherrian Crumbley. All rights reserved.

When A Waiter Gives You Free Food, Is It A Nice Gesture Or Is It Stealing? is a post from: Faithful With A Few. If you enjoy it, please subscribe to the Feed.

After going to a great Good Friday service at a local church near New Brunswick, we decided to go out for an evening meal with some of our friends. It was a lot of fun, and our party of 9 adults and 6 children made for quite the entourage!  Our waiter was very friendly, polite, and patient throughout our entire meal.

I asked to taste the broth (I was thinking a tea cup full) of matzah ball soup (having never had it) and he said he would just bring me the bowl of broth. I thought he was just being nice, since I wasn’t even sure I wanted it, and appreciated him not making a big deal about it.

After tasting the broth, and liking it, I asked him to bring me the actual matzah ball with the intention of paying for the dish. He then indicated that he wouldn’t charge me for the soup at all. At that point I leaned over and told my husband, “he must be fishing for a great tip!”

One of the people we were with then complimented the waiter on his service and he in turn said we should tell his manager since she doesn’t seem to think so. When I heard that, I really wondered if all his sucking up was indeed to get back into his manager’s good graces? I thought it was quite funny, and someone did mention it to his manager.

Not until the whole night was over did I discover that he had given out quite a few freebies that night: the kids all got ice cream, others got free cookies, and other odds and ends were missing from the bill! In all our table chatter, and parents’ keeping their children in check, I did not realize that he was busy charming each of us on his bosses’ dime!

Years ago I encountered something similar when the cashier of a bookstore would give me various discounts because she knew I was purchasing things for a good cause. Not until months later when I heard she had been fired for stealing did I realize the ramifications of her ‘good will’.

I know it may not seem like a big deal to some, but our characters are built on how we handle situations like this one. I definitely think it shows poor character that this server cost his employer money so that his tip could be better or his reputation improved.

Abraham Lincoln said, “Character is like a tree and reputation like a shadow. The shadow is what we think of it; the tree is the real thing.”

When experiencing situations like this I often search my own heart, seeing the frailty of my own character, and praying for God’s help so that in my heart I will want to do what’s right – not just build some reputation that is untrue.

No one has the right to mishandle someone else’s resources, regardless of how small. I would like to think, if I realized what the waiter was doing the other day I would have insisted on paying for the additional items – but honestly, since I like getting things for free, I really don’t know.

photo by digitalart

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© 2012, Sherrian Crumbley. All rights reserved.

Yakezie Carnival 4.22.12 Edition is a post from: Faithful With A Few. If you enjoy it, please subscribe to the Feed.

It’s time for another Yakezie Carnival. I can’t believe how much this has grown since the beginning. There were so many great articles submitted, so let’s just get right into it! I will just announce that I am moving closer to my goal to lose 100 lbs!

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Steve Zussino @ Grocery Alerts Canada writes Saving Money with the Best Canadian Shopping Apps – Not only do the following 5 apps help save you money when it comes to showing you the best savings via coupons and price comparisons; they also enhance the overall shopping experience by saving you time with things like user reviews, match capabilities, and shopping math for frugal shoppers on the go. Plus, they are all completely free too!

FG @ Financial God writes Why Are Environmentalists Against North American Oil & Gas? – I don’t understand why environmentalists are supporting regimes that are well-known for their corruption and human-rights abuses, like Iran or Venezuela.

Eddie @ Finance Fox writes Tools to Boost Small Business Growth – There are many tools available to help small business owners grow their businesses, but like many newly formed business money becomes the biggest constraint.

Debt Guru @ Debt Free Blog writes Use Incentives to Pay off Debt – Paying off debt can be a lot easier when you use incentives to motivate yourself.

Ashley @ Money Talks Coaching writes Ask the Consumer Financial Protection Bureau – I came across a new (new to me anyways) government site that has a ton of financial information on it. It’s called the Consumer Financial Protection Bureau.

SB @ One Cent at a Time writes Basics of Insurance: Why we Need Insurance? – What is insurance? Insurance is all about playing defense, where as an investment is an offense. You protect yourself and your asset by having insurance and investments take care of future needs.

SB @ Finance Product Reviews writes American Express Serve Platform Review – Let it Serve You – American Express Serve is a new generation payment platform for your peer-to-peer money transfer needs. Will serve be able to edge past Google wallet and PayPal? What are the features for Serve platform?

James @ Short Road To Retirement. writes 401k Allocation Calculator – Provides a risk versus return analysis of investments over the last 20 years. Also provides a 401k allocation calculator that will give you the proper allocation to different investment classes based upon your age and risk tolerance.

Pam Whitlock @ The MoneyTrail Blog writes Raising Charitable Kids and Teens – Striking a balance between managing money and being charitable is a skill that takes practice.

PK @ Don’t Quit Your Day Job… writes Mega Millions Expected Value Calculator – A calculator to determine the expected value of an individual ticket in a Mega Millions drawing – based only on the listed prize money!

Kylie Ofiu @ Kylie Ofiu writes Money Making Challenge – Have you started? – A couple of weeks ago I started a challenge to find some money, then double it and continue to double it until it is over $1,000,000. I share what I am doing and what others can to make money.

Edward Antrobus @ Edward Antrobus writes Why I Avoid Cash – I avoid cash because I always wind up wasting it on stuff I don’t need. Like buying lunch when I brought one from home.

Philip Taylor @ PT Money Personal Finance writes Online Job Search Sites – Highlights 10 more targeted, unique job search sites than the big ones like Monster or CareerBuilder.

Brent Pittman @ On Target Coaching writes What Do You Teach Your Kids About Money? – What do you teach your children about money? A recent survey by T. Rowe Price revealed the state of the union regarding financial literacy and what actually teach our children about money.

Sicorra @ Tackling Our Debt writes Let’s Talk Money – The Series – With Anthony – This week’s interview is with Anthony from the well known blog Joyful Self-Manager. I was motivated to learn more about Anthony after reading his story on the About page of his blog. Anthony has overcome many financial challenges in his lifetime. Please check out his interview. Comments much appreciated!

Jeremy @ Modest Money writes Establishing Spending Priorities – Depending on your financial situation, you may need to make some sacrifices. At the same time, you don’t want to let your budgeting prevent you from enjoying the things you love. To stay happy you need to establish spending priorities and spend a bit where it makes you happy.

Lina Zussino @ Baby Alerts Canada writes Top 5 kids clothing stores & some savings tips – There are quite a lot of choices when it comes to buying your kid’s clothing. Here are my top 5 choices for kids clothing stores, and some tips on how to get deals and discounts there.

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Robert @ My Multiple Incomes writes The Importance of a Schedule and Time Management – However, because I take the time to plan and organize, I can usually squeeze everything in that I need to in a day, and still have free time to hang out with my family and walk the dog. Here are some of my scheduling tips that you may find useful. I’d love to hear your’s if you have them!

Pat Huddleston @ Investor’s Watchblog writes SEC Shutters Alleged Municipal Bond Fraud – The SEC would be the first to tell you that they cannot stop fraud before it starts.

Glen Craig @ Free From Broke writes Should You Give Human Resources Access to Your Facebook Profile? – Human Resource departments, and employers in general, are becoming more interested in employee social profiles. Some are even asking for Facebook passwords.

Roger the Amateur Financier @ The Amateur Financier writes How Much Information Should You Share? – A discussion of the amount of information that you should share, online and off, in an era when it’s easier than ever for anyone to find information.

J.P. @ Novel Investor writes How Long Should You Keep Tax Records? – Tax season is stressful enough just getting those returns finished and sent in time. Now you have to deal with filing away all those tax records. Or do you?

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© 2012, Khaleef Crumbley. All rights reserved.

How To Start A Blog: My Advice To Beginning Bloggers is a post from: Faithful With A Few. If you enjoy it, please subscribe to the Feed.

This post is a part of the Beginner Blogger Challenge hosted by Passive Income To Retire. The point of it is for “experienced” bloggers to give a few tips to those who are just starting out or who are looking to start out.

Because I know a number of people who are looking to start their own blogs/websites, I will try to make this a “how to start a blog” post as well as tips. If you have any questions, just leave a comment below.

How To Start A Blog

Many of these points are things that I wish I knew about when I first started. Doing these things from the beginning will save you a lot of time, frustration, and even money!

Own Your Blog

When you start blogging, you have a choice on what type of platform you will use. There are websites which will allow you to have a page (or pages) within their preexisting site. The big three are Blogger, Tumblr, and WordPress.com. If you are on one of these sites, whatever happens to them (hacked, bugs, shut down by government, etc) happens to you!

Also, they can shut down your space on their site whenever they feel like it (especially with Blogger). This is why I recommend that to anyone who wants to have a blog to establish their own website first! Here is how you do it:

Buy the Domain – I recommend using GoDaddy (I’ve purchased over 30 domains through them and have never had a problem). Once you decide on a domain name (this is a very important step), head on over to Godaddy (this is an affiliate link – meaning that I will earn a few pennies, at no cost to you, if you use it) and make it yours. They also have a great search feature that will let you know if a name is taken, and if so, what the closest available alternatives are.

Buy Hosting – Once you buy a domain, you have to have a place to store (or host) all of the files for your website. I have used Hostgator for nearly 3 years now and I love them! They have great prices – I pay about $6 or $7 a month, and I have about 30 websites hosted with them! They are also known for their reliable systems (my website has only been down twice since I’ve been using them), and great customer service – they have forums, an instant chat service, and a toll-free number.

If you use the coupon code “KNSFINANCIAL25” (with no quotes), you will receive 25% off of your order! So be sure that you sign up for a couple of years in order to take full advantage of this sale (it only applies to new accounts).

Install WordPress – WordPress.org is where you can find the version of WordPress that you can install on your private site. This is the most popular blogging platform (and is also used to create full websites), and it is completely free. They also have tons of plugins, themes, and basic support in order to make your site run as smoothly as possible!

Permalink Structure

This is the term that describes what the URL (or link) will look like with each blog post. When you first set up your blog using WordPress, it will make the links to your blog posts look like this http://knsfinancial.com/abunchofnumberswhichmeannothingtoyou instead of http://knsfinancial.com/taxes.

Now, which one would you rather deal with? It’s pretty easy to tell what the second one is about, and it is also easy to type, and say.

There are also other benefits, which are beyond the scope of this article.

Decide If It Will Be A Business Or Hobby

When you are thinking about how to start a blog, you need to know this right away. If it is a hobby, then make sure that you keep it fun, light, and don’t allow it to take over your life or your bank account. However, if it is a business, then you can evaluate each purchase on the basis of its value as an investment.

You should organize and present yourself as a business – this may mean spending time and/or money investing in a professional design, using emails from your own domain (instead of Yahoo, Hotmail, or Gmail), and spending time creating and refining a system of organizing files, contacts, wishlists, etc.

I would also recommend that if you see something that you want to use for your site, but it costs money, you buy it and start using it right away – if it’s worth the investment. Trying to change platforms, especially from a free, under-supported product to a more robust professional one can be a big headache. This is especially try when it comes to building an email list!

Learn/Understand The Basics Of SEO

SEO stands for Search Engine Optimization. This is the art/science of writing and marketing a website, page, article, or even photo, in such a way that it comes up as one of the first choices when someone uses a search engine and types in the word or words that your item is about.

There is no point in doing all of these other things if no one knows that you are out there. Also, for many websites, the readers that come from search engines tend to be the ones that bring in the largest revenue.

Be Organized & Have Structure

Even if you start out with the idea that this is just a hobby, you need to be organized. Create subfolders in your email inbox, use a task list, share documents over the web so you can keep track of your ideas and other things.

Also, the way that you structure your website – categories, tags, posting schedule, pages – should be organized as well. Your readers will find it much easier to follow your story if you are organized.

Network With Others In Your Niche

The best way to learn about organizing your blog, trends, plugins and other software, affiliate programs, SEO (including targeting the right keywords), tricks, free tools, and everything else related to blogging, is to talk to people who are already doing it. Actually, that is the point of this “Beginner Blogger Challenge” – people who have been doing it, writing tips and lessons learned for the benefit of those who have less experience!

I have “met” – actually I did meet a lot of bloggers in person at the 2011 Financial Blogger Conference – a lot of great people by trying to network. I was amazed to find out that there are more than a dozen Christian personal finance bloggers…I thought I would be alone! I wouldn’t have known that if I hadn’t started to comment on the one or two blogs that I found, and then started to develop relationships with the writers and other commenters as well.

By networking, you can also find people who can help you with things that are outside of your expertise. I know nothing about coding, but there are quite a number of people who do in the Yakezie network, and so I know where to go when I have coding questions. Whenever there is a subject that I know pretty well, I try to lend my expertise as well – the definition of effective networking!

Support Others

Part of networking is supporting other bloggers and organizations. The point of doing this isn’t just to see what you can get out of people, but it’s a way for you to extend yourself and help people. Even if it is just giving feedback on a site redesign, the help of other people who are going through (or have already been through) what you are doing is so important.

Be willing to share what you know with others and don’t expect anything in return.

Here are 4 questions that everyone who participated in this “challenge” had to answer…

Q&A Time:

1) How long have you been blogging?

I have been blogging for about 2 years. I’ve had this site for longer than that, but I didn’t use it for blogging (actually, I’m still not sure if I do now).

I initially started off by posting bulletins and announcements from the IRS, and also adding other information to my tax guide. It took about 4 or 5 months for me to start writing consistently, and also to broaden out my topics to more than just taxes.

2) Why did you start blogging?

I was bothered by all of the people that I came across who knew nothing about personal finance. I started the website as a way to provide organized information that would help people gain control of their finances.

I want people to be able to find answers to their financial questions without having to wade through all of the garbage and attempts to sell something, which flood the internet!

3) How long did it take you to earn $100?

It took about 6 months to earn my first $100. After about a year the income became a little more steady.

I honestly didn’t know that it was possible to make money with a blog or small website, so I was shocked when I found so many people making more online than I do at my day job!

4) What is (at least) one thing you wish someone had told you before you started?

I wish I would have treated this as a business from the very beginning. I would have viewed spending money as making investments, and I would have saved a lot of time and energy, while making a lot more money!

I wasted time by trying to go the cheap route and then upgrade to the better option once I started making enough money. That’s not the way most businesses operate! There needs to be an initial investment in capital and manpower in order to get a business off the ground – the same is true with a blogging business.

photo by digitalart

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• Build Up Your Financial Security In Uncertain Times

© 2012, Khaleef Crumbley. All rights reserved.

Roth Vs Traditional IRA: Which One Is Best For You? is a post from: Faithful With A Few. If you enjoy it, please subscribe to the Feed.

When the idea of saving for retirement comes up, many people wonder whether a Roth vs Traditional IRA is better for them. There are many similarities between these two investment vehicles, but there are also enough differences to make this question a little more difficult than it seems.

We will look at some of the similarities and differences of these Individual Retirement Arrangements

Roth Vs Traditional IRA

Both a Roth and Traditional IRAs can be great options when it comes to saving money for retirement. Before we take a look at Roth IRAs, let’s look at a couple of quick points regarding traditional IRAs, so you can better decide which may be the best retirement plan for you.

Traditional IRAs

One of the greatest benefits of a Traditional IRA is the fact that your contributions can grow freely, with the taxes that you owe being deferred until the money is distributed. This means that you receive the benefit of compound interest on all of our contributions, gains, and other earnings!

In most cases, the contributions that you make into a traditional IRA are fully or partially deductible – depending on your circumstances. That means that your taxable income is reduced by the amount that you contribute to a traditional IRA (if it is fully deductible).

An IRA usually provides more freedom than an employee sponsored retirement account when it comes to your investment options. You can invest in individual stocks, bonds, mutual funds, CDs, and even real estate! This helps to make an IRA an extremely attractive retirement vehicle.

Here is something that is usually seen as a negative feature of a traditional IRA. According to the IRS:

You cannot keep funds in a traditional IRA indefinitely. Eventually they must be distributed. If there are no distributions, or if the distributions are not large enough, you may have to pay a 50% excise tax on the amount not distributed as required.If you are the owner of a traditional IRA, you must generally start receiving distributions from your IRA by April 1 of the year following the year in which you reach age 70½.

That’s right – if you do not start withdrawing money from your account, the IRS will charge a 50% tax on the amount that should have been distributed! Before you become too outraged, remember that you received a tax deduction on your contributions, and you are not required to pay taxes on any gains until they are distributed. If you kept the money in your account indefinitely, it would never get taxed…there is no way that Uncle Sam will allow that!

You can read IRS Publication 590 (link to online version) in order to gain more information about Traditional IRAs, including calculating the required minimum distribution.

Roth IRAs

In looking at the “battle” of Roth vs traditional IRAs, there is no need to compare the investment opportunities since they are exactly the same. Unlike their counterparts, Roth IRAs do not give you a tax deduction upfront. This means that you will have to reach the IRA contribution limits with without the benefit of reducing your taxable income for the year.

Like the traditional IRA, your contributions, gains, and earnings will grow without being taxed – allowing compound interest to kick in! However, since your initial contributions were made with taxed dollars, you do not have to pay taxes when you take a qualified distribution from the account!!!

What this means is once you put money into a Roth IRA, you will never have to worry about paying taxes on that money (as long as you satisfy the requirements). For one thing, you have to keep your contributions in the account for at least five years before you can withdraw them with no penalty. Of course, since it is a retirement account, keeping the money invested for more than five years shouldn’t be a problem.

Another thing to consider with Roth IRAs is that you can make contributions to the account even after you turn 70 1/2 (something which you cannot do with a traditional account). On top of this, you are also able to leave amounts in your ROTH IRA for as long as you live. There are no required minimum distributions, and no taxes assessed for failing to make withdrawals – since the initial contributions were already taxed.

Roth Vs Traditional IRA – What’s Best For You?

Here is one of the keys to consider when trying to answer this question:

At what stage in your life will you be paying lower taxes? If now, then go with a Roth and pay lower taxes on your contributions, rather than paying taxes on your distributions when you are paying at a higher rate. If your lower taxes will come in retirement, then go with a Traditional IRA to get the tax break when your taxes are higher, and pay taxes on your contributions once you are in a lower bracket.

There are a couple of things that will affect your tax rate both now and in retirement.

• The tax code – will future administrations raise taxes in order to pay for government spending?
• Your income – will you have more taxable income now or in retirement? The answer isn’t as obvious as it might seem.
• The amount in your retirement accounts – if you have a take several required distributions from large accounts, that can easily push you into a higher tax bracket.

There are other things to consider but since they are pretty much impossible to quantify, we will leave them for another discussion.

Photo Source: goodfinancialcents.com via Jeff on Pinterest

Reader Questions

1. Based on your situation, which IRA is best for you?
2. What do you think about having one of each?
3. At what point did you/will you start saving for retirement?

This post is a part of the Roth IRA Movement that my blogging buddy Jeff Rose at Good Financial Cents put together. The last time I checked, there are almost 150 websites that will be posting about the benefits of Roth IRAs! Even though the information is pretty standard, I am confident that each post will be different, because of the voice of the individual writing it! You can read my other post (which takes a more personal and informal look at this question) on my weight loss and debt repayment site here: Why Roth IRA is better than Traditional for us

Related Posts:

• IRA Contribution Limits for Both Roth and Traditional
• The Best Retirement Plan For You
• 2011 Contribution Limits for IRA, 401(k), and 403(b)
• Are Your Children Saving For Retirement?
• Which Of The Free Tax Forms Should I Use To File?

© 2012, Khaleef Crumbley. All rights reserved.

8 Things You Can Do With Your Tax Refund is a post from: Faithful With A Few. If you enjoy it, please subscribe to the Feed.

Many people will be receiving (or have already received) a tax refund in the near future. Most people that I know plan to blow it on something that will not provide a benefit for their lives. Instead of wasting your refund and regretting your decision, try one of these 8 tips!

What To Do With Your Tax Refund

Start An Emergency Fund

Probably the most common characteristic of a financially stable household (besides the idea of living within their means) is an emergency fund. The point of this emergency fund so you can have money stashed away when something unexpected comes up.

If you are not financially prepared for emergencies, then you may be forced to rely on high-interest credit cards, or tap into your retirement savings in order to get by.

Pay Down Debt

Another great use of your tax refund is to pay off debt. This may seem like a boring option (especially when compared to how most people use their tax refund), but it will automatically earn a rate of return that is equal to the interest rate on your debt.

For instance, if you pay off a credit card that had an interest rate of 20%, then that is equivalent to earning 20% on an investment!

If you use it to pay off/down an installment loan (such as a mortgage or car loan), then you may have to specify that your extra payment should be applied to the principal.

Consider Paying Infrequent Expenses

Many times it can be difficult to remember those expenses which only come once or twice each year. Instead of being taken by surprise and sent scrambling for extra cash at the last minute, either pay or put aside money for these expenses using your tax refund.

Some of these can include your car insurance premium, a maintenance fee on a timeshare (don’t get me started on this one) or other property, roadside assistance fee, and any other types of subscriptions.

Save For Retirement

This is something that I recommend to many of my tax preparation clients. You can easily fund a retirement account, such as an IRA with your tax refund. If you have more than the current IRA contribution limits, then you can fully fund your account while taking advantage of one of these other options.

If for some reason you are not reaching the 401k contribution limits at work, you can use this extra money as a way to increase what you currently contribute. Of course, you can’t add outside money into a 401k; however, if you fall short of the contribution limit due to other expenses, you can use your tax refund to pay those other expenses and increase the amount that goes into your 401k!

Save For A Large Purchase

If you are looking to purchase a car (learn how to save money on car costs), new laptop, vacation, or any other large purchase, this may be your chance. Instead of going into debt to buy the item, you can use your tax refund.

Even if the amount of your refund isn’t enough for you to purchase the item outright, it can greatly reduce the time it will take to save up for it. You can also pad the account with bonuses, raises, and future tax refunds.

Give

Giving is a very important part of any financial plan – especially for a Christian (we are commanded to give). I know many people who have a strong desire to give, but are not able because things are too tight for them financially.

If you are in a situation like this, a large tax refund can provide you with the perfect opportunity to give. There are plenty of organizations that are looking for donations in order to fulfill their mission such as, your local church, a missionary, food banks and homeless shelters, and any other charity that is fighting for a worthy (to you) cause, and has proven to be reliable!

If you are still looking for ideas, you can check out this orphanage in Haiti (I serve as the Treasurer)!

Start A “Blessing Fund”

One of the things that my wife and I want to do (once we are out of debt) is to establish a savings account that will only be for the purpose of providing financial blessings to others. By having a separate account for this, we never have to worry about depleting our emergency fund or any other “dedicated” savings when we come across someone in need.

If you have a desire to help people out at various times, but don’t always have the means when these times come up, use your tax refund to start a “blessing fund”.

Spend Your Tax Refund

I’ve talked before about celebrating small victories during your financial journey.  Use some or all of your tax refund and do something that you have wanted to do, but couldn’t. Maybe go out to a fancy restaurant, or buy a New iPad or some clothes!

No matter what you choose to buy, use all or a part of your tax refund to treat yourself. Then take the rest and put it toward your highest financial priority. This way, you can celebrate achieving a financial milestone, without diverting funds away from your current plan.

photo by cooldesign

Reader Questions

1. Did you receive a tax refund this year? If so, how did you spend/save it?
2. Do you purposely have excess taxes withheld during the year so you can have a large refund?
3. Do you regret how you’ve spent a previous tax refund, bonus, or other “windfall”?

Related Posts:

• Federal Income Tax Rates For 2011
• Need More Time to File Your Tax Return? Here Is How To File For An Extension
• Why You Should File A Tax Return Even If You Are Not Required!
• Tanning Tax Goes Into Effect July 1
• The IRS Has Over $1.1 Billion In Unclaimed Refunds

© 2012, Khaleef Crumbley. All rights reserved.

What Is Financial Spread Betting? is a post from: Faithful With A Few. If you enjoy it, please subscribe to the Feed.

The following is a guest post about the basics of financial spread betting…

Since financial spread betting is not conducted through an exchange, you have more flexibility when it comes to spread betting than you would with other financial derivatives.

Spread betting is used to speculate on price movements on underlying financial products – such as stock market indices.

Types of Financial Spread Bets

Spread bets are either long or short – if you are long, you believe that the underlying index will rise, and if you are short, you believe that the underlying index will fall.

The tighter the spread, the more you can maximize your profits, since the price movement to be profitable can be smaller.

There are also rolling financial spread bets, where you “roll” your position each day, but closing it and reopening it the next day.

Financial Spread Betting Styles

If you spread bet, you fall into four categories: day trader, short term trader, medium term trader, or long term trader.

If you are a day trader or short term trader, you are looking to profit from small market moves – usually less than 5%.  Typical trades will last minutes to days, and the trades are based on mostly technical price analysis of stocks and indexes, as well as potential news events.

If you are a medium term trader, you typically take a position that lasts less than a month.  Usually, the trader will make a trade based on some fundamentals and technical analysis combines.

Finally, a long term trader usually trades monthly or quarterly bets, and trades usually last several quarters.  This type of spread better looks for profits of 10% or more, and relies more on fundamentals than technical analysis.

Risks of Spread Betting

It is important to note that spread betting involves inherent risks of loss.  Since it is leveraged, the downside loss can be much more than the original value of the best.  It is important to use risk management strategies such as stop loss orders to prevent losses from going beyond acceptable levels.  Make sure that you employ risks management strategies with every trade.

photo by frankie_8

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• Roth Vs Traditional IRA: Which One Is Best For You?
• 8 Things You Can Do With Your Tax Refund

© 2012, guest. All rights reserved.