Here’s a few quick tips to save money on your personal finances:

• Take a look at how much you contribute to your retirement savings like your IRA or 401(k) plan. See exactly how much your employer will match of your contribution and, if you’re not there yet, increase your own retirement contribution. One of the ‘easiest’ ways to save money is to put it away before you even realize you have it.
• Cut you cable bill…or ditch cable altogether. If you don’t do so already, you might be amazed how many shows and movies you can watch online. And this doesn’t mean necessarily ditching the TV. You can connect you laptop to your TV with a simple connection. Do a little research on this and you’ll be amazed what’s not possible. And, you can also get quite a few channels, in digital, with a simple antennae watching over-the-air free broadcasts in your area.
• Shop around for the best bank.  It might be a hassle getting all your automatic deposits and bill payments changed over, but you can possibly save a bit of money doing so.  In addition to not paying fees, it’s quite possible to be earning interest on your balance.  There are a lot of choices out there now and it would be in your best interest to shop around for the best deal.
• If you use your credit cards, by all means pay them off every month.  Do not give away money to credit card companies through exorbitant fees and interest rates.
• Better yet, find a card you can use for cash rewards.  It will definitely take some work, but it is quite possible to find a card that will give you a decent cash reward…nothing better than cashing a check from your credit card company.
• Compare auto insurance rates every time your policy comes up for renewal.  Don’t get complacent with your policy when you might find a better deal elsewhere.  Many companies will give a discount if you have an auto and home policy with them, so make sure to consider that option as well.
• Make sure you aren’t over-insured on you auto insurance policy.  While you busy checking for new rates, revisit exactly what coverage you have and what you might need.  It doesn’t always make financial sense to keep full coverage on your ten-year-old car if the replacement value has dropped too much.

A lot of these suggestions and tips to save money might take some time to implement.  Of course it’s probably easier to just continue paying on those accounts you’ve had for years, but you could be leaving a lot of money on the table.  Revisit these payments and accounts regularly, set aside a few hours each month for some research and start putting more of your money towards investments and assets.

Common wisdom suggests that it is best to avoid mutual funds with high expenses. Why bother to fight for modest returns when the fund manager is racking up expenses. However, the performance on a fund is usually given with rate of return after expenses–that is, after all of the operating expenses have been accounted for. The cost of owning, not buying, a mutual fund is usually defined as its expense ratio. The cost of buying a mutual fund is defined by its sale load.

The expense ratio contains the fees involved in running the fund including costs like the management fee and the operating costs. The price of sending out mailings, and in some case advertising for the fund, all fall under the category of costs. The expense ratio of mutual funds vary quite bit surprisingly. Some of the more efficient index funds have relatively low, like around .20% expense ratio, while the more expensive mutual funds sit around 1.5-2%.

The big problem with expensive mutual funds is that they are always hindered by that expense. The rate of return might go up and down, fluctuating with the market or economy, but that big up front expense will remain constant. A nice yield is hard enough to produce without having to fight against the tough odds of high costs.

Ultimately, there is more to consider than the expense of a mutual fund–the historical performance of the fund as well as the risk profile being among those. Still, a relatively expensive fund shouldn’t be completely ruled out if all the other factors fall in its favor.

However, it might not actually make sense to pay down your home loan. There are quite a few factors involved when making this decision. You need to first do the basic calculations about how much you owe, how long the loan remains in effect, what your current interest rate is and what your other outstanding debts are. As mortgage rates fall lower it makes less sense to pay down your loan. Likewise, if you have credit card debt that is a higher interest rate you need to pay that down first.

Still, even after you’ve made some basic calculations, you need to dig a little deeper. Remember that payments on the interest of your home loan are tax deductible. The less interest you pay the less of a deduction. You need to figure this into your overall savings when you pay down the principal of your loan. The NYTimes has a good article on the details of this decision.

Ultimately, it boils down to numbers of course, but there is the emotional element involved with a home mortgage loan that is not always found elsewhere and which will usually play into your decision. It simply feels right to put some extra cash toward that mortgage. The idea of possibly paying off your house in 25 rather than 30 years is a notion that can’t always be quantified.

The great difficulty at this point in choosing the best method to refinance your home is finding exactly where to seek these funds. Refinance.com is a great place to begin your hunt for the best refinance rates as well as basic guidance and a host of other resources. They offer resources like clear and informative articles on why someone should refinance, basic myths about the process, how to determine whether you’d want a fixed or ARM loan and much more.

One of the key differences that Refinance.com offers from other such services is that they help guide you through the process rather than simply shuffling you off quickly to a lender. During the application process, they allow you to take a peek at your credit report that includes your score through Experian. If your credit score comes up a little low, they advise ways to improve it. They take the time to offer you suggestions to make your loan application more appealing to lenders and thus ultimately more likely to be approved with good terms. Once they have helped you craft your application you can choose amongst the best offer and submit an application with that company.

Remember, a Mortgage Refinance is not a simple decision that should taken lightly. But the fact remains, if you do your research, find the right lender with the right terms and know the purpose of your refinance, it can save you money and should be pursued. It’s impossible to predict the future and no one knows where mortgage rates are headed, but they are clearly low now.

Take some time to check out Refinance.com’s homepage, watch their short video on the process and if you like what you see submit a free application.

Disclaimer

This year, Congress introduced several new tax saving methods in the American Recovery and Reinvestment Act. Here are a couple of highlights:

Homebuyer Tax Credits ~ In addition to a pretty strong buyers market right now in the real estate world, there are some nice home buyer tax credits. First time home buyers can receive a $8,000 credit while those who have been in a home for five years but have bought something new may be able to get a $6,500 tax credit.

Residential Energy Incentives ~  The government is keen to see you go green and they’ve devised a few incentives to push you along. Credits that were set to expire have been extended and the amount of credit you can claim on energy efficient improvements has been raised as well.

Education Tax Credits ~ Perhaps you’ve heard of the Hope Credit, well now that’s been replaced with the American Opportunity credit.  This new and improved credit will extend help to more taxpayers than before and raises the potential credit to $2,500 versus the old $700.

These are just a few of the new tax credits we’ve seen this year.  Take your time and really explore all of the potential tax savings that are now available and you might just be surprised what you can save.

There are, however, several loopholes that the credit card companies can use to sidestep some of these new regulations and consumers should be aware of them.

This article in the Washington Post covers a few of these and is worth the time to read.  The author mentions ways in which the companies can still charge high rates as well as unnecessary fees.

Of interest is an article on preparing your first retirement account.

Also, 11 financial tips for new parents.

And, very amusing article on haggling for the best price at traditional retail stores like Best Buy and Macy’s.

Check out his article.

The HARP program was designed to help some 4 to 5 million homeowners refinance their mortgages in order to reduce their payments and stay in their homes. The guidelines of the HARP program require, among other things, the homeowner to have a loan owned by Freddie Mac or Fannie Mae and the home to have a LTV (Loan-to-Value) ratio of no more than 105%.

Although the program was unveiled to great fanfare, the results have been less than stellar. The main sticking point here being that lenders are not required to make the loan even if the homeowner qualifies under the terms of HARP. That is to say, despite the appropriate and complete qualifications, the lender can simply deny the loan.

The Obama administration has recently urged lenders to free up credit and make these loans, but the results are still to be seen.

As home prices continue to fall an increasing number of homeowners are finding the LTV ratio on their home reaching the 125% mark or worse. Lenders are simply too skittish at this point to make these loans and are finding little incentive to begin any time soon.

The NY Times has an interesting article with some good tips for saving money while site-hopping for the best deals.

There are two useful tools that will help you to do that: A Cash Flow Statement and a Balance Sheet. These will let you take a detailed inspection of your financial state and create more reasonable decisions about what you choose to do next. It might take a little prep work, but developing these tools will get you started so you can make the harder decisions later.

Your Financial Balance Sheet

A thorough balance sheet is like a statement of your finances at the present moment. It consists of some key components, namely your assets and your liabilities, or you can put it simply as what you have or own versus what you might owe. To then figure out your net worth (or perhaps you lack of net worth) you device a simple equation of your assets minus your liabilities. This gives you a simple but effective balance sheet.

So let’s think of some of the things we can list on your balance sheet. First here are some examples of of your assets. These feature things like your house, cash, stocks, bonds, mutual funds, 401(k) plans, valuable jewelry or precious metal, checking and savings accounts and so forth. Really anything of value that you own. This, of course, is offset by what you owe or your liabilities. These would be things like your mortgage, student loans, credit card debt, car loans and all those other things that you might owe money on. If you have more in your asset column you’re left with your net worth. If you owe more, you’ve got some work to do…

Of course, the goal of people looking to save money and invest is to grow the asset side and decrease the liabilities. You want to increase the net worth in the equation. Your balance sheet is a simple way to clearly lay out where you’re strong and where you need to put your focus to increase your net worth. Once you’ve got the facts down on paper, your balance sheet, you’re in a better position to understand your goals. If you’re balance sheet is looking a little weak it might be time to cut out some of the debt. Conversely, if your net worth is strong it’s time to start thinking about your investments.

Your Cash Flow Statement

So, you now have everything down on paper and you’ve developed some goals. Now you have to figure out where to get money to put these goals into action. You can design a cash flow statement to better implement a plan to get you started.

Put simply, a cash flow statement gives you a complete picture of your money that comes and goes over an extended period. It shows your revenues, or what you are earning through income and investments, and also your expenses, or what you are spending your money on each month. You can determine your net cash flow by taking your revenue and subtracting your expenses.

A proper examination of your cash flow statement allows to recognize how to better cut your expenses and how to move your cash to better realize your financial goals. If the net cash flow is negative than you’ll be better able to see where to cut the expenses and turn this into a positive cash flow. This should be done before you try to begin investing or even saving.

Do the hard work up front, beginning with the basics of a solid balance sheet and a detailed cash flow statement, and you’ll be rewarded in the end with a good plan to realize your personal finance goals.