Retire at Young

A Retirement Planning Calculator / Spreadsheet

2011-04-05T10:06:00.000-07:00

Putting it All Together

Retirement planning can be thought of as consisting of two phases:

The accumulation phase -- saving for retirement
The distribution phase -- living in retirement

In the previous two posts in this series, we looked first at establishing a target for the savings needed to cover expenses during the retirement years, and then at creating a savings plan to reach that target. In this post, we'll add some enhancements to our retirement planning Excel spreadsheet in order to create a consolidated accumulation and distribution plan -- we'll put it all together. This, in turn, will give us a foundation to do some additional analysis in future posts. (See the end of this post for a link to the spreadsheet.)

A Consolidated Retirement Accumulation & Distribution Plan

Consolidated Retirement Saviings Accumulation & Distribution Plan

The graph above (click on it to expand it) shows a retirement plan for a 35 year old, Alex, who hopes to retire at age 65 and live to age 90. Alex has no savings yet, but is planning to save 13 percent of salary from now on. Alex plans to put 3% of pay into taxable accounts and split the remaining 10% equally between a tax-deferred employer-sponsored 401k and a tax-free Roth account. (For a full description of this scenario, see the appendix at the very end of this post.)
The graph shows the accumulation of savings up until age 65, followed by withdrawals. Withdrawals are assumed to be made first from the taxable account (light blue), then the tax-deferred 401k account (medium blue), and finally from the tax-free Roth account (dark blue). Note that the balance in the Roth account goes to zero before Alex is 90 years old. The bright red slice is an estimate of the additional savings Alex would need in order for the savings to last until age 90.

Start Planning Retirement Early

This graph suggests that, under reasonably conservative assumptions, saving 13% of your income may not generate enough retirement savings if you wait until age 35 to start. Note, however, that if Alex were lucky enough to have an employer who provided a pension and matched 401k contributions up to 3% of employee salary, the situation would be remarkably better. Waiting until age 67 and receiving full social security benefits would also make a significant difference. (Note: for more on the importance of getting an early start, see Start Investing When You're Young).

How to Use Basic Retirement Planning Calculators More Effectively

Simple, so-called "linear," calculators/spreadsheets like this one help to identify the fundamental inputs to retirement planning, and the basic calculations and issues involved. In fact, this is a modified version of the spreadsheet I developed to do my own retirement planning early in my career. However, they must be used with care. In particular, I think it is important to be conservative in your assumptions regarding stock market returns -- especially if you are near, or in, retirement. To understand why, see Don't Plan Retirement Assuming Average Stock Market Returns.

Source from http://observationsandnotes.blogspot.com

How Much Money Will You Need To Retire?

2011-04-05T09:56:00.000-07:00

How much in savings will you need to retire? A lot -- even many of you who are among the vanishing breed of employees who have traditional defined benefit pension plans. In this post I will introduce a spreadsheet to help you estimate the amount you need to save. I'll also provide a simple rule of thumb for those who prefer a shortcut.

Retirement Savings Needed vs Life Expectancy This series of posts will not only help you estimate how much you will need to save, and help you develop a plan to save that much, it will also help you understand the whys. Understanding the issues, and the assumptions that retirement planning software packages typically make will, I hope, decrease the chances that you will misinterpret or misuse their results; this, in turn, will increase the chances of your living the retirement of your dreams.

How Much Will You Need in Retirement Savings?

For many people, the biggest savings challenge they will face is saving for retirement. The chart above (click to expand) shows the estimated savings needed for a hypothetical 25 year old, Pat, planning to retire at age 65 with living expenses of about $45,000/year in today's dollars. (Note: the $45,000 is after tax spending, not income. If you plan to spend less than that in retirement, or have a traditional pension, or your employer matches some or all of your savings, or are more optimistic than Pat regarding the future of social security, or you're older than 25, or you expect less than 3% inflation, you may need to accumulate much less in savings.) The solid red lines assume Pat's investments are in taxable accounts; the blue dashed lines assume the investments are in tax-deferred accounts such as IRA or 401k accounts.

As you can see, Pat will need about $2 million to fund retirement expenses to age 85 if the investments are in taxable accounts -- somewhat more if the investments are in tax-deferred accounts. The downward slope of the curves reflects the fact that, as a rule, the fewer years remaining to live, the less money needed. For example, not surprisingly, Pat will need less in savings at age 75 than at age 65. The curves that end at age 100 illustrate the fact that it will take significantly more money to fund 35 years of retirement expenses than to fund 20 years.

Retirement Planner Assumptions

Maybe a better answer to "How much money do I need to retire?" is "It depends." The amount you will need to save depends on a surprising number of factors -- most of which are difficult or impossible to predict. Below is a table of the input data used (click to expand) to produce the above graph.

Retirement Savings Needed Assumptions

Note: Click on the above screenshot to expand it. The link to download the spreadsheet is at the end of the post.

Most people are relatively comfortable estimating their retirement age and their expenses in retirement. At the other extreme, however, are critical inputs that you may find very difficult to estimate, and over which you may feel you have little or no control -- your return on investment, inflation, and life expectancy (a euphemism for when you will die). In between are other important variables that you may or may not feel comfortable estimating, such as social security, pension income and tax rates (see link below for help on estimating social security). In fact, the only input that you can likely provide with certainty is your current age.

Introducing Al's Simple Retirement Planning Calculator/Spreadsheet

The retirement planning calculator/spreadsheet introduced in this post is similar to other basic planners that you will find. (See the end of this post for links to download the spreadsheet.) A key thing to remember is that the results can only be as accurate as your input. As a result, the reality is there is no way to know exactly how much you will need to save. For starters, you'd have to know how long you are going to live! Even so, I found a simple planner like this useful -- especially early in my career.

Another problem with models like this one is how they handle return on investment (ROI). Simple models assume your ROI will be the same year after year. Keeping up with recent stock market performance in the news -- it should be clear that the real world doesn't work that way. Unfortunately, the fact that it doesn't has huge implications on retirement planning. In a future post, we'll explore ways to deal with these issues more effectively.

A Conservative Rule of Thumb for How Much You'll Need to Save

In the meantime, here's a shortcut that many find useful. A common rule of thumb that some financial planners recommend is the 4% withdrawal rate. Withdrawing 4% of the portfolio in the first year of retirement is a plan that should work for a broad range of retirees. It follows that, using this plan, you would need savings equal to 25 times what you plan to withdraw from savings in your first year of retirement. This is a more conservative approach, and generally recommends savings larger than those recommended by the simple models. (In Pat's case the recommended amount is $3-3.5 million.) This approach to estimating required savings is most helpful if you're in or very near retirement; otherwise, you may find it difficult to estimate how much you will need to withdraw.

Note that the same factors still determine your needs; you just don't get a chance to specify them. For example, you'll notice that nowhere do you specify your expected return on investment or life expectancy. The method gives you a reasonable target under a broad range of circumstances, but it's not magic. If you're planning to invest all your savings in Treasury Bills, retire at age 50 and live to 120, this method won't give you a reliable savings target.

Conclusion

Most people will require substantial amounts in savings in order to retire comfortably -- especially if they do not have a traditional "defined-benefit" pension. Saving such large amounts will require a long-term saving and investment plan. The good news is that accumulating this much money is probably easier than you think. The next post will help you develop a saving plan by addressing the question What Percent of Your Salary Should You Save?

Source from http://observationsandnotes.blogspot.com

What Percent of Your Salary Should You Save For Retirement?

2011-04-05T09:52:00.000-07:00

"What percent of my salary should I save?" is a frequently asked question -- especially early in one's career. People often ask the question implicitly assuming there is a standard, magic percentage of your pay that works for everyone. I think the most honest answer is "it depends." In this post, we'll add some additional capabilities to my retirement calculator so that you can understand what the answer depends on and use the calculator to determine a percentage that works for you. (The download link is at the end of the post.)

Pat's Retirement Savings Plan

In How Much Money Will You Need To Retire?, we looked at a hypothetical 25 year old, Pat, who wants to retire at age 65 and have $45,000/year in today's dollars for after-tax living expenses (not income) during a 20 year retirement. The retirement calculator introduced in that post estimated that Pat would need more than $2 million in tax-deferred funds at age 65! (See that post for a discussion of the assumptions made; you may need to accumulate considerably less -- especially if you're older than 25, or you expect to spend less than Pat, or you expect to have a pension, or....) The graph above (click to expand) suggests that by saving and investing 10% each year, this 25 year old could accumulate the needed retirement funds -- and then some; the final total is over $2.3 million.

Keys to Successful Retirement Saving

Three of the most important factors in reaching your retirement savings goals are:

How much you contribute,
When you start, and
How much your investments earn

Clearly, the greater the percentage of your income you save and, the more you are likely to end up with. The general consensus is that 10% is usually the minimum starting point. Many people find that as they get older they are able to contribute significantly more. (See link at bottom of post for a fascinating discussion of how much other people are saving.)

The longer your money is working, the more it is likely to earn. By starting early, Pat is allowing 40 years for "the magic of compounding" to do its thing. Had Pat waited until age 35 it would have been considerably more difficult. (See Start Investing When You're Young)

The greater your return on investment (ROI), the more you will accumulate. Pat is assuming an ROI of 8%, the default assumption of many retirement planning calculators. Note, however, that it is your actual, not your planned, returns that ultimately matter. Be realistic; some of the links at the end of the post may be helpful in that regard.

From the above we can see that the percent of your pay you need to save clearly depends upon, at a minimum, when you start, and how much you earn on your investments. Start early and earn a substantial return, and you won't have to contribute as much. Even in the best of circumstances, however, you'll likely need to save at least 10%.

The Impact of Inflation

In Pat's case, there is another important factor that makes it much easier to accumulate $2 million than you would expect -- inflation. We've assumed that Pat is making about $65,000 a year. The savings needed are more than 33 times Pat's current salary; that sounds like a lot. However, in 2049, if Pat's salary keeps up with the assumed inflation of 3% per year, Pat's salary will be over $200,000! As a result, when Pat retires, $2 million dollars may "only" be a little more than 10 years salary.

Al's Retirement Savings Planner Assumptions

Note: Click on the screenshot below to expand it. The link to download the spreadsheet is at the end of the post.

In the previous post, we saw that the amount needed for retirement depends on a surprising number of factors. When basic retirement planners calculate your planned savings, the results depend on a similar number of factors. Above are the inputs used by this model. It follows that the percent of your income you'll need to save also depends on factors such as how much money you start with (do you have a trust fund from a rich uncle?), and what percent of your savings are being matched by your employer.

Observations About Simple Retirement Savings Models

Simple savings models make the same simplifying assumption about return on investment (ROI) as we made when calculating needed savings. That is, they assume you will earn a constant return year after year. However, the fact that it's an unrealistic assumption is less of a problem here. That's because, assuming you update your plan every year or two, your estimate of how much you will have at retirement will become increasingly accurate. That doesn't mean you'll like the results, but at least you'll have the opportunity to do something about it if your plan is diverging too far from your target. For example, you could increase your annual savings during the remaining years; or, you could defer retirement until you've met your target.

A note of caution. So far we're only talking about saving for retirement. Many of you will also have to deal with saving for other important goals -- for example, buying a house, or sending kids to college.

How Much Should I Save For Retirement: Conclusion

In order to have a reasonable chance for a comfortable retirement, most people will need to plan to save a large sum of money. It's not as difficult as you think. However, there is no magic percent of your salary that works for everyone. Start early and you may be able to get by with 10%; wait 'till your mid-30s and you may well need to stash away 15% or more.

Note, however, that how much you'll want to save depends first upon what your situation will be after you retire. For example, how much do you plan to spend? Will you have a pension and social security? Those questions are addressed in the first post in this series. Retirement tools like this Excel spreadsheet can not only help you figure out how much you'll need to save to support your desired lifestyle, but also help you devise a plan to save it. The next post in this series will help you put together a consolidated savings and spending plan. Remember, the earlier you start planning the easier it will be, and the better your chances for a comfortable retirement.

Source from http://observationsandnotes.blogspot.com

Investing in FOREX or investing in Stocks?

2011-04-05T09:19:00.000-07:00

So, you have the money to invest, but you don't know whether to buy Stocks or try something new, like FOREX for example.

Stocks

Before we describe what are the benefits of FOREX, lets remember what are Stocks. Stocks have been a popular investment for hundreds of years. Companies issue stocks to raise capital for expansion and new projects, and each share of the stock represents a partial ownership in the company. Basically speaking, when you buy stocks you invest in the company and in the market it is working in.

Hence, when the company does well and makes a profit, the value of the stocks rise and you can sell your shares for a profit or hold on to the stock for even more gain in the future. Sometimes companies will issue dividends – part of the profits that are distributed to share holders, another way for you to make a profit.

Stocks are traded on Stock exchanges. Most stocks are bought and sold through brokers (agents) who charge a commission or fee for this service. American stock exchanges include the New York Stock Exchange (NYSE) and the National Association of Securities Dealers Automated Quotation System (NASDAQ). Most stocks are only listed on one exchange, although large companies may have listings on several exchanges.

Stocks were traditionally seen as long-term investments. So-called 'blue chip' stocks - those having proven value over many years - may form the backbone of an investment portfolio. Short-term traders (Day traders) exist, but it is a relatively new phenomenon made possible with the advent of Internet trading. Day traders attempt to take advantage of large daily fluctuations in the market by buying and selling many times in one trading period. It is relatively risky and broker commissions charged on each transaction reduce any profits realized.

Stocks may sometimes be bought on Margin, meaning that the investor borrows money to buy the stocks. Margin rates are usually around 50% - the investor can borrow as much as half the value of the stock.

FOREX

The Foreign Exchange Market (FOREX) is quite different from the stock exchange. In contrast to the stock exchange, the FOREX is primarily a short-term market. Most traders enter and exit deals within a 24-hour period – sometimes within a few minutes. Many FOREX trades can be made in one day without building up a large brokerage fee because FOREX trades are commission free; hence, you keep all of your profit. Brokers earn money by setting a spread – the difference between asking and selling prices.

FOREX is the largest financial market in the world. It is handles transactions worth $1.5 trillion every day ($1,500,000,000,000). By comparison, all the American stock exchanges combined handle daily transactions worth about $100 billion ($100,000,000,000), 15 times smaller than FOREX. It is not located in any one location, but in the virtual space of the Internet. Trading markets are located world-wide and because of difference in time-zones trades can be made 24 hours a day, 5 days a week. Trading begins in Sydney, Australia on Monday morning (Sunday afternoon New York time) and continues non-stop until Friday afternoon New York time.

The huge volume of FOREX and its around the clock availability, means that it is one of the most liquid markets in the world. There is always a buyer and seller for any type of currency because the world economy relies on the movement of goods from country to country. Stock exchanges have more limited trading hours. While it is possible to trade on exchanges worldwide, each exchange is independent and operates for just 7 hours a day. There is no way to buy or sell a certain stock that is only traded on one stock exchange when that exchange is closed.

FOREX has even more advantages compares to Stocks: It is more predictable than stocks, it follows well established trends, it allows high leverage – typically 100:1 instead of 2:1 on the stock market; and it doesn't require a large investment – mini accounts as small as $250 can get you started in FOREX.

The big question is what is Best for you? Are you looking for a Day-Trading constant activity, with its advantages, or a long-term investment. Know the answer and you know the nature of your next investment.

Source from http://www.howtoadvice.com

Reasons to Invest Money

2011-04-05T08:51:00.000-07:00

For all those urgent reasons there are to invest maybe the most important be to broaden or increase our retirement fund for being our current life expectancy higher than before. Nowadays, investments are the foundation of our future financial level. Bad investments can bring us negative turnovers and therefore decrease our future possibilities. You are looking at two options for your money, the first you can spend it or save it and invest it. According to the Bureau of Economic Analysis, personal savings of North Americans are very low comparing them to other developed countries. A low savings interest rate indicates that North American citizens are accumulating enough savings as to carry out successfully any emergency, and keep the life standard after retiring. Below you will find a list of why is it more important to save and invest than to spend.

People live longer than before and need more money to keep on living
Medical, educational, and insurance expenditures are still very high
The more one saves now the better his future in what having money to recycle refers to
By investing wisely you may better your life standards and increase your future wealth.

Without having to win the lottery you may accumulate an important retirement fund without having to dispose of great amounts of money. It is easier than what you can imagine. All that you need is time, money to deposit in regular periods of time and a return rate for your investments. The following arguments show how these three elements: time, money deposited and an investment rate interact in reaching your first million dollars.

For example:

An amount of US$231,377 invested during 30 years, at 5% annual interest rate, will have a future value of one million dollars.
If the return rate increases to 5 or 8%, the initial deposit will be reduced to US$99,377
A US$99,377 deposit invested over a thirty year period, at 8% annual interest, will have a future value of a million dollars
If you make regular deposits instead of investing a big amount , the sum of deposits will definitely decrease.
US$15,051 deposited each year during 30 years, at 5% per year, has a future value of US$1 million.
Earning a larger turnover reduces the annual deposit amounts.
US$8,827 deposited each year during 30 consecutive years, at 8% annual interest rate, also has a future value of US$1 million.
If you make monthly deposits instead of annual deposits the amount of each deposit will decrease more.
US$1,202 deposited each month during 30 consecutive years, at 5% annual interest rate, will result in US$1 million.
If you make weekly deposits instead of monthly ones the amounts will decrease even more
US$276 deposited weekly during 30 consecutive years, at 5% annual interest rate will also result in US$1 million in the future.
If the annual interest rate were increased from 5 to 8%, the weekly amount deposited would be the following:
US$154 invested each week at an annual interest rate during 30 consecutive years would render a future amount of US$1 million.
If we extend the investing period from 30 to 40 years and keep an annual interest rate of 8%, the weekly deposit would only be US$66.
US$66 invested weekly, at 8% annual interest rate, during 40 consecutive years would be worth a million in the future.

From these varied options we arrive to the following conclusions:

When longer the period, bigger the effects of recycling, which reduces the single initial amount or the diversified deposit amounts.
While higher the turnover interest rate, higher will be the recycling effects, which reduces the initial amount or the diversified deposit amounts.
While longer the period and higher the interest rate lower will be the single initial amount or the diversified deposit amounts.

The key to a successful financial plan is to keep apart a larger amount of savings and invest it intelligently, by using a longer period of time. The turnover rate in investments should exceed the inflation rate and cover taxes as well as allow you to earn an amount that compensates the risks taken. Savings accounts, money at low interest rates and market accounts do not contribute significantly to future rate accumulation. While the highest rates come from stocks, bonds, and other types of investments in assets such as real estate. Nevertheless, these investments are not totally safe from risks, so one should try to understand what kind of risks are related to them before taking action. The lack of understanding as how stocks work makes the myopic point of view of investing in the stock market ( buying when the tendency to increase or selling when it tends to decrease) perpetuate. To understand the characteristics of each one of the different types of investment can or may help you determine which of them is the right one for your needs.

Source from http://www.beginnermoneyinvesting.com

Stock Market Futures

2011-04-05T08:43:00.000-07:00

An operation with futures can be defined as a contract or agreement between two parts in which they commit to Exchange an asset, physical or financial, at an established price and at a future pre-established date at the signing of the resolution.

For the buyer, the contract of futures means the obligation of having to buy the underlying asset at a future price at the date of expire and for the salesman, it supposes the obligation to sell such underlying asset at the future price at the same date of expire.

In futures two positions distinguished themselves, in whose losses or profits will depend on the relation between the future price (agreed at the present) and the price of liquidation (price of the underlying asset at the market and on the date of expire):

Long position (buying):

If the future price is < than the liquidation price, the buyer obtains a profit.
If the futures price is > than the liquidation price, the buyer has a loss.

Short position (selling):

If the futures price is > than the liquidation price, the salesman has a loss.

A key element on the contract of futures will be then the determination of the futures price. This will be calculated in base on the cash price of the underlying asset plus the net financial cost; financial cost that will mark the difference between today (day the contract is agreed) and the date of expire of the contract.

So then, it will depend on the underlying asset defined on the contract. As a way of example we present the case of the shares and the bonds.

Forward price of a share:

FW= PC (1 + ti)- d (1 + t’ I’)
Where FW= forward price
PC= Cash quoting of the share
I = Rate free of risk
D = Dividends paid before expiration
T= time until expiration

And it pays dividends during the contract period; the person who accorded on the futures contract will no perceive the dividends in question.

Before this situation, you will have to deduce its impact from the futures price. If this is not done, the cash operation would result more efficient than the future operation and everybody would buy in cash until this effect would dilute (arbitrage operation).

Forward price of a bond without the intermediate coupon payment:

FW = (PC+ CC) (1 + it/360)- CCF)
Where PC = Cash quoting of the bond
CC = Running coupon of the bond in t (synonymous of the accumulated interests)
t = time till expiration
i = Free of risk type of interest corresponding to t
CCF = Running coupon the day of expiration of the forward

Forward price of a bond paid with an intermediate coupon:

FW= (PC +CC) (1 + it/360)-CCF- CC’ (1 + I’ t’/360)

Where: CC’= Paid coupon in t’
T’ = time until the expiration since the payment of the coupon
I’ = Type of interest free of risk corresponding to t’

In this case the intermediate coupon acts in the same way as with the payment of dividends of the shares. Those who have a future over a bond will not receive the coupon, so it must be discharged from the price.

Source from http://www.beginnermoneyinvesting.com

Options, Call Options, Put Options and Writing Options

2011-04-05T08:36:00.000-07:00

This section focuses on options which are stocks derivative investments. A derivative security is a financial security that derives its value from another security.

Stock derivatives as options and futures are securities that offer investors some of the benefits of stocks without having to own them.

Future contracts will be discussed in the next section.

Options and how they work

An options contract gives the holder the right to buy or sell shares of a particular common stock at a predetermined price (strike price) at or before a specific date (expiration date). An option is a right not an obligation to buy or sell stocks at a specific price before or at expiration date.

The strike price is the price at which the option holder can buy or sell the stock. An option expires at its expiration date.

A stock option is a derivative security because its value depends on the underlying security which is the common stock of the company. For example, the value of an to buy or sell Intel stocks depends on the price of the stock in the market.

Another underlying securities, besides common stocks, for the options contract are stock indices, foreign currencies, US Government debt and commodities.

Options are negotiated in the Chicago Board Options Exchange (CBOE), the New York Stock Exchange (NYSE), the American Stock Exchange (AMEX), the Philadelphia Exchange (PHLX) and the Pacific Exchange (PSE). Options can also be negotiated in the over-the-counter (OTC) market.

Understanding how options contract work can provide you with additional tools that can be successfully used in volatile markets.

Options are used to speculate with the movement of future prices of stock, and to reduce the impact of volatility of the stock prices, in some aspects the options are similar to future contracts. One of these similarities is that option holders with small investments can control a great amount of money in stocks for a limited time. The risk of loss, however, is much less for option holders than for future holders.

An options contract gives the owner the right to buy or sell a specific number (generally 100) of common shares from a company within a period of time.

Source from http://www.beginnermoneyinvesting.com

Stock Market and How Stocks Are Negotiated

2011-04-05T08:29:00.000-07:00

Stock markets are sensible to changes such as boosting and dwarfing of interest rates, political situations, events ahead of time, and those situations that one would never think could affect the economy or markets. In addition, the same stock markets have been constantly fluctuating due that they also have to adapt to any external situation.

To get to understand those changes, and how markets work may allow you to lower transaction costs when selling or buying stocks.

The stock markets: The stock markets are the foundation of any capitalist system where titles-valuables (stocks, bonds, options, future and services) are negotiated. The stock markets in the United States have two big interchanges and a parallel market (OTC.)

The New York Exchange (NYSE) and the American Stock Exchange (AMEX) are the largest in interchange and have negotiation environs in places in which there are stocks exchange.

The NASDAQ market is the same as that of the OTC, basically negotiates new stocks coming from low capitalization companies through phone and computer net chains. The stock markets and bonds have changed significantly due to technological advances. The wide and extent use of PCs and more specifically of the internet has given investors direct access to information that before would have been almost impossible to get.. Besides negotiation schedules for investors has been broaden. While before the markets gave access to negotiations during specific schedules, today negotiations are taking place out of schedule. Interchanges still close at the end of the negotiations official day (4:30 pm Eastern US time); after hours negotiations happen via the Electronic Computer Chain Network (ECN) which starts at 4:30 pm and ends at 9:30 am (Eastern US time), time in which the markets starts operating.

NYSE negotiations are taken place by floor specialists through sound voice auctions, but the NYSE is oriented towards the use automatic systems of wide use to accept sales and buy orders as done by its opponent, NASDAQ.

One of the many advantages that internet gives investors is that they can negotiate valuables through the line without the help of an stock market agent. Another advantage of the internet is the transparence in the market price. In other words, you can see the real price which buyers and sellers are willing to bargain over determined stocks. The bond markets still have a long way to go concerning transparence that their market prices should have for their potential buyers.

The transaction cost have dropped in the use of decimals. This change has had the effect of narrowing the lowest offer and ask for an extension of 1/16 points ($0.06) to a minimum of $0.01 per stock.

Coming of computers, on-line negotiations, ample negotiation schedules and the use of decimals have turned investing in different stocks something easier, but you also need to be better informed about the valuables you are going to buy or sell so easily. The stock market’s function is to provide continuous fair prices. Buying and selling financial valuables are auction procedures. A buyer offers a buying price (the amount he or she is willing to pay) and the sellers give their selling price (the price he or she is willing to sell at.) If these prices are similar the supply and demand coming from other buyers will be brought about until they complete the negotiation.

Source from http://www.beginnermoneyinvesting.com

2011-04-05T08:27:00.000-07:00

Investment companies have reached near in relation to providing the ideal type of investment for millions of investors that do not want to manage their own investments. Managers of these investment companies invest funds from investors in varied stock portfolios, bonds and instruments in the money market.

Investors participate of these investment companies depending on the amount of their investments. Which means that even with a modest investment the investor is the owner of a share in diverse stock and bond portfolios.

An advantage of this kind of investments is that investors that do not have time to manage their own financial investments or do not have the knowledge of individual financial values can invest their money in a diversity of stock and bonds portfolios, as well as in the money market instruments that offer mutual funds. Even so mutual funds are more often being monitored by regulators (Securities and Exchange Commission and the New York Attorney General for example) because of the excessive fees charged and for using the market timing shares in some mutual funds.

This shocking practice done by some mutual funds have put them on a dilemma on whether to invest or not in mutual funds. Many of them have turned to the exchange-traded funds as a more popular investing alternative.

Money growth that are managed by mutual funds companies have made them become important pieces of the stock market. According to the Investment Company Institute by the end of 2004 the mutual funds industry had moved around a $16.06 trillion of investors capital all over the world. With that many mutual funds from where to choose the investor should be very careful when selecting a mutual fund as well as to invest in individual stocks.

There are three steps that can make it easier to choose over what funds to invest in:

Understand how funds work
determine which are the objectives of the funds and what type of investments they make
Evaluate the performance of funds by reading the prospectus and other sources.

Source from http://www.beginnermoneyinvesting.com

Investing with Options

2011-04-05T08:24:00.000-07:00

This site has been created in order to show people how they can increase their wealth like never before. We are going to take you into the strategies involved in options that common investors usually do not think about or have probably not even heard about. You will soon realize that option trading is a new opportunity to turn into some of the people in the world that know what it feels like to win. The first part of the site will be based on the options basics in order to fill people in on how it works. This will allow you to learn about how option trading is done and why. Then we are going to show some of the strategies that have been used in different occasions and which have proven to be successful. These are not only strategies that have been used before but they are also easy to adapt into the strategies of any investor or trader. There are currently a number of successful investors that currently utilize these strategies on a daily basis within their own business. We are also going to show people what needs to be done in order to set up their own business at home with the best options trading software that exists as well as provide information on the tools, brokers, web sites etc

Grabbing at those opportunities

The economical idea of price of opportunity is intimately related with the idea of restriction of time. You can only do one thing at a time, in other words, unfortunately, you have to sacrifice other things. The price of opportunity of any activity is the value of the best alternative that you could have done instead of another. Everyday we have to choose what sort of things we think are more beneficial to do. For example instead of staying home and watching television on the weekend, you might have chosen to take your kids out for ice cream, as this gave you more satisfaction and happiness. The price of opportunity only depends on the value of the best alternative. It does not matter if you have five alternatives or if you have thousands. The price of opportunity is simply the value of the best alternative because you can always reduce a complicated selection with many options, to a simple selection between two things: option X against the best of all the other alternatives. The price of opportunity can give you an indicator of when to do things and when not to do them. For example, maybe you are the type of person that really likes eating chocolate; however you have more of a knack for pretzels. If you were only offered chocolate, you would most likely take it; however if you were offered both chocolate and pretzels you would probably take the pretzels. The price of opportunity of eating your pretzels is not eating the chocolate. Since the price of not eating pretzels is greater than the benefits of eating chocolate, it would not make sense for you to choose the chocolate. Of course if you were to choose the pretzels you will still need to face the price of opportunity of sacrificing the chocolate; but you will be willing to do this because for you the price of opportunity of chocolate is less than the benefits of pretzels. The prices of opportunity impose inevitable restrictions in the behavior because you always need to choose what is best and are obligated to sacrifice the second best alternative.

Source from http://www.beginnermoneyinvesting.com

Investing in Silver

2011-04-05T08:12:00.000-07:00

Investing in Silver is one of the things that is taking off today in the investing world. Anyone that is thinking about making cash in the market should take some time to read about these kinds of things and comprehend that there are not always opportunities that come as far as making money is concerned. It takes people these days a lot of bravery to get in and start investing when they are not aware of exactly what is going to happen.

The idea of this site is something quite simple to understand if you have a basic knowledge and understanding about economics you will be able to see just how important this is for the market of silver. Understandably, it can seem a bit challenging for first time investors. Savings accounts and term deposits are easy to get to grips with-- but investment? Stock markets? There is a lot to learn when it is all new! Our focus is on investment and giving advice to help you make wise economic choices."

There are some myths that many people have heard about the price of silver and it seems that the most common one is that digital photography is going to destroy the silver market. This is actually something that is not completely understood by people and what has been researched about is something that is definitely going to be a shocker for a few.

No matter what the market, it is known that supply and demand is something that has to be well balanced. However, this is an aspect that would take us into a whole other aspect of the silver market.

Silver as well as gold is measured to be a leading article of trade by the market. And even though these once used as money in the past it is interesting to find out how silver is traded now in our modern day and age.

Silver was actually the first type of money that existed in history. The word silver and money are identical in places like South America and Mexico where it is called “plata” which means silver.

Silver is one of the most important metals in this day and age. As a lot of people know, people are discovering more and more uses for silver every day and it is the metal that is used more than all the rest put together. New use has an effect on the demand, and demand will have an effect on the price, and we will look into some of the future and new uses for silver.

There are different options of how investors can invest in the market, which include mining stocks, bullion, coins, and leveraged investments that are some options for the future.

Source from http://www.beginnermoneyinvesting.com

Investing in Bonds

2011-04-05T08:10:00.000-07:00

Stock prices are guided by earnings. When a company’s gains increase through a period of time, the price of stocks of the company also are increased.

Reaction of prices of bonds under certain economic events are mainly different to prices of stocks. Prices of bonds generally decrease when the news about the economy are good and increase when negative. An understanding about these characteristics of bonds could explain the phenomena.

Bonds features

A bond is a negotiable debt security under which the issuer borrows money and in exchange agrees to pay fixed amounts of interests during a specific period of time, and besides gives back the total amount of the principal when the bond reaches maturity.

The principal is the net value (par value) of the bond that generally is $1000 per bond.

A bond is similar to an IOU. Bonds also have certain similarity with the Certificates of Deposit (CDs) and savings accounts. Investors who deposit money in CDs (or savings accounts) are in effect a loan to banks.

Banks pay the investor interests over their deposits and later repay them the principal when CDs reach maturity. Equally, bond investors make loans to the issuer (corporation or government). This process turns them into creditors, not in owners, as in the case of investors in common stocks. In return, the issuer pays regularly a specific amount until maturity date of the bond.

Virtually, bonds have a maturity date, time in which the issuer gives the investors back the face value of each bond. The main difference between the three, savings accounts, CDs and bonds is that investors can sell their bonds to others in the secondary market before the bonds reach maturity. Savings accounts and CDs cannot be sold to other investors.

Take into account that CDs in amounts larger than $100,000 can be sold before reaching maturity, make from it a very profitable investment.

Bonds are negotiable IOUs opposite to savings accounts and CDs in amounts smaller than $100,000, and issuers of these bonds pay regularly a fixed amount of interests y repay bondholders its principal on the fixed maturity date.

These regular payments of interests make bonds a good investment for investors that search fixed amounts of incomes and be given back its principal when at maturity date. Bonds in general have similar characteristics. A bond has a face value, also known as par value which is the bond amount that is repaid at maturity. The bonds par value is almost always $1,000 with very few exceptions. The par value is the amount under which interests to pay is determined.

For example, if a bond is bought when issued at a price of $1,000, the investor is buying such bond at its par value. At bonds maturity date the investor receives $1,000 per owned bond.

When bonds are issued a maturity date is fixed, and will be the date bondholders will receive the par value of their bonds. Maturity date is the date in which the issuer of the bonds takes away the bonds from the market and pays the bondholders its par value. Bonds’ maturity dates can be established from a day to 100 years.

Bonds with maturity of one year or less from the time of issuance are referred to as short-term bonds or debt. Bonds with maturity of one year to ten years are referred to as intermediate bonds or intermediate notes.

The long-term bonds are issued with a maturity of at least ten years and commonly up to 30 years. Disney Corporation and some other corporations have issued bonds with a maturity of 100 years, but this does not generally occur. Bonds have two types of maturity. The most common one is a term bond in which all bonds of a determined issue mature on the same date.

A serial bond has different dates of maturity within the same issue. The coupon rate of a bond determines the annual amounts of interests paid by a bond which generally is determined in a percentage over the face value.

If the coupon rate is of 5% the issuer of those bonds agrees to pay $50 (5% x $1,000, the face value) in annual interest per bond. Many bonds pay interests each semester, the bondholders will receive $25 per bond every six months. Some bonds have adjustable or floating interest rates.

Let’s suppose that last year you purchased a bond with a coupon rate of 5% when the market rates were also of 5%, and you paid $1000 per bond. This year the markets’ interest rate raised to 6%. What price would you receive if you sold such bond? Obviously, new investors wouldn’t pay $1,000 for a bond with a performance of 5% when they could buy new bonds with an updated coupon rate of 6% for each $1000. Due that new investors would expect to get at least a 6% from a bond that would be sold at a lower price than $1000 (a discount) in order to be more competitive against current bonds.

Equally, if the markets interest rates fall under the coupon the rate, the new investors will be willing to pay more than $1000 per such bond. That is how prices of bonds are vulnerable to the market interest rates, as to other factors that will be discussed later on.

Source from http://www.beginnermoneyinvesting.com

How to Invest in Stock Market

2011-04-05T08:06:00.000-07:00

How to Invest: The Stock Market and Exchange is a great alternative for the savings of people and institutions. It permits them to obtain an important profitability against other types of official markets even if it means assuming, possibly, a greater risk.

An example of the growing importance of the stock exchange at a world wide level is the existence today of millions of small and big savers that are willing to put part of their excess funds in the stock exchange markets. The stock exchange, then, is each time more and essential element for the regular functioning of the financial system of a capitalist economy.

With this site we pretend to contribute with the essential knowledge, which includes the functioning of the stock exchange market, as also to present the main techniques to invest in it.

In the following Section a general description of the stock exchange is offered, its functioning, types of assets that are negotiated in it and the agents that intervene, also the main characteristics and functions that defines them are resume and a review of its history is done.

In Section 3 the securities object of dealings in the stock exchange are described in detail and in Section 4 the different types of more frequent operations are studied.

In Section 5 the required requisites for institutions that want to quote in the stock exchange markets are analyzed and the official procedure of quoting is described. Also, the official security and supervision of the market and the intermediaries in it are discussed.

Section 6 presents the different techniques for analyzing the shares of a Company. The pretension is to answer the question of; what to do to begin to operate in the stock exchange? For it, the main sources of information from the market and other tools used by the stock exchange annalists is gathered to comprehend the market and to try to foresee its future. The fundamental techniques of analysis and technical analysis are studied and a final comparison about its advantages and limitations is presented.

Section 7 is dedicated to the types of indicators that are used to follow the evolutions of the stock exchange markets: the stock exchange indexes.

In Section 8, the profile of the investor in the stock market is tried to achieve, having in account that there doesn’t exist any kind of universal description for them. Two types of investors are basically distinguished: according to its way of operating and according to its knowledge and financial capacity.

Source from http://www.beginnermoneyinvesting.com

Futures, Future Contracts, Analysis and Speculating

2011-04-05T08:03:00.000-07:00

Futures contracts are complex investments that should not appear in investor’s majority of portfolios because of the loss risks in relation to other securities such as stocks and bonds. The greatest risk is caused by the leverage obtained from futures contracts.

Futures contracts investors are required to pay only a small percentage (2 to 10%) of the total value of the contract. If the value of the contract declines significantly, investors are forced to pay additional amounts. Omitting to deliver such additional funds would result in a loss and liquidation of the investor’s position.

Source from http://www.beginnermoneyinvesting.com

Beginner Money Investing | Learn Best Way How to Invest Money

2011-04-05T08:01:00.000-07:00

The Main Educational Ideas of my Beginner Money Investing site is to help you learn and train yourself to put money aside, commit money to earn a financial return as well as the Best Ways to Invest Money? Is committing money to earn a financial return the same as playing for money? It must have crossed your mind if you had committed some money every month to acquire shares of any major company during four or five years previous to filing its bankruptcy. Having tried to take some business risks cost you an arm and a leg, but if you had given it a second thought you would have committed your money to a savings account earning a 1,3 or 2,3 annual percent during that time period. Still, during that lapse of time, the Dow Jones Industrial Average scale had raised 100% its price. Middle class property house prices had raised between 6% and 8% in that same time. Certificates gained around 6% per year. Could your possibilities to succeed be higher if you were playing at some casino or race? You may either come out naked or you may triple your pension money.

Committing money in certificates, shares and/or properties is not similar to playing for money, even when shares, certificates and property prices fluctuate suddenly. Keeping money aside at home is not the same either. Contrasting ideas come from the following: Putting money aside is to keep your money worth the same when not being used. On the other hand, committing money for profit has to do with risking. Depending on where you put your cash, that is to say what kind of business, you’ll get more or less turnovers. To invest is to put money in the financial market or in real estate to increase its future value. Committing your money includes shares, collecting coin, bonds, real estate, options, and future contracts; savings is usually done through a bank savings account.

Speculating is putting money in a place in which opportunities to get a financial return in blue through a determined period of time are just minimum. With this investment probabilities of getting back some money over a long period of time are really high. Therefore, we can assure that investing and speculating are not the same; moreover, speculating is more related to gambling in which odds are against the individual that decides to invest. The risk of loosing in future contract investments area extremely high. For each dollar earned from commercializing future contracts you loose another one. Then, why are there who invest en speculative values? The answer is very simple. If investments work as one hopes or expects, the investors will count with a substantial turnover.

Having success in investments requires knowledge about values and stocks in which one is investing as well as the risks that those values carry. Investment opportunities are very broad and the abundant information that exists in the internet may help you get more knowledge about those investment opportunities that you feel you can carry on. The negative part that comes along with the internet is that the use of such a simple and quick that you can make investing mistakes much more easily. Without having to talk about your investing ideas to your agent o financial broker, you could end investing in low return shares and bonds, but with a higher risk of loosing it all. Advice about investments are spread freely and easily through internet. But you should take into account that no advice is free. If you had followed the advice of a research analyst having to do with which shares to buy or sell for the 2000-2002 period you would have lost most of the capital you invested. Many analysts recommended the buying of shares and stocks with very little information about those values, and only because the prices had dropped to a very low level. For example, selling shares and stocks suggestions over: Enron, WorldCom, and Global Crossing came only when they were already near to file for bankruptcy.

By understanding how to build a investing portfolio you could keep safe against any potential loss such as those shares and stocks coming from the mentioned companies and corporations.

Put money aside, commit money to earn a financial return or take a business risk?
Motives for committing money to earn a financial return
Outlay of money process
Kinds of outlays of money for profit

Source from http://www.beginnermoneyinvesting.com/

Retire young by investing in properties

2011-04-05T07:54:00.000-07:00

By: Milan Doshi

Retire early via property investments

How to retire in less than five years by accumulating good debts of more than RM3 million through property investments

I was having lunch a few weeks back with David (age 55), a past participant of my property investment program whom I had not met for many years. David works in the oil and gas industry and he was posted to the Middle East for the last five years. When he left Malaysia, he was a millionaire. When he came back for good, he was worth over RM5 million. Not a bad way to get rich quickly within such a short period of time. I am sure he would not have been able to make so much money so quickly had he remained in Malaysia.

Hence the important lesson here for all employees is to be adventurous and grab any opportunity to earn a high income in a strong currency. The amount you earn working overseas in one year is equivalent to at least 3-5 years of working in Malaysia! The amount of money you are able to save while overseas will enable you to leapfrog your peers when it comes to investing.

While away, David managed to accumulate over 10 residential properties and he paid cash for all the new purchases as he used to come home at least three times a year. David’s combined passive rental income today is over RM10,000 a month enabling him to retire very comfortably. He only took loans for the earlier three purchases he made before he went overseas.

When I asked David, why he did not take any loans for all the recent purchases he made while working overseas with a high income, he replied that he did not like paying the bank interest. He was also afraid of interest rates going up like what happened during the Asian currency crisis of 1997/98. Another reason was that he preferred his surplus cash to be used up instead of leaving in fixed deposits where the temptation to spend or make ‘silly’ investments would be extremely hard to resist. David told me that his goal was to retire debt free and he was happy that he was finally able to do so at a fairly young age.

While David did well for himself, I personally felt he could have done much better. Like David, many people’s goal is to retire debt-free early, preferably well before the age of 65. Did you know that it is possible to retire, if you so wish, within the next five years by accumulating good debts of RM3 million via property investments? Sounds too good to be true? Read on for the truth.

In my article in the June 2009 edition, I gave several reasons why you must aim to borrow intelligently as much as you can. They were:

Leverage

Transfer of Property Risks

Effects of Inflation on Bank Loans

How Your Net Worth Increases due to the Reduction in Liabilities

Here are more reasons on why it makes sense to borrow money:

1. Time Factor: It may take you five to ten years to save RM100,000, but less than one month to borrow the same amount for property investments. Hence why wait to save when you can start investing now using borrowed money! You will be able to get rich quicker by starting your investment journey much earlier.

2. Your ‘Hard Working’ tenants are paying your bank instalments, not you. Many people make the mistake of mixing up the bank instalments for their home and investment properties. For your own home, you are responsible to pay the bank instalments every month. Hence it is important to ensure that there is income or salary coming in every month. Alternatively, you must have a buffer to service three to six months bank instalments in case you temporarily lose your earning ability.

However, for investment properties that are being rented out, you are using the rentals collected from your tenants to pay the bank instalments. Even though you are technically responsible for the bank loans, as long as the properties are rented out and the rentals are sufficient to pay the bank instalments, there is really nothing to worry about as far as your own earning ability is concerned.

You can go a step further and reduce risks by ensuring that 10 months rental is sufficient to service 12 months bank instalments in the event your property becomes vacant or unexpected property expenses crop up, etc. If you own several investment properties, another way of mitigating risks is to ensure that 80 percent of the combined rentals collected (in case of full occupancy) are sufficient to service 100 percent of the bank instalments every month. Your worry now shifts from servicing the various bank loans to ensuring the rental from all your properties comes in every month.

3. Spread between the ‘yields’ and ‘interest costs’. To illustrate this, let us assume that you are investing in medium priced condominiums in the Klang Valley in good locations where it is possible to get:

Average Property Yields > 7.5% pa

Interest Costs on Bank Loans < 3.5% pa (Today, most banks are giving spreads of at least B.L.R. – 2.2% for residential housing loans)

Hence the Difference or Spread > 4% p.a.

Currently in Malaysia, there is a huge spread between yields and interest costs. In other countries like Singapore or Hong Kong, the spread is less than 1.5 percent pa. Personally, I do not think the spread will remain this wide for long. Over time, yields will come down as residential rental rates remain the same (in areas where there is an over-supply, it may even come down!) and prices of property increases due to inflation. The BLR may also increase once the economy recovers. Even if the spread reduces from the current four percent to let’s say two percent over time, there still exists a comfortable cushion to invest in properties. In fact, now is a far more ‘comfortable’ time to purchase investment properties compared to the future based purely on the spreads.

Assume the current spread is four percent pa, let’s look at the gains for loans of various amounts. See the Table below:

Loan (RM)	Gains per Year (RM)	Gains per Month (RM)
1 million	40,000	3,333
3 million	120,000	10,000
5 million	200,000	16,666
10 million	400,000	33,333

If you have RM1 million in bank borrowings, you are getting rich passively by RM40,000 per year or RM3,333 every month. By the way, this happens to be the worst case scenario where property prices do not increase, which we all know happens to be highly unlikely!

If your combined borrowings are RM3 million, your gains are RM120,000 every year akin to a passive income of RM10,000 every month. This is an amount that will enable you to retire comfortably if you so wish! Hence my contention that all it takes to retire is to accumulate at least RM3 million in bank borrowings and making sure your spread is 4 percent pa. If you are starting from zero borrowings, you can easily build up your borrowing quantum within the next five years no matter where you are financially today!

Once you have hit RM3 million in bank borrowings, are you going to stop there? I do not think so. In fact, I would recommend that you set a personal target of borrowing anywhere between RM5-10 million. The figures in the above table will give you sufficient reasons why you should set these achievable targets. In fact, the more you borrow intelligently for good property investments, the richer you become!

Further, the figures in the table assume that property prices do not increase. If we were to factor in a modest five percent per annum increase in property prices every year, the gains shown in the table would easily be higher by another 30-50 percent!

Coming back to David, what advice would you have given him? I frankly suggested that while he still had his last ‘high income’ pay-slip which was less a month old, he should quickly refinance all his properties and borrow to the maximum while he still could as the banks would not know that he is back for good. If David were to delay by a few months, he would find it more and more difficult to borrow money as he did not have any more fixed income and his age would not help either. And what to do with all the borrowed money? Go out and invest in more properties and pay cash for them!

Source from http://www.iproperty.com.my/

Where to Invest in Malaysia Hotspots for Property Investment

2011-04-05T07:45:00.000-07:00

Where are the Klang Valley hotspots for property investment to make more money? Everyone is so interested to know where to invest in property hotspots at KL and PJ. Therefore, I keep collecting the information released from our Malaysia property experts and consultants regarding the hotspots for property investment, especially residential property at KL and PJ.

Malaysia KL and PJ Property Hotspots for Investment

Northeastern Petaling Jaya (Bandar Utama, Taman Tun Dr Ismail, Mutiara Damansara, Kota Damansara, Sri Damansara, Desa ParkCity and Valencia)
Subang Jaya – Shah Alam belt
Damansara Heights
Sri Hartamas
Bangsar
Taman Seputeh
Taman Desa

From the locations listed on above, medium cost up to high end properties are available for different group of people. So, where is your favorite and preferred location for property investment during this slowdown economic? Keep an eye for all the new launch property or completing soon project at the locations abovementioned. Get ready to make more money from hotspots property! More importantly, get your money be prepared! Cash is King!!!

Many property investors are adopting a “wait and see” attitude. Nothing to be surprised, do thing last minute always is Malaysian style! For me, there are three groups of investor in whatever type of investment:

Sense first, get first （先知先觉）
Sense later, get later （后知后觉）
Never sense, never get （不知不觉）

So, sense more and get more! Go visit more property showrooms, do more actual site survey, read more property investment books, do more analysis, and etc. Put for afford and just do it!

Source from http://www.horlic.com

Taking The Mystery Out Of Retirement Planning

2011-04-04T22:50:00.000-07:00

Planning For A Lifetime

It's not going to be your parents' retirement - rewarded at 65 with a gold watch, a guaranteed pension, and health insurance for life. For many Americans, retiring in this new century is a mystery. Earlier generations of workers could rely on employer-provided pensions, but now many workers will need to rely on their own work-related and personal savings plus Social Security benefits. These savings have to last longer because Americans are living longer, often into their eighties and nineties.

If you are one of those people who want to plan - and are about 10 to 15 years from the day you retire - this booklet is for you. Today's (and tomorrow's) retirees may well have a new kind of retirement. With a longer and healthier life span, bikes, boats, planes, and RVs may be part of your life, because you are more likely than previous generations to be an active older American.

Opportunities to take courses, start a new career, and become a volunteer can make your future an adventure. A longer life, however, will also mean more medical care, some of which will not be covered by the federal Medicare program.

The whole retirement scene has changed and many American workers find it a mystery. In fact, a 2009 survey by the Employee Benefit Research Institute (EBRI) suggests that only 44 percent of Americans have tried to calculate how much they need to save for retirement. In this booklet, each chapter will give you clues on how to take control of your finances so that when you retire, you have the time and money to do what you've always wanted. For some, it's simply being with friends and family. For others, it's starting a new hobby or craft. And for some it's starting a new life.

Whether you are 10 years from retirement or have a different timeframe - or even if you are retired - this booklet will help you to unravel the financial mysteries of life after work and to discover changes you can make for a financially secure future.

Time On Your Side

Getting started today will help you put time on your side. To help, Taking the Mystery Out of Retirement Planning offers a simplified, bottom-line approach to figuring out just how much you may need when you retire. The worksheets in this booklet will provide a guesstimate. Regard them as a starting point.

Each chapter in this booklet asks you to chart a different part of your financial life - your savings and your expenses - and helps you project future costs and savings well into your retirement years. Of course, no one has a crystal ball, and life has a way of throwing changes our way. But getting time on your side now, before you retire, means you will not be awake at 3 a.m. worrying about, instead of planning for, the future.

How To Use This Booklet: Simply read it to get familiar with retirement issues. Better yet, fill out the worksheets to figure the dollar amounts of what you have, how much it will grow in 10 to 15 years, and how much you may need to last over a 30-year period. Remember these amounts are only estimates, and you will want to update them from time to time.

Take your time. You may want to tackle one or two chapters, fill out the worksheets provided...then spend some time gathering the documents and information you will want to keep. This online version of the booklet allows you to save the information that you have entered so you can find it when you return another day. Whether you approach the booklet chapter by chapter or all at once, keep going. Don't get stuck on details - guessing is okay, and you can always come back later with more accurate numbers and information.

This booklet uses three time periods in charting your retirement savings. The starting point is today, when you are about 50 to 56 years old and plan to work approximately 10 to 15 years more. This is a good time to take stock of where you are in terms of retirement savings and set financial goals you would like to achieve in the 10 to 15-year period you plan to work.

The second point in time is the day you retire, when you are about 65 to 66 years old. That period between now and then is an important one. In those (approximately 10 to 15) years, you will have time to put more of your paycheck to work in a retirement account. It will grow, not only from your additional savings, but also from the “miracle of compounding,” the world's greatest math discovery, according to everyone's favorite genius, Albert Einstein. This is the result of earnings from interest and from investments continually increasing the base amount.

Finally, the third time period used in this booklet is the approximately 30-year span you hope to enjoy retirement. It is the time period experts suggest you plan for, based on the average 65-year old American male living 17 more years and the average 65-year old female living 20 more years. These are only averages, so planning for 30 years will help you avoid outliving your income.

As you read through this booklet, keep an eye on the Timeline for Retirement that follows. Some of the terms, like "catch-up" retirement contributions beginning at age 50, may be new to you. The timeline offers some milestone opportunities to make changes so you can have the kind of retirement you want. The time to start is today.

The General Information Worksheet will get you started thinking about when you will retire. This information will be used in the worksheets that follow to help you come up with your retirement savings.

Clue 1
Timeline For Retirement


At age 50	Begin making catch-up contributions, an extra amount that those over 50 can add, to 401(k) and other retirement accounts.
At 59½	No more tax penalties on withdrawals from retirement accounts, but leaving money in means more time for it to grow.
At 62	The minimum age to receive Social Security benefits, but delaying means a bigger monthly benefit.
At 65	Eligible for Medicare.
At 66	Eligible for full Social Security benefits if born between 1943 and 1954.
At 70½	Start taking minimum withdrawals from most retirement accounts by this age; otherwise, you may be charged heavy tax penalties in the future.

Chapter 1 - Tracking Down Today's Money

This chapter will help you shine a light on the mystery of where you will find the money to support yourself in retirement. Many people don't have a clear idea of how much money they actually have, so it's hard to know how much they might be able to count on when they no longer work. Finding out what part of today's money can go toward retirement simply means adding up the value of all your current assets. In this case, "assets" are cash, investments, and anything of value you can exchange for cash, like your house, savings bonds, or even fine jewelry. This figure will be your first important clue.

Recording these amounts could be a pleasant surprise. You don't want to count emergency money and savings for your children's education or a big trip - only money that you are not going to touch for at least 10 to 15 years. For purposes of the Pre-Retirement Assets/Savings Worksheet, you also don't want to include any future Social Security benefits and guaranteed pensions because these items are future income, not current assets (and they will be included later). Money in work-related retirement plans, like 401(k) plans, is counted, however, and you will want to include amounts from current and former jobs. In fact, these will probably be at the top of your list of today's assets that follows.

More Than You Think

Tracking your money in retirement plans should be fairly easy. If you didn't roll over your retirement plan balance when you changed jobs into a new retirement plan account or into an IRA, or if you didn't take your account balance as cash, you may discover some forgotten retirement assets you have. This is a good time to think about keeping your money with fewer, rather than more, quality financial institutions so it is easier to manage.

Recording current and old retirement account amounts on the Pre-Retirement Savings/Assets Worksheet, is important for a couple of reasons. First, locating an old account could take time. The longer it's "lost," the harder it will be to find. Second, understanding your current financial standing should automatically start you thinking about how to make your money grow.

Quit Worrying, Start Planning

Remember you're facing a retirement that's probably going to be longer than your parents' and will involve more uncertainties. This new kind of retirement probably means there are many American workers worrying about, instead of planning for, the future.

You can choose to stop worrying and start figuring. Not only will you come up with facts to work with, the chances are good you might change the way you save. The 2008 EBRI survey also found that 44 percent of people who tried to figure out their financial futures ended up changing their retirement savings plans.

If you are a married woman: In preparing for retirement, women face the very real possibility of spending part of their retirement years without the support of a husband - most likely through widowhood. The loss of a spouse can sometimes mean the loss or reduction of benefits that can place women in financial jeopardy. For that reason, women will need to focus on their financial resources as a single person as well as half of a couple.

For purposes of the following worksheets, consider filling them out as a couple and as a single person. Consider what happens to your Social Security and to retirement benefits if your spouse dies or you divorce. Know what assets you can count on. Check Social Security benefit documents, retirement plan documents, and wills. Remember that wills are important, but they may not provide the protection desired. Depending on the way assets are titled or the terms of a will, the money women believe they can count on may not be passed to the surviving spouse.

Next, you can estimate how much that money could be worth because it will probably grow - in the 10 to 15 years between now and retirement. The Pre-Retirement Assets/Savings Worksheet will help you project a 10 to 15-year total, which will help you estimate a 30-year total. Yes, it's just a guesstimate, because the further in the future you plan, the more that can happen. But the totals give you some idea of how much you may have for your retirement years. (People who are retired may want to skip this worksheet and focus on the information about ways to grow your money.)

In addition, this worksheet will let you see how much your money can grow by investing it in different ways. In fact, you will be able to assign different rates of return to different types of savings and to see how your decisions can impact the growth of your money over the next 10 to 15 years. Rates of return are simply the amount your money earns over a certain period.

How your money increases over time will depend on the nature of your investments, the rates of return, and other factors, such as the economy. One kind of investment, for instance, is a bond, which is often referred to as a "fixed income" investment because the interest rate is fixed. As an example, if you owned a bond with an original value of $10,000 and you got a 5 percent return (or yield) on your investment, your original investment would increase to $16,289 in 10 years.

Digging Deeper

You will probably want to dig deeper by assigning different rates of return to different pots of money-workplace savings accounts, IRAs, bank savings accounts-you have put aside for retirement. Let's say you have $2,000 in a checking account that you never use. Your rate of return, in this case, with interest compounded monthly, will be low, maybe 1 percent. But your money is safe. Then let's say you've invested in a stock mutual fund for 15 years using your retirement plan account and you get a return of 9 percent. Investments in securities can bring a higher rate of return than simple interest because prices of securities often rise and gains are compounded. Of course, security prices can fall, as we saw with stocks in 2000, 2001, and 2008. The tradeoff for aiming for higher returns is taking on more risk, including the risk of losing money. Keep this in mind in selecting rates of return for the Pre-Retirement Savings/Assets Worksheet.

In the example above, with some money invested in stocks and some in a safer, interest-bearing account, you are already doing what the experts recommend. You are practicing "asset allocation" - by putting your money in different types of products that earn different rates of return. Financial planners highly recommend this technique as a way to spread risk. A general allocation is to have some money in "cash," such as a savings, checking, or money market account with little or no risk; some money in bonds, with a little more risk but paying more interest; and some money in stocks, with more risk but a likely higher return, especially in the long run.

Another way to spread your investments among different categories is to invest in index mutual funds. Index funds are a collection of investments, such as bonds or stocks, that closely match the performance of the major holdings for that category of investment. For instance, a Standard and Poor's (S&P) index fund tracks the 500 broad-based stocks that comprise the S&P 500 Index. A bond index fund would track the performance of major bond holdings in that index. In this way, your investment is following the financial market for that particular category.

Experts recommend that you spread your money among a range of investments so that your money is "diversified." In addition, most experts add that you should not only invest among categories but within each major category as well. For instance, your risk of losing money is less if you buy shares in several mutual funds investing in various types of assets (such as large company stocks, small company stocks and bonds). Even investing in just one mutual fund will help you to diversify compared to investing in individual securities on your own, since mutual funds, by their nature, allow you to invest in a collection of stocks, bonds, etc.

Financial planners believe that diversifying your investments helps reduce risk as markets move up and down. For example, in 1980 when some certificates of deposit (CDs) were paying 12 percent, stocks were barely holding their own; but in 1999 most stock prices were rising fast, and CDs were paying 5 percent. You will see sample rates of return for some common places to put your money in the box below.

Too much money in one type of investment is always a bad idea and puts your money at risk. For example, many American workers are holding a lot of their employers' stock in their retirement accounts. This ties both your current paycheck and your retirement savings to one employer's success...or failure. This can be risky.

Now that you have tracked down your retirement savings, personal savings, and other assets and investments, you can return to the worksheets, and select the tab to fill out the Pre-Retirement Savings/Assets Worksheet.

Chapter 2 - Tracking Down Future Money At Retirement And After

Congratulations. You are making great progress in tracking down your retirement assets and solving the first half of your retirement mystery. Now move on to the Post-Retirement Assets/Savings Worksheet to come up with a monthly income during retirement. Based on the information you entered in the Pre-Retirement Assets/Savings Worksheet and what you enter in this worksheet, you will have a monthly income that can then be compared to your anticipated monthly expenses in retirement.

Return to the worksheets, and select the tab for the Post Retirement Assets/Savings Worksheet. You can now add Social Security and pension benefits as this worksheet deals with income you can rely on during retirement.

Chapter 3 - Tracking Down Future Expenses

Clue 2
Average Annual Returns Over 10-Year Period: 2000-2009

Investment	Percent
Checking account/money market account	3.67
10-year certificate of deposit	5.47
S & P 500 Index (large company stocks)	7.22
Russell 2000 Index (small company stocks)	3.61
Barclays Capital (long-term bond index)	7.37

This chapter will start you on the road toward a realistic look at your expenses in retirement and how they will be affected by inflation. These numbers are important clues to your retirement mystery.

You will be looking at your expenses today and estimating how they will change over time and, specifically, during two other time periods: the day you retire 10 to 15 years from now, and over the approximate 30-year span of your retirement. In doing so, you will have some idea of whether the money you have saved will be enough to last. You will also have a chance to look at your spending patterns and decide how they could change over time. After all, you can't control inflation over this stretch of time, but you certainly can control what you spend.

Your expenses will likely change as you grow older. Early on, you will spend less on work-related things like transportation and clothing. Maybe you'll spend more on traveling, hobbies, or other things you have always wanted to do. As you age, it is likely that more of your budget will go toward medical expenses, which you will read about soon. Retired people may find that recording their expenses will alter future spending patterns.

Inflation And Your Future

Inflation, in its simplest terms, means that dollar for dollar your money will not buy as much next year as it does this year. This means inflation is a major factor in determining how much money you will need in retirement since, to cover inflation’s impact, you will need more money every year. In other words, if your money is not earning more than the rate of inflation, you will lose part of your nest egg’s buying power.

You can't know and can't control future inflation. The only accurate inflation rates are from the past, and they vary widely. In 1980, overall prices went up a whopping 13.5 percent; in 2002, they went up only 1.6 percent. Looking at the past shows how rates may vary widely. The Expenses Worksheet assumes a 3.5 percent rise in prices for the next 10 to 15 years. But these are estimates, and remember, we've gotten used to low inflation overall - with a few glaring exceptions - over the last decade.

Facing Down Rising Costs

One exception to low inflation rates is medical costs, which have risen faster than inflation over the last 20 years and some experts think will rise about 7 percent a year over the coming years. If you have, or your family history includes, a serious medical condition like heart disease, you will probably spend more on health care than you ever imagined. According to recent studies, almost 20 percent of retiree income will be spent on health care.

While Medicare is a great benefit to persons 65 and older, it does not cover all medical costs - deductibles, co-payments, and long-term care, for example. Medicare Part A covers hospital care only. Medicare Part B, an additional insurance you will be offered when you become 65, covers doctors' services, outpatient hospital care, and things like physical and occupational therapy and some home health care. The current cost of Medicare Part B is about $96 per month for most people, although some may pay more. In addition to Medicare Parts A and B, many retirees buy Medigap policies for uncovered services like dental and vision care and drugs. Depending upon where you live and the policy you choose, you can pay from well under $100 to as much as $350 a month. Medicare, private insurance, and/or Medicaid pay for only about 79 percent of retirees’ overall health care expenses.

Medicare also has a Part C, which serves as an alternative to traditional Part A and Part B coverage. Under this option, beneficiaries can choose to enroll in and receive care from private “Medicare Advantage” and certain other health insurance plans that contract with Medicare. In most of these plans, there are extra benefits and lower premiums than the original Medicare plan, however your choice of doctors and hospitals may be limited, and the plans' copayments and charges may vary. You do not need to purchase a Medigap policy if you join a Medicare Advantage Plan.

An additional feature is the Medicare prescription drug program (Medicare Part D). Those who become eligible for Medicare Part A and/or Part B can join a prescription drug plan offered in their area. By paying a small premium - around $30 a month in 2011 - those who join will be able to get prescription drugs at a lower cost. (The Resources section includes booklets about this program.)

If you are thinking about retiring early, you may have to buy health insurance until Medicare kicks in at age 65 if your employer does not cover health care for retirees. You should know that employer-provided health benefits for retirees might not be guaranteed, and could be reduced or eliminated by your former employer under some circumstances.

Where Will You Live When You Retire?

Make planning for your future housing needs one of your first priorities since where you live in retirement affects not only your income, but also your emotional, social, and physical well being. It is an important part of your overall retirement strategy. While the cost of owning a home hasn't gone up as much as health care, it is high in many regions. Home heating and cooling costs are rising fast too. Maintenance, condo fees, real estate taxes, and insurance are other costs affected by inflation.

As you age, you may want to look into other types of housing. Independent living facilities, designed for reasonably healthy older people, often require a hefty down payment, say $120,000, and then a monthly fee of up to $2,000. Saving for nursing home care, which in 2008 averaged $212 a day, also might make you feel more financially secure, given that at least 40 percent of today's 65-year-old Americans will spend some time in the future in a nursing home.

With medical and housing costs such a big part of a retirement budget, it's no surprise that products and services have been developed to help plan for and manage these costs. Rising health care costs, in particular, could consume all the money saved for retirement. One of the more recent products developed is long-term care insurance, which can protect retirees' assets by paying for medical care in a nursing home and sometimes in your own home. Premiums vary by the features you choose, such as the amount of the daily benefit paid and protection against inflation. The average premiums for a 60-year old are about $2,300. Buying such a policy at a later age means higher premiums. If you're considering a policy, get some advice, because long-term care insurance is a new product and some policyholders may find the coverage isn't what they need.

To cope with these future expenses, some preretirees are starting special health care savings funds at work, separate from their retirement savings. One example is a type of account, a health savings account (HSA), which is designed to help certain employees save for future qualified medical and retiree health expenses on a tax-free basis. Essentially, an HSA is a savings account into which you can deposit money for future use. If you belong to a health plan with a deductible of at least $1,200 (for individual coverage) or $2,400 (for family coverage), you may be able to set up an HSA. Individuals who don’t belong to a workplace health plan can sign up for HSAs with some banks, insurance companies, and other approved entities.

These accounts can receive contributions from you, your employer, or even a family member on your behalf. You can use the funds from an HSA to help offset future medical costs, and the money in your account can be carried over from year to year. In addition, this type of account is portable; it stays with you as you move from one employer to another or if you leave the work force. To learn more about health savings account criteria, see the Resources section. Returning to the worksheets, now select the tab for the Expenses Worksheet and start entering what you are spending today and what your expenses will be at retirement.

Chapter 4 - Comparing Income And Expenses

Now you will compare your income with your expenses during retirement and see if they match up. This is the number you've been working toward as you've investigated your assets and income, then expenses, and finally, figured the effects of time on your money. By the end of Chapter 4, you will discover whether you need to save more for retirement and, if so, how much more...and you will learn how to grow your savings over time.

Few people will have exactly the amount of money they will need in retirement. Most will get a negative figure - a gap - when they do the math. If this is your situation, this chapter can help you figure how much more to save each month over the next 10 to 15 years until you retire. After you come up with your totals, be sure to read on to find out the difference a year can make and the five ways to close the gap and boost your savings. Where will you find additional savings? Here are some suggestions for active workers and retirees alike.

You probably know by now the easiest way to watch your nest egg grow is to make the maximum contribution to your workplace savings plan through payroll deductions. If you are 50 or over, you will have the chance to add even more to your savings through catch-up contributions, ranging from $1,000 to $5,500, depending on the type of retirement plan you have. And you are reducing your taxes. If there's no retirement plan at work, you can add annual contributions to any IRA accounts you have.

Join The Club

Most people haven't thought about how long their savings will last in retirement or how much inflation will increase over time.

The Projections and Results Worksheet is where all your prior work comes together. Building on the clues uncovered in the earlier worksheets, this worksheet compares your anticipated income and expenses over the 30 years of your retirement. Making the comparison in dollars valued at the time of your retirement, this worksheet takes into account that while you will have a fixed monthly income, your expenses will increase due to inflation.

At the beginning of retirement, most people's monthly income likely will exceed their expenses; but after a decade or so, expenses begin to exceed the monthly income. Realizing this now will allow you to save and invest any extra income in the early years of retirement so that it will grow and can be used to cover increased expenses later in retirement. Especially if you have a shortfall, the Projections and Expenses Worksheet will allow you to see how much you may need to add to your savings. When doing this comparison of your projected income and expenses, keep in mind that the value of a dollar tomorrow is less than a dollar today. The goal is to stay ahead of inflation. For example, a dollar today is worth more than a dollar in 30 years if the rate of return, say 5 percent, is greater than the inflation rate, say 3.5 percent. The worksheet addresses the impact of inflation by converting your anticipated cash flows into a constant dollar value - at the time of your retirement.

If the result is negative, don't worry. Just about everyone will need to make up a shortfall in savings. Remember also, that it is difficult to project inflation rates, especially for health care, that far in the future. It is better, however, to have a rough idea of where you stand than have no guesstimate at all.

The good news is that time is on your side. Remember the effect of interest compounding and how it can work to make your money grow in 10 years. Each year, as you set aside more money, the combination of savings and earnings will help close the gap. Return again to the worksheets and select the Projections and Results Worksheet. This worksheet lets you figure out how much you need to start to save today to make up the gap between projected income and expenses.

Socking away that amount of money over the next 10 to 15 years, while getting a rate of return you're comfortable with, should go a long way toward matching up income and expenses over 30 years of retirement.

You don't have to save the total amount of any gap between what you have and what you need. Each year the amount you invest will grow, and the growth of your savings lessens the amount you need to save.

Chapter 5 - Five Ways To Close The Gap

Where will you find additional savings? Here are some suggestions for workers and retirees alike.

Number 1: Work your contributions at work - Without exception, retirement planners advise contributing the maximum to your retirement plan, especially if your employer contributes too. If your contributions are made by salary deduction, saving is easier to do and may seem almost painless. And contributing more means postponing, or "deferring," taxes until you withdraw the money at retirement. Then you may be in a lower tax bracket.

Catch-up provisions for some retirement plans allow you to contribute extra amounts if you're over 50. Information about 401(k) catch-up contributions is available from your retirement plan administrator or on the Internet. If your plan has a catch-up provision, act on it now.

Number 2: Work longer, retire later - Staying employed as long as possible benefits your retirement finances in several ways. Having an income gives your retirement savings more time to grow. A regular income could mean more regular savings. If you work for a company that provides health insurance, you won't have to fully pay for a policy yourself.

You don't have to stay at your same job if there are other opportunities. Maybe you want a new career, one that ties in to your personal interests. Longer life spans and better health mean many older people have the energy and enthusiasm employers are looking for, not to mention the skills and experience. Many people find the social benefits of working as important as the financial ones.

Clue 3
Saving: A Little Goes A Long Way

Extras To Consider Doing Without	Monthly Cost	Savings Over 10 Years At A 5% Rate of Return With All Earnings Reinvested
Weekly dinner for 2 @ $50	$200	$31,186
Premium cable TV subscription	$80	$12,474
Movie & popcorn for 2 @ $32 twice a month	$64	$9,998
Daily lottery ticket	$30	$4,678

Number 3: Cut expenses, big and little - Moving to a region with lower housing and living costs or moving to a smaller home can help narrow the savings gap. Another option is staying in your community but downsizing to a smaller place like a condo or apartment. The same factors that drove up the value of your current house, however, will also have driven up overall housing costs, including real estate taxes. Housing is a major part of everyone's budget so think carefully about where you want to be and whether you can afford it. Keep in mind, however, that moving includes its own financial expenses and means leaving friends and your community.

Financial planners say that pre-retirement years are the wrong time to take on large debts, including home equity loans and credit card debt, with its high interest rates. Buying a new car, boat, or vacation home is not wise if you need to save. Investing that $400 a month (the average 5-year car loan payment) and getting a 5 percent return would put more than $27,000 in your retirement account. Consider keeping your old car or buying a used one.

Pre-retirement is also the wrong time to give or "loan" large sums of money to your children and grandchildren. Their earning power is usually far better than yours. Now is the time to take care of your finances so you don't have to ask others to bear the financial burden for your care later on.

Number 4: Social Security, now or later? - The amount of your monthly Social Security benefit goes up the older you are when you start receiving it. For example, a 61-year-old man earning $60,000 in 2009 and eligible for his Social Security benefit at 62 would receive an additional $1,080 a year by waiting 1 year, until he is 63, to collect his benefits. On the other hand, retirees who are seriously ill, who need the money immediately, or who feel comfortable investing their monthly checks may choose not to wait.

In this example, the worker turning 62 in 2010 would have a full retirement age under Social Security of 66. At full retirement, his benefit will be $1,645. If, however, he starts to receive benefits at age 62, his monthly benefit would be reduced to $1,172. By waiting until age 70, his monthly benefit would be $2,281.

On average, early retirement will give you about the same total Social Security benefits over your lifetime, but in smaller amounts to take into account the longer period you will be receiving them.

If you delay retirement beyond the full Social Security retirement age, you can earn retirement credits, increasing Social Security by a certain percentage (depending on date of birth) until you reach age 70.

Regardless of the age you start receiving Social Security benefits, remember to sign up for Medicare at age 65. If you don't (for example, because you have other coverage) you may be limited on when you can enroll later and may pay more in premiums. For more information, see the Resources section.

Number 5: Put your money where the returns are - Educate yourself about investing and consider paying a professional to help you choose the right place for your money. Financial experts say too many people keep too much money in the wrong kinds of accounts, for example checking accounts, savings accounts and money market funds, which typically have low interest or return rates. Review the discussion in Chapter 2 about asset allocation and diversification of investments.

Adding $200 a month, or $2,400 a year over 10 years to a starting retirement savings balance of $40,000 would more than double your money, assuming a 5 percent rate of return and all earnings reinvested.

Chapter 6 - Making Your Money Last

Clue 4
Closing The Gap

With $200/Month Additional Savings At 5% Per Year Over 10 Years
Year	Start	Add	Rate	Year End
1	$40,000.00	$200/month	5%	$44,512.50
2	$44,512.50	$200/month	5%	$49,255.80
3	$49,255.80	$200/month	5%	$54,241.90
4	$54,241.90	$200/month	5%	$59,483.00
5	$59,483.00	$200/month	5%	$64,992.30
6	$64,992.30	$200/month	5%	$70,783.40
7	$70,783.40	$200/month	5%	$76,870.80
8	$76,870.80	$200/month	5%	$83,269.70
9	$83,269.70	$200/month	5%	$89,995.90
10	$89,995.90	$200/month	5%	$97,066.20

The point of all the calculations you have done in this booklet is to make sure your income will last a lifetime. If doing the worksheets has uncovered a gap between your retirement income and expenses, you probably will be changing some financial habits over the next 10 to 15 years. The only part of your retirement mystery that remains is deciding how you are going to make your retirement income last as long as you do. You will need a strategy.

Solving your retirement mystery has revealed that more saving (especially for medical costs), more investing, and less spending will boost your confidence and your financial bottom line as you near the end of your working life.

For now, you will probably need to focus on adding to your nest egg and investing it wisely. Take into account that you will also have income taxes to pay. Take the short tax quiz in this chapter to find out about minimizing your taxes in retirement.

You may also want to take a look at financial products and services that could help build some financial security into your retirement. But first, a word of caution. Because you're growing a nest egg, you may start hearing from people offering their own strategies for managing your retirement money. These people may be relatives and friends. You will also hear from strangers in phone calls, letters, and emails. Some may offer to double your money at no risk. Think long and hard about involving them in your financial affairs, unless they're qualified financial professionals and can be objective. Retirees are frequently targets for scams. Don't give out any personal information to strangers. Don't be a courtesy victim. Con artists will not hesitate to exploit your good manners. Save courtesy for friends and family members, not potential swindlers!

It's A Big Deal

"Having a strategy" may sound like retirement is a battle or a complicated business opportunity. You may be thinking, "What's the big deal? I'll just withdraw money when I need to pay bills." Your parents may have done fine by simply cashing their monthly Social Security and pension checks to live on. Their taxes most likely were a lot simpler and a lot easier to do.

In today's world, keep in mind that the money you have saved and invested will be earning income until you withdraw it. Part of solving your retirement mystery will be deciding how to handle your retirement money, including continual investing, throughout your lifetime. Your tax situation, both federal and state, may not be so clear. You need to plan a withdrawal strategy so you pay less tax on money you take out of your retirement account and continue to grow the money you leave in. A qualified tax adviser can help here.

Getting Your Retirement Benefits

You may need to decide whether to take your pension or your retirement plan benefit in a lump sum or in an annuity. You can find out about your retirement plan payout options by reading your plan documents. Or you can contact the plan administrator directly for information about what your plan offers.

If you are in a traditional pension plan, your benefit is paid in the form of an annuity - that is, through periodic payments, typically monthly, for an extended period, usually your lifetime. If you select an option that provides for a survivor benefit for your spouse, note that your monthly benefit will be reduced. The survivor benefit is typically 50 percent of the retiree's benefit, but some plans provide for other options, such as 75 percent.

If you are in a defined contribution plan, such as a 401(k) plan, you do not automatically get your benefit as an annuity. Your retirement benefit can be taken as a lump sum paid entirely at the time of your retirement, or, as in some plans, through periodic payments over a short period of time, such as 3 or 5 years. Your plan may provide an annuity option or you may choose to buy an annuity with all or part of your lump sum benefit. If you choose to take your benefit in a lump sum, be sure to put it in a tax-deferred account, such as an IRA, within 60 days to avoid paying high income taxes (the highest tax being 35 percent as of 2009) on the amount. You will then have to decide how to invest what could be the most money you've ever accumulated and make sure it lasts for the 30 years of your retirement.

If you choose an annuity, make sure you realize the risks and rewards. An annuity provides a steady stream of income that lasts throughout your lifetime and can provide adjustments for inflation. This is helpful especially in the early years of retirement when there may be the temptation to spend the excess income instead of saving it to make sure it is there in 20 to 30 years. Keep in mind that if you die sooner than expected, however, the insurance company may keep the remaining balance unless you have opted for a survivor benefit. That is why annuities are usually not recommended for those with a shortened life span. Annuities come in many varieties. If you are purchasing one, choose an insurance company with a good credit rating and track record. Be sure you know what you're buying - there are costs involved in ending the contract. The more you learn upfront, the better.

You can also buy an annuity with money from other assets such as an inheritance or the sale of your house. Like other annuities, you will receive a monthly check for a defined period or for life. The tax treatment of these payouts will be different, however. Like any investment, review the terms of the annuity before you purchase it. For example, will the amount paid vary based on investment returns or is it fixed, what will you pay in related fees, etc.

Another way to make your money last is to obtain a reverse mortgage - essentially a bank loan based on the amount of the equity in your home. It can provide you with a monthly check, but at a cost. You are spending down the value of your home. If you can keep your house in good repair so the bank sees value in the loan, this is a way to supplement your income and not have to leave your home. When you or your heirs sell the house, however, the loan has to be repaid. Talk with the bank about any taxes due on these payments, and make your family aware of your reverse mortgage.

Also, remember long term care insurance can help you plan for increased health care costs in your later years.

Withdrawals: Which Pot?

You probably have some personal savings included in your retirement nest egg that you've already paid taxes on. A Roth IRA, for example, is a good place to leave money you've invested for growth because the withdrawals are not taxed.

Retirement experts say you usually should withdraw from this pot of money earlier in retirement when you may be in a higher income tax bracket. Withdraw your taxable retirement plan money (such as your 401(k) or other workplace savings plan) later, when you have less taxable income and possibly higher deductions due to medical expenses.

Be aware, however, that the IRS requires you to start withdrawing tax-deferred money from retirement accounts when you turn 70½ years of age. (This is a milestone on the Retirement Timeline at the beginning of this booklet.) By doing so, you will avoid tax penalties. These withdrawals are called " required minimum distributions," and the formula for determining the amount can be complicated. You may want to consult a tax expert for help.

Can You Beat It?

As you're withdrawing money to pay your bills in retirement, you should be trying to grow your remaining money to at least keep up with inflation. Of course, it's better to beat inflation. Experts say you need to continue investing and diversifying your assets throughout your life. Keeping your money in accounts paying guaranteed interest rates will keep it safe, but not from inflation. Inflation is a major threat to your financial future, so make it a consideration in your investment decisions.

Going It Alone vs. Getting Help

With a lot of study and regular attention to changes in tax laws, the economy, the stock market, and your money, you may be able to come up with a strategy to minimize taxes and maximize income. There's even software to help.

There's another road too. You can hire someone to develop your strategy and manage your money for you. Especially during the later years of your retirement, you may want to seek the help of a professional, when you may have less interest, energy, and ability to keep your strategy on target.

Good financial professionals, and the companies they work for and with, are required by law to be clear and open about their fees and charges and whether they are paid by commissions or for the sales of financial products, such as annuities and mutual funds. Be sure to ask questions, get references, and avoid anyone who guarantees performance on returns. This way you can make an informed decision. After all, it is your money you are putting in their hands. For more information, see the Resources section.

Taxes & Retirement - True Or False?

Income taxes go away when you're retired. True or False?
False. Remember all that pretax money you contributed to your retirement plan? When you withdraw it at retirement, you pay income taxes.

Social Security benefits are not sheltered from taxes. True or False?
True. A portion of your Social Security benefits is included in your taxable income if, for example, in 2009, you have taxable income and Social Security benefits of more than $25,000 for a single person and $32,000 for a couple.

There are no tax consequences if you don't start to withdraw your pretax savings at age 70½? True or False?

False. There is a 50 percent tax penalty on amounts that the IRS requires to be taken out after age 70½ and that are not withdrawn when required. In tax terms these are called "minimum required distributions.”

A Few Words About Scams

As you plan your retirement, don't let fear, desperation, or the need to catch up financially push you into any hasty investment decisions. In all legitimate investments, higher returns are accompanied by higher risks - risks you may well not want to take as you near retirement. Be wary of anyone who claims they can sell you a product that offers great reward without great risk - a sure sign of a scam. Here are a few points to keep in mind when you make any financial decision:

Recognize that anyone can claim to be a "financial consultant” or "investment counselor.” That person may not have the special training, expertise, or credentials necessary to back up the claim, however. Ask about licensing and professional designations and check them out with securities regulators and any trade groups in which they claim membership.

Understand your investments and never be afraid to ask questions. Good financial professionals are never pushy, and they never dismiss your concerns.

Don't let embarrassment or fear keep you from reporting suspected investment fraud or abuse. Contact the securities agency in your state as soon as you suspect a problem or believe you have been dealt with unfairly.

Never judge a person's integrity by how they sound or how they appear. The most successful con artists sound extremely professional and have the ability to make even the flimsiest investment seem as safe as putting money in the bank.

Monitor your investments. Ask tough questions and insist on speedy and satisfactory answers. Make sure you get regular written and oral reports. Look for signs of excessive or unauthorized trading of your funds when you receive statements, and do not be swayed by assurances that this kind of practice is routine.

Above all, become an informed investor. In investing, as in life, if it sounds too good to be true it probably is.

Now that you have reviewed the rewards and pitfalls of investing, you are ready for a review of all the clues you've tracked to solve the mystery of your retirement. Reading it will reinforce what you've learned and will help you to take action. You'll also find several resources to turn to for more information. Take advantage of them.

Chapter 7 - Tracking Down Help For Retirement

Like a black and white TV, retirement used to have high contrast and few choices: One day you were working and the next day you weren't. One day you lived on a paycheck and the next day on pension and Social Security checks. Your income was fixed and retirement was no mystery.

You have the power to put some color, maybe even gold, in your retirement. It mostly means putting into action a plan to close the income-expense gap and manage your money smartly now and during your later years.

You won't be alone. In the next 25 years, one in five Americans will be over 65. That's a lot of people today who need to work on a clear and realistic retirement plan during the next 10 to 15 years. Make sure you're one of them so your retirement wishes come true.

In the following list, you will find ways to discover more clues about retiring gradually and maybe working longer, paying attention to your assets and income, saving and investing, planning for increased expenses, including medical costs, and developing a withdrawal strategy. The information available on the Web sites listed is rich in detail and wide in scope. But remember to protect your privacy by not giving out personal information such as your Social Security number, telephone, or address, unless you know whom you're dealing with.

In fact, helping American workers succeed in a new kind of retirement has become the focus for a number of government agencies and organizations. Businesses selling products and services like annuities, long-term care insurance, and income management services are another source of information. To reach all these sources, use the Internet, your telephone, and the public library.

Periodically look back over the worksheets you have done and fill them out again as your finances change. Chart your progress through the next 10 to 15 years until retirement and beyond. Get time on your side and get going.

Source from http://www.dol.gov

Step by Step Retirement Planning Guide

2011-04-04T22:38:00.001-07:00

Summarized Overview

In this article you will find information about how to plan your retirement, when to start planning for retirement, precaution on the assumptions and some retirement tips for you.

Best Time to Start

Now is as a good time as any. The earlier you start, the bigger the nest egg you’ll have on retirement. But as we know, it is difficult to start in our twenties, as at that age we save for a car and then a house. And soon after, there will be educational expenses for kids.

But you cannot afford to keep postponing your financial planning for retirement. In order to have sufficient income to cover all those non-working years, you cannot leave the plan to the very last moment. If you decide to retire at 55, you need a nest egg that can generate an income for another 25 to 35 years.

Three Simple Retirement Planning Guide

The amount you need to save will depend on the retirement lifestyle you have in mind and the income that you are earning currently. There are three steps in retirement planning guide.

Step One: What’s your monthly retirement income?

First decide how much you think you will need every month to retire comfortably. For example, you may think that if you were to retire today you would need $2,500 per month. But you are only 45 years old and your retirement is still another 20 years away. Because of inflation, you will need more than $2,500 a month in 20 years time to spend on the same things you are used today.

Assuming an average inflation rate of four per cent per annum, you will need $5,477 per month in 20 years time, so that you still have the same purchasing power as $2,500 today. The higher the rate of inflation, the greater the sum needed per month to give you the same purchasing power as today.

Step Two: Required lump sum

From previous assumption of four per cent inflation rate, you will need $5,477 per month or $65,733 per year. The next stage is to calculate the lump sum required to generate $65,733 for the rest of your life. The interest or return on your investment will determine the lump sum required to earn you a regular income of $65,733 a year.

The higher the rate of return, the smaller lump sum needed and vice versa. For example, if the average interest on your investment is 10 per cent per annum, then the lump sum needed to generate that income is $657,337. But if you managed to find investment with 20% potential return, $328,668 is enough for your retirement planning.

Step Three: How much to save?

Along the way, let say you can earn ten per cent interest per annum, you will have to save $11,128 a year or $927 every month for 20 years to get lump sum of $657,337. How do I get that? You can derive the annual or monthly savings required by multiplying the lump sum figure with the respective figure in the table. In my case, I multiply $657,337 with 0.01693.

However, if the rate of return or your interest earnings is 15 per cent per annum, then you would only need to save $5129 a year. Same if you start a bit earlier, you only need to save $5826 a year for ten per cent interest rate but 25 years of savings.

Some Precaution Though

With retirement planning, you are looking into the future.

So you will be making a lot of assumptions.

Though how much you need to save depends on the assumptions made, working through the three steps will give you some better picture of what is expected and whether you are on the right track to a retirement lifestyle that you want.

Source from http://www.stock-investment-made-easy.com/

50 Most Influential People In Blogging 2010

2011-04-03T08:35:00.000-07:00

Well it’s that time of year again, the leaves are starting to fall, the weather is getting colder and the day’s are becoming shorter, guess that means its time for the annual “Top 50 Influential Bloggers of 2010” then.

It’s great to see how many young bloggers are starting to come through the ranks now, and they’re not too shabby either. I must admit I do enjoy seeing the success of the younger bloggers a little more than the veterans, purely because they are coming from the same place I did those 4 years ago.

However the more seasoned bloggers, give you the inspiration and the motivation to achieve not only what they have already, but possibly become even bigger and better than they are. That however is not an easy task!

Then there are the veteran bloggers the die-hard big boys (and girls) that just never seem to stop and never seem to drop their continuous stream of brilliantly written content. The blogging community is thriving as always and I think it may only be the start. Want to be on the list next year? Try my FREE Blogging eCourse out! Remember to share this with your friends:

Top 50 Bloggers Making Money Online

#1 Collis Ta’eed

Why has Collis Ta’eed made the list?

The Netsetter! He had to be top of the list right? Not only is his blog one of the best, it is designed well, visually exciting and appealing and the content is most certainly king here. Collis Ta’eed Is one of those bloggers that is extraordinarily good at his writing skills. Collis Ta’eed is the CEO of Envato, and he started Netsetter in 2009, basically as an outlet for him to get rid of some of those excess thoughts. His personal blog alone has over 4,500 RSS subscribers, his twitter following has risen to over 1,400 and he still keeps going. Why is he Numero Uno in today’s list? From living in his in-laws garage to becoming the CEO of Envato in less than five year! how can he not be.

www.envato.com

www.workawesome.com

#2 Yaro Starak

Why has Yaro Starak made the list?

Yaro is not only a professional blogger and entrepreneur, he’s also a great teacher. From the comfort of his very own blogs and websites, Yaro has been able to teach literally thousands of ‘students’. From this stand point alone its easy to see why he is regarded as one of the most influential bloggers of 2010. Easily earning over $20,000 per month is no mean feat, but he manages to do this every single month.

www.entrepreneurs-journey.com

www.blogmastermind.com

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#3 Darren Rowse

Why has Darren Rowse made the list?
With over 107,000 Twitter followers why wouldn’t he be! Darren is constantly gaining new subscribers, followers and fans due to his ever consistent style and posts via his three main blogs. From hobby, to profession, Darren has managed to create some great blogs and continues to excite and delight his fan-base every week. Definitely a man to look out for.

www.problogger.net

www.twitip.com

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#4 Joost de Valk

Why has Joost de Valk made the list?
Joost de Valk is one of those bloggers that seemingly come from nowhere and all of sudden they are everywhere, but Joost is everywhere for a very good reason. He helps literally hundreds of people to create solid SEO within their own sites, allowing them to dominate their niche and get on top of their goals. Through his careful planning he has become a great blogger, consultant and above all person. If you are in desperate need of some SEO consulting, there’s not many other people better for the job than Joost.

www.yoast.com

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#5 Pat Flynn

Why has Pat Flynn made the list?
Firstly Pat is an incredibly insightful blogger who, early on, has realised just how important interviews and podcasts are to him. Secondly Pat really is an extremely helpful, genuine and all round niice guy. His aim is to help others gain the kind of rewards he is, from his online escapades. One of the great things about Pat is that he is so up front everything, from showing his monthly income reports within his blog posts and even stating he “not a millionaire”. Well Pat you may not be a millionaire yet, but we’re sure you’re on your way.

www.smartpassiveincome.com

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#6 David Risley

Why has David Risley made the list?
I’ll start with a quote from David himself “I show bloggers how to turn their blogging into a business” and in a nutshell that is exactly what he does. He’s to the point, genuine and tells it how it is. By reading any of his numerous blog posts its easy to see how passionate about his work and life David really is. With a wealth of knowledge and the ability to be brutally honest, David is definitely one of the best.

www.davidrisley.com

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#7 Glen Allsopp

Why has Glen Allsopp made the list?
Glen is a high profile blogger and viral marketeer who has an abundance of followers, fans, and subscribers. Firing off his monthly reports, stating the obvious and the not so obvious, Glen knows how to write a great post. Glen is also one of the younger bloggers on the list today, he like myself, stared online at the tender age of 15 years old, he was featured in a book aged 17 years old, by 18yrs was a social media manager for some huge brands, and by 20 years old he had sold the 10th biggest personal development blog in the world!

www.viperchill.com

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#8 Gideon Shalwick

Why has Gideon Shalwick made the list?
Gideon is a very influential blogger that likes to use videos within his blog, but he doesn’t just use video, he shows others how to do the same successfully. With a variety of offerings such as reviews, concepts and even a few rants now and then Gideon definitely knows how to please a crowd. Again he is one of those bloggers who likes to give back to the wider community and offers his teachings to those who will read, listen to or watch his posts. With some great inspirational and genuine blog posts Gideon is very much one of few highly respected bloggers.

www.gideonshalwick.com

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#9 Katie Freiling

Why has Katie Freiling made the list?
Katie is a great blogger, her posts are always from the heart and she offers a plethora of exciting an innovating concepts and ideas within her blog. One thing that stands out with Katie is her ability to be very serious, humorous, and simple with her writing, she is very consistent and very optimistic which is a breath of fresh air sometimes. However don’t think for a second that she isn’t a big player, Katie is very good at dominating her niche, want proof? How does over 16,000 twitter followers sound? Katie is here to stay and has huge potential, check her out.

www.katiefreiling.com

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#10 Syed Balkhi

Why has Syed Balkhi made the list?
Syed Balkhi has very strong work ethics and beliefs, one such belief is that people often wait too long to get started in blogging and online businesses, and he’s right too! Syed is a very successful and young blogger, since 2009 his websites have pulled in over 145,000 unique visitors. Syed is very good at helping others and is currently making a good living online. He’s got tonnes of potential and I’m sure we will see a lot more of him in the near future.

www.wpbeginner.com

www.balkhis.com

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#11 Brian Clark

Why has Brian Clark made the list?
Brian Clark is from the very well known blog Copyblogger, I’m sure all of you have heard of that site once or twice? His blog posts are always well written, informative and sensible. There is some great content surrounding how to be a better blogger, copywriter, website owner the list goes on. Over 130,000 people subscribe to the Copyblogger so it’s easy to see why Brian is so successful.

www.copyblogger.com

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#12 Vitaly Friedman

Why has Vitaly Friedman made the list?
Vitaly Friedman is a very well known blogger who is best known for his role (Editor-in-Chief) at the highly respected website Smashing Magazine. Vitaly is also a freelance web designer, and pro-blogger where he shows all his subscribers the best places to find fonts, themes and graphics on the web. Smashing Magazine is one of the most important design blogs on the internet, and the success shows with some 209,000 magazine subscribers and 268,000 followers on Twitter. Vitaly’s posts are often in a teaching sense, educating the subscribers and readers in the dark art of web based design. If you are stuck in a rut for some design work, or just need a little inspiration to get you kick-started into gear, then check out his personal blog as well as Smashing Magazine, I’m sure you will be pleasantly surprised.

www.smashingmagazine.com

www.alvit.de/blog

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#13 Gary Vaynerchuck

Why has Gary Vaynerchuck made the list?
Educating the online community of bloggers and website owners is the name of the game when it comes to Gary Vaynerchuck. Not only does he passion for blogging and video blogging in particular, but he loves showing others how to succeed. After finishing his first book “Crush It” in 2009 it went on to be a top seller on many well known websites, play.com and Amazon to name but two. He oozes enthusiasm and passion for the art of blogging and video blogging and as such he is now one of the most respected vloggers and bloggers around the world. Gary also has a very successful website all about wine! If you are a wine lover you will love his videos and posts, its a must see website so be sure to check it out!

www.garyvaynerchuk.com

www.tv.winelibrary.com

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#14 Tim Ferris

Why has Tim Ferris made the list?
Ever heard of “The Four Hour Week”? Sure you have, it’s been all over the place, NBC, Wired Magazine, heck even USA Today and CNN! Well meet the author, Tim Ferris, not only has he created the ever successful book but he is also a top blogger! Tim’s posts are often one of three things; Serious, Humorous and inspiring, I think that is one of the best things about Tim, his ability to take complex topics and make them simple, and vice versa too. He’s also a pretty funny guy and his writing style keeps you enticed and ready for more. Intrigued? Check him out.

www.fourhourworkweek.com/blog

www.timferriss.com

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#15 Rand Fishkin

Why has Rand Fishkin made the list?
Rand Fishkin (The Wizard of Moz) is one of the best SEO bloggers in the world. His success has been astonishing over the last few years and he has consistently been added to some of the latest, and greatest top list in recent years, the “40 under 40 List” and the “30 Best Young Entrepreneurs Under 30″ to name but a few. Rand Fishkin saw the light in 1993 when he became intrigued by the online world and started using MS Frontpage to get started, and just look at him now! He is the CEO and co-founder of the company SEOmoz, helping thousands of people to get their websites, blogs and business seen, heard and noticed. I’d highly recommend seeking out his company if you are stuck for SEO ideas.

www.seomoz.org

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#16 Adii Rockstar

Why has Adii Rockstar made the list?
Yes folks that is his name, Rockstar by name and by nature it seems, as he’s kicking up an almighty fuss in the world of WordPress. Adii is the founder of Woo Themes, a very successful, and exciting website that basically helps you to get your blog looking the business. With a Bachelors Degree in Accounting as well as an Honors Degree in Business Management it’s plain to see why he is such a successful guy. There’s more however, not satisfied with his years of study to finally attain his Degree(s) he went on to create Woo Themes which is now one of the most successful WordPress theme publishers on the web. If you want a theme but don’t know where to turn to, or if you don’t really know if you should go for a premium WordPress theme, then go check out Woo Themes because they will definitely have you reeling for more.

www.woothemes.com

www.adiirockstar.com

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#17 Chris Brogan

Why has Chris Brogan made the list?
Chris Brogan likes to teach, he loves learning, and wants others to learn by his example, which is great. There are far too few people in the world that want to make a genuine difference for us online bloggers and Chris is right here to help. Chris is very popular with the top Fortune 100 and 500 companies around the globe and this just goes to show how much we can learn from him ourselves. President of New Marketing Labs and Human Business Works, you would have thought that he’d have his work cut out, but not wanting to under achieve Chris gives you the chance to speak to him live via your own personal seminar (if you have the money, space and subscribers). He really does not stop and he is so passionate about what he does that it makes you want to get up and do something yourself.

www.chrisbrogan.com

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#18 Chris Pearson

Why has Chris Pearson made the list?
Chris is one of those bloggers you need to keep up with, his funny popular blog posts are great reading fodder. Although there is a lot of humor in his writing he is often very practical and creates some great blog posts which are both extremely insightful as well as informative. He’s also the creator of one of the most widely used WordPress themes on the planet “Thesis” add to that the delightful DIYthemes website which offers many other themes in it’s arsenal Chris sure knows how to pack a punch in the online business world. To say he is successful is an understatement, and I think Chris has long deserved to be on this list so here’s to you Chris.

www.pearsonified.com

www.christopherpearson.com

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#19 Seth Godin

Why has Seth Godin made the list?
Seth Godin has a very minimalistic approach to his blog layouts and it is great to see, I think you can tell a lot about a blogger by the way they have things designed as well as their writing style and there content, its all part of the package and Seth Godin does all these things very well. Seth is very successful in the offline world of publishing too, with no fewer than twelve books under his belt (every one of which has been a best seller). He also does a lot of public speaking in seminars as well as online interviews. I love that he offers everything from free content to seminars, he really is a man of many talents.

www.sethgodin.typepad.com

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#20 Jeremy Schoemaker

Why has Jeremy Schoemaker made the list?
Jeremy Schoemaker is a very tough-skinned individual, bullied in his younger years he put his strength and energy into being successful, and guess what? He now is, and very successful at that. Creator and co-founder of AuctionAds which is an ebay affiliate marketing service that basically puts your ebay ads onto whatever website you need, or the product needs to be advertised upon, great thinking! His success was really brought home when he and business partner David Dellanave won multiole awards in less than six months, a truly flying start to say the least. Now he shares his secrets, thoughts, information and techniques in his online blog. Catch up with him to see what you may have missed.

www.shoemoney.com

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#21 Neil Patel

Why has Neil Patel made the list?
Have you ever heard of Crazy Egg? How about KISSmetrics? Well if you haven’t where have you been? Neil Patel is the co-founder of both companies and boy has he done well, he has become one of the go-to guys for some very high profile brands and companies, helping them to make a lot more money. Neil has some great insights into the world of online entrepreneurship so if you are thinking about becoming one, or have already started on your quest to become the next big thing, then check out his blog. His posts are often inspirational and thought-provoking but he has an uncanny ability to give those hard to find answers. So if you have been googling the heck out of “How to become an online Entrepreneur” then be sure to take a glance at his posts.

www.quicksprout.com

www.neilpatel.com

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#22 Andy Beard

Why has Andy Beard made the list?
With tonnes of informative writing it was hard not to put Andy on the list, always informative, highly addictive and often very humorous Andy is a must for all bloggers. Andy enjoys blogging about SEO, and marketing strategies more than most, which is a good job really because he is great at it. He writes concisely and appropriately for the title of all his posts and he is one of the rare people who likes to give back to the online community. He can teach you anything and everything you need to know about the online marketing world if you are ready to learn.

www.andybeard.eu

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#23 Matthew Mullenweg

Why has Matthew Mullenweg made the list?
Well…Unless you have been living under a rock for the past few years , or unless you are completely new to blogging (in which case you are excused), Matthew Mullenweg is the founding developer of a little thing we like to call WordPress. That’s right, Matt’s our man, he created the amazingly versatile WordPress which many of us love and use daily. You can imagine the scale of his success just by the statement that he is the founding father of WordPress, neat right? Not only is he an expert developer but he also puts aside time to go and speak publicly so we can all hear what his thoughts are on various topics, but if you can’t get to any of his seminars, or to any seminars in which he is a guest to, then you are till on luck because Matt has a couple of nifty blogs where you can find out just what Matt is all about.

www.mullenweg.com

www.ma.tt

www.matt.wordpress.org

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#24 Jack Humphrey

Why has Jack Humphrey made the list?
Blog Marketing is the game and Jack Humphrey is definitely the name, Jack is one of the foremost experts of blog marketing and traffic funneling in the world. He is a very serious but humorous sounding individual and all of his posts have some value to offer. In other words it’s pretty much all killer and no filler in Jack’s blog. Back in 2002 Jack wrote one of the most widely downloaded books on link building – “Power Linking”. This was a game changer for Jack who went on to great success, in 2005 he started ContentDesk.com, and BlogSuccess.com, both of which were highly successful businesses aimed at helping others to gain the marketing audience they couldn’t quite grasp alone. If you would like to know more about Jack then I’d definitely recommend you go visit his blog it’s very much worthy of reading.

www.fridaytrafficreport.com

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#25 Daniel Scocco

Why has Daniel Scocco made the list?
Daniel Scocco is an entrepreneur, a teacher, and a scholar, armed with his Degree in International Economics, Daniel pureued a career within a multinational business, however he was not there long. Fast forward to the present day and Daniel is now a respected blogger, who has been online since 2005 creating and developing websites and blogs for himself and others. In 2007 his blog was nominated for “Best Web Development Blog” at the weblog awards. On a near regular basis Daniel posts about all manner of things from how to make money to how not to lose it, from the best plugins for your site, to what to write in your own blog. Daniel really does give back to his subscribers, he’s one to watch out for.

www.dailyblogtips.com

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#26 Skellie Wag

Why has Skellie Wag made the list?
Ever thought to yourself… I’d quite like to be a freelancer. Or maybe you want to know how to run an online business? Well Skellie Wag is a great place to find that sort of information. Skellie Wag is a blog which is made up of, essentially lots and lots of essays from blogging to happiness in work and lots of things in between. It’s a great place to go to when you are feeling a little less motivated. They have recently brought out a book that you can buy from their site entitled “The Blog Business Funnel” which is sure to be a motivating read. Go have a look-see.

www.skelliewag.org

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#27 Erica Douglass

Why has Erica Douglass made the list?
Well at the tender age of 26yrs, Erica sold her original online business for a fairly hefty $1,100,000! After “Retiring” from the traditional work she had been doing previously, Erica now teaches other how to become successful online. She doesn’t only teach the good though, she also teaches the bad, the failures, the pitfalls you know, the parts we all want to avoid but no one ever lets us in on. Well Erica certainly does, so if you are motivated, and want to read some concise, succinct and inspirational blog posts then you must go and meet Erica on her blog.

www.erica.biz

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#28 Robb Sutton

Why has Robb Sutton made the list?
He is the owner of Oneninety8, Robbsutton.com and he’s an all round Mr Nice Guy. Seriously, Robb is a great chap, full of exciting, inspiring and thought-provoking content within each of his blogs. He has many passions in life, blogging is definitely one of them, the man is obsessed, and we mean that in a very complimentary way. He’s also a giver, of advice, freebie icons, graphics and code, he really is a true gentleman. His blog posts are always worth a read and you will be hard to find other writers who have so much to offer at such a young age. He now has a new ebook ready for download if you so wish I wont reveal the surprise you will have to head over there to see for yourself. If you are looking for success and don’t have the get-go then Robb Sutton’s blogs are definitely worth a read.

www.robbsutton.com

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#29 Chris Garrett

Why has Chris Garrett made the list?
Chris is hard to pigeon-hole and I’m pretty sure he likes it that way, writing for his personal and business blogs he always has very informative posts and interesting topics that keep you interested. He is very successful within his niche and he loves to give back by helping others learn how to avoid the pitfalls. Chris also writes offline, co-authoring five books so far, one of his most successful being “Problogger: Secrets for Blogging Your Way to a Six-Figure Income” which he co-wrote with our #2 on today’s list, Darren Rowse.

www.chrisg.com

www.chrisg.org

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#30 Lewis Howes

Why has Lewis Howes made the list?
Lewis is a very interesting blogger, an unofficial world record holder, founder of two highly successful companies and co-author of the LinkedIn book, LinkedWorking: Generating Success on the World’s Largest Professional Networking Website. His online success is easily seen and he has a large number of supporters, even his Twitter account has nearly 40,000 followers. Lewis is very much a professional in the world of social media and networking, Which he writes about in his highly successful blog.

www.sportsexec.net

www.sportsnetworker.com

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#31 Denise Wakeman

Why has Denise Wakeman made the list?

Denise Wakeman offers blogging, marketing and visibility tips for all that decide to look her up. She gives a very serious account of how to do things the right way and helps countless bloggers to keep their eye on the ball. With almost 20yrs of experience in the business and online marketing realm she is one of the most important bloggers online. Having written many different programs and posts for her subscribers and followers her unflinching and charismatic presence shines through her writing. Often using videos to emphasize her point across to the readers Denise certainly knows how to make herself heard. Denise has a huge online presence and enables others to contact her easily through her blog, if you need training or advice, or simply want to get the inside know-how of online marketing Denise would be a person to seek out for sure. Her success is no accident, she works hard and gets where she wants to be.

www.biztipsblog.com

www.buildabetterblog.com

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#32 Kristi Hines

Why has Kristi Hines made the list?
Kristi Hines provides informative and valuable posts on her blog as well as a very clear writing style. She is a Internet Marketing Specialist with the company Vertical Measures which provides link building services to those that need it most. Her tips and advice are second to none and she is always writing new posts on a near daily basis. Her success is greatly matched by her ability to blog in a very intellectual and yet simple way allowing you to get the most out of the internet, be it by yourself with her advice and tips or through her company. Another definite blogger to look up to.

www.kristihines.com

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#33 Rae Hoffman

Why has Rae Hoffman made the list?
Rae Hoffman is a self-confessed Internet and Marketing SEO Consultant…try saying that after a few drinks! Specializing in viral and affiliate marketing, Rae is one of the SEO gatekeepers, she really knows a thing or two about her chosen career, that is for certain. Just by reading any number of her online posts its clearly evident that you are in the presence of SEO royalty. Rae has been mentioned in a lot of publications, and I mean a LOT, USA Today, Forbes, and ZDNet to mention a few of the more well known ones. Rae runs a lot of different affiliate and content based websites and is also the co-founder/co-owner of two high profile businesses; MFE Interactive and Outspoken Media. Both of Rae’s companies have had great success, both for her and her clients. Watch out, Rae’s about.

www.sugarrae.com

www.outspokenmedia.com

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#34 Marko Saric

Why has Marko Saric made the list?
Marko ‘How To’ Saric has made the list because he definitely knows his stuff. His blog is a great big how to of everything a blogger could want to know but hasn’t got the nerve to ask. A lot of his blog posts are entitled “How To” and for good reason, he really goes into depth about the kinds of things all blogger should know, want to know, or just plain didn’t know. Marko Saric Is also the co-founder of the London Blog Club, where he gives back to the community of bloggers, in fact that is a great place to be if you haven’t already checked it out.

www.howtomakemyblog.com

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#35 Leo Babauta

Why has Leo Babauta made the list?

Leo Babauta has no formal qualifications (how many of us do have?) but that hasn’t stopped him from getting on the list of the top 50 influential bloggers of 2010! Leo likes to help others, and also write about the difficulties he has faced and overcome. He is also a very competent writer, in 2009 he wrote 108,000 words in 30 days to complete a novel! Now that takes some doing! He is also the author of “The Power of Less” which was a best seller on Amazon, but that’s not the end, he’s also written “Zen to Done” an ebook which has been downloaded by tens of thousands of readers and subscribers. Leo is forever working hard and because of his excellent standards and writing skills Leo has made our list. Leo..we salute you.

www.zenhabits.net

www.thepowerofless.com

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#36 Mary Jaksch

Why has Mary Jaksch made the list?
Practical inspiration, creative ideas and generally good informative content, that’s what Mary offers at ther blog the GoodlifeZen. Mary is an officially authorized Zen Master, a Psychotherapist and an author. Wow, that is a lot to aspire towards. Mary as you can already see is a very successful woman and her blog is just an extension of her success which she throws out to help and inspire others. Not only does she offer tips, advice and general thoughts, she also has a great ability to make you want to relax, grab a cup of green tea and just read through her topical posts. A master in her own right, Mary has helped many people around the world to get to grips with all manner of serious topics, and although mostly serious, it is one that you will enjoy.

www.goodlifezen.com

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#37 Alex Fraiser

Why has Alex Fraiser made the list?
Blogging trickery is what Alex Fraiser specializes in, well, in a sense anyway. He is the 17 year old mastermind behind blogussion, see what he did there? Good right? Alex has been given the gift of the gab and can write his socks off. Don’t let his age fool any of you either this young blogger is becoming a real hard hitter on the bloggin scene and we can’t wait for more. His posts are informative, creative and concise. You have just got to give him credit for his ability to write such great content at such a young age, it’s great to see! He now has over 4,000 twitter followers and in excess of 1,900 subscribers, and he’s only been doing this blogging malarkey since 2009. Well done Alex.

www.blogussion.com

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#38 Corbett Barr

Why has Corbett Barr made the list?
I have one simple goal for this site: to help you build a high-traffic traffic website or blog. That’s the opening line in one of Corbett’s blogs and it speaks volumes don’t you think? His willingness to give back to others and exercise his right to help those in need, heck he’s almost like the online version of Batman! Seriously though, he really is a top blogger, great guy and his posts are of the highest quality you will see from a blogger. He’s definitely not an amateur that’s for sure. He has had great success in a venture-capital backed company too! Corbett’s writing, so go read his posts!

www.freepursuits.com

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#39 Andrew Warner

Why has Andrew Warner made the list?
With $30+million a year in sales alone Andrew is one of the heavy weights in the online world. Still in his 20′s Andrew and his younger brother decided to create mixergy a website that has clear and simple goals, to encourage, inspire, introduce and give. What a guy, what a generous thing to do, and all his subscribers are glad he did too. Sharing his wisdom, expertise and his courage to take a huge leap of faith in the name of online entrepreneurship Andrew has been able to help many, many of his subscribers just by posting his thoughts. I recommend taking a look at Andrews story to get the full down-low.

www.mixergy.com

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#40 Michael Martine

Why has Michael Martine made the list?
He blogs, he coaches, he blogs about coaching, oh, and he also consults too. Michael Martine’s blog posts should not be missed, he has a wealth of inspiration and advice to offer and you would be mad not to listen to him too. He loves nothing more than to guide, excite and entertain with his posts giving you the vital information you need to motivate yourself or maybe write an extra post a week. Maybe you are stuck for topics to write about? Well head on over to his blog and get some inspiration. Michael’s success has been created through hard work, determination, and basically being brutally honest at times. Miss him at your peril.

www.remarkablogger.com

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#41 Zac Johnson

Why has Zac Johnson made the list?
He’s not just any old affiliate marketer, oh no my dear friends, he’s not even a great affiliate marketer…he’s a “Super Affiliate” marketeer! I may sound as though I a joke, but in all fairness, would he be on this list if I didn’t think he was worthy? of course he’s worthy, his content is great, his style unique, and he really is a super affiliate you know! Never shy of getting behind the keyboard, or in front of the camera, you’ll find some great posts on his blog that will make you want to come back more and more. Zac is fantastic at reproducing his techniques over and over to see huge sales, and he’s not keeping it a secret either go and check out his latest post to see what he’s up to at the moment!

www.zacjohnson.com

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#42 James Chartrand

Why has James Chartrand made the list?

He’s a business web designer and creates some great posts on his blog, which by the way is a very cool looking site. He’s the founder of Men with Pens and his writing style is solid, he was featured in many major online media resources such as Newsweek and the Huffington post and he’s a regular over at Copyblogger. He’s an informative writer with plenty of humorous and anecdotal offerings. He also writes as I imagine he speaks, very openly, and very real. His online website has made him a great deal of success both with subscribers, affiliates and probably in offline popularity. He’s a top blogger and he’s on the list.

www.menwithpens.ca

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#43 Tyrone Shum

Why has Tyrone Shum made the list because he is a very influencial young blogger, he specializes in “Outsourcing and Automation for Lifestyle Business Owners”. What? You want me to delve a little further? Well okay since you asked so nicely… Tyrone has a really useful style, he aspires to reach the best in order to reach complete automation for money making. His posts are really insightful and he leaves nothing to the imagination, he like many of the bloggers on this list, is a giver and that is one of the key’s to success with blogging. To receive you must first give seems to be the natural quality all of today’s top bloggers have in common. Tyrone teaches his subscribers how to find the best programs, blogs, videos and basically everything that will lead to an automated money making business. No mean feat I’m sure you will agree.

www.tyroneshum.com

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#44 James Schramko

Why has James Schramko made the list?
James Schramko is an Australian internet marketer and all-round good guy. His aim was to leave the 9-5 working lifestyle to one better suited to us bloggers and hasn’t he done well? James has identified how to find and dominate niche areas to build his online empire, and in his blog he divulges into all his inner thoughts. It’s yet another great example of a blog that gives back to the community. James has sold millions of dollars worth of goods, services and information products over the span of his online career. He is now one of the most prolific speakers in the blogging world and is a regular at many of the industry events held all over the world.

www.internetmarketingspeed.com

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#45 Dave Navarro

Why has Dave Navarro made the list?
Dave Navarro is a very well known blogger, best known in fact for his product launches, product launch coaching and his ability as one of the best online marketing consultants. He is widely popular with many bloggers, mainly for teaching them how to essentially launch their own products. What a great guy to have on your side. He is someone I would honestly read about a couple of times a week, his posts are so informative and offer very real techniques, none of that fake guru persona, Dave is the real deal and he has made a fortune launching products, teaching others how to launch services and products and of course his ebooks. Go and have a look I’m sure you will agree.

www.thelaunchcoach.com

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#46 Lynn Terry

Why has Lynn Terry made the list?
Lynn Terry is a valuable source of information, she creates tutorials, advice, and tips for newbies and the expert bloggers alike. She is always added to her valuable collection of posts and there is always great content to indulge in. After quitting her “last real job” back in 1996 she started her first business and never returned to the 9-5 lifestyle. She eventually left her business behind to become a super affiliate and she has gone from success to success each year. In 2003 she received the Best of Success Award at Total Life Success, she has also had the pleasure of contributing to a #1 best seller and has been featured on the Entrepreneur Magazine’s home biz talk show. I think you can see why she is on the list, and staying there too.

www.clicknewz.com

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#47 Michael Stelzner

Why has Michael Stelzner made the list?
Michael Stelzner writes, about…well writing actually. He loves to teach his subscribers and followers how to expertly write, white papers. Michael has written over 130 white papers many of them being for some of the worlds biggest and best companies. Michael is also an author – “Writing White Papers: How to Capture Readers and Keep Them Engaged”. On top of all of this he is also the editor of the White Paper Source Newsletter which has a readership of 20,000+. Finally he also teaches corporations and leading professionals how to write white papers in his “Monthly Teleclass”. Be sure to check him and his blog out, its worth a read.

www.writingwhitepapers.com

www.whitepapersource.com

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#48 Hesham Zebida

Why has Hesham Zebida made the list?
Blogging tips galore, advice grotto, Hesham’s blog really is a place where bloggers can find the secrets to those never asked questions. Not only does he offer his fellow bloggers advice, he also teaches how to create a buzz, gain traffic and the most important of issues, keep subscribers. On top of all of this she also blogs about how to make your own blog look better and how to blog better, or should we say, blog properly. One of the main reasons that Heshams blog is so much more appealing than a lot of other blogs is due to the fact he used to be a web designer a few years back. He has helped many, and will help many more in the future I’ve no doubt.

www.zebida.com

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#49 Rob Rammuny

Why has Rob Rammuny made the list

Rob Rammuny wants to help you to have the online lifestyle that you crave. He needs to teach, advise and share with his fellow bloggers and readers alike. Did I mention he is only 16 years old? That correct 16yrs! It’s so fresh and inspiring to see someone with such talent and diversity create such a fantastic blog with great content and advice especially at such a tender young age. I can see big things ahead for Rob. His main aim is to get out of the rat-race and leave the 9-5 lifestyle before he even has to join it, and I’d have to agree that it’s definitely the right choice. Why work for others when you are perfectly good at working for yourself? I really hope Rob keeps up his terrific work and I look forward to what he does in the future.

www.robswebtips.com

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#50 Chris Guthrie

Why has Chris Guthrie made the list?

Chris Guthrie earns a six figure income from working online. He’s only 26yrs old and already he is a big name in the blogging world. He first started working for his own business back in school, trading pokemon cards for money, this early lesson in business eventually got the better of him and he decided working for an employer just wasn’t going to cut it. He eventually ended up as an online marketer after “playing too much Halo 2″. How many people can boast that playing a video game could lead them to a career of such magnitude? Well it wasn’t entirely Halo 2 that helped him, getting fired must have been a factor too, but nonetheless, with monthly incomes of $13,000 and more a month, he must be doing something right.

www.makemoneyontheinternet.com

Source from http://retireat21.com

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Powerful Ways To Make Money With Your Blog

2011-04-03T08:02:00.000-07:00

Hello Everyone,

Every single day over 8,000 people start a new Internet business and it is said 90% of them fail / never really take off! There are a lot of reasons why a business fails but in the end it comes down to one main thing – it isn’t making money!

It doesn’t matter if you get 100,000 visitors a day, if you can’t monetize your site, then you will lose money and fail like most other people. Most Internet Marketers suggest you put up adverts on your site to make money. OK, that appears an easy option, but if you don’t have much traffic you will fail to sell the advertising and frankly in my experience there are many better ways to make money.

So today I have decided to go through some of my own sites and also some my favorite bookmarks and show you how and why some sites (even with the same traffic) make a lot more money than other sites in their niche. And, I’m not just talking about an extra $1000 a month – in many cases it is significantly more.

Why Typical Blog Monetization Doesn’t Work

The main reason it doesn’t work is because you can only make so much. If you only have 8 advertising spots on your site, that will Net you a total of $600 at an average of $75 per spot. Truth is that in many cases unless you have significant traffic you will struggle to get even $75 per spot.

Now if you use some of the monetization techniques I will cover below, instead of making say $600 for the month you could make $3000 or even more! (I estimate you need around 20000 visitors per month in most niches to achieve this) Banner advertising to some degree isn’t scalable and therefore isn’t a good long term solution. That said, if you are ‘lazy” (as I sometimes am) then the one good thing about banner advertising is it’s guaranteed money most of the time, provided you can keep selling those spots!

But to give you some comparison, if I had decided to go with only offering banner advertising when I launched IncomeDiary, I would of been lucky to earn $300 from advertisers in the first month, instead of the $5000 that I did.

Selling eBooks

This is something that has been increasingly more popular over the last couple years for a bunch of reasons. The main reason obviously is money, selling an eBook to your readers is easier then selling someone else’s product because your readers know who you are, what your about and you should have a good track record for offering good content. One of the big benefits of launching an eBook on your blog is traffic. I have seen blog’s traffic saw once they launch an eBook because they set up an affiliate program, so even if they don’t buy your eBook, they still look around your blog and can make you money in other ways and the best thing, you don’t have to pay the affiliate for it.

How To Sell eBooks On Your Blog

On some levels, most blogs do the whole selling an eBook thing completely wrong. Having a eBook on your blog will mean a lot of leakage because they can go off in a million different directions such as check out your about page, past posts, advertisers etc. Typically sales page give you the option to either buy the eBook or leave the website which keeps the buyer more concentrated as they won’t get distracted by other things on your blog. Here are a few rules I would encourage you to abide by:

Have an affiliate program (via E-Junkie)
Offer Testimonials from people who have read your eBook. Including names, website URL’s, country and picture will help reinforce the fact that these are real people giving real opinions on your eBook.
Offer a sample page or chapter so potential buyers can get a good feel for who you are and what you have to offer.
Have a eCover to symbolize some physical value to the product. I recommend either Minisite Studios or searching for someone on Digital Point webmaster forums.

Membership Websites

I have seen a lot of blog adding membership areas to their blogs recently, probably because of the demand for even better content and the fact that it’s so easy to set up. Think about it, would you be happy paying $10 a month (or even $100) to have access to content that will change your life or business in some way, of course you would! The real benefit of having a membership website over a eBook is that with a membership website, you don’t just bill them once but you bill them every month. Let me show you the maths then you will get really excited:

Option 1: Sell 1 eBook a day at $40, that will be $1200. Now say you do the same next month, you will make $1200 this month as well. Say you do this for a whole year, you will make $14,600!
Option 2: Sell 1 Membership Website a day for $40, that will be $1200. Now say you do the same next month, you will bring in $1200 of additional membership but you will also have the recurring revenue from last month, making it $2400 that month. Say you do this for a whole year, you will make $105,600! I will leave you to pick which one sounds best to you.

One small thing I should note about my maths above, some people will obviously cancel there membership, the amount of people who cancel depends on the value you provide them. For those who have already went with Option 1, don’t worry, here is what I would do; take your eBook that you are selling for $40 and charge $1 for it, you will now probably sell 20 or 30 copies a day instead of one. Now when they order, add them to a membership program for $39 a month and give them the first 30 days to try it for FREE. This approach will get a lot more people buying and convert more people into staying for your recurring program. For those of you think this is to much work, you could simple change your eBook into a membership program by time releasing the content.

I always find inspiration the best way to start something new on my site, so here are my favourite membership websites that have been added to blogs.

If you would like to know more about recurring revenue and building membership websites, check out the great interview I did with Ryan Lee! He also has just released the videos and audios from his continuity seminar earlier in the year, I went to it and it honestly made a big difference to my online business and I don’t even have my own continuity program (YET!)

How To Add A Membership Website To Your Blog

From my research and recommendations from a lot of friends, there are 2 main ways to go about setting up your own membership website for wordpress. Them being:

Wishlist Member – Very customizable plugin with lots of features to make your membership website stand out from the crowd! (My personal recommendation)
aMember with WordPress Plugin – Gives a simple yet effective membership area allowing users to download and see files easily.

FREE eBooks and eCourses

As I mentioned in a past post, building your list is one of the most important things to do and the best way to attract people to sign up for your list is to offer them something for FREE! Now the benefit of having a good mailing list is, so that you can email out about new content and promotions which could make you more money. I know some people that have such great lists, that when they email out promoting a new online course, they can bring in as much as $300,000!
Not bad for writing a few emails. Now this is great but sending emails can become a bit of a pain and some readers will be turned off by them. What I have done is built a really strong eCourse and eBooks sharing lots of great secrets, tips and tools on how I make money online and then monetized it with affiliate links. Now this took me around 2 days to write (partly because I’m dyslexic and writing isn’t my forty) but since then it’s made me tens of thousands of dollars with no additional effort. My advise to you is to create a eBook or course that you could sell and then give it away for free and make your money through affiliate commissions. Remember to check out my past post on making money with email marketing to make sure you approach it using my no leakage rule.

Adding an eBook/Course to your Website:

Adding your eBook to your website can be done in a variety of ways, personally I recommend my funnel system to work the best. This is how it works:

Offer a sign up on your blog for a FREE eBook. I highly recommend using Aweber for your auto-responder as it’s what I use and most other Internet marketers. The best way to draw attract to your opt-in box is by placing a eCover of your eBook, this also gives it some physical value.
Once they sign up for your eBook or Course, send them to a thank you page where you promote a few of your best selling affiliate programs. Also give them a personal thank you and remind them to check there emails and confirm that they want to be on the list.
Now automatically dispatch an email using your auto-responder with your first email from your eCourse or a link to your eBook.
Now build in several follow up emails promoting content on your blog and affiliate offers.

Web Directories

This method isn’t so common but looking from the examples I could find online, it is one of the most profitable! FreelanceSwitch has one of my favorite examples of a web directory, how it works is web designers who need work can pay monthly to have themselves listed in there web designers directory so people who are looking for web designers, can browse the directory and pick there favorite. What’s great about this approach is they have made the deal even better for web designers, they have included access to the website job board, where they can apply for jobs that are posted which has allowed them to make it free for people to submit jobs.

How To Add A Web Directory To Your Blog

Although there are dozens of free web directory plugins for WordPress, not many let you charge people to submit links to them. The first directory I created was for WebDesignDev which was a directory of all the resources web designers and developers would need such as hosting, scripts, domains, coding etc. I allowed people to submit for free but gave a premium option which for a price they would be posted at the top of the directory with a special border and made to stand out from the crowd. The software I used was PHPLinkDirectory which seems to be bringing out more and more WordPress friendly additions to it’s software and would be my pick for anyone trying to achieve a successful directory.

Job Board

The great thing about offering a job board is that it’s offering a needed service to your users. Take for example you are visiting a web design blog because you wanted someone to design your blog. Now this blog has a job board and it was free for you submit a job, that’s a great additional service the blog is providing. But where is the money you are probably asking, what you do is you charge the designers who are looking to do the work, possibly a $50 monthly charge to reply to any design jobs. For any designer looking for work, this is a no brainer because these are the best leads you can get, people who are saying they want to give you work. This really is a no brainer and something I really am thinking about adding to IncomeDiary as it will solve the problem of people looking to hire people and the problem that WebDesignDev is over flowing with web designers looking for work.

How To Add A Job Board To Your Blog

There are two main WordPress plugins that will allow you to add a Job Board to your blog, those being WPJobBoard and JobPress. Pricing strategy is most important here, either deciding to charge people to post job or to reply to jobs. Personally I think charging people to post jobs works best because then you can focus on getting people to respond to work, which will be easier when its FREE for them although it seems it seems to be a mixed opinion between bloggers on which way is best to charge.

Done For You

Done for you is something new I’m working on but have seen some really great examples of some very clever Internet entrepreneurs using it. “Done For You” is basically a service you offer on your blog that is all done for you, one great example is Done For You Meal Plans, something that I have seen very popular in the fitness niche. So if you want to lose weight you need to create a meal plan but the problem is, you got to spend days researching to make sure you get it right and then put it together. Instead fitness marketers put together the plan for you at a price. Now a lot of the time they can use the same plan for a lot of people so the work is minimal or they could even outsource it to someone else for the fraction of the price.

How To Add A Done For You Section To Your Blog

This is one of easiest things to do, find a problem, supply the solution, bill them! All you need to do now is create a page on your blog with your offer, add a PayPal link to purchase and then outsource the work at a very small fraction of the price paid.

Affiliate Marketing

All of IncomeDiary’s income comes from affiliate commissions and I’m getting quite good at it, this has actually be my best month ever online by far! Now the best advise I could give you is testing, work as hard as you can to test everything possible. So IncomeDiary has been online for around 6 months and I have a lot of really popular content driving good traffic to affiliate offers but I knew I could do better so what I did was I used Google Analytics to find out which pages got the most visits and then used CrazyEgg to see what parts of a post are seen more and which links they clicked. To a surprise, my most popular page in two days had no clicks on my affiliate links so what I did was included a green stop sign (something tested by Internet marketers) and I added it to the paragraph with my links. Over night I got a few clicks, although it wasn’t many, comparing it to zero, it meant a big difference.

How To Monetize Your Blog Using Affiliate Marketing

A couple tips that I really recommend you take advantage of when doing affiliate marketing are, ask for a better commission rate and also ask for a coupon code to give your readers a discount. Doing these two things will greatly increase your success at making money online with affiliate marketing because you will be able to convert more readers with a coupon code and with a higher payout then other affiliates, you will be able to invest more to get more conversions. The most important thing is how you display your affiliate links, there are a few different ways to offer affiliate links on your website, the ones I suggest are:

Comparison charts, this way you make the reader choose which one is the best choice. This works really well because you give them all the options and which ever one they take, you collect a commission on.
Recommendations, this converts better for me because the reader gets to see you using the product in action and so know you are not promoting it just to make money but because it actually works!

Source from http://retireat21.com

Top Young Entrepreneurs Making Money Online

2011-04-03T07:51:00.000-07:00

Top Young Entrepreneurs

Hello Everyone

As some of you who have been following me for a while know, I have done several “Top Young Entrepreneur Lists” including the highly successful Young Entrepreneurs Rich List over at RetireAt21.com

Today I have compiled a list of the Top Young Entrepreneurs Making Money Online – aged under 25 – these are really impressive individuals, both as business people and as human beings. Of course you will already know some of these names (Matt Mullenweg and Mark Zuckerberg for example) but there should be some that are NEW to you as well.

All of these young entrepreneurs are having a tremendous impact on the world – and we all have so much to learn from them.

Talking of impact, I am very pleased to announce that Yanik Silver is adding a “Young Mogul Day” to his now famous annual “Underground Online Seminar“. What is more I will be working closely with Yanik to make this one of the best young entrepreneur events ever – with some of the world’s most incredible top young entrepreneurs already booked to speak. (Any of you young entrepreneurs who got attended Yaniks last UNDERGROUND back in February already know what a Top Notch event this is) Expect to hear more news about this soon.

Finally — watch out for a BIG UPDATE at RetireAt21.com in the near future – we are currently doing a huge redesign with some amazing new content, including profiles of some of the world’s best up and coming young entrepreneurs.

Enjoy the list – let me know what you think — and is there a Young Entrepreneur that you know / admire who I have missed of this list?

To Our Success

Michael

#1. Mark Zuckerberg (25 Years Old)

Website: http://www.facebook.com

Why They Matter: Mark is at the top of our list for two HUGE reasons, he is the world’s youngest billionaire and he runs the world’s largest social networking website which is actually the second most visited site in the whole world, not bad for 25 years, is it?

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#2. Matt Mullenweg (25 Years Old)

Website: http://wordpress.com

Why They Matter: Matthew Mullenweg is the founder of WordPress, the software that runs this blog and millions of others out there. Without Matthew, you probably wouldn’t be at this website right now because I wouldn’t as fond with blogging without his genius, easy to use blogging software. He has been offered over $250,000,000 for his company which he turned down.

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#3. Pete Cashmore (24 Years Old)

Website: http://mashable.com

Why They Matter: Pete Cashmore makes our list because he runs on of the world’s top blogs which is about all that is new on the web. With over 1,600,000 Twitter followers and 300,000 RSS readers, you know this guy is running something big!

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#4 & 5. Aaron Levie and Dylan Smith (23 & 22 Years Old)

Website: http://box.net

Why They Matter: Box.net founded in 2005 was originally launched as a college project to share and store any type of file, and make it accessible from anywhere in the world with an internet connection. The company nearly has 2 million users on the service, and netted a $6 million in venture capital.

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#6. David Karp (22 Years Old)

Website: http://www.tumblr.com

Why They Matter: Tumblr is a blogging platform that anyone can use. The service was built with customization and ease of use in mind. Karp invested money into the company from his previous job as a software consultant at a parenting website. Tumblr raised $5.25 million in funding from various investors, including 2 lead investors with the popular social network Twitter.

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#7 & 8. Catherine & David Cook (19 & 21 Years Old)

Website: http://myyearbook.com

Why They Matter: Catherine and her brother, David started MyYearBook back in 2005 and have grown it to become America’s third largest social network and since raising $17.1 million in two rounds of investment has become profitable!

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#9. Sean Belnick (23 Years Old)

Website: http://www.bizchair.com

Why They Matter: Sean is a real entrepreneur, at 14 years old, he locked himself in his bedroom and 3 days later, his business was born! Now he is earning over $50,000,000 a year selling business chairs online. Sean has been an inspiration to young people around the world trying to sell online!

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#10. Matt Mickiewicz (25 Years Old)

Website: http://www.sitepoint.com http://www.99designs.com and http://www.flippa.com

Why They Matter: Matt is an inspiration to thousands of webmasters around the world, whether it’s their first website or their 20th most people would have visited Sitepoint to learn how to improve their website. Sitepoint has evolved from the website to learn about web design to anything from selling your website for a million dollars, buying books on coding the perfect contact page, to hiring someone to create your twitter background.

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#11. Noah Everett (24 Years Old)

Website: http://twitpic.com

Why They Matter: Noah is the founder of the popular image upload website, TwitPic. His website has grown with the growth of the social media website Twitter and is now one of the top 200 websites in the world according to Alexa. Surprisingly Noah works from home, which is also where he powers his servers that have to deal with millions of pages a day!

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#12. Ryan Allis (25 Years Old)

Website: http://www.icontact.com

Why They Matter: Ryan who is just 25 years old runs iContact.com and email marketing service that expects to turn over $25,000,000 this year. With over 55,000 customers paying a monthly FREE, Ryan has build a membership program where he has been able to offer an unbelievable service and at the same time build a continuity program that should never end.

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#13. Jon Wheatley (22 Years Old)

Website: http://www.dailybooth.com

Why They Matter: Jon runs a great social networking website called DailyBooth which basically lets you snap a picture every day and it puts it all together in a little video. The site has really evolved since launching earlier in the year has got over $1million in funding from big names such as Digg co-founder Kevin Rose and Flickr co-founder Caterina Fake.

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#14. Neil Patel (24 Years Old)

Website: http://www.quicksprout.com & http://www.crazyegg.com

Why They Matter: Neil Patel is the co-founder of 2 Internet companies: Crazy Egg, and KISSmetrics. Through these 2 companies he has helped large corporations such as AOL, General Motors, Hewlett-Packard and Viacom make more money from the web. By the age of 21 not only was Neil named a top 100 blogger by Technorati, but he was also one of the top influencers on the web according to the Wall Street Journal. The thing that really makes Neil stand out as a top young entrepreneur is how he got a lot of the top blogs in the world to permanently link to his site.

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#15. Kieran O’Neill (22 Years Old)

Website: http://www.psu.com and http://www.playfire.com

Why They Matter: Kieran is 22 years old and is a serial internet entrepreneur with three huge successes online so far! Kieran sold his first website online for $1.25 Million at the age of 19 and now has launched a new gaming social network which he raised over $1 Million in venture capital investment for as well as still running one of the world’s largest PlayStation fan sites.

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#16. Blake Ross (24 Years Old)

Website: http://www.mozilla.com

Why They Matter: Blake is an American software developer, who is probably best known for starting the Mozilla Firefox project. Firefox was released in 2004, when Ross was 19 years old. Firefox got over 100 Million downloads within its first year of being on the market!

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#17 & 18. Eric & Susan Gregg Koger (24 & 25 Years Old)

Website: http://www.modcloth.com

Why They Matter: ModCloth started as a small clothing business that Eric and Susan started when they left high school. They continued the business at university, shipping clothing items from their dorm room. When they graduated from uni in 2006, they decided to pursue the business, and since then it has grown into a huge success.

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#19. Anthony Volodkin (23 Years Old)

Website: http://hypem.com

Why They Matter: The Hype Machine keeps track of music discussion on blogs around the world. It lets people discover, listen and buy music that bloggers are writing about.

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#20. Ashley Qualls (20 Years Old)

Website: http://www.whateverlife.com

Why They Matter: Ashley Qualls who is already a multi-millionaire, and has taken the young entrepreneurs world by storm. Aged just 14, Ashley created WhatEverLife.com, a Myspace layouts site aimed at the female demographic, the site at its peak received over 250,000 visitors every single day, which is more than teen magazines such as Teen Vogue, Seventeen & Cosmogirl… combined. Ashley doesn’t charge users to use the site, instead, she strategically places ads on the site, and around 60% of her monthly income comes from Google Adsense.

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#21. Juliette Brindak (20 Years Old)

Website: http://www.missoandfriends.com

Why They Matter: Juliette first came up with the idea of Miss O and Friends ten years ago when she was 10 years old. Her business is now worth over $19 Million, and is visited by millions of girls every month. In 2006, Juliette released a book, and since then has sold over 120,000 copies of it!

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#22 & 23. Sam Tarantino & Josh Greenberg (Both 23 Years Old)

Website: http://listen.grooveshark.com

Why They Matter: GrooveShark was launched in private beta in early 2007, and is now a huge online music search engine and streaming service. GrooveShark employs 40 people (as of december 2007) and is part of the Escape Media Group which was formed in march 2006.

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#24, 25 & 26. Elliott Breece, Joshua Boltuch & Elias Roman (All 25 Years Old)

Website: http://amiestreet.com

Why They Matter: Amie Street is a music website, where the community decided the price of the music. Every song on the website starts at a very low price, sometimes free, and then increases up to prices of 98 cents depending on how many people purchase it.

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#27. Richard Ludlow (22 Years Old)

Website: http://academicearth.org

Why They Matter: Richard is the founder and CEO of Academic Earth, a website that provides full video courses from leading universities. Academic Earth was included in Time Magazines top 50 websites of 2009 list, along with companies such as Google, Amazon and Facebook.

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#28. Kristopher Tate (21 Years Old)

Website: http://www.zooomr.com

Why They Matter: Kristopher is the co-founder of photo sharing website, Zooomr. The popular website service was created in 2005, and since then has grown and had many new features implemented into it.

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#29. Edmund Loh (23 Years Old)

Website: http://edmundloh.com

Why They Matter: Edmund started his internet business back in March 2005. He achieved success after selling other peoples ebooks online (with resale rights), and then went on to write his very own ebook, titled Edmund Loh’s Guide To Private Resale Rights. Since then, Edmund has written over 212 PLR titles.

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#30. Shama Kabani (24 Years Old)

Website: http://clicktoclient.com

Why They Matter: Shama is an online marketing master. She is the president of Click To Client, a full service web marketing firm. Shama travels the world speaking at many conferences about internet marketing.

Source from http://retireat21.com

10 Reasons Why You’re Not Making Any Money Online Yet

2011-04-03T07:39:00.000-07:00

Wondering Why You Haven’t Made Any Money Online?

There are loads of reasons I could of added to this post such as, Everyone’s trying to be something they’re not, Wasting To Much Doing Rubbish and so many more.

Well it is nice to know people like your content — but more importantly it is essential that people take action on your content. Reading a post is great and FOCUSING on success is essential but unless you take action on that FOCUS you are wasting your time / day dreaming.

1. You are too busy complaining about other people

This is No1. for a lot of reasons, despite my young age, I have been in business for 7 years now and have enjoyed it but a few times a year you are going to come across complete IDIOTS – honestly, no better words for them. Here are some great examples:

- You hire someone to do a job, they don’t do it but still want to get paid, you said NO! So they go to all your competitor blogs and forums and message about you being a scammer – you clearly are not one and they ripped you off however you end up paying them because you want the madness to end and they still think they are right.

- You create a HUGE forum, beat all your competitors in a very little time and so they gang up on you and hack your forum day after day till you leave.

- You tell a close work colleague your online business idea so that they will promote it and instead they go of and create it themselves because they are GREEDY!

- You do a 10x bigger job for someone than anyone else but at the regular price and they still complain and don’t appreciate your work. (that annoyed me the most, there is just no helping some people!)

I’m just like most of you guys, when these things happen, I hit the fan, I go crazy but the thing is, all that time you are complaining about these idiots, going crazy, thinking about getting revenge etc YOU are not building your business. Fortunately for me I come to my senses fairly quickly and get on with what I should be doing which is Building my business rather than being bothered by small minded people who frankly will never make much of their lives anyway.

2. You are Too Busy Being a Douche

I was at one of the many events I go to every year and one guy in the audience decided it wasn’t for him so he refunded after the first day. (as per the offer the organizer made when people signed up). I have no issue with that individual requesting a refund – but when they then take a picture of themselves holding the refund cheque and Tweet it – they are behaving like a complete douche in my opinion

This guy wasn’t prepared to listen, learn and ultimately make more money because when it came down to it – he was to busy trying to be a jackass. Focus on yourself and stop wasting your time thinking about other people.

Here’s Another One: So often people like to point out my bad spelling because they really don’t have much going on in their business, leave me alone and focus on yourself. (I know some of you do it in a nice way but honestly, we all know I can’t spell already)

3. You buy every single product, crap ones included

There’s nothing wrong with buying lot’s of product, myself, my friends and even the top gurus in the world spend $100,000′s a year on their own training. The problem comes when you buy EVERY single one and you get confused because some will contradict each other because their teaching you different things. If your into blogging, buy all the blogging books, but don’t then buy into all the product creation books, affiliate marketing, facebook marketing etc if your not ready to even implement what you have learn’t. Get an idea of where you want to go and the work out how to get their – that’s exactly how I go about it and if Facebook marketing isn’t included in my plan then I don’t buy the products.

4. You go to every single FREE seminar

I myself go to a couple a year as I find it gets me excited again and I love hearing how they pitch from stage as it really is an art form. But some people go to EVERY single one and frankly if your spending all this time going to free events that have the soul purpose of pitching you something, when will you get time to implement?

5. You’ve Been Pitched Crap | Your Teachers Have Got It Wrong

There are some people (‘gurus’) teaching rubbish or selling ‘systems’ that went out of date in 2002 – often at ‘FREE’ seminars. Unfortunately some people as per my example above get so caught up in the PITCH and want out of the rat-race so much they BUY — but ultimately never take action. The thing is, so many people are DESPERATE to ESCAPE the rat race that they will believe anything and I don’t blame them. Don’t misunderstand — not all “gurus’ are scammers – far from it, but as you can tell I personally have an issue with so called FREE seminars that are nothing more than Pitch Fests!

I do believe in Karma — and if you knew how little these so called ‘millionaires’ really made you wouldn’t buy their products either.

Here’s another great example:

Twitter and Facebook make it easy for people to get noticed and connect with other people. Some idiot obviously made a product teaching people spamming is effective because it seems anyone who can’t make money decides to spam us on social sites with offers we don’t want and they do it in a very unappealing way. Don’t ever tweet me an offer because I will not take an notice of you and I would really recommend you find out more about your teacher. For example, I was at an event recently where a lady was teaching how to make $10,000 a month with Twitter and a friend of mine told me she said she only made $8,000 a month, now if shes willing to admit she makes $8,000 she probably makes closer to $5,000 and that could be a one of? Look for someone with a great track record and lot’s of social proof.

6. You are Lying To People

This one goes out to some people I know off that think they run with the big name gurus. Listen, the reason your still broke is because your lying to your audience, you don’t make millions a year, you don’t get 100,000s of visitors to your site and you don’t live on your own private island where you work from your laptop on the beach. Your audience are NOT, I repeat, ARE NOT dumb, so when you try to teach them how you supposedly did something, most people can tell when you actually know jack shit (can I really swear on my own blog?!?!) about it!

7. You are Forever Copying Someone else

So copying isn’t a bad thing, I actually tell my students to copy me because, I have tried it, tested it and it works so why not share the love, right? The problem is, when people copy a whole system without fully understand how it works. Remember from reason 1 and I mentioned a colleague who stole my idea that I showed him, well I really got the last laugh because he would of gone of, spent a few days copying my product and I actually found out how much he made, ZERO, Zilch, Nothing! The reason was simple, he had no right doing the same thing, just like number 6, if you don’t know something about a subject, then don’t try to teach it because your readers will notice.

8. You are Too Busy Dreaming Small to Ever Dream Big

We all know the big money comes when you do big things so why are you wasting your time thinking small? Here’s an example for you, when creating IncomeDiary I could have niched it down and made it only about driving traffic to a blog, sure I would of got some traffic and a following but nothing like I have today. Instead I went for the whole niche, Blogging and now even opened up to blogging about Income Online in general. That’s a tip right there, always make sure you know where your going, don’t enter a niche if you can’t scope it out and go REALLY big. If I become the top site for Online Income, I would be on the level with BusinessWeek and Entrepreneur.com – definitely where the big boys hang out.

9. You are Not Prepared To Listen

Around 15 months ago I met a reader of my site, I told him a few things that should help him make money online. A year later, I see this guy again and he’s still not doing anything online but is writing mad amounts of notes at a seminar just like the year before. I couldn’t bare to watch him waste his time so I grabbed him, took him to a quite area outside and got my laptop out and gave him a blueprint to what he needs to do to go big online, I found him an amazing domain (which I was quite jealous about but I already said he could have) and sent him off to go make it big! 1 week later he emails me telling me basically he’s doing something else online, which sounds to me like a really bad version of the idea I gave him, basically he decided to over complicated it.

10. You are Not Implementing

So the ones who actually do decide to listen to my great advice, where are they? Well of course I have some great students which makes it all worth it but I would have a lot more if EVERYONE implemented what I teach. If you are not prepared to implement, why bother learning?

Which of the above apply to you? What do you think is stopping you from making it big?

Adding more…

11. Your To Focused On What Other People Are Doing that You Don’t Focus On Yourself

Every day on my blogs I go to my comments and their is someone talking crap about me or my posts – if you don’t like it, LEAVE, go somewhere else! Stop focusing on making my life harder and instead work on yourself.

12. Your Trying To Do To Many Things

This one probably applies to the most us, if you try to do to many things you will end up lots of tiny websites that don’t make you any money. Focus on making one thing big, it doesn’t have to be your BIGGEST idea, you just need to see it through.

13. You Think Everything is Harder Then It Is

So many people don’t want to do things, including myself because you think it’s going to take a lot longer then you think or it’s really hard to do. Stop giving excuses and work out a way to do things – here’s a couple problems with solutions:

- A product will take me months to create – A: Create a 90 minute presentation offering your solution.

- Can’t Code a Site – A. Get someone else to do it for you.

It really can be that simple, don’t over think things.

14. Time

Real simple, MAKE TIME! I can handle my whole business with a hour a day if I have to.

Source from http://retireat21.com

9 Tools That Help Us Drive Higher Quality Traffic

2011-04-03T07:11:00.000-07:00

When it comes to selling products & services online – the QUALITY of your traffic is much more important than the quantity. In today’s blog post I will share with you my favorite tools for driving high quality traffic and a lot of it!

When we’re talking about the “quality” of your traffic, we’re talking about:

Buyers intent – are these buyers?
Demographic match – is this traffic your actual target audience?
Cost effectiveness – can this traffic reach my CPA (cost per action) goals?

If we get 50 comments on this post, I will release 2 more of my favorite webites and tools to drive more traffic!

Web Traffic Tools You Should Be Using!

1. Google Analytics

First and foremost, Google analytics is absolutely crucial in driving quality traffic. The ultimate mistake in driving traffic is not tracking your results. Google Analytics allows you to track conversions (goals), tells you which traffic sources are converting the best, and lets you segment your data so that you can go out and find more high quality traffic. As far as I am concerned, it is the most essential tool in internet marketing. Visit Google Analytics!

2. Quantcast

After tracking, you need to make sure you’re doing your market research. If you don’t know anything about your demographic or target customer, you’re going to end up driving untargeted, low quality traffic to your site that doesn’t convert. Quantcast gives you a demographic profile of your site, or, if you’re too small, your closest competitor – so you can get a feel of what audience you should be targeting. We also use it for buying advertising – it tells you what demographic usually visits whatever site you want to advertise on, so you know if your traffic is going to be targeted or not. For more on quantcast and market research, check out our Market Research series over on our blog. Visit Quantcast!

3. Google Website Optimizer/Visual Website Optimizer

The thing that really sets apart top tier internet marketers and the rest of the crowd is simply this: split testing to increase conversion rates. It not only separates them from the crowd now, but will keep their advantage for years to come. Basically, Google Website Optimizer and Visual Website Optimizer are split testing tools that allow you to test different versions of your website against eachother simultaneously to determine which version generates a higher ROI. The higher your conversion rate, the more you can spend on traffic, the more you can spend on traffic, the better you can compete. For example, if you are able to pay $40 per conversion, and your competitor can only pay $35, you can basically wipe the floor with them. It’s the ultimate competitive advantage and if you are selling something online – if you are not split testing, you absolutely need to be. Visit Google Website Optimizer!

4. ClickTale & CrazyEgg

Another tool in optimizing websites – Clicktale and Crazyegg give you in depth information on how your visitors behave when they get to your website. Crazyegg offers heat map tracking – showing you what places your visitors click on the most. It can show you places where you should have something for sale – for example, you might have an image that gets a lot of clicks – maybe that means you should link that image to something. Clicktale goes a little more in depth, offering actual recorded sessions of how your visitors interacted with your page. You can literally see them scrolling through your site and moving their mouse (a little creepy), and make business decisions based on their behavior. These are both massively useful tools and highly recommended. Visit Clicktale and CrazyEgg!

5. Google Webmaster Tools

Google Webmaster Tools basically gives you an in-depth look into how your website is functioning. It shows you what your pageload time is (according to Google), which is a known ranking factor, it shows places on your site where there are errors or broken links, and it shows you your impressions/clickthrough rate/positioning for keywords. It’s a useful tool in determining how well your SEO efforts are going, and we use it especially to see if we need to optimize our title/description tags (if our clickthrough rate is lower than it should be). Visit Google Webmaster Tools!

6. RankTracker

Ranktracker is one of the most powerful tools we use – it allows us to track our organic search rankings for hundreds of keywords at a time. Whenever we begin SEO work, we put in our keywords into rank tracker, and it allows us to see what gets us the best results. For example, we’ll buy a linkwheel package and see how many spots it moves us up in our rankings – and based on those results, determine what kind of linkbuilding we need to continue with. Tracking your results online is essential – and RankTracker is a must-have in your SEO arsenal of tools. Visit RankTracker!

7. SEO Spyglass

SEO Spyglass allows you to see your competitor’s backlink profiles. Now, that might not seem like much at first, but it actually is incredibly powerful. When Google has ranked a site #1 for a keyword that you want to go after, the best place to start is by mimicking that #1 person’s backlink profile. SEO Spyglass doesn’t just give you their backlink profile, it shows you the pagerank of each backlink, as well. Using this data, you can go out and essentially copy their backlink profile, moving yourself up in the rankings and dominating your competitors. Visit Seo Spyglass!

8. Big-Boards.com

I honestly think that forums are highly underrated. Forum traffic is some of the highest quality traffic you can get – you can build strong relationships on forums and a strong brand, and do it quite inexpensively. Forum advertising is notoriously underpriced (we’re talking about 30 bucks a month to reach a highly targeted audience). You can run sponsorships for sections of forums, create sticky posts and interact with your potential customers – ask them what deals they want from you, etc. In the internet marketing world, the biggest forums are WarriorForum.com, WickedFire.com, and DigitalPoint.com. I know a lot of people that have created 5- 6 figure businesses just from their relationships on forums and from selling their services there. It’s one of the easiest ways to get started marketing your products & services. Visit Big-Boards.com!

9. Market Samurai

One of the best internet marketing tools there is, Market Samurai is absolutely clutch when it comes to keyword research . It allows you to masterfully research any niche – you put in your target keywords and it will tell you how competitive they are, and if you really stand a chance to rank. We use it every time we are beginning an SEO campaign to help us to determine which keywords to go after first. If you want to learn more about market samurai specifically, check out our Market Samurai Review. Visit Market Samurai!

And that’s it! Those are 9 of the best tools that we use to maximize our quality of traffic. There’s plenty of other tools out there that you can use as well – what are some of your favorite tools for internet marketing?

Making Money Online with Affiliate Programs

2011-04-03T03:32:00.000-07:00

It’s no secret that many business owners are now bringing their respective ventures on the web. As a result, new websites are being created everyday, where site visitors can browse among a selection of goods and services and make instant purchases.

Many web business owners have also recognized the viability of affiliate marketing as an excellent promotional tool. Affiliate marketers are able to grow their earnings by directing traffic to certain websites and obtaining new customer leads.

If you want to earn additional Internet-based income, it is always possible to make money with affiliate programs.

Huge earnings from customer leads

It is true that many affiliate marketers currently enjoy excellent earnings, just by generating customer leads. Many affiliate programs require that you make recruits or persuade people to actually make purchases on their site.

However, some affiliate vendors are willing to pay you excellent money for every lead you gain, even if these leads do not actually convert to a sale.

It does not come as a surprise therefore, why many people have already taken up affiliate marketing as an excellent means for them to boost their incomes. A few really successful ones have already quit their day jobs and are now focusing on affiliate marketing instead.

How affiliate marketing really works?

If you are concerned as to how affiliate marketing really works, the equation is actually pretty simple. Before you can become an affiliate of any website, you need to build your own site first. If you don’t have a website and you plan on taking up affiliate marketing seriously, it is high time that you start creating a traffic-friendly site.

Once your site is up and running, you can start choosing from the many affiliate programs available on the web. If your site caters to a specific niche, it is highly suggested that you also choose affiliate sites which are related to your site’s content.

It will be easier for you to gain leads in this manner, since you know that the people who are checking out your site will be interested in the offerings of the affiliate program as well.

A few tips in effective and profitable affiliate marketing

If you want to be really successful in affiliate marketing however, you need to learn a few effective strategies in generating web traffic to your site.

The more traffic your site gets, the easier for you to enjoy bigger earnings from your affiliate programs. Nonetheless, successful traffic generation is often easier said than done. You need to put in the hours and learn to be more patient as you are slowly building up on traffic volume.

When it comes to generating traffic, there is no any other way but the legitimate way. Unless you want to be banned from the listings of search engines, you should steer clear of underhanded traffic generation strategies.

Choose who you want to be associated with.

Finding an excellent affiliate program is also important. Before you even think of earning from affiliate marketing, you need to make sure that the programs you have chosen to become affiliated with are legitimately operating and offer excellent rewards for your efforts.

The last thing you would want is to become affiliated with a web business that has no plans of compensating you for all the work that you do for them.

This is why reviewing each affiliate program is important, prior to signing up with them. If you can’t review each of these programs on your own, you can seek out affiliate program review sites such as Affiliate Scout.

Here you will find that most affiliate programs are categorized according to type, and you can also read up on their reviews. This will help you choose a program that is perfect for the market niche your site is currently targeting.

You may have to contend with tough competition if you’re trying to sell affiliate products, however there are many things you can do to make your site more distinctive and your promotional tactics more aggressive.

Affiliate marketing is one of the best ways to earn lucrative money from the web nowadays. By choosing the right affiliate program and building an attractive site, there is no reason why you should not become a successful affiliate on the web.

Source from http://retireat21.com