Money Money Money

The Best Card Card - Part 2

2012-06-12T11:49:00.002-04:00

I still love my Starwood American Express, but there's a new card on the block that seems to be the best card out there.

Some exceptionally notable features:

6% cashback on Super Market purchases (you can even buy Amazon.com gift cards from grocery stores and get 6% cashback).
3% cashback on Gas and Departmental Store purchases
1% on Everything else
Unlimited Cash back

You may also get 0% APR on purchases for an entire year

They do have a $75 annual fee that is not waived even in the first year, however, if you apply for the card using my unique link, you will get $150 in sign up bonus essentially nullifying the annual fee for almost two years.

Apply for the American Express Blue Cash Preferred now

Suite of travel and shopping protections

With your Blue Cash Preferred Card, enjoy access to a suite of shopping and travel protections, like Purchase Protection³, Extended Warranty⁴, Global Assist® Hotline⁵, Travel Accident Insurance⁶, and more.

Special savings with the Blue Savings Program® ⁷
Blue Cash Preferred gives you access to the Blue Savings Program, which offers a wide range of offers and extras at hotels, car rental companies, restaurants, cruise lines, and more.

Apply for the American Express Blue Cash Preferred now

Entertainment for Less

2012-04-20T14:19:00.003-04:00

Having fun can be quiet expensive depending on what you like to do in your free time.

After all, who doesn't enjoy a great night out watching the Opera or cheer the Lakers take on Mavericks or watch Katy Perry live in Concert. You may end up paying any where from $100-$500 depending on how much you want to spend.

How about $1 or less? Yes, you can entertain yourself for more than an hour by renting a movie from RedBox. When was the last time you got such a great bargain? Use the unique link below to get your free 1 night rental and browse latest hits. Trust me, you just got the best value for your dollar!

1 night free rental from RedBox

If you already watch movies using RedBox and think they are a great company, then think about investing in the company by being a Shareholder of its parent Company CoinStar. You can get Coinstar shares for cheap and with future deals for Video Streaming with Verizon, they may be the next thing NetFlix shoudl worry about.

Get 100 free trades when you open a new account with OptionsHouse.

Fix up your car - easy way and save money

2011-11-03T15:53:00.001-04:00

Advance auto parts has everything you need to clean up your car, replace batttery, replace parts on your car. I am not a very hand person and I agree that its a pain to do those things yourselves.

However, Advance auto parts is cheap and if you do a single car related task yourself including carwash, you are looking at saving a lot of money.

Certain things that can EASILY be done in very little time with no or limited tools:

Replace Air Filter
Clean and Wax your car
Install New Wiper Blades (Advance auto parts will install for free and they sell wipers for much less than those pricy dealerships or places like TiresPlus and Meineke)
Install new battery (free installation if you buy the battery at AAP)
Replace your tires

Get 40% off your first online order using this unique code.

You can order online and do a free in-store pick up.

Think about it; money saved is money made! Your car will run longer if you regular take care of it and if there is a problem, you can always use this Free App to get a good estimate on repairs.

Stock for 2012 - TEVA

2011-10-31T16:53:00.000-04:00

TEVA

Its the largest generic drug maker in the world based out of Israel. About 17 major drugs are set to lose their patents till 2015 starting with next year allowing companies like TEVA to have generic versions of those drugs. The upside is a lot to this company..and they have their own R&D wing now too..with a few of their own drugs in the pipeline..but generics is the future..as economy tanks and more babyboomers get old and get sick..demand for generic drugs will only go up..

TEVA is my recommended stock for 2012. The current price as of Dec 2011 is about $40/share.

Disclaimer: Investing in stocks carries a risk. Always consult your financial advisor before investing. This site may not be held liable for losses resulting from using any of the stock tips.

Always, remember the big picture.

Stock of the Month - ESL

2011-09-16T14:20:00.001-04:00

Esterline Technologies Corp (NYSE: ESL)

My stock pick for September is ESL. This company is key manufacturer of sensors, systems, advanced materials for the aerospace industry. It is involved in everything from instrumentation panels, power systems, interface technologies. In a nutshell, they are one of the major parts manufacturer for commercial aircraft.

Boeing already has a huge backorder for its 787 Dreamliner and Airbus has also been rolling out big orders( 667 orders worth $60.9 billion+) for its revamped A320 called A320neo. There has been a surge in orders for new planes ( a lot more from Asia) for both Boeing and Airbus. Major US airlines are operating an aging fleet of aircraft nearing its life cycle, and have already starting putting big orders for newer aircraft that are better in terms of fuel efficiency, range and features.

Despite the recession slowing down demand for leisurely travel, I expect the entire global airline industry to buy more planes for the next decade and this company will stand to benefit the most from it.

After staying in the mid 80s earlier this year, this stock is currently near 60s.. Expect the stock to climb back up to 80s in the next 4-6 months as Boeing rolls out more of its 787 planes to customers like Korean Air & ANA.

97.5% of the company shares are held by institutions and they also sport a healthy record of beating analyst expectations quarter after quarter. Get 100 commission free trades by using this link and get ESL in the low 60s today.

Current Price as of Dec 2011: $58

Update: An example of how bullish this aerospace sector is and can be - United Technologies is buying Goodrich for $16.5B

Disclaimer: Investing in stocks carries a risk. Always consult your financial advisor before investing. This site may not be held liable for losses resulting from using any of the stock tips. This stock tip is for September 2011.
Company image

The BIG picture

2011-08-10T17:11:00.017-04:00

ok. So you are going to cut down on eating out. You are going brew your own coffee and have breakfast at home. You are going to subscribe to the Sunday paper and combine valuable coupons with sale on certain products and save a ton of money! The list goes on..and every day Yahoo finance has at least one such article with repetitive advice on how you can save money on a daily basis.

All good, but what about the BIG picture?

Someone once said, you want to make pennies, you think about pennies, you want to make dollars you think about dollars! Rather than micromanage you every day life into saving a few dollars, what if you could ACTUALLY make an impact to your finances?

Consider the following list of big ticket items that will significantly make an impact to your bottom line.

Re-negotiate your auto/home insurance policy - This is a no brainer and irrespective of whether your driving record has improved or gotten worse, you should always shop around for a better rate. Most auto insurance companies will charge you 10% penalty fee for bailing out earlier since the rate they gave you 'assumed' you were going to stick with them through the terms of your current policy. But even with the penalty, you almost always come out ahead and save at least more than $50 if you shop around, agree to pay premium in full. Savings: $50-160
Get a cheap Broker - if you are still paying more than $5/trade to your current broker, switch immediately to OptionsHouse and pay just $3.95/trade. Don't buy into "My broker gives me state of the art tools" as OptionsHouse gives you all that and honestly it hardly matters. Savings: $250-600
Spend an Extra day buying a car - We all have been there. When we are spending $25,000 whats an extra thousand here and there? That's exactly the problem A thousand dollars saved is still a thousand dollars saved irrespective of how much you are spending. Whenever you have the absolute bottom price on a car, rather than JUST get it, just take that LOW price to another dealer and ask them to beat it. Most dealers will or at least will throw in some freebies along with the rock bottom price you were going to get.Try to at least beat the average price of some well known car buying programs like this one. Savings: $500
Find Another job or renegotiate your current salary - ok so its not that easy, but the best way to earn more money is by simply switching companies. Times are tough and I wouldn't quit your current position without getting an offer in writing from another company. However, the fact that you have a job right now gives you an edge compared to the unemployed who are desperate for any kind of work. If you are happy with your current position, ask for more money! Times are tough, and its not like your boss will be paying for your salary from his OWN pocket. Read this link for tips on how to ask your boss for a raise.
Avoid impulsive shopping - if you ever watched en episode of Entourage or are a big fan of Entourage ask yourself what you love about the show. Its not the story or the characters or the drama. The biggest reason why people love that show is it shows how ordinary street people can make it big and just buy anything and everything whenever they feel like from designer watches to super expensive cars to getting floor tickets to just about any concert or hot women! Its about getting WHAT you want and WHEN you want it. For most ordinary folks like us, its a dream. That doesn't stop us from pretending that we can also be a big shot every once in a while. Just know WHEN would be a good time to buy certain things and you can save a lot by following the proper time table. Savings: $100-500
Use a discounted Gift Card: Sites like PlasticJungle sell you unused gift cards from other people for upto 12% discount and free shipping. All gift cards are verified, and have no expiration date. If you are shop regularly at Macy's or eat regularly at California Pizza Kitchen or Chipotle, check them out to see if they have a gift card for you to buy. Certain gift cards like Gas, Grocery stores or Target are ever green since you always need to shop there. Check to see if your retailer's gift card is available at PlasticJungle.
Savings: 12-20%
Save your gift cards wisely because if you lose your gift cards then the savings realized by purchasing them at a discount won't matter any more.

So go ahead, indulge yourself in that White Chocolate Caramel Latte at Starbucks. After all, isn't one allowed the pure pleasure of good tasting coffee in these difficult times? Most people were predicting Starbucks stock to fall like crazy, but the exact opposite happened. People cut down on luxury cars and stopped eating out, but they still wanted their morning java.

Always remember the BIG picture.

Are there any BIG items that I missed out; feel free to add your own.

Best Place for Tires - TireRack

2011-08-04T13:21:00.012-04:00

Gas prices are climbing and one proven way to increase the mileage on your car is by keeping your tired properly inflated at all times. Check out this free App for estimates on car repair.

Summer: Don't super inflate your tires since air expands due to the summer heat and it may blow your tire.
Winter: Its ok to super inflate your tires since air will contract a little due to the cold.

Worn out tires can also reduce the mileage and in some cases if the tread depth of the tires is low, it can cause accidents, skidding and lot of other problems.
Solution: Check your tires treadwear with a coin & get new tires if needed.

Best place for cheap tires is TireRack. They have the lowest prices around, almost next to nothing shipping and they will beat most competitor's prices as well. You can get the Tires Only package and go to a local auto shop like Tires Plus and have the tires mounted. It will cost you about $80 to have four tires mounted on a wheel and they'll still do the balancing and all that.

You could go to Costco or Sears and they all have free installation and lifetime warranty or many things like flat tires etc. but the cost of providing such service is already included in the price.

I highly recommend TireRack. Don't forget to use Ebates to get an additional 3% cash back on TireRack.

What do you think? Have you purchased tires from other places and found better deals/service?

Credit Card Perks - Free

2011-07-29T17:27:00.000-04:00

You may not know this, but your favorite American Express or Visa card gives you so many free perks on everything from travel to dining to discounts on car rentals.

Visa Signature Benefits - full listing of all the benefits of Visa Signature including special car rental codes, codes for free shopping and % off deals
American Express Benefits

In addition to the above deals, both American Express and Visa recently started a deals page specifically for hotels. The benefits of booking a hotel room through their site include complementary upgrades, free breakfast and more.

Visa Signature Hotels - $25 food/bev voucher, free WI-FI, free valet parking, automatic room upgrade, VIP status
Amex Hotels

Just bookmark these links and the next time you decide to shop online using Ebates, make sure to check these sites also for an overlooked discount.

If travelling international, make sure that you just use the above cards to make your reservation, but use a better card like Capital One (no Foreign transaction fees) or Starwood Amex (low 2.7% fee).

HouseWarmers Maids, LLC review

2011-07-25T17:19:00.004-04:00

The best way to earn wealth is by not blowing it away on stupid stuff. LivingSocial and Groupon are great ways through which you can save a lot of money. But do you really need that Scuba lesson in a swimming pool or that pilot lesson where you hold the controls for 20 mins?

Recently, I bought a cleaning service via Living Social.

This was the worst cleaning service of all times.

You cannot schedule in advance what time you want them to come. Essentially like the cable service, you have to stay home entire morning or afternoon or evening. Sure... I have nothing better to do with my life any way right?
Didn't clean the inside of the microwave
Didn't dust or clean the Window blinds or planks
Fans not cleaned properly
Hardwood floors felt sticky while walking after they cleaned
Corners of the floor not vacummed
Vacuuming of the room not done well; I could do better vacuuming with my left hand!

They leave you flowers, but I would rather have my home smell clean than have fancy roses. You can read horrible reviews on Yelp by going here

Avoid HouseWarmers Maids, LLC at all cost.

I tried to contact LivingSocial a few times, but I guess they don't really care about Customer Service now that their big IPO is coming out. Update: LivingSocial's customer service finally responded and gave me DealBucks credit to my account.

If a company gives you a hard time you could do the following:

Contact the company and ask for a refund
Contact LivingSocial or the company that sold you the voucher
File a complain with BBB
Small Claims Court
Ignore, learn your lesson, always check reviews first and buy a deal IF you REALLY need it !

Why I love walmart.com

2011-07-12T13:15:00.001-04:00

There's an opportunity cost associated with everything that you do. When you are reading this blog, you could be doing something else....something else that could be potentially earning you money.

People love to shop at walmart and why shouldn't they? More than 90% of the times you can get better prices on everything from cleaning supplies to toothpaste to even milk without worrying about coupons or sale. Most people don't realize that they are also wasting about 2 hours of their valuable time. Shopping at a walmart is no better than shopping at a flea market. Its crazy on weekends.

How about getting walmart prices without leaving your home? Have you tried Walmart.com lately? They have FREE shipping on thousands of items. Don't believe me?

Check out this listing: Free Shipping items on Walmart.com

Wait...there's more. What if you could make the deal even sweeter? You can save 2% on everything you spend on Walmart.com by using Ebates. Just sign up for Ebates using this link and then go to Walmart.com using a special Ebates link. Thats it. Ebates will gladly send you a 2% cashback check every month or so.

Free Shipping, Cheap Prices, 2% cashback...only thing missing is some whipped cream!! :)

Save 5% on HOTEL stays through 2011

2011-04-04T16:31:00.002-04:00

Sign up for Ebates and go to Orbitz
Search for a hotel based on your needs
Enter promo code HOTEL5 or REVIEW5
Book by June 30, travel by Dec 2011
Save 5% instantly

101 on Taxes

2010-08-20T17:43:00.001-04:00

Did you ever notice that when you put the words "The" and "IRS" together, it spells "THEIRS?"

Bottom Line: Taxes are always a percentage or a fraction of your profits (also known as Capital Gains). They can never be more than your profits. If you trade short term (less than a year), you can safely choose to ignore the tax implications all together. If you truly want to come out ahead, read on.

Big picture:
The IRS treats income from trading stocks differently than the income you earn while working for some company. You pay Federal tax + State tax + Medicare + Social Security on your taxable income. Income from stocks is subject to just federal and state taxes and there are ways to pay less of that too.

Long Term (stocks held for more than one full year, not calendar year) - Profit made from selling such stocks is currently taxed at flat 15%. This is the BEST way to play the stock market and pay the least tax. Even if you are a billionaire, you still pay 15% in taxes. No other source of income would let you get away by paying just 15%. You can never get rich if you pay too much in taxes! Most CEOs prefer to get compensated in stock as opposed to cash for the exact same reason. They simply have to wait a year and then pay just 15% !!! Nearly all wealthy people use this strategy to pay least possible tax on the income generated from the stock market. There may be liberty and justice for all, but there are tax breaks only for some !!

Short Term (stocks held for less than a full year) - The income generated by selling stocks in a short term is taxed at your current "tax bracket". The term tax bracket is very confusing. None ever falls into one tax bracket. Your income is always split into multiple brackets. Income higher than certain levels get taxed at different rates. Read more about tax brackets . Despite feeling more in control of the market, tax wise this strategy is not the best strategy. You can pay tax as high as 35% and the rate is expected to go up to 43% in 2013. Can you imagine paying more than half of your hard earned stock income to the govt? The average Joe ends up paying upwards of 30% tax on the little profit he made in the stock market, but the Big-Shot millionaire holds his stock for one year and just pays 15%.

Dividends (Short term or long Term): When companies give you cash dividend, its always taxed at flat 15% independent of how long you have held the stock. This is going to expire by end of 2010, but hopefully it gets renewed. To take advantage of the dividend without paying much in taxes, know the ex-date of the dividend payment. This date is usually published about a month or more in advance. If you buy the stock one day before the ex-date you automatically qualify and will receive the dividend. The actual dividend may take a month or more to be physically deposited to your brokerage account. However, keep in mind that on or after the ex-date the price of the stock will automatically adjust (decrease) to reflect the decrease in the perceived value of the company. So a strategy where you buy the stock for the dividend and sell right after doesn't always work. Consider companies like Tiffany or Corning.

REITs - Real Estate Investment Trust - Example: AGNC is a REIT dealing with residential real estate. There are other REITs that deal with Health Care facilities, Office, Hotel/Motel etc. These are special trusts who are forced to give out 90% of their profits to its shareholders in form of dividends. In return, the company doesn't pay any taxes. However, when you get dividend from a REIT, it doesn't get the special 15% preferential treatment any more. In fact, it gets taxed at the same rate as your regular income. The dividend yield from such companies can be sometimes as high as 20%. To take advantage of REITs, its best to buy them in your ROTH IRA account. You never pay taxes again with a ROTH account and so all those jumbo dividends paid can be tax free!

Other Considerations
Whenever your money sits idly with your broker, your broker pays you a little interest. This interest is again taxed by the IRS as your interest income and its the same rate as your regular adjusted gross income tax rate.
Lets say you also borrow on margin from time to time from your broker. You pay some interest to your broker for borrowing the money (usually about 7-8%). Here's the part where you get screwed. This interest is deducted from your adjusted gross income ONLY if its more than 2% of your adjusted gross income. In other words, you earn interest (even $1), its taxable, but if you pay interest to earn any income, its deductible only if it is more than 2% !!!

How to get a good vacation deal?

2010-03-17T13:08:00.002-04:00

Click on Ebates link and open multiple windows to go to Orbitz, Expedia and Priceline. This step will get you a 1-2% cashback credit just for using Ebates. Sign up for Ebates if you haven't done so.
On each site, do a vacation search by entering your Flight+Hotel+Car query
After sorting for best values, or lowest price, pick out a combination of flights and hotels that you like.
See if you can get a better hotel deal separately Visa Signature/Amex Hotels program
Look for a coupon code on retailmenot for Orbitz, Expedia or Priceline
Enter your coupon code, use a good cashback credit card and buy the package.

You really save a lot by combining hotel and flights and you get 1-2% cashback from Ebates and rewards from your credit card and you save some more money by using a coupon code from retailmenot. Always, remember the Big Picture when it comes to saving money.

Have you found better ways to save on vacation packages? Leave a comment below.

Save Exxtra 6% on Macy's & 2% on Kohl's (in-store or online)

2009-12-16T11:45:00.004-05:00

Right now u can buy gift card (can be used online or in-store) at macy's.com with no tax, no shipping, no fees

Ebates is giving 6% cashback for macy's.com. So basically get 6% off just like that. Once you go to store you can use that e-giftcard in the store just like a regular gift card and use it with coupons and everything as before, but you still saved 6%!!

You can use the same technique to save 2% on Kohl's purchases too.

1. Sign up for Ebates
2. Click on this link to go to Kohl's & search for Gift cards

Net Worth

2009-11-12T14:00:00.006-05:00

What is net worth?
In simple words, its how valuable you are.

To calculate your net worth:

Add all your assets (cash, jewellery, stocks, bonds, real estate, car, etc.)

For your house, just count the equity built on the house (how much of principal on the house is paid by you + any increase in value since you bought it. Don't count how much mortg interest you paid on it)
For your car, take the current Blue book value (don't use what you paid for what you think the car's worth)

Add all your liabilities (credit card debt, outstanding loans, any other payments or money you owe)

Definitely count total outstanding mortgage amount in this category.

Whatever is the result of subtraction of assets-liabilities is your total Net Worth!

How much should be my ideal net worth?
Your total net worth should be your salary multiplied by your household income divided by 10.

So if you are 30 years old and your household earns 200k/year, your total net worth should be:
(200,000 * 30)/10 = 600,000

So when you calculated your net worth above, if the number is less than $600,000 then you are behind!! You should consider saving more and investing more to reduce your liabilities and increase your assets. Try to get appreciable assets vs those that depreciate in value.

401k....what?

2009-11-06T13:00:00.007-05:00

A 401k is very similar to an IRA. Read my post on IRA to understand how an IRA works. In a 401K plan, a part of your pretax income (reducing your current tax liability) is deposited into a 401k account. This account can be designated to invest money in stocks, mutual funds, bonds. When you retire, you pay taxes on whatever amount you take out of this pool of money (principal + earnings). There is also something known as ROTH 401K which is similar to ROTH IRA where you put after tax money and let the earnings grow and never pay any taxes when you retrieve the money at retirement.

For year 2009, IRS has a limit on employee contribution of $16,500. So that's the maximum amount you can take out pretax and send it to your 401k account to grow tax free.

Can I borrow money from 401k?
Yes, you may borrow it as a loan and pay predefined interest rates. There is no penalty if you repay it back and also when you borrow its not considered as taxable income. This is different than an IRA where you can't take out money except for certain special circumstances only. After age 59, you may borrow at will. The interest you pay on the money borrowed goes back in to your own account only..which is good. Unlike a loan from a bank, the interest goes back to the bank, here the interest you pay goes back to your own account which you will get along with everything else when you retire.

How is 401k different from IRA and why should I care?
401k often has a matching employer contribution. This is FREE money folks! Take it! Consider the following statement in your employee benefits while accepting a job offer:

"50% matching 401K contribution upto 5%".
What this means is that the employer will contribute 50% of whatever amount you set aside to deduct pretax from your paycheck to your 401k amount with a limit of 5% maximum of your yearly income.

Example:
John has the above benefit at his company and he earns $48k/year. As stated above, the max he can contribute for 2009 is $16,500.
Lets assume he wants $6000/year or $500/month taken out from his paycheck for 401k. Now his beloved company has promised a 50% contribution upto 5% max. So the max that his company will match is 5% which is 0.05*48,000 which is $2400/year or $200/month.

John's yearly 401k Pool:
$6000(John)+$2400(Company)=$8400

Lets say he retires after 30 years and assume he works at the same company and his pay and everything remains the same. Also assume his 401k investment earns him a measly 2%/year. Lets do the math:

Using the compound interest calculator the total works out to be a whopping $340,000! This amount is subject to taxes based on his tax bracket. If he takes out less then $67,900/year then he will pay only 15% taxes on it.
The above amount will be substantially higher if stock market takes off or his salary increases as he becomes a more experienced employee or if he contributes more to his 401k every year.

NutShell Bottom Line:
Don't ignore the power of compound interest! Any employer matching to 401k is FREE MONEY! Your account instantly goes up in value thanks to your employer.
Borrow money from your 401k as a loan and pay interest, and as long as you pay it back there's no penalty or taxes.
No penalty-free withdrawal for first time home buyers.

IRA ...what?

2009-11-04T17:38:00.083-05:00

Lets face it..you have heard all the talk about IRA, but you need the money now and you could care less for IRA since you aren't ready to retire and are pretty young right now. Hopefully, this entry would explain in a nutshell all you need to know about IRA. The numbers assume you are covered by a retirement plan at work such as a 401k.

IRA = Individual Retirement Account.
ROTH IRA and Traditional IRA.

Regularly-Taxed Account	Traditional Deductible IRA	Roth IRA
You pay income tax, and then make your contribution with post-tax dollars Your principal may be subject to taxes on dividends and capital gains as it grows You pay capital gains tax on your gain at withdrawal	You get a tax deduction, essentially letting you deposit pre-tax dollars Your principal grows tax-free You pay income tax on the entire amount of your withdrawal	You pay income tax, and then make your contribution with post-tax dollars Your principal grows tax-free You pay no further taxes on withdrawal.

Scenario1: You earn money. You pay taxes on them based on your tax bracket. You invest a portion of the remaining money in Stocks or Mutual Funds. The value of your portfolio goes up and you pay taxes again on the capital gains. You pay 15% if the stocks were held for a year or more or tax percentage equivalent to your tax bracket if you held the securities for less than a year. Either way, you pay taxes on your income and then again when you invested a part of that income to earn capital gains. Its like double taxation!! Avoid this!

Example: You earn $48,000/year. After paying taxes, your take home pay is $38,000. You invest $8000 in the stock market and you make $1000. You pay taxes again on that $1000 profit. Not only did you pay tax on your salary once, but you also paid taxes again when you invested that same post tax dollars.

Scenario2: Traditional IRA - You set aside certain amount of money (subject to annual limits) of your paycheck in this account. You don't pay any taxes on this amount right now thereby reducing the pool of money in the "higher tax bracket". You can invest that money in stocks or mutual funds and let that pool grow every year. When you are ready to retire you pay taxes on the total amount (contributions + earnings). Depending on how much you take out you pay taxes on that much amount only. The idea is you reduce your current tax liability, your money will grow and in the future your tax bracket would be much less depending on how much you take out every year and so you pay less taxes. Also, since the money grows without taking out the tax up front, the amount is also more and the more the amount, the more it grows thanks to compounding and reinvestments. There are penalties and taxes if you try to get your money before retirement.

Example: You earn $80k/year. You set aside $5000 every year for 30 years into traditional IRA account. Keep in mind that exact $5000 without taking any tax out goes to your account. This money is invested into the market and even if it earns 3-4% this amount will grow to $291,000!! using compounding interest. You pay taxes on this amount depending on how much you take out every year.

Remember, the entire amount will be not be charged a flat %. Tax brackets are tricky, if not understood well; check this link for more information on your bracket.

For 2009, income between 16,700 and 67,900 is charged at 15% and 67,900 and 137,050 is charged at 25%.

Current federal tax without IRA drop:
(1-16,700 ----10%) + (16,700-67,900---15%)+ (67,900-75,000---25%) = $10,872
With IRA drop:
(1-16,700 ----10%) + (16,700-67,900---15%)+ (67,900-75,000---25%)= $9622
Rather than pay 25% tax on income from 67,900-80,000 you pay 25% tax on 67,900-75,000.

Future:
if you withdraw only $67,000/year you will pay only 10% tax on 16,700 and 15% tax on the $50,300. You don't even care about the ridiculous 25% bracket at this point.

Foolish Bottomline: Most people with incomes above $60k don't qualify for traditional IRA making it pretty useless. Otherwise, the quick and easy withdrawal for valid reasons and no holding period make it very attractive.

Scenario3: Roth IRA - The best choice in my opinion. You pay taxes on your income. You invest a portion of the remaining money into a ROTH IRA account ( 5000/person or 10,000/couple). That's it! You are done with taxes. The money in that account grows (stocks and bonds) and grows and lets say it quadruples. You pay nothing extra since you already paid taxes. Nothing nada. Even if you contribute $5k/year and it ends up being a million dollars you will still not pay a penny to the IRS. Penalties for early withdrawal still may apply. The Roth IRA income limits for 2009 are $176,000 for married filing joint taxpayers, and $120,000 for single taxpayers. If your income is within this range, you can still contribute a max of just $5000/person or $10,000/couple per year.

Joke of the Week

2009-10-16T14:52:00.000-04:00

A Pakistani tourist after a long walk in one of very fancy clean streets of Delhi found himself needing to urinate badly. After a long search he could not find any place to you-know, and eventually couldn't control himself and chose a silent corner of a clean street to release himself.
As soon as he had just started you-know-what, a Delhi police official approached him, "Hey, What do you think you're doing here?"
Pakistani tourist: "Sorry I have to Pee"
Police : "No PP here okay ? Follow me."
The Police officer took him to a beautiful garden nearby with lots of grass, flowers and singing birds around.
Police: "PP here..... and have a nice day".
Pakistani tourist : "Oh Sir, ....... that's very nice of you, is this Indian courtesy?"
Police: "No.......this is The Pakistani Embassy!"

Watch the movie Amelia - Free - Expired

2009-10-14T17:56:00.003-04:00

RSVP to see the movie "AMELIA" for free and before it releases in theaters by going here:
http://rsvp2.foxsearchlight.com/signup/6

Starrring Richard Gere, Hillary Swank and directed by Mira Nair. Full Movie Details.

Cities include: Albany, Albuquerque, Atlanta, Boston, Charlotte, Chicago, Cleveland, Columbus, Dallas, Hartford, Houston, Indianapolis, Kansas City, Las Vegas, Louisville, Memphis, Milwaukee, Montreal, Nashville, New Orleans, NYC, Norfolk, Oklahoma City, Philadelphia, Phoenix, Pittsburgh, Raleigh, Richmond, San Diego, Tucson, Tulsa, and Washington DC (Mazza Gallerie)

Top 10 ways to save money and live well - desi version

2009-10-05T15:43:00.014-04:00

We all see tons and tons of such top 10 and top 20 ways that you can save $100-500/month. It has gotten to a point where Yahoo Finance and CNN money have nothing better but to daily advertise haggling with cable operators to save a few dollars or cut. This list may have some similarities, but I promise its more relevant, practical and geared towards us desis.

Daily Stuff:

Use Target/Walmart a lot. Their prices are really cheap and its far better to just walk out knowing you didn't overpay and that you didn't spend your entire Sat morning clipping coupons. If you do see a coupon you can really use, definitely use it!
Get a membership to Sam's Club/Costco. I would say Sam's Club since in a recent price comparison it was found to have cheaper prices and the membership is cheaper too. Get Toilet Paper, Laundry Detergent, Cereals and the savings have already paid for your membership. Case Closed. Please don't buy jumbo packets of Muffins and Croissants as however tasty and good they look, you will not be able to finish it. Don't buy these things.

Shopping:

Don't buy on impulse and NEVER ever worry about what your friends got. Desis are notorious for comparing and gossiping and bragging about every little thing they buy and what a great deal they got! To buy anything online do the following:

Read the reviews on Amazon (best place to review a product)
Look for coupon code for the site on RetailMeNot
Look for deals on SlickDeals and Fatwallet.
Use Ebates to go to the target store and get Cash Back.
Always use a good credit card like Starwood Amex, to buy a product/service online.
Most products have a 30 days price match, so keep checking the store's web site, if price drops, call customer service and get the difference credit back to your card.
Before you buy anything new, recycle your old product by going to Gazelle. They give you cash money and free shipping.

Don't buy Jewelery like there's no tomorrow! I have seen families load up Gold faster than Zambia trying to balance their economy by buying Gold bullions. Please stop. Gold is expensive and depending on where you live and how social you are, you'll be using it about 4-5 times a year plus paying extra for a bank locker to keep this precious jewelry. And its not as good as CASH not matter how you try to justify it.
Don't go to India every year! Stop it. The ticket is like $1000+ and then you buy at least another $500+ in clothes to impress and its a rush rush trip and you blow up your entire year's vacation. Instead for the same price you can go to places you haven't been in the US for much less, relax a little. I am not against meeting family back home, but do it in moderation.
Just because you and your brother and your dad and your cousin are in IT, you don't need 5 laptops in the house. Just get a decent one and share.

Extreme Cheapness
1. Call up friends and relatives and pretend you are in the area and want to drop by and drop in during dinner or lunch hours.
2. Whenever having people over, always insist on Pot luck
3. Visit local temple on Sundays to get free dinner. Also, pray while you are there!
4. Visit Ikea on the weekends for their $1 breakfast.
5. Steal toiletries from your hotel stays. Load up on paper napkins from Starbucks (they are better compared to TacoBell ones).
6. Steal unsecured wireless connections and never pay for Internet.
7. Guys should get haircuts at home from their roommates, mom, sister, girlfriend, wife. Just invest in a cheap clipper.
8. Never eat out. Eating at home is healthier, cheaper, you get more quantity and cooking is a fun exercise.
9. 15% is a good enough tip for any restaurant! Don't buy in the hype. Always share a dish with your spouse....Healthier & Cheaper and also increases the love & bonding!
Education:
Stop wasting your time by reading blogs like this one while updating your Facebook status and do something more constructive online: Free online classes from MIT. Start contributing money towards your child's 529 plan tax free now.
Taxes:
Always file your own taxes. We are desis, and the only thing we are good at is Math. Pick up a copy of TaxAct or TurboTax at Sam's or Costco and just answer their tax interview. The IRS web site is also pretty good. Make sure to take all the deductions for parents, siblings and children.
Fines:
Don't donate money by getting traffic, speeding or parking tickets. The Chinese are smart; they never get tickets even when they drive 20 miles under the minimum posted speed limit.
Find a good mechanic by asking your friends and your coworkers. If you choose to go with a major auto repair shop always go to their web site and print coupons. Also check out RepairPal
Investing:
Invest in Stocks regularly and use free personal financial analysis software such as Mint.com or one of these software. Use calculators like this one to figure out just about anything financial.
Services:
Get basic cable and drop HBO and Cine-max other premium channels. Combine your internet with your cable package and save money. Don't keep a land line and get a good Family Plan on your cell phone.
Invest in yourself:

Explore Hobbies/passion and pursue it. Whether you want to learn Flamenco or be a Top Chef just find a school and go for it.
Never fall sick. Life's too short to be spending on a bed feeling all miserable. Drink orange juice, milk and eat fruits EVERY day! The desi remedies that your mom always tells you about do work. Try to avoid popping a pill every now and then stick with natural ways to cure any headaches or infections. Always use Olive oil or Grape seed oil. Don't eat anything DEEP fried. Eat Taco-Bell ONLY if you are not overweight according to this BMI calculator. Do this along with these steps and live till 100.
Get out there and enjoy nature. There are tons and tons of national and state parks in US. They are free or $5/car. You will get exercise, you will spend some quality time alone from work, dishes, laundry and other things, and you will breathe fresher air. Take a hike; it is the cheapest way to spend half a day and it will reduce your stress levels too. As desis, we stress out over everything...no wonder most of us suffer from heart and blood pressure problems.
Get a gym membership for Winter for cheap by using GlobalFit. No matter what don't ever sport an ugly belly or unwanted fat. Desi food is notorious for adding pounds which is why you need to exercise more often..specially women.

Entertainment

Don't spend $100+ per ticket to see your favorite Bollywood celebrity lip sing a song you have already seen like a zillion times on You Tube and Zee TV. Instead spend money and get the cheapest ticket to a desi singer's concert where the only thing that matters is his/her voice even if you have the last seat in the auditorium. Don't waste $500/ticket to get your picture taken with Ash only to post it on Facebook for some lousy comments.
You don't have to see every single YashRaj movie in the theater and pay upwards of $10. Just wait for the original DVD and watch it for a dollar. Better yet, download it from sites like DesiRelease. With fast net connections even streaming videos are fun to watch on your flatscreen TV with a S-video cable or a HDMI output capable laptop. Get your English movies from RedBox and cancel your NetFlix subscription and stop watching movies that you don't have to.
Never go to a club and pay cover! Only pick clubs/lounges where you don't have to pay to get in. I mean what are you really paying for? AC?? Music? Unless they have a special guest DJ or something don't pay to get in. Always get on the guest list and sign up for emails from all the major clubs that you go to. Never keep the tab open and pay the bar tender with Cash. Its easy to lose more money on drinks when you are drunk and the tab is open

Disclaimer: This is an original post; Please try to link to it as opposed to copy it and present it as your own. Also, this post is only for those trying to save money. If you are loaded, then sure ignore this post and please spend however you feel like.

Joke of the Week - The Jewish and Chinese Pilots

2009-09-15T17:24:00.002-04:00

A plane leaves Los Angeles airport under the control of a Jewish captain.

His copilot is Chinese. It's the first time they've flown together, and an awkward silence between the two seems to indicate a mutual dislike.
Once they reach cruising altitude, the Jewish captain activates the auto-pilot, leans back in his seat, and mutters, 'I don't like Chinese.'

'No like Chinese?' asks the copilot, '....why not?'

'You people bombed Pearl Harbor, that's why !'

'No, no,' the co-pilot protests, 'Chinese not bomb Peahl Hahbah! That Japanese, not Chinese.'

'Japanese, Chinese, Vietnamese... doesn't matter, you're all alike!'

There's a few minutes of silence.

'I no like Jews either!' the copilot suddenly announces.

'Oh yeah, why not?' asks the captain.

'Jews sink Titanic.'

'What? That's insane! Jews didn't sink the Titanic!' exclaims the captain, 'It was an iceberg!'

'Iceberg, Goldberg, Greenberg, Rosenberg ...no mattah... all same.'

Save on GYM membership (any gym) - GlobalFit

2009-09-01T12:08:00.007-04:00

GlobalFit gives you upto 65% discount on gym memberships without any long term contracts. They also give you a multi club option, ability to change clubs as you wish or cancel your membership easily. They have Curves, Gold's, Bally's, Sport & Health and many more clubs. I did a price comparison with the best price my club was giving me and they were able to beat it by 35% without a committment. You will need to Qualify first which you can do that through your employer or your health insurer like CIGNA or Carefirst. Check your eligibility first and get rates by going here.

Never pay retail prices and dont get sucked into high pressure sales pitch by good looking women with bigger biceps than yours or hunky guys with shrunk tshirts about committment to a workout and how its money spent on your health and all that other BS.

Special: Save $5 on your membership dues by calling GlobalFit and giving them this unique code: HMBHJI86NF2

Save at RedRoof Inn

2009-08-31T17:35:00.007-04:00

You are tired, your eyes hurt, you have exhausted the music collection on your IPOD and your galpal has run out of stories and your back hurts. PULL OVER.

Save 15-20% at RED-Roof Inn by using the promo code 544469. You can book online using ur IPhone or simply call 800-RED-ROOF and give the operator the promo code over the phone with your location and he/she should be able to get you a super discounted rate. Offer valid for 2009.

Check entire listing of discounts (Visa) or AMEX Listing.

Unlimited Calls to India - $24.99 Vonage

2009-08-21T13:47:00.004-04:00

Vonage Holdings is adding unlimited free calls to countries including India, Mexico and China, plus speech-to-text conversion of voicemail, to its fixed-line VoIP (voice over Internet protocol) service. Vonage will let subscribers call more than 60 countries and territories as part of a flat-rate calling plan called Vonage World, priced at US$24.99 per month. The countries include India, Brazil, South Korea, Canada and Australia, as well as several countries in Europe and other locations in Africa, Asia and Latin America. In more than a dozen of those countries, including India and China, calls to mobile phones are included. Alternatively, you can use Startec to call India for just 1.9 cents/min without a committment or prepayment.

Unlimited India - Vonage Plan

Free Car Repair Estimate

2009-08-17T14:17:00.008-04:00

This new site called Repair Pal gives you a free estimate on how much it would cost to repair your car. Try it out!

If you get stranded on the road, do give their IPhone-App a try as well. If you have the time and don't mind getting your hands dirty, here is a quick guide to fixing your car yourself

Don't just pay the mechanic whatever mumbo jumbo he tells you. As always shop around, use online coupons from Midas, Mr Tire, TiresPlus AND your DEALER. Yes thats right..your dealer oftens has deals which are cheaper than these other shops! courtesy of MSN's Smart Spending Blog