It’s important to be alert to the fees you’re being charged for retirement accounts products such as IRAs and 401ks. Just a few tenths of a percentage point in fees can mean a difference of tens of thousands of dollars in retirement. You can test out other scenarios using our rollover calculator.

401k fees are notoriously difficult to find out and understand, because many of them are rolled into ‘program administration costs’. There’s talk of legislation that will require these fees to be more transparent.

The fees for your IRA account are easier to find out about, though no less complex.

There are two main categories of fees – fees charged by the IRA provider and fees charged by the funds/products you buy within the IRA. Remember, an IRA is like a shield. You can buy a mutual fund in an IRA, or in a regular taxable investment account, but the things you put within it have special tax status. So you’ll usually pay some fees for the shield (the IRA) and some fees for the investements themselves.

1) Fees charged by the IRA provider

Opening fees – The fee to open the IRA. Most discount brokerages don’t charge anything for this – after all, they want your business. If you’re opening an account at a brick and mortar institution, watch out for this one.

Annual fees - This is a fee for each year you have the account open. It might be 0, and if not it’s usually waived once your balance gets high enough – check with your provider.

Closing fees – If you move your IRA to a different provider, you’ll be charged a closing fee. Most brokers charge this – but check with your new provider, because they might reimburse you for the cost.

2) Fees charged for the funds within the IRA

Trade commissions – this is the charge to buy and sell things traded on a stock exchange. within the account. You’ll pay this each time you buy shares of a stock or exchange traded fund, but then you won’t have any ongoing charges. Some brokerages have different fees for different fund types.

Fund Load - this is the upfront cost of buying a mutual fund – like a sales commission. You can avoid this cost, which can be as high as 5%, by looking for ‘no load’ mutual funds.

Expense ratio - this is the annual cost of owning a particular mutual fund, expressed as a percentage. So a 1% expense ratio means that 1% of the fund assets are used for expenses. This cost is charged every year and can have a huge affect on your earnings, so try to keep it as low as possible – look for expense ratios of 0.5% or below.

The idea seemed smart at first – lose the land line for a cellular phone.

For years, I used my mobile phone for all my telephone needs, insisting it was a simple budgeting trick that would save me a few bucks. After all, nearly everyone else I knew was doing this. And then my bill started to climb higher and higher, well above what I would have paid for a monthly land line.

Recently, I began actually reading my cell phone bill and researching ways I could trim those costs. I realized that monthly statements are occasionally wrong when you read them line-by-line, that cell-phone companies often will negotiate charges on the bill, that I was paying for more coverage and add-ons than I needed and that I could make small changes in my usage to bring that bill even lower.

Some creative ways to help you trim your phone bill: Read More…

Happy 2010!

Did you know that gaining control of finances consistently ranks right next to “lose weight” on surveys of the most common New Year’s resolutions?

Something else weight loss goals and financial-health goals have in common: almost no one keeps them because reaching toward them sucks. It takes energy and commitment.

But, good news! There’s a simple, and dare I say it, almost fun way to create and stick to a budget. Envelope budgeting has presumably been around since the Great Depression , but it’s gained recent buzz as one of Dave Ramsey’s budgeting methods.

Here’s envelope budgeting at it’s simplest:

1. See how much you spend Keep a receipt or recording of every penny you spend for at least a month. Several months is better, because your numbers will be closer to average, and if you have a finance management account from Thrive or another service, you’ll really only need receipts for cash purchases as your card/check purchases can be tracked online. Add them all up (averaging if you have more than one month represented) and see if you’re spending more or less than you’re earning each month. Read More…

What if Tiny Tim was actually a perfectly healthy and mobile child, but his parents pimped him out as an endearing charity case?

What if Tiny Tim was actually a perfectly healthy and mobile child, but his parents pimped him out as an endearing charity case suffering from … I don’t know what (but here are some ideas)? No one could blame Ebenezer Scrooge for holding onto his money if he couldn’t even trust ol’ Bob!

Misuse of charitable funds isn’t the stuff of classics, but unfortunately it occasionally happens among the throngs of organizations collecting donations this season. It’s important to find out who you can trust when it comes to charities, because your time and money can make a difference in the right hands. Read More…

Do word problems and on-the-spot equations make you queasy? Maybe you’re otherwise very intelligent, but can’t seem to figure out whether it’s cheaper to buy two ½ gallons of milk or one whole gallon this week. My friends in education have told me that most students who hate math aren’t actually bad at it; they’re just visual learners.

Visual learners work best with concrete, tangible problems, so they have the hardest time with abstract concepts—making math pretty loathsome. I’m visually-oriented, and while other analytical feats come easily to me, my equations are usually frighteningly off due to the merciless journey they make through the cogs and shredders of the math-processing centers of my brain. Read More…

Did you know that Retail Therapy and Comfort Food have a lovechild?

Women have a reputation for using “retail therapy” after a hard day (or week, or year), and both sexes are known to use high-fat comfort foods to soothe the soul; but did you know that Retail Therapy and Comfort Food have a lovechild?

His name is Recession Obesity.

Recession Obesity is a phenomenon born of both the gratification and convenience of a new purchase, and of the quick mood-boost offered by fatty and sugary foods. Though many people blame their declining diet standards on healthy food becoming more expensive, Time Magazine and The Wall Street Journal have been documenting America’s changing purchasing habits, and waistlines, over the past year. Their findings are that junk food sales aren’t up primarily because they’re cheap, but because they feel good.

The recession has done some good things for our health (bike riding is up 14 percent from 2007); but they don’t outweigh (pun intended) the bad. McDonald’s sales, as well as those of  chips, donuts, beer and microwaveable meals rising. Read More…

If you even suspect you’re a victim of identity theft, it’s vital to go with your gut and start the investigation process today.Why the rush? Because cleaning up after an ID thief is, unfortunately, never a quick process and the amount of money you’re responsible for can grow if you delay.

Avg. cleanup time for ID theft: 81 hours

According to a survey by Nationwide Mutual Insurance in 2005, even after an average of 81 hours of fighting about 16 percent of victims end up being held responsible for some or all of the thief’s fraudulent charges, which average $4,000.

If you suspect identity theft

You may have been tipped off by a creditor calling you about an account you didn’t open, or received a card you didn’t apply for in the mail. Whatever made you suspicious, it’s important to keep a record of it.

1. Hang on the suspicious mail, or try to remember any details you can about a creditor’s call. Call back for details if you can. Access the most recent statements for all of your credit and bank accounts and check for unauthorized charges. Read More…

My friends and I joke that holiday shopping is more about buying fabulous presents for ourselves than buying for others. Sure, we set out with lists and budgets, but being so deep in the holiday sales makes it easy to stray.

Recession or no recession, impulse purchases are the bane of the financially frugal, especially when sleigh bells start jingling.

Impulse purchases represent what you want, while your shopping list or your budget represents what you need. Even when you budget your groceries for just a few items, extras manage to sneak into the cart. Read More…

Did you know Facebook, cell phones and new operating systems could all be used to steal your personal information?

Identity thieves are increasingly creative as changing technology allows them new tools to pilfer; but with a little awareness and some creativity of your own you can keep your private information out of sticky fingers.

New ID theft tactics

TMI on social networking sites Did you know that information posted on fan-sites helped a man steal Will Smith’s identity back in 2005? The sites had seemingly innocuous tidbits like his legal name and date of birth.

What you can do Learn from Big Willie: tidbits like nicknames and pets’ names (if you use them as part of your passwords), addresses, phone numbers and your date-of-birth shouldn’t be public on your Facebook or Myspace page. It’ll be hard going a whole birthday without practical strangers wishing you a good one, but it’s a small price to pay to reduce your risk of ID theft.

Zero Day attacks Commonly written “0-day,” these babies are hackers’ ways of showing the big software companies how much more awesome they are, even without girlfriends. What happens is new software (like an operating system) falls into to hands of a hacker with something to prove, and he or she finds and exploits vulnerabilities to wreak havoc— and sometimes steal information from users’ files. Older Web browsers also occasionally fall prey to 0-day type attacks.

What you can do Keeping your Web browser (Internet Explorer, Firefox, etc.) updated is helpful, as some of the browser-based attacks are launched in countries like China, where the newest versions are not common. It is also best to wait a few months to purchase a recently released operating system, such as the new Windows 7—which hasn’t had any reported 0-day attacks as of this writing. Why wait? Because when an attack reveals a weak spot, software engineers develop a patch to fix it, giving you a stronger product. Read More…

My husband, born in Kerala, India and raised in Dubai, remembers his parents participating in ‘kuri‘ clubs.

All the participants – mostly members of his extended family – would get together for a celebratory dinner.

During the evening, everyone would give their kuri contribution to the oldest brother, and a name would be drawn from all the contributors.

The winner of the draw received all the money contributed that week – they could pay off an interest-bearing loan, invest in their fledgling business, celebrate a wedding, or help pay their children’s school fees.

Then the next month it would happen all over again. Previous winners were removed from the drawing so everyone was guaranteed a share of the money at least once. And the whole group could make future plans, knowing a larger sum of money was headed their way in just a few months. Read More…