A couple hundred years ago, Benjamin Franklin’s advice to young tradesmen was “time is money.” He was referring to the time it takes to perfect a skill and the reward of investing in your business. This man’s words carry weight and wisdom considering a few of his job titles include author, politician and scientist. Are his words still relevant today? How true are they and how should we heed this advice as Christians?

No matter what our occupation we typically get out of it what we put into it. The longer we’re at our job the better we become and the more passionate we are the more time we’re willing to put in. Claude Monet didn’t spend fifteen minutes on Water Lilies and Harper Lee didn’t write How to Kill a Mockingbird in a week. Success isn’t accomplished without sweat, tears and a whole lot of invested time.

The American Dream

Christian or not, American society places an intense pressure on its citizens to work. The “American Dream” is life, liberty and the pursuit of happiness, but the pursuit of happiness has become an impossible goal to reach. The unspoken, difficult standard includes a great job that can afford a picket fence and provide for two and a half kids, but where is the time to fix the broken fence or spend with those two and a half kids when you’re pulling a 10-hour shift at the office?

Balancing work and family time seems to be the number one stress for American families. Almost daily we hear about couples divorcing because he was a “slave to his job” or she “loved her career more than our family.” We must work for the wellbeing of our family. So what are we to do? As Christians we need the right attitude and perspective on work.

The Parable of the Bags of Gold

The Parable of the Bags of Gold is in Matthew 25. It’s a parable about getting into the kingdom of heaven. The story consists of a man and his three servants. The man gave five bags of gold to one, two to another and one to the last. The first servant doubled his gold to to 10 bags. The servant with two bags gained another. But the last servant hid his bag because he was afraid. The last servant was deemed worthless and thrown into the darkness. He did not use what God gave him!

Work is not just to provide for our family, but to spread the love of Christ. When you know the gospel and you’re not interacting with anyone, you’re not being a good Christian. Work can be stressful and difficult, but our co-workers should notice there’s something different about us by how we handle those situations.

A Time for Everything

Genesis 2:2 says, “By the seventh day God had finished the work he had been doing; so on the seventh day he rested from all his work.” God made a beautiful universe in six days and set an example to rest. Pushing yourself too hard all the time burns you out. Remember to give yourself time for family and relaxation.

It often seems that gold only gathers national attention when it’s either setting a new record price, or going through a freefall. In recent weeks we’ve witnessed the freefall, and the media frenzy that accompanied it.

It often seems that their are two very distinct camps when it comes to gold. The first are the “gold bugs;” they’re the people who believe that gold is the best remedy for financial troubles of all kinds. The second group are the anti-gold crowd. They’re the type who feed on (and feed into) the slightest decline in the price of gold, and they seem to be especially prevalent in the financial media.

We’ve been treated to open warfare between the two camps in the last few weeks.

The Recent Gold Price Collapse

The gold bugs had their day in the sun – actually many of them – while the price of gold was steadily rising and setting new records for nearly a decade. But in mid-April 2013 the price of gold went into a sudden and spectacular fall. For the financial media and their attack dogs, this was their moment to shine!

What’s interesting is that if you follow the various explanations of the price collapse, you come away little more than confused. Cyprus was selling its gold. The economy is suddenly picking up, and investors are getting out of gold and into stocks. Interest rates might rise putting a damper on gold prices. A shadowy central bank or other financial institution is dumping gold on the market. The derivative trade is artificially suppressing the price.

Any of those explanations might have something to do with the collapse of gold, but there’s just as likely a chance that none of them had anything to do with it.

I don’t propose to explain why the price of gold fell so convincingly. But I do think that the event serves as a lesson for us all in regard to gold.

To say – as the anti-gold crowd does – that gold is “just another commodity” is a gross overstatement. Gold has been a monetary commodity all the way back to biblical times. Clearly there is something about gold that is special. But at the same time, to believe that everything is going to go to hell in a hand basket and only those who own gold will remain standing overstates the case in the other direction.

Gold is a Religion All by Itself

Once an investment becomes entrenched and successful (at least some of the time) it develops a following. Among the true “believers,” an investment can develop a group of followers who are so fanatical in their attachment to it that it borders on religion. This has certainly happened with gold, but the same can also be said of real estate and the stock market. As human beings, we are prone to fashion false idols.

But the collapse of the price of gold – in addition to the collapse of real estate prices and two stock market crashes since the turn-of-the-century – should rightfully leave us curious of any religious type infatuation that we will have with any investment.

Gold as Part of a Balanced Strategy

I don’t mean to bash the gold crowd – as mentioned in the last section, real estate and the stock market have their own cast of religious zealots. But the recent collapse should provide a solid reason to avoid putting too much faith in gold, or any other investment for that matter.

There’s no doubt that the economy of the U.S., and the rest of the world for that matter, looks more vulnerable than it has at any time at least since the 1930s. But the one thing none of us can afford to do is to load up on a single investment, and think that that will get us through the crisis that may be before us.

Personally, I’m sympathetic with the gold crowd. Gold has the advantage of being portable, barter-able, and ultimately less subject to government manipulation than paper assets. And its 5000+ year track record simply cannot be matched by any other investment. Fair enough.

But the world and its problems are far too complicated to be solved by holding enough of a certain investment. To load up on gold carries the unspoken assumption that you know how the future will play out. That’s either fortune-telling or a form of insanity! None of us know what will happen in the future, let alone the details along the way.

The only way to have a reasonable chance of being properly prepared is through balance. You can hold some gold – but you should also have some cash, silver, certain types of stocks and U.S. Treasury securities.

And while we’re at it, it’s equally important to consider your occupation going into the future, where you live, how much money you need to survive, and the amount of debt that you have. To be truly prepared, you have to look at all sides of your economic and financial survival.

Why We’re Unlikely to Go Back to a Gold Standard

There is one area where I completely part company with the gold crowd, and that’s the belief that we’re going to be going back to some sort of gold standard in the future.

While anything is possible, when you consider the size of the world’s population, and the obligations that major governments have taken on (and that the public demands), there simply isn’t enough gold in the world to accommodate that level of public spending and worldwide economic activity.

If a gold standard is ever resumed, my guess is that it will be for only a short time. But that’s just my opinion, and I certainly have no crystal ball.

The Only Real Security We Have

Ultimately, the reliance on gold and on other investments is about creating security. But while investments can help us to weather some of the storms of life, they cannot insulate us from the world’s troubles. The only way we can achieve true security is through faith in our Savior, Jesus Christ.

Some trust in chariots and some in horses, but we trust in the name of the Lord our God. – Psalm 20:7 NIV

Prepare for a rainy day, certainly, but if the world’s financial system and economy get so bad that we’ll need lots of gold (and guns, ammunition, and canned food, or whatever), we’ll need our Savior more than any single commodity or collection of them.

What are your thoughts on gold and global instability? Leave a comment!

To early retire by the time you’re 50 or 55 is quite a job. But to retire early in 10 years – that’s a much bigger job. Most people expect early retirement to come as a result of early retirement planning. So if you want to retire by the time you’re 50, and you’re 25 now, you’ve got a full quarter of a century to prepare for it.

But let’s say that you want to retire 10 years from today – no matter what your age – is that even possible? It is, but you’ll have to rearrange your life in ways that most people are not willing to do.

1. Commit yourself completely to the task at hand.

In order for you to retire in 10 years you’ll have to build your entire financial plan – and even your entire life – around the goal. While other people are enjoying life, you’ll have to be fully committed to a decade of self-denial. If you are not, don’t even bother to take this effort on.

As an alternative, you can choose a longer timeframe to achieve your goal. But to do it in 10 years will require some serious sacrifice. You’ll need to be ready for that.

2. Don’t have a family, but if you do – plan to retire in 20 years.

If you are serious about retirement in 10 years, don’t even plan on having a family. That sounds cold I know, but with a family comes greater financial obligations. You’ll have to maintain a larger home, a larger car, more money for food and clothing, and funding for future college education – at a minimum. All of that will eat into your retirement goal.

If you have a family, or plan to have one within the 10-year timeframe, you’ll almost certainly need to extend your retirement goal to at least 20 years. Early retirement is a juggling act; with a family you’ll just have too many balls in the air to make it happen.

3. Get the best job (or business) you can, and keep moving forward.

If you want to retire in 10 years, having a job that will be comfortable may not do it for you. You’ll have to be in a job or business that will enable you to make the most money that you possibly can. That means you want one of those jobs or businesses where you will be working 80-100 hours per week. Unless you already have a substantial amount of money saved and invested, your primary job will be your main source of funding for your early retirement plan.

4. And then get a second job (or business).

If you can’t make enough money to fund your retirement goals with a single job or business, you’ll have to get another. That won’t mean getting a job pumping gas or flipping burgers, but a second job that pays something like a full-time hourly wage. Two incomes will get you there a lot faster than one will, if only because the second income will be entirely for savings.

5. Learn to live on next to nothing.

There are two purposes for the extreme frugality:

• Keeping spending bare-bones so that you’ll have more money to save for retirement, and
• learning to live at a minimal level so that you will have less need for income when you retire.

The basic rule is that the less you need to live on, the more you will have for savings and investments, and the quicker you’ll be able to retire. That might mean living in a rented room, commuting by public transportation, and eating peanut butter and jelly sandwiches three times a day.

6. Save 50% or more of your income.

Now we get to where the high income and the low living expenses meet for a common agenda. You are maximizing your income and minimizing your expenses so that you can save and invest the most money that you possibly can.

If you are serious about retirement in 10 years, you’ll need to save at least 50% of your after-tax income. What we’re talking about here is putting away a serious amount of money each and every year for the next 10 years.

7. Invest aggressively.

If you want to retire in a decade you will not have the luxury of investing your money conservatively. Your investment portfolio will have to be heavily skewed in favor of high risk/high reward investment vehicles. That will mean investing in stocks, and largely in the most aggressive ones at that.

How aggressively?

Let’s say that you are 25 years old and earning $75,000 from all sources. Your after-tax income is $60,000, of which you are saving 50%, or $30,000 per year.

You decide you need to have $500,000 by the time you’re 35 in order to retire early.

In order to reach your goal of retirement 10 years – at age 35 – you’ll need a rate of return on investment of roughly 12% per year. It will take some pretty aggressive investing to achieve that return over 10 years, and you better hope that there isn’t market crash along the way.

That will most likely see you investing your money in the highest risk stocks available, such as aggressive growth stocks and a very healthy mix of emerging markets stocks. Unfortunately, the time value of money isn’t nearly as strong over short periods of time as it is over nearly a lifetime.

8. Stay out of debt.

If you want to save, invest, and retire in 10 years, you absolutely positively must avoid debt at all costs. Not only will debt payments reduce the amount of money that you have to put toward savings and investments, but it can also leave you walking into retirement and still carrying some past obligations. And, make sure you get out of debt as soon as possible (perhaps try ReadyForZero).

So there you have it – you probably can early retire in 10 years, as long as you fully commit to the plan. That will mean becoming single-minded, and excluding nearly any other goal that you have for your life – at least until you finally retire.

Will be worth it? That’s a personal decision . . . .

Would you be willing to commit to this level of sacrifice if it meant that you would be able to retire is little as 10 years? Leave a comment and let us know!

If you have children, you probably spend some time worrying how they will be provided for in the event of your death. You no doubt have life insurance and financial assets that they will inherit that will help provide for their care until they are adults. But one overlooked resource is Social Security benefits for children of deceased parents. This will provide a monthly income for the children – or more specifically for their caretakers – to cover ongoing expenses.

With that in mind, you may be able to move your financial assets and even the proceeds of your life insurance policies into trust funds that will be available to help your children once they reach age of majority. This will help to provide for a college education as well as money to get started early in life. From a financial standpoint at least, it will be as if you’re still around to help them.

But let’s take a closer look at those Social Security benefits . . . .

How do you become eligible?

Your children – including natural, adopted or dependent step children – are eligible as long as you and/or your spouse either worked long enough in a job where he or she paid Social Security taxes (10 year minimum), or are already collecting benefits due to being disabled or retired.

In addition, per the Social Security Administration (SSA) website:

• The child also must be unmarried.
• The child must be younger than age 18.
• 18-19 years old and a full-time student but no higher than grade 12.
• 18 or older and disabled, and the disability must have started before age 22.

SSA will require certain documents when applying for benefits for your child(ren). Here is at least a partial list of the requirements:

• Your child’s birth certificate.
• Your and your spouse’s Social Security numbers.
• For survivors benefits, proof of the parents death.
• For disability benefits, medical evidence to prove the disability.
• Other documentation as required.

How long do benefits continue?

As a general rule, benefits stop when a child reaches the age of 18, but there are exceptions.

One such exception is when the child is a student, though this does not extend to college enrollment. Benefits will continue only as long as the child is a full-time student at either a high school or an elementary school. Upon turning 18, the child will have to complete a statement of attendance, certified by the school. The benefits will end either upon high school graduation, or upon reaching the age of 19 years and two months, whichever comes first.

Disability of the child is another exception, and if that is the case benefits will continue past age 18.

Benefits for Caring for a Child

If you are caring for a child who is receiving Social Security benefits, those benefits will end when the child turns 16 – unless the child is disabled. Benefits can continue past age 16 if you “exercise parental control and responsibility for a mentally disabled child or perform personal services where child was physically disabled.”

This disability status must be established before the child reaches 16. The Social Security Administration will notify you of the termination of benefits prior to the child turning 16, at which point you’ll have to begin picking application for continuation based upon disability.

The Amount of the Monthly Benefit

If you will be relying upon Social Security for at least part of the cost of care for your children, is important to know how much that monthly benefit will be.

A child may receive a benefit of up to one half of the parent’s retirement or disability benefit, or 75% of the deceased parents’ basic Social Security benefit. The Social Security Administration allows you to estimate your benefits on their website. You can calculate your benefit to help you to get at least a rough idea as to how much you can expect your own retirement benefit to be, as well as the benefit to your children in the event of your death.

The maximum benefit per family is limited to between 150% and 180% of the parents’ full benefit amount. Should the monthly benefit exceed this calculation for any reason, the amount of benefit paid for your children will be reduced proportionally to stay within limit. This may become an issue if there are more than two children who will be dependent upon Social Security benefits in the event of your death.

If you would like to learn more about Social Security benefits for your children upon your death, you can go to the Social Security website.

It’s been approximately five years since I last owned a credit card. Looking back over that time, do I now regret the decision to ditch credit? Not in the least. In fact, rejecting credit cards was probably one of the best financial moves I ever made. I know, I know, that’s a bold statement. But stick with me, and I’ll explain why – it’s for more reasons than you think.

My Position on Credit Cards

Obviously, I don’t personally use them. If you do, I’ll still be your friend – I promise.

The main reason I don’t use credit cards is because of their intended purpose: to lure me into debt. Sure, I could probably “beat the system” and get some nice cash back rewards. But remember, credit card companies aren’t in the game to help you out, they’re in the game to take your money.

Honestly, I don’t think there’s anything morally wrong with using a credit card, or even issuing them to customers, but it’s just not for me. I have an alternative budgeting system set up that allows me to bypass the use of credit cards and still earn some pretty sweet rewards (thanks PerkStreet).

I should mention that if I was in a pinch, and didn’t have my emergency fund, I might turn to credit cards. But other than that, I stay away from them. You might even want to switch to a different credit card to get a better interest rate if you’re in debt, but certainly don’t put more debt on them.

How Rejecting Credit Cards Improved My Finances

Okay, so this is the cool part. Still with me? Good.

Remember that I rejected credit cards because of their intended purpose (to lure me into debt), but over the past few years, I’ve noticed a few unintended but welcome consequences of my credit card boycott:

1. My income shot up.

Yeah, weird, right? I attribute a lot of my income increase to not having a credit card to fall back on. The mere absence of credit cards causes me to continually realize that in order to stick to my plan and pay cash for everything, I’ll have to get my income up.

In other words, I’ll have to actually live beneath my means, something many of those with credit cards seem to have a hard time doing. And because we’re living on what I’d consider to be a tight budget, that only leaves one side of the equation to work on: my income.

2. I got out of debt.

Except for my mortgage, that is – but that’ll come later . . . .

Still, this is a nice little achievement, and again, gaining a distaste for credit helped me blast debt out of the water.

3. I built an emergency fund.

Not having lines of credit to depend on forced me to create an emergency fund. What if something happened and we needed money? Turning to credit cards would break our debt-free streak, so I built an emergency fund.

I should mention that all of these things I did together with my wife, who played an awesome and major role in reaching our goals. Without her, it wouldn’t have happened. Even though I wrote this article with “I’s,” it was the “We’s” that really won the day. (Thanks honey! We make a great team!)

What About You?

So, what about you? Are you using credit cards and feel the itch to get out of a cycle of debt?

Start by destroying your credit cards. Then, consider opening a PerkStreet account to get some cash back on your debit card purchases.

You can do it. If you’re a bit extreme, like I am, you have what it takes to live without credit. Try it out . . . you can always go back to the credit cards if you miss them.

Are you living without credit cards? If not, how do you use credit cards? Have you always been responsible with credit cards? Leave a comment!

A house becomes a home when the atmosphere within it reflects the personality of the family living there. High-priced art and decorations made by a manufacturer can be nice, but they tend to be stiff because they don’t represent the family that looks at them every day.

The wedding, vacation and baby pictures hanging on the walls are examples of unique decorations the can only be found in your home. There might be a scratch on the couch from the family cat or an ever-growing toy corner in the family room. Furniture and decorations in our homes should be an extension of our lives. These personalized DIY craft projects will add charm to your home and will not be found anywhere else.

Want to save some money on supplies? Try shopping online through Ebates!

1. Canvas Art

You’ll need:

• 16 x 20 inch canvas (5 for $25)
• Two 2 fl oz bottles of acrylic paint (69 cents each)
• X-acto knife ($4)
• Blue tape ($4)
• Regular printer paper
• Foam brush ($1)

Step 1: Choose a favorite quote and type it into a word document on your computer.

Step 2: Select the size and font of your quote. Print it out.

Step 3: Using the x-acto knife, cut along the outline of the letters to create a stencil. Use a plastic backing like a cutting board or binder that will hold up to the sharpness of the x-acto knife blade.

Step 4: Paint the canvas your selected background color using the foam brush. Apply two coats and let dry. Rinse your foam brush clean and let dry.

Step 5: Arrange the stencils you have created on the dry canvas in how you wish the letters to appear. Tape down the edges of the stencil.

Step 6: Slowly begin filling in the letters with the other paint color you’ve chosen. Apply two coats and let dry.

Step 7: Remove the blue tape and slowly remove the stencils. Use the x-acto knife to remove any paper that has dried to the canvas.

Step 8: Hang up anywhere in your home and look at what a great job you did! The 5-pack of canvases is the best deal because then you can make more for friends and loved ones or use a different quote for somewhere else in your home.

2. Mason Jar Candle

You’ll need:

• Mod Podge ($5)
• Foam brush (69 cents)
• Paper lace doilies ($4 for 100)
• Tea lights ($6 for 50)
• Mason jars ($1.50 each).

Step 1: Make sure the mason jar is clean and dry.

Step 2: Apply the lace doily with Mod Podge using your foam brush. Experiment with different colors and sizes of doilies if you like. Allow Mod Podge to dry.

Step 3: Place a tea light in the bottom of the mason jar. Place anywhere in your home and light the tea light to enjoy the romantic atmosphere.

Flameless tea lights look just as great as the real ones and prolong the life of your mason jars. These are perfect decor for summer evenings or late dinners.

3. Coffee Table Scrapbook

You’ll need:

• Blank scrapbook ($12)
• Printed photos (17 cents each)
• Scissors
• Glue

Step 1: Remove the scrapbook book sheets from the book’s protective film.

Step 2: Begin arranging pictures, any special mementos (movie tickets, cards, etc.) and stickers to your liking. You can use stamps, cut-outs or stickers if you’d like. This is the best kind of craft project because there are no rules. You can choose to tell the story of your family, use one specific vacation, or simply use your favorite photos from the past year or two. Use both the front and back of the scrapbook page.

Step 3: Allow the glue to dry if needed before placing the page back into the protective film of the scrapbook.

Step 4: Set on your coffee table or end table so guests can enjoy your work! A homemade scrapbook is less expensive than a digital scrapbook and has an imperfect, cozy feel that the perfectly-made digital copy can’t give you.

If you’ve been intimidated by the skill of crafting, these are the DIY projects to start with. They’re inexpensive, easy and fool-proof. Consider them for any kind of gift, too! Any mistakes you make will simply add to the charm of the finished product. Enjoy!

What are some other DIY projects you can do for your home? Leave a comment!

With its big, beautiful retina display screen and long battery life, your iPad is practically begging you to use it to watch your favorite movies and TV shows. Here are some easy ways to rent or buy movies on your iPad via download and/or online streaming access. And yes, some are even free!

5 Ways to Rent or Buy Movies on Your iPad

1. iTunes Store

Of course, we begin with the iTunes Store, where you can rent or buy thousands of independent films and movies from the major Hollywood studios.

When you rent or purchase a movie in iTunes, it is stored in the cloud so you can watch it on your iPad, iPod, iPhone, and Mac or Windows computer. Each device remembers where you stopped watching and picks up where you left off. And if you’ve already downloaded previously purchased movies, you can send them to all your devices through iCloud – regardless of which device you used to buy them.

It’s easy to browse the iTunes Store for movies to rent or buy. The average purchase price is in the $14.99 – $19.99 range, and rentals start as low as 99 cents but most are $3.99 to $4.99 to $5.99 range.

Once you make your selection, your movie will begin to download immediately. Movies you purchase are saved in the cloud forever and can be downloaded to whatever devices you want.

For movies you rent, you have 30 days from the time of rental to watch your movie, and 24 hours (in the US) or 48 hours (elsewhere) after you’ve started viewing to finish it. When the rental period expires, the movie will disappear from your iTunes library.

2. Netflix

Netflix is a subscription-based service that allows you to stream unlimited movies (and tv shows) anytime anywhere (on your TV, computer, phone or tablet that is connected to the Internet) for only $7.99 a month. To watch them on your iPad you’ll need to download the free Netflix app from the iTunes store first, then use the app to log into your Netflix account. If you’re new to Netflix, you can give it a try for one month for free!

3. Hulu Plus

Hulu Plus, like Netflix, offers unlimited online streaming only $7.99 a month, and the Hulu Plus app allows you to watch movies and shows on your iPad.

However, there are two key differences between Hulu Plus and Netflix. First, Hulu Plus shows commercials, and Netflix does not. Second, Hulu Plus focuses more on the latest, most popular TV shows while Netflix focuses more on the latest, most popular movies. Yes, Hulu Plus does offer hundreds of movies, but I couldn’t find one that I was familiar with.

4. Crackle

Crackle, by Sony, streams a select number of movies and TV shows to your iPad for free via the Crackle app which you can download from the iTunes Store. And because Crackle is free, the app is ad-supported, so brace yourself for pop-up ads and commercials.

According to their site, “Crackle specializes in hand-picked movies, TV shows and original programming in guys’ favorite genres – like action, sci-fi, horror, crime and comedy.” If you have kids, there are unfortunately only three movies in Crackle’s “Family” category.

5. Amazon

Amazon offers an amazing collection of 140,000 tv shows and movies that you can watch on your iPad via the Amazon Instant Video app. You can shop for videos that you’d like to rent or purchase at the Amazon Instant Video Store (on your computer or via the mobile app).

Movie rental prices are around $1.99 for 24 hours, and up to $4.99 for 48 hours.  You can buy most TV episodes for around $1.99 each.

To watch Amazon movies and shows on your iPad, simply download the Amazon Instant Video app and either stream movies live or download purchased or rented movies to watch later.

But wait, there’s more . . . .

If you’re an Amazon Prime member, you have unlimited access to over 35,000 Prime Instant videos (including both TV shows and movies), which can be streamed (not downloaded) to your iPad at no extra charge!

Prime membership costs $79 per year, and includes, in addition to the free videos, free two-day shipping on purchases and Kindle books to borrow for free from the Kindle Owners’ Lending Library. If you’re not currently an Amazon Prime member, you can get started today with a 30-day free trial!

Thanks to the iPad and the Internet, it’s never been easier to watch streaming or downloaded movies and TV shows wherever and whenever you want: in the car, on the plane or train, at the gym, at the park, in bed, or just about any other place you can think of.

What’s your favorite way to buy or rent movies for your iPad? Leave a comment!

One feature that makes the Roth IRA stand out from most traditional retirement accounts (such as a Traditional IRA, most 401ks, 403b, traditional pension plans, etc) is the fact that you pay with after tax dollars. In other words, you do not receive a tax deduction for your contributions and technically, this means that you are paying taxes before you even decide how to invest your money!

Even though this can be seen as a negative feature, there are several advantages to choosing a Roth IRA (a couple are even direct consequences of being taxed upfront)!

1. Tax-Free Growth

Normally, when you open an investment account you have to pay taxes on your gains. So if you buy a stock and then a dividend is paid or you decide to sell, you will have to pay capital gains taxes on this amount.

In contrast, once you fund your Roth IRA account, you don’t have to worry about paying taxes at the end of the year when you have a gain. This goes for all capital gains, dividends, coupon payments, or any other gain that you experience during the year.

So if you are looking to invest your money for the future, it pays to use a retirement account such as a Roth IRA so that you can take nearly full advantage of compound interest.

Of course, this advantage is also shared by a Traditional IRA, so now we will consider what makes the Roth IRA stand out even when compared to a Traditional.

2. Tax-Free Withdrawals

For most people, this is the biggest advantage to a Roth IRA. The fact that you do not get to take a tax deduction on your contributions allows you to legally avoid paying taxes when you take a qualified withdrawal from the account!

What this means is once you put money into a Roth IRA, you will never have to worry about paying taxes on that money (as long as you satisfy the requirements).

You have to wait until you are at least 59 1/2 years old before taking a distribution from your account (with one exception which we will discuss below), but if you do that, then you are in the clear.

The really great advantage to a Roth IRA is that this rule not only applies to the money that you contribute, but also to any gains on your investments over the years! So if you follow the rules, you only pay taxes when you contribute to the account, and you will never have to worry about uncle Sam again!

3. You Can Withdraw Your Contributions at Any Time

Another great thing about a Roth IRA is that you can withdraw your contributions at any time, even if you are under 59 1/2 years old. The only stipulation to this is that your Roth IRA must have been open for at least 5 years. After that point, your contributions are free for you to withdraw without penalty.

Of course, since it is a retirement account, you should use caution before deciding to withdraw your contributions; but the fact that you have that option available is enough to tip the scales in favor of the Roth for many people.

So the bottom line is that you will never pay any taxes on any growth or earnings that your IRA fund will generate after turning 59 and a half, and if you run into an emergency, you can even withdraw your contributions without penalty.

4. No Mandatory Distributions

With a Traditional IRA you are forced to start taking annual distributions once you hit age 70. So even if you don’t need the money or your investments tanked in the short term, the IRS will make you start taking distributions.

Fortunately, with a Roth IRA, there are no required minimum distributions, and no taxes assessed for failing to make withdrawals – since the initial contributions were already taxed.

This is a huge advantage for those worried about preserving their wealth even in retirement (especially considering the fact that those forced distributions from your traditional account will be taxed).

5. No Age Limit on Contributions

Another thing to consider with Roth IRAs is that you can make contributions to the account even after you turn 70 1/2 (something which you cannot do with a traditional account). So at the time that you would have been forced to start taking distributions from your Traditional account, you can still make contributions to your Roth!

On top of this, you are also able to leave amounts in your Roth IRA for as long as you live.

By the way, if you want to open up an easy Roth IRA, try Betterment (see review).

Can you think of any other advantages to a Roth IRA? Do you view any of these as a disadvantage? If so, why? Leave a comment!

IRAs aren’t just for retirement anymore. You can use proceeds from your IRA to cover a wide range of specific expenses, and the dreaded 10% early withdrawal penalty will not apply. You will still have to pay the regular income tax on the distribution in most cases, but since you most likely got a deduction as a result of the contribution, this is only fair.

Here are some of the more common early withdrawal penalty exemptions for IRAs.

1. Withdrawals made after you turn 59 ½.

Withdrawals taken from an IRA after you turn 59 ½ are not subject to the 10% early withdrawal penalty. For Roth IRAs, there is an additional requirement that the account must have been in existence for at least five years prior to the withdrawal.

All other exemptions listed below will enable you to withdraw money from your IRA penalty-free even before turning 59 ½.

2. Annuity distributions.

You can take distributions penalty free if they are made as part of an annuity, even if you have not turned 59 1/2. The payments must be distributed in equal annual amounts, based on your life expectancy.

The annuity calculation must be based on an IRS-approved distribution method and requires distributions to be made annually.

3. Distributions under divorce or similar proceedings.

Distributions under a divorce or similar proceeding are also exempt from the 10% penalty. This is where there is an imbalance between the spouses’ respective retirement plans, and the court orders a distribution that will result in an equitable allocation of funds between the parties.

Distribution however must be rolled over into another IRA, and must have been made pursuant to a qualified domestic relations order. The order is typically a judgment, divorce decree, or property settlement agreement. Since the proceeds are rolled over into another retirement account, there is also no income tax levied on the distribution either.

4. Death of the plan owner.

If you, as the plan owner, die before turning 59 ½, your heirs will not be required to pay the 10% penalty tax on the distribution of your retirement plan proceeds.

5. Permanent disability.

The IRS defines permanent disability as the inability to “do any substantial gainful activity because of your physical or mental condition.” This claim must be backed by a physician who must indicate that your condition will either be of undetermined duration, or will ultimately result in death.

6. Un-reimbursed medical costs.

You can withdraw funds from your retirement plan penalty-free in order to cover the cost of un-reimbursed medical expenses to the degree that they exceed 7.5% of your adjusted gross income. That is to say that you will be able to make withdrawals penalty free up to the amount that you declare as deductible medical expenses on Schedule A of your individual income tax return.

The medical floor deduction percentage is set to increase to 10% for 2013 and subsequent years.

7. First time home buyers.

You can take withdrawals of up to $10,000 from your retirement plan penalty free for the purpose of buying a first time home under the following conditions (per the IRS):

1. It must be used to pay qualified acquisition costs before the close of the 120th day after the day you received it.
2. It must be used to pay qualified acquisition costs for the main home of a first-time homebuyer who is any of the following:
   *Yourself.
   *Your spouse.
   *Your or your spouse’s child.
   *Your or your spouse’s grandchild.
   *Your or your spouse’s parent or other ancestor.
3. When added to all your prior qualified first-time homebuyer distributions, if any, total qualifying distributions cannot be more than $10,000.

8. College costs.

According to the IRS, you can withdraw funds from a retirement plan penalty-free as long as:

“Qualified higher education expenses are tuition, fees, books, supplies, and equipment required for the enrollment or attendance of a student at an eligible educational institution. They also include expenses for special needs services incurred by or for special needs students in connection with their enrollment or attendance. In addition, if the individual is at least a half-time student, room and board are qualified higher education expenses.”

9. Unemployed medical insurance premiums

You are exempt from the penalty if you use the proceeds to purchase medical insurance in any year in which you are unemployed. This includes medical insurance purchased for you, your spouse, and your dependents. You are exempt if all of the following apply:

• You lost your job.
• You received unemployment compensation paid under any federal or state law for 12 consecutive weeks because you lost your job.
• You receive the distributions during either the year you received the unemployment compensation or the following year.
• You receive the distributions no later than 60 days after you have been re-employed.

Have you ever withdrawn money from an IRA account for any of the above purposes? Leave a comment!

(Source: IRS Publication 590 )

Have you ever heard a great bargain story and wish you had one of your own? Susie found a three hundred dollar designer handbag at Goodwill and bought it for twelve dollars. Jackson bought a new set of golf clubs for twenty bucks at the local secondhand shop.

Maybe you’ve tried thrift shopping before and had a bad experience or didn’t find anything you wanted. If you’ve never gone thrift shopping, stepping into a thrift store can be intimidating. You could become overwhelmed by the amount of inventory or fear the horror stories about secondhand clothing. These tips can make you more confident in finding your treasure for a great price that fits your budget.

1. Take your time.

Going thrift shopping isn’t something you should do on your lunch break. Give yourself a large chunk of time to browse and sort through everything. Go in a full circle and work your way into the middle of the store. Thrift shopping can be an opportunity to take some time for yourself and slow down. Be patient, and you will be rewarded.

Also take the time to find the best thrift store in your town. Look for cleanliness, organization and appeal. If the style of the store doesn’t match your taste the chances are you won’t buy anything from there. Some stores acquire more items than others like furniture, home decor or electronics. Research the stores in your area and visit according to which item you’re most interested in.

2. Be willing to put in the extra effort.

Some items you’re interested in might need a little TLC. A shirt might need a couple stitches on the seam or a watch might need a new battery. In most cases you’ll still come out ahead financially if you buy it as is and repair later. Shoes may need some shining or jewelry might need washing. Furniture is a great project to acquire. A coat of paint can make it look brand new and you’ll avoid spending money unnecessarily for an overpriced piece of new furniture.

3. Check regularly.

Thrift stores receive new inventory every day. Stopping in regularly increases your chances of scoring a bargain. Premium denim, designer handbags and other brand name items don’t last for long. Becoming familiar with the layout of the store can also make it easier to spot the good stuff when it does come in.

4. Negotiate down the price.

If you’re interested in an item but think it’s overpriced, most thrift shops will adjust the price for you. Your chances increase for a discount if the item is defective in some way like a hole, a stain or a scratch. If you frequent a local thrift shop the staff will get to know you and may give you a discount for being a regular customer. There can be so many items in a store under so many inventory categories that the employees might not know what it’s worth. If you could get a great bargain over a good bargain why not give it a try? The worst case scenario is no discount given and you still walk away with a bargain.

5. Be aggressive.

Regardless of the store’s size, shoppers are going to be aggressive in their shopping. There’s only one of every item and at a great price. Pick up any item you’re even thinking about getting and put it in your basket. It’s better to pick it up and put it back later, then have it gone when you’ve decided you want it.

Thrift shopping can be relaxing when you go by yourself, but it can be a lot of fun when you take a friend who knows your taste. You can divide and conquer all of the goodies at once and have some fun with the crazy items you find along the way. Who wouldn’t want a fuzzy pair of mouse ears? The deals you find using these tips will give you your bargain story. When someone asks you if you heard about the person that bought a $10 flat screen you can say, “That was me.”

Have you been thrift shopping? What kind of deals have you encountered? Leave a comment!