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What Is a 401k?

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A 401k plan is typically offered through your employer. You will be able to make a contribution to your plan from your paycheck. This contribution can be made either before taxes or after taxes, depending on the options offered through your plan. In some cases, your employer will match a portion of your contribution.

Once you have a good amount of money saved, you can roll your 401k into a Gold IRA, Traditional IRA, or a Roth IRA. This can give you a bigger pay out when you retire.

Most people make it their number one priority to save for their retirement. With the way the country is today, by the time many adults reach the age of retirement, there may be no Social Security left; therefore, it is important to start saving for your retirement on you own. The best way to save the money that you need is through a 401k plan.

What are the Benefits of Having a 401k Plan?

There are several advantages to using a 401k plan to save for your retirement.

Matching contribution:

When you set up a 401k plan through your employer, most will match a portion of your contribution. One of the most common matches employers make is 50 percent of the first 6 percent of the money which you have saved. By not taking advantage of your 401k plan, you are basically giving up free money.

Tax advantages:

If your employer does not offer matching contributions, there are tax advantages which make having a 401k plan worthwhile. When you contribute a portion of your salary to your plan, you will be paying less money in taxes. This is because when your money goes into your 401k, it is taken before taxes have been deducted. This makes your taxable income lower, which benefits you greatly.

Loans:

One huge advantage of having a 401k plan, is that you can borrow from your account. You can borrow from your plan to purchase a new home, to pay for your education, to cover medical expenses, or if you are experiencing serious financial hardship. Most plans require that you repay your loan within 5 years with interest.

If you have borrow against your 401k to purchase a new home, you will have more than 5 years to repay your loan. All the interest that you pay, goes right into your account. This makes borrowing from your 401k better than getting a traditional bank loan.

When you have a bank loan, you will be required to pay interest to the lender. The only stipulation of borrowing against your 401k loan is that you must remain employed by your company until the loan is paid off.

Investment opportunities:

Most plans offer a variety of investment opportunities where you can do a 401k rollover. When you do a 401k rollover, you can invest in money mutual funds, bond mutual funds, stock mutual funds, or your own company’s stock. You can do a 401k rollover, and invest in a Gold IRA, Traditional IRA, or a Roth IRA.

What are the Steps to Convert a 401k into a Gold IRA Through a 401k Rollover?

Many people choose to convert their 401k plan into an IRA plan, because it will protect their savings against market loss. The process of converting your 401k to a Gold IRA is very easy and straightforward. It can be very beneficial for you to consider rolling your 401k into a Gold IRA rollover.

1. Make sure that your particular plan is eligible for a 401k rollover. If you are no longer working for your employer, or you are older than 59 years and 6 months, you should be eligible for the 401k rollover without any issues.

2. If you want to have the same tax benefits that you would with any other government approved retirement account, you should set up a precious metals IRA Account.

3. You need to decide how much of your plan you want to invest in gold. You can invest all of it if you wish; or you can diversify. You can do this by investing only part of your 401k in gold, and the rest in other investments.

4. In order to have your 401k transferred into your name from the 401k plan administrator to the IRA administrator, you would need to sign paperwork to liquidate funds from your 401k and transfer them to your Gold IRA rollover account.

5. To finalize your investment, you need to decide which type of gold you want to invest in. Some people choose to invest in gold coins, others invest in gold bars.

6. Finally, ask your IRA agent to purchase gold at the current market price. After it has been purchased, it would be sent for secure storage in a metal depository or a vault. At this point, your Gold IRA rollover is complete.

401k rollover into a Traditional IRA and or a Roth IRA

You will be eligible for a 401k rollover to a Traditional IRA or a Roth IRA once you have left your job. Some plans offer in-Service 401k distribution. This plan allows you to do a 401k rollover to a Traditional IRA or a Roth IRA while you are still working for your employer.

This makes investing in a Traditional IRA or a Roth IRA possible earlier. Doing a 401k rollover to a Roth IRA, a Traditional IRA, or a Gold IRA rollover will give you more security in the future. When you look into a 401k rollover to a gold rollover or a traditional IRA rollover, the worst thing that you can do is to cash out your plan first. This leads to huge tax penalties. What you should do, is use a trustee to trustee transfer, also known as a direct transfer.

This will make the Gold IRA rollover and the Traditional IRA rollover simple with no tax issues. If you do a 401k rollover to a Roth IRA, it will increase your taxable income. A Roth IRA rollover can also bump up your marginal tax rate into the next tax bracket.

This makes the Roth IRA less appealing than the Traditional IRA or the Gold IRA rollover. If you had to choose between the Traditional IRA and the Roth IRA, you should stick with the Traditional IRA. There are very few cases where a Roth IRA is the better option.

Why are Companies Getting Rid of Pension for 401k Plans?

Many companies these days are trying to get rid of employees’ pension for 401k plans. These employers no longer want to be obligated to sending monthly checks to employees. They just can’t afford them or they just don’t want the responsibility.

They are placing more of the responsibility on the employees for their own retirement savings and financial future. What several companies are doing these days, is offering employees a lump sum payment on their pension. When the offer is accepted, workers cannot go back on it.

I know a few people who have taken the lump sum option that their company offered. They turned their money over to a reputable investment company and they have regretted their decisions. Their money was invested in the stock market. With the turmoil of the market over the years, their lump sum retirement has vanished. So be very careful if you choose the “lump sum” option.

What are the Penalties for Early Money Withdrawal?

When you withdraw your money from your plan before you turn 59 years and 6 months old, your money will be taxed as ordinary income. Also, you could be subject to a 10 percent Federal tax penalty. If you leave your job when you turn 55, or a year later, you might not be subjected to the 10 percent early withdrawal penalty. It depends on your particular plan.

What are the Restrictions of a 401k loan to Yourself?

1. The IRS can set limits on how much money you can put into your 401k plan. This amount is adjusted each year due to inflation. When you turn 50 years old, the limit increases by $5,000.

2. You cannot defer more money to your 401k than you earn from your employer that year. If you have more than one job with a 401k, you can put money from each job into your 401k, as long as it does not exceed the annual limit.

3. The Internal Revenue Service caps the total annual additions of your 401k. This amount goes up each year for inflation.

When Can I Invest in My Plan?

You can invest in a 401k plan when you begin working for an employer who offers a 401k plan. Some employers allow you to sign up right away, while others require that you wait for the next enrollment date.

The sooner you begin investing in a 401k rollover plan, the more you will have to invest in a Gold IRA, a Traditional IRA, or a Roth IRA.

How Much Can I Invest in My Plan?

The IRS sets limits on how much money you can invest in your plan. As of 2014, you can invest a maximum of $17,500. If you are over 50 years old, you can contribute $23,000 provided you earned enough to make that contribution.

How Much Should I Invest in My 401k Plan?

Because of the excellent tax breaks that you are entitled to through your plan, you should invest the maximum allowed by the IRS.

If your financial situation does not allow you to invest the maximum, you should at least contribute enough so that you qualify for your company’s matching contribution. Each company is different.

You would need to contact your Human Resources Department to find out what that amount is. The more you invest, the more you will have to reinvest later in a Gold IRA, Traditional IRA, or Roth IRA.

In your retirement, you should know how much money you will need and where the money will come from to maintain a desired life style.

Who Administers My 401k Plan?

The person who administers your plan is the custodian. Your employer will appoint a custodian, who is usually an employee of the company. Companies can also hire an outside service to handle the custodial duties.

The custodian is responsible for operating your plan according to regulatory requirements. When it comes time to do a 401k rollover into a Traditional IRA or Roth IRA, if you choose to do so, you would need to find out from your custodian to whom you could speak in order to get the ball rolling.

Having a 401k plan is a great way to invest in your future. Before you invest in a 401k plan, it is a good idea to do as much research as possible (due dilligence) so that you make a wise investment.

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Source by Sam Williams

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Where to Find Those Efficient and Hardworking Affiliates?

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Everyone wants a hardworking affiliate, employee, associate, partner, or even spouse, and why not? It’s the next best thing to doing the work yourself. However with the massive outbreak of work and income opportunities available online, how can you beat everyone else and find that one (or more) ideal person who will make your online business explode with success? Here are some of the most ingenious and uncommon ways to snag the idea affiliates for your affiliate program

Direct Sales Agents

Direct sales people are really one of the most enterprising, hard-working individuals in business. They mostly work on commissions or rebates and are willing to literally go door-to-door offering their products to anyone and everyone they bump into. Imagine how much easier their job would be if they could be an affiliate and simply work via the Internet and a mobile device or desktop.

Also, most direct sales people tend to carry more than one brand in their product arsenal so signing up as an affiliate would be almost the same type of work but using a different approach.

Colleges and Universities

Many college kids would be interested in a part-time income opportunity if it would mean funds to help pay for their education, loan, or partying. All you have to do is make sure to offer them products they can endorse as a student.

Freelancers

Did you know that the U.S. Census Bureau’s latest annual report show that 75% of U.S. businesses used freelancers in 2011? Freelancers earned a whopping US$990 billion in 2011 which is a 4.1% increase from the previous year. The only industries where the number of freelancers decreased were in insurance, finance, and construction. Most probably your affiliate program isn’t a part of these 3 industries.

Furthermore, online business and finance experts are predicting the growth to increase incrementally every year even with an economy that is improving. People just want income security and more control over their earnings. With the spate of lay-offs, it’s understandable why many would prefer to work as an affiliate than as an employee.

Scout For Them At Affiliate Conventions

There are annual affiliate conventions held in different cities around the country. You should try to catch one when it is held somewhere near your location. The average turn-out for these types of conventions has increased regularly over the years. Last year, many of them were sold out weeks before the event.

Advertise!

The US Census Bureau has said that as of 2012, 15% of Americans are poor, 43% of young adults depend on their parents to some extent for money. Even more surprising is that the median income of young adults in 1982 was $31,583 and last year it was $30,604 for the same age group! Income is dropping and people are looking for ways to earn additional income outside of their 9 to 5 jobs. That’s where you can come in playing the hero and helping others realize their dream income.

Finally, go online and talk about your product. Make the affiliate marketers come to you and have the luxury of picking the best candidates. You will need some help in marketing your affiliate program so target a marketer who’s experienced in affiliate program and SEO.

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Source by Lina Stakauskaite

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Recession Is Here… Six Costly Mistakes Home Sellers Make During Recessions And How To Avoid Them

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The U.S. is officially in a recession. What is a recession? A recession is a business cycle contraction or general economic decline due to significant drop in spending and other commercial activities. Most pundits and politicians will blame Covid-19 crisis for the recession, but even pre-Covid-19 the proverbial writing was on the wall.

The U.S. had over 120 months of economic growth, which was the longest expansion in the modern history. Other indicators, such as negative yield spread on treasuries (long term bonds having lower interest rates than short term T-notes), were pointing to an imminent change of the economic cycle and an impending recession. The only real question was: when and how bad?

Then Covid-19 came… If the cycle was going to change anyway, Covid-19 acted as a huge and unexpected accelerant to make the recession much more immediate and severe.

Inevitably during recessions all classes of real estate, including residential homes and condominiums, will be negatively impacted as lower consumer spending and higher unemployment rates affect real estate prices and marketing times.

Here are the six costly mistakes home and other real property sellers make during recessions and how to avoid them:

Mistake #1: This will pass and real estate market will be hot again soon

First thing to remember is that real estate cycles are much longer than general economic cycles. Even if the general economy recovers, which eventually it always does, a typical real estate cycle takes as long as 10 to 15 years. The cycle has four key stages: Top, Decline, Bottom and Rise.

Let us consider the last real estate cycle, which lasted approximately 14 years:

  • 2006 – Prices hit the Top
  • 2006 to 2012 – Prices Decline
  • 2012 – Prices hit the Bottom (Trough)
  • 2012 to 2019 – Prices Rise*
  • 2020 – Prices hit the Top
  • 2020 to? – Prices Decline

*NOTE: In 2016 the national residential real estate price index reached its pre-recession 2006 peak levels. It took 10 years for the real estate market to recover.

The way to avoid this mistake is to recognize that real estate cycles take years to run and plan accordingly. Additionally, nobody knows for sure when the prices will hit the top or bottom until after the fact.

Mistake #2: Low interest rates will make the economy and real estate market rebound

Between 2006 and 2011 the interest rates (Fed Funds) were continuously cut by the Federal Reserve Board and went from low 5% to almost 0%. However, that did not stop the real estate recession and depreciation of property values.

Undoubtedly, low interest rates made the economic decline and real estate recession less severe and saved some properties from foreclosures, but it still took six painful years for the real estate market to hit the bottom and then four more years for the prices to go back to their pre-recession levels.

Some markets had never fully recovered. For example, residential home prices in some parts of California, Arizona and Nevada are still below their 2006 highs.

To avoid this mistake, one needs to realize that although low interest rates help stimulate the economy and the real estate market, they do not cure them.

Mistake #3: I don’t need to sell now, so I don’t care

If you do not need to sell until the cycle plays out, which typically is over ten years, then you will not be as affected, especially if you have a strong equity position, limited mortgage debt, and solid liquid assets.

However, it is good to keep in mind that “life happens” and either professional or personal circumstances can change and we may need to sell property before the downturn runs its course.

Furthermore, if a property has a mortgages and its value declines to the point being “upside down,” meaning the mortgage loan balance exceeds the value of the property, then the options of selling, refinancing or even obtaining an equity line of credit, will be significantly limited.

This does not mean that everybody should be rushing into selling their real estate if there is no need to do so, just keep in mind that circumstances may and often do change and property options will be affected, so plan in advance. As one wise proverb says: “Dig your well before your thirst.”

Mistake #4: I’m selling, but I won’t sell below my “bottom line” price

This is a common and potentially very costly mistake. Generally speaking, every seller wants to sell for the highest price and every buyer wants to pay the lowest price. That’s nothing new. When selling real estate, most sellers want to achieve a certain price point and/or have a “bottom line.”

However, it is important to understand that the market does not care what the Seller, or his/her Agent, think the property value should be at. The market value is a price a willing and able buyer will pay, when a property is offered on an open market for a reasonable amount of time.

Overpricing property based on Seller’s subjective value or what is sometimes called an “aspirational price,” especially in a declining market, is a sure first step to losing money. When a property lingers on the market for an extended period of time, carrying costs will continue to accumulate and property value will depreciate in line with the market conditions.

Additionally, properties with prolonged marketing times tend to get “stale” and attract fewer buyers. The solution is to honestly assess your selling objectives, including the desired time-frame, evaluate your property’s attributes and physical condition, analyze comparable sales and market conditions, and then decide on market-based pricing and marketing strategies.

Mistake #5: I will list my property for sale only with Agent who promises the highest price

Real estate is a competitive business and real estate agents compete to list properties for sale which generate their sales commission incomes. It is not unusual that Seller will interview several agents before signing an exclusive listing agreement and go with the agent who agrees to list the property at the highest price, often regardless if such price is market-based.

Similarly to Mistake #4, this mistake can be very damaging to Sellers, as overpriced properties stay on the market for extended periods of time costing Sellers carrying expenses such as mortgage payments, property taxes, insurance, utilities and maintenance.

Furthermore, there is the “opportunity cost” since the equity is “frozen,” and it cannot be deployed elsewhere till the property is sold. However, the most expensive cost is the loss of property value while the real estate market deteriorates.

During the last recession, we have seen multiple cases where overpriced properties stayed on the market for years and ended up selling for 25% to 40% below their initial fair market values.

The solution is to make sure that your pricing strategy is based on the market, not empty promises or wishful thinking.

Mistake #6: I will list my property only with Agent who charges the lowest commission

Real estate commission rates are negotiable and not set by law. A commission usually represents the highest transactional expense in selling real properties and is typically split between Brokers and Agents who work on the transaction

Some real estate agents offer discounted commissions, in order to induce Sellers to list their properties with them. But does paying a discounted commission ensure savings for the Seller? Not necessarily.

For example, if the final sales price is 5% to 10% below property’s highest market value, which is not that unusual, due to inadequate marketing, bad pricing strategy, and/or poor negotiation skills, it will easily wipe out any commission savings and actually cost the Seller tens of thousands of dollars in lost revenues.

The solution is to engage an agent who is a “Trusted Advisor,” not just a “Salesperson.” A Trusted Advisor will take his/her time and effort to do the following: 1) Perform Needs Analysis: listen and understand your property needs and concerns; 2) Prepare Property Analysis: thoroughly evaluate your property and market conditions; 3) Execute Sales and Marketing Plan: prepare and implement custom sales and marketing plan for your property; and 4) Obtain Optimal Results: be your trusted advocate throughout the process and achieve the best possible outcome.

Finding such a real estate professional may not be always easy, but it certainly is worth the effort and will pay off at the end.

In conclusion, this article has outlined six costly mistakes real estate Sellers make during recessions and how to avoid them. The first mistake is not understanding that real estate cycles are long and take years. The second mistake is a misconception that low interest rates alone will create a recovery. Another mistake is not realizing that circumstances may change and not planning in advance. Mistakes number four, five and six pertain to understanding the market value, proper pricing and selecting the right real estate professional.

By understanding and avoiding these mistakes, real estate Sellers have significantly better chances of minimizing the negative impact of a recession while selling their properties.

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Source by Robert W. Dudek

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Useful Tips To Build The Best Gaming Computer

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Every gamer will want their computer to be the best gaming computer among their peers. Sometimes, with a little knowledge and tips and tricks, it is possible to build the best gaming computer and show it off to your peers. This article will show you how:

1) You can’t get the best gaming computer from computer retailers

If you want to get the best gaming computer, you have to build your own. Different gamers have different requirement for their gaming machine. Unless you are willing to pay a high price, you will not be able to buy a commercial computer that fulfills all your gaming needs. The only option you have is to build your own gaming computer.

2) You don’t have to be rich to build the best gaming computer

It is not necessary to burn a hole in your pocket to build the best gaming computer. With some due diligence, do some market research and compare prices around the marketplace. Merchant such as TigerDirect and NewEgg give regular discount to their products and you could save a lot of money if you catch them during their promotional period.

3) Most expensive parts do not have to be the best part

Sometime, the latest model or the most expensive model does not have to be the best part for your computer. It requires various components to work together to form the best computer system. When choosing a computer part, what matters is how well it can integrate with the rest of the components. Compatibility is more important than individual performance. What use is there if you spend lot of money on the latest quad-core processor and find that your motherboard doesn’t support it?

4) You don’t need to change the whole PC to own the best gaming computer

It is a misconception that you have to change the whole gaming machine to build the best gaming computer. If you already have a good barebone system, what you need to do is to upgrade the necessary parts and your gaming computer can roar back to life instantly.

5) Brand is important

Unless you want to see your computer system malfunction every few days, it is important that you purchase the parts from branded manufacturers with strict quality control. Motherboard brand such as Gigabyte, ABIT, ASUS are some quality brands that you can consider

If you follow diligently to the tips stated above. You will be on your way to build the best gaming computer. While price can be an issue, it is better not to scrimp on important computer parts such as motherboard, CPU, RAM and graphics card as it will cost you more to upgrade in the future.

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Source by Damien Oh

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