Have you given your retirement much thought lately?  According to the Employee Benefit Research Institute, nearly 50% of Baby Boomers and Gen Xers are at risk of not having enough retirement income to cover even basic expenses and uninsured health care costs.  That figure jumps to 70% when you look at the low-income households in America.

The reality of retirement hits us at different stages of our life, but the questions always seem to be the same.  Will I have enough?  How should I be invested?  Will I have to pay taxes?

If you’re like me, I don’t want to hear the cookie-cutter answer: “it depends.”  I already know that the answer will be different for each person.  I just want to know what tools and calculations are available to show me how to create an educated estimate.  At the end of the day, we cannot predict the future and the exact figure in our retirement account, not to mention the expenses we’ll have.  But we can make smart calculations to help us find the answers to these five retirement questions.

Am I on track to retire?

You can use online retirement calculators to show your projected savings, but the figure might look like it’s all over the place.  I used three different calculators and got a range of $500,000 to $3,000,000 as my projected savings.  Why was it so different?  Because some calculators assumed variables like inflation and contributions, while others allowed you change those manually.

The best retirement calculator will take these factors into consideration: age, income, contributions (and increases), inflation, investment return, retirement age, Social Security income and income replacement during retirement.

AARP and CNN Money have very good calculators, but calcxml has my favorite calculator for projecting your retirement balance.  Don’t be afraid to use all of these to get a good idea of how much you should be saving in order to get on track for retirement.

Should I be invested more aggressively?

This question always seems to come up, especially if someone is a little behind with his or her retirement savings.  Before you change your portfolio to 100% stocks, make sure you ask yourself if you’re being as aggressive as you can be with your current retirement contributions.  Your strategy of slowly increasing your contributions year after year will make a much bigger impact on your savings than chasing a high return in the market.

You might have heard of the recommendation that your exposure to stocks should be equal to 110 or 120 minus your age.  For someone who is 30 years old, their portfolio might include 80-90% stocks based on this rule of thumb.  It’s not the most scientific approach, so it’s wise to meet with a financial planner.  If you’re not even sure where to start with assessing your risk tolerance, you can take a risk tolerance quiz provided by Rutgers University.

What’s is the RMD?

If you or your parents are nearing age 70, you might have received a letter regarding a required minimum distribution (RMD).  The RMD will affect nearly every retiree.  It’s basically an IRS rule that says you must start drawing money from your retirement accounts by age 70 ½.  If you don’t start, you’ll end up paying penalties of 50% on the money you fail to withdraw.

You can calculate your RMD by using the life expectancy tables provided by the IRS in publication 590.

What if I inherit a retirement account?

Your options will vary depending on whether you inherited the account from a spouse or non-spouse (parent, sibling, extended family, etc.).  Inheriting an IRA from a spouse gives you the most flexibility and allows you to treat it as your own.  You can add to the account or rollover the IRA to another retirement account, as long as it was inherited from a spouse.  If you inherit an IRA or 401(k) from a non-spouse, you’ll need to follow strict rules on distributing the money and maintain its ‘inherited’ status.  In other words, you won’t be able to move it into your own IRA – it must stay as an inherited IRA.

Will I have to pay taxes on my retirement money?

The quick answer: yes.  Withdrawing pre-tax money from your retirement account is considered to be taxable income.  What you do with your money throughout the year can lower your taxable income, so have a conversation with your tax preparer as to how you can lower your taxable income during retirement.  You might consider giving to a charity or starting a business, which can lower your taxable income for the year.  Of course, your Roth IRA has already been taxed, so you can withdraw those funds tax-free during your retirement years.

Have you had any retirement questions come up recently?  Share them in the comments!

Happy senior couple image from Shutterstock

Related Articles:

• Tax Treatment for Inherited IRAs
• Can You Afford Retirement?
• Should You Use Retirement Savings For Your Kid’s College?
• Should you convert your IRA to a Roth?

Tim is a personal finance writer at Faith and Finance a Christian financial help blog that provides financial insights for individuals, businesses, and churches. Outside of finance, Tim enjoys spending time with his wife, playing the saxophone, reading economics books, and a good game of RISK or Catan. Find him on Twitter and Facebook.

If you’ve been investing your money for some time—or at least studying up on the subject—you’re no doubt aware of the importance of diversification. The purpose of diversification is to reduce the risk inherent in investing, which improves investment performance (by minimizing losses) in the long term. Coming up with the right diversification formula then seems like a critical component of any investment plan.

And it is. But the open question is, which formula? No one claims that investment diversification is an exact science, but there are at least a couple of models that have become so common that they’re assumed to be winners.

Fixed allocation. In this model you set a specific allocation, say 60% stocks, 30% bonds, 10% cash, and keep it no matter what happens. Through bull markets and bear markets, you stay faithful to the diversification plan, rebalancing periodically to make sure that you don’t become “overweight” in any one investment class. The advantage of a set allocation is that it imposes discipline on your investment habits in that you’re much less likely to make investment decisions based on emotional factors.

Stock allocations should be in inverse proportion to your age. This one is even more common. Simply put, the younger you are, the higher the percentage of your investments that are committed to stocks, the older you are, the less you should have in stocks. Under this model, a 25 year old might commit 80%-90% of his portfolio to stocks, while a 70 year old might allocate only 30%. The theory is that the younger investor, having a longer time horizon, has more time to overcome investment reversals.

Though some combination of the two is typical, the problem with both models is that they’re extremely general and may not adequately address market conditions or personal circumstances. There are factors that must be built into any diversification plan that may require ongoing flexibility.

Market conditions

One of the problems with fixed allocations is that they don’t adjust for market conditions. A 75% stock allocation may be too risky in a market that’s doubled in the past two years. Conversely, a 25% stock position may be unnecessarily conservative in a market that has fallen 50% in the same time frame. How do you invest safely?

While it makes sense to maintain at least some investment in stocks regardless of market level or direction, there are times when higher or lower allocations are the order of the day. One of the most fundamental rules of stock market investing is “buy low, sell high”. You need to have the flexibility to buy when stocks are cheap, and begin selling when they aren’t. Fixed allocations remove this option.

Still another market factor is the performance of non-risk alternatives, like bonds and cash. A low interest rate environment will make bonds and cash pure capital preservation assets, rather than sources of reliable investment returns. In such an environment, stocks become more attractive, at least until the rate picture reverses.

Inflation is another market factor that can make stocks more attractive than fixed investments, since bonds in particular fare especially poorly in inflationary periods. Inflation might also necessitate taking positions in real estate or commodities, which will add another layer to the diversification mix.

Risk tolerance

Age inverse allocations are based solely on a single factor, which is of course your age. However personal risk tolerance is at least as important. A 30 year old who’s risk adverse may not be at all comfortable holding 75% of her money in stocks, while a 75 year old may be more than willing. Neither investor should completely ignore age as an investment criteria, but appetite for risk—or the lack of it—is at least as important.

Personal financial circumstances

How you allocate your investment mix has as much to do with personal financial circumstances as any other factor. If you’re well employed in a very stable field, and/or if you have substantial assets overall, you may be willing and able to take on a greater level of risk than the average investor.

If however you work in a field where layoffs are frequent, you have a relatively small investment portfolio or you’re carrying substantial debt, you need to be more conservative with your investments. Any personal financial circumstances that might predictably require the liquidation of investments within the next year or two should automatically limit you to non-risk investments.

As much as we might long for a single diversification model that will bring us something close to guaranteed investment success with minimum input, the reality is that no such model exists. Circumstances change and we need to adjust as they do.

Perhaps investing is just like the rest of life—inherently uncertain. The Bible addresses the issue of certainty in the book of James:

…you who say, “Today or tomorrow we will go to this or that city, spend a year there, carry on business and make money.” Why, you do not even know what will happen tomorrow … Instead, you ought to say, “If it is the Lord’s will, we will live and do this or that. —James 4:13-15

So back to the question in the title, is there a magic formula? Adequate, yes; magic, absolutely not. And guaranteed? Never!

How do you handle investment diversification? Is there a model that you think has the potential to be successful over the long term? Meet us in the comments!

Allocations image from Shutterstock

Related Articles:

• Diversification strategy from the Bible
• 5 Fundamentals for 401k Investing
• What Is The Best Investment For My Money During These Economic Times?
• 3 keys to safe and successful investing

With backgrounds in both accounting and the mortgage industry, Kevin Mercadante is professional personal finance blogger, and the owner of OutOfYourRut.com, a website about careers, business ideas, money and more. A committed Christian, he lives in Atlanta with his wife and two teenage kids.

The last stats I heard about employee participation indicated that over 30% of employees in the US are not enrolled in their company’s retirement plan. So, if you are one of them, this article is for you.

Video Intro

I remember when I first started this site, I was trying to think of the most important (and simple) steps to financial success that I wanted the world to know. One of them was how easy it is for many of us to get an amazing return on our 401k or 403bs.

The reason it is possible for so many of us is because most employers have some sort of matching program with their 401ks or 403bs. For example, my wife’s employer offers a 100% matching of her contributions up to 4% of her salary. So if she puts in $100 each paycheck, they put in $100 each paycheck – not bad! But if she puts $0 in, they put in $0.

Many employers across the nation have similar programs – not all offer 100% matching, but most offer some kind of incentive to contribute.

It is free money – find a way to get it

If your employer has a matching program and you are not contributing, you are passing up free money. While that is enticing, I know what it feels like to just not have the money to be able to contribute – believe me, I remember that feeling well. What I did to remedy that situation, was use my next raise to my advantage. So why not just take your next raise and contribute that amount to my 401k. That way, your take-home pay doesn’t change, but you start funding your retirement account without any pain!

You can get a good return in your 401k – even in a recession!

Over the last year or so my 401k has gone down in value – about 40% to be honest. And my wife’s 403b took a big hit as well. But if I look at how much I actually contributed into the plan, I am still very much in the positive!

For example, say I contributed $100, and my company matched it – now I have $200 in my account. If it goes down 40% (like it has) I still have $120 left – which is still a 20% return on my investment – even in this market! Not too bad at all…

So the point is if your employer has a matching program of any kind, it would be VERY wise to get involved!

Related Articles:

• The easiest way to increase your 401(k) return
• How much can I contribute to my 401k?
• What to do with a raise
• What is a Health Savings Account (HSA)?

Bob enjoys dark chocolate, paying off debt, giving, Foosball, loose-leaf tea, helping people succeed, learning, anything God created, playing guitar, Philippians, excellence, Chick-Fil-A, and making his wife smile. He started ChristianPF in 2007 and Co-Founded Blogging Your Passion in 2011. Find him on Facebook & Twitter.

Many financial forecasts predict tough times ahead.  With trouble in Europe, a struggling U.S. economy, and the lingering effects of the financial crisis of 2007-9 still creating problems, it is no surprise investors are quite concerned.  Do you go to cash?  Should you sell your stocks and mutual funds?  How will you navigate these choppy waters?

Now is certainly not the time to panic, but you shouldn’t “stick your head in the sand” and do nothing either.  Mapping out a game plan for 2012 is critical.  When we see a significant chance for a major downturn like today, many investors become restless or fearful and run for the hills. They sell, sell, sell!   Yet those with a solid game plan often remain patient and keep their long-term portfolio strategies in mind.

St. Augustine once said, “Patience is the companion of wisdom.”  The market has certainly seen its share of ups and downs over the years, and it often discovers its own remedy. If you were around for Black Monday in 1987, you probably recall the widespread panic that followed. But you may not be aware that within two years the market had sprung back, fully regaining the value it had lost by September of 1989.

Bull, Bear, Rally, or Slump?

Often the media encourages investors to think in either/or terms such as bull or bear, rally or slump and euphoria or panic. There will always be another “latest headline”, and if you base your investment strategy on the headlines, the chances are you will end up confused and astray from the principles that work and truly build wealth.

However we must also remain prudent and prepare ahead of time for trouble we see brewing.  There are times to be more aggressive (offense) and times to be more reserved (defense).  Today I believe is a time to be much more defensive for the year ahead based on all of our research at Faith-Based Investor.

Three Major Threats

There are three major threats we see for your portfolio in 2012:

1. Political risk

Right now, there is a high risk right now that President Obama will get reelected. Obama believes he is doing a good job for the economy.  He believes things are heading in the right direction and he deserves another 4 years to fix this mess. He believes we need to go deeper into debt to solve our problems. He does not believe our entitlement programs in America need to be fixed. Yet, we are spending far more than we can sustain. On the other hand, Republicans don’t have the solutions either.  So we have gridlock.

The political gridlock is harming our financial progress. Democrats want one thing and Republicans want another. Regardless of who is right, we need to make significant changes in the U.S. and this is not being accomplished. Even if a Republican wins the White House, we could see major budget cuts which could swing the U.S. economy back into a recession. That’s what happened when Reagan came into office. It took time before growth took hold . . . . As investors we have to be prepared for more tough times ahead regardless of who’s in the White House.

2. Possible European meltdown

Nothing is solved in Europe!  The 16 other European countries are trying to bully Germany to help out the much weaker countries.  Germany is looking out for herself. Of all the solutions and fixes presented in Europe none are significant enough to contain the problems.  They are spreading faster than cancer.  The weak are getting weaker and bringing the strong down with them.  It is only a matter of time before the walls begin to crumble and fall.  There are cracks in the system yet European leaders are unwilling to take the painful steps that need to take place to solidify this major banking system.  This mess could create a global chain reaction. Europe has not fixed any of her problems and this I believe will rear its ugly head in 2012.

3. Global economic slowdown

Greece and Portugal are already in a recession.  Italy and Spain are well on their way as well!  The U.S. has seen chillingly slow growth and the “king of growth” China is cooling off.  There are very few countries expanding right now.  My greatest concern right now is with China.  If they continue slowing down, it could take countries like Australia, Brazil, and Canada down for the ride.  These natural resource producers depend on China’s growth.

So where do you do from here?

Now is the time to take defensive measures for 2012!  In the game of football, defense wins championships it’s not the offense. We created a special report for 2012 to help investors map out a game plan for the tough road ahead. We  believe investors should consider the following four steps:

1. Avoid companies that violate your faith and values.

Some of the types of companies you may wish to avoid include those involved in:

• The abortion industry
• Producing explicit entertainment and pornography
• Embryonic stem cell and fetal tissue research
• Homosexual activism
• Producing alcohol and tobacco
• The gambling industry
• Environmental abuse

2. Seek out those companies that complement your faith and values.

This may involve finding companies:

• Helping the poor and defenseless
• Protecting the sanctity of human life
• Producing morally sound entertainment
• Finding cures for life threatening diseases
• Improving the society we live in

3.  Seek investments with strong financial potential.

Examine the up and downside potential of every investment, look for companies with low debt, attractive valuations, growing earnings, strong management/leadership, in growing sectors of the economy (to name a few).

4.  Seek to diversify your holdings.

This involves buying stocks, bonds, alternative investments like gold, silver, and oil, and cash investments. By diversifying your risk, you stand to gain peace of mind and potentially higher rates of return.

The bottom line is this: 2012 should be a difficult year for investors, but you don’t have to be “left behind”.  Starting plan now before the storm hits is essential to protect and grow all that God has entrusted to you.  As it says in Luke 16:10 “”If you are faithful in little things, you will be faithful in large ones. But if you are dishonest in little things, you won’t be honest with greater responsibilities.”  Seek to honor the Lord with your finances and He may very well bless your efforts. It’s no guarantee, but I would rather place by trust in Lord and leave the results up to Him rather than going the world’s way.  How about you?

What are your concerns about 2012?  Do you think it will be a good or bad year for the markets and economy?  I’d love to hear your thoughts!  Meet us in the comments!

Investing image from Shutterstock

Related Articles:

• Forex Trading 101: Major Currency Pairs, Most Traded Currencies, & More
• How to create a tax efficient portfolio of investments
• Guide To Investing: 7 Deadly Mistakes
• 10 Tips To Manage Your Personal 401k

Jay Peroni, CFP® is author of The Faith-Based Millionaire, Chief Investment Officer at Faith-Based Investor, and host of the Rethink Wealth radio show. His life passion is helping individuals and businesses keep Christ first in the investment and financial planning process.

Do you hate headaches?  Well, you will probably get one if you inherit a traditional IRA.  Why you ask?  Well, the United States government has decided to create what I call the “labyrinth” of tax code for inherited IRAs.  Why they decided on this, I have no idea.  For all we know it’s to create more government jobs!

What I do know is that most people make serious mistakes when they inherit an IRA account and hopefully we can clear up some of the common issues now.

It all starts when you get a notice that a family member has passed away and you were the beneficiary of an account.  The first question you should ask yourself is if the IRA owner died before or after April 2 after the year the person turned 70 1/2.  If the person had still been alive, he or she would have had to take minimum distributions.  The answer will determine the tax implications of an inherited IRA.

Now, before you go and make any hasty decisions, let’s go over some general rules for two situations.

IRA Inheritance from a Spouse

This is the most typical situation for most Americans.  Your husband or wife will pass away and leave you with their retirement savings.  You have three options in this case:

1. Designate yourself as the new account owner.

2. Roll it over to one of your existing accounts.

3. Consider yourself a beneficiary, not the owner of the inherited account.

Doesn’t sound too bad now does it?  Inheriting a IRA account from a spouse gives you the freedom and flexibility to avoid unnecessary taxes.  Also, the surviving spouse is able to name another beneficiary.  Consider this as a type of “baton” hand off.  The object (IRA account) stays the same but the runner (beneficiary and account owner) changes.

You can also forgo all of this and start taking minimum distributions if you’re under 59 1/2.  You’d want to make sure you actually need this income now versus letting the money stay in a tax sheltered account.  It’s really up to you.

Non-Spousal IRA Inheritance

This is where things get complicated.  If you inherit a IRA account from a non-spouse, you’re not allowed to treat it as your own according to federal regulations.

This means no contributions are allowed to this account and rollovers are out of the question.  Where you go from here depends on when the IRA owner passed away.  You have two options:

1. After the minimum distribution date has passed.

In this case, you will have to follow the set distribution schedule put in place by the owner.  You can reference the official distribution tables here.

2. Prior to the minimum distribution date.

For this situation, you can ask to have the entire IRA account distributed over a set period depending on your life expectancy.

Inherited IRA Takeaways

Now that you know the basics, let’s wrap this up with some general rules to live by.  Here are a couple things to think about if you ever find yourself inheriting an IRA:

• Use life expectancy payout.  If you do this, you can take out distributions from an inherited IRA over your lifetime!
• Do the necessary tax research and use the IRS website to your advantage.
• Seek out a qualified representative.  You don’t want to look back and cringe at a bad decision you’ve made.

OK, take a breather.  Believe it or not, this is just a snapshot of how complicated inherited IRAs can get.  This post should be enough information for your situation but I would still recommend you to seek out a Christian financial planner to help you navigate this muddy tax code.  You don’t want to find yourself in a bad situation based on a lack of knowledge.  No one wants t0 pay Uncle Sam more than they have to!

Have you inherited an IRA account? How did the process work? Meet us in the comments!

Image by JohnKwan/Shutterstock

Related Articles:

• Tax Treatment for Inherited IRAs
• How to Calculate Your Required Minimum Distribution (RMD)
• Roth IRA Tax Benefits and 2010 Conversion Rules
• What are Required Minimum Distributions or RMDs?

Jon is a Christian personal finance writer at Free Money Wisdom. His mission is to help you succeed in your personal finance life with the Bible as your compass. When Jon is not writing on personal finance, he spends time with his girlfriend, lifts iron at the gym, and plays Scrabble. You can subscribe to his site through EMAIL/RSS or you can also find him on Twitter and Facebook.

We have all heard that “time is money”, but have you ever stopped to think about just how much your own procrastination is costing you? Here are some typical thought processes:

Age 20:  “I’ve got forever. Retirement? That’s for old people.”

Age 30: “Right now, as we are starting our family, is the worst time to be thinking about the future. Besides, I have plenty of time.”

Age 40: “I know we need to get out of debt and build our retirement, but the kids will be in college soon, and I don’t want them to struggle like we did. Once we get them through college we will really hit it hard.”

Age 50: “Wow. Where did the years go? I know we need to be sticking away every spare dollar, but, with all we owe on our kid’s education, there aren’t any extra dollars.”

Age 60: “Where did the years go? Yes, we still could do some last minute saving, but what’s the use? It is a case of too little too late. Maybe social security will stick around a few more years.”

Age 70: “Here we are, barely making it. Let’s hope that if things get really bad, our kids will help us out.”

What is the cost of that wasted time?

To give you an idea, let’s follow a make-believe couple.

Our couple is 25 years old.
They have nothing in an emergency fund.
They are paying:

• $250/month on $15,000 credit card debt at 15% APR.
• $400/month on $20,000 car debt at 8% APR.
• $900/month on $150,000 home debt at 6% APR.

I assume that they will maintain those same debt levels until they start their plan. Although they are currently living paycheck to paycheck, they could (by changing their lifestyle) generate a positive cash flow of $1,000 per month.

Their plan, once they start, is 1) get rid of credit card debt and car debt, 2) build a $20,000 emergency fund and 3) invest for retirement (assume 8% annual return).

The following scenarios depict the different results based on when they get started:

Start now.

Using a debt snowball, the credit card is paid off in 13 months and the car is paid off in 11 more months. Emergency fund will be complete in another 12 months. This couple will now invest that $1650/month ($1,000 positive cash flow + $250 from paid off credit card + $400 from paid off car) while continuing to make the same house payment. In 12 years, the house will be paid off, bumping the investments at that time to $2550/month for the next 25 years.

Nest egg at age 65 = $5.3 million.

Start at age 35

Same three years to pay off debt and build emergency fund. Invest $1,650/month for 12 years and $2,550/month for 15 years.

Nest egg at age 65 = $2.2 million.

Start at age 45

Again, same three years to pay off debt and build emergency fund. We invest the $1,650 for 12 years, but the $2,550 for only five years.

Nest egg at age 65 = $780,000.

Start at age 55

You get the picture. Only seven years left to invest the $1,650 but not enough time to pay off the house.

Nest egg at age 65 = $185,000. Debt on house = $125,000.

Start at age 65

It is never too late to start, but choices are definitely limited.

The point of this post is to not to depress our older readers, but to motivate the younger ones. None of us can turn back the clock, but all of us can decide to get started now. Time is still money — use it to your advantage.

Readers: Have you ever used any of the above excuses to justify delaying your financial plan? How are you doing now? Meet us in the comments!

Image by skyfish/Shutterstock

Related Articles:

• Could We…Should We Pay Off Our Home Early?
• What’s Your New Year’s Financial Resolution?
• Set Your Financial Priorities and Accomplish More
• Becoming debt-free with Dave Ramsey’s plan

Joe Plemon, a retired engineer, financial counselor and blogger, lives in Southern Illinois with Janice, his wife of 40 years. Joe likes online Scrabble, St Louis Cardinal baseball, blues music, power naps, high school football, short term mission trips and Sunday family dinners. You can read more from Joe at Personal Finance by the Book.

I‘m all too often amazed when a random conversation strikes up with an acquaintance and the topic of investing and the economy comes up. So many times I run into people that are completely frustrated with the markets that they’ve given up saving all together.

Yes. They are saving nothing.

I’m left scratching my head wondering what their “retirement plan” is.

If you are fed up with the stock market and your 401k, I get it. The market has not been very friendly lately. But that doesn’t mean you should pull all your money from your 401k all together. If you’re considering giving up on your 401k, don’t. At least read these tips on what not to do, first.

1. Do not stop contributing to your 401k no matter what.

Just because the markets are down does not mean you should not contribute. In fact if there was a time ever to contribute, this would be the time. The simplest reasons is that right now despite the market’s turmoils, currently the market is at a discount, and what that means is that there are a lot of great companies that exist out there, that are currently “on sale”.

This is a time to buy stocks, at a cheap price, in hopes to benefit from the appreciation in later years. This strategy can also be called dollar cost averaging, which means as long as you are contributing on a consistent or periodic basis, you’ll take advantage of buying shares at a lower price in down markets, and compare that to buying shares at a higher price in up markets, which should then all balance out for a dollar cost average.

If the market has you completely terrified, then consider changing all future contributions to short term or intermediate bonds. At least that way you’re money is making a little interest while the market tries to figure itself out. And if you’ve cut back your savings, you’re in luck. They just announced that the 2012 401k contribution limits have increased to $17,000 a year. That way if you skimmed back the past few years, you have a chance to get caught up.

2. Do not put all of your 401k into the money market.

While I understand the disbelief in the markets right now to where you want to shift all of your money into the money market, by doing this would be a great mistake. If you believe that making money in the market is to buy low and sell high, then by shifting your money into the money market from your other investments, it would be the exact opposite; buying high and selling low. If you’ve seen your 401k lose a lot in the last several months, the only way to get that back is by staying exactly where you’re at.

Now, I understand for those nearing retirement, that this can be a compromising situation, but if you visit the rule of 72, meaning that you take 72 divided by the interest rate on your investments, and that will tell you how long it will take to double your money. That also, too, will give you an indicator how long it will take you to recoup the losses that you have incurred.

By shifting to the money market, chances are, you are making somewhere in the 1% interest rate, which means it would take you almost 72 years just to double your money, and to recoup your other money that you’ve lost, would be that much longer.

3. Do Not Check Your Account Daily

I always advise to stay in touch with your investments. I have many clients that don’t even open their quarterly statements when they get them in the mail. On the opposite side of the spectrum are those that check their accounts daily – and sometimes more than that.

Checking your 401k balance every single day will give you no additional benefit, just additional worry. If you have many years ahead of you before retirement is a reality, then checking it once a quarter is sufficient.

From my experience, those that check it often are more likely to “day trade” their 401k which is never a good thing. Remember the long term plan and stick to it.

4. Do not borrow against your 401k.

This can be said in an up market or down market, but I had to throw it in there. Borrowing against your 401k is never advisable, especially in a down market. Look to start an emergency fund of some kind so that you can have that to fall back on in case of an emergency. If you don’t have an emergency fund, start one now. There’s no sense in contributing to your 401k if you have to pull it out just pay the bills.

Have you given up on your 401k?

This guest post was written by Jeff Rose. Jeff is an Illinois Certified Financial Planner, he blogs at Good Financial Cents, he loves Crossfit workouts, and craves In-N-Out burger.

Image by carroteater/Shutterstock

Related Articles:

• 401k Debit Card – Thoughts
• Should I pull my money out of the bank?
• Do You Need an Emergency Fund? GS13
• My 401k has lost a lot of money – how about yours?

This article was written by a Guest Author. If you would like to write a guest post for our personal finance blog, you can find out how here.

Picture this scenario: You have a meeting tomorrow that you’ve scheduled with a financial advisor because you know that proper planning is important.  You’re proud of yourself for taking action and scheduling this meeting and you feel a sense of accomplishment for doing so.  You know that this is a huge step to take.  However, you can’t shake this nagging feeling inside that says, “I have NO idea what I’m doing when it comes to this stuff, and besides, how do I even know that the person I’m meeting with has my best interests at heart?!”

You’re not alone on this one.  It may be safe to say that most people feel this way and, if they’re not saying it, they’re thinking it.  I mean, who wouldn’t?  From the meltdown in the mortgage industry to the Bernie Madoff’s of the world, the financial services industry hasn’t exactly been portrayed as a bastion of virtue.  Granted, that may sound unfair since the number of financial professionals that truly do have a heart to put the clients best interests first far outweigh the number of those who are blinded by greed and seek their own gain. Yet, because of the latter, millions of Americans every year are hesitant to meet with a financial expert.  Some even putting off planning altogether, due to a lack of knowledge, expertise, and, ultimately, trust in the industry itself.

So, the question that haunts the minds of every well-intentioned person who simply wants to properly protect what they have and leave a financial legacy to those they leave behind is this: “Is there really any way to equip myself to be able to discern if the financial advisor that I’m meeting with is looking out for my best interests?”

Of course there is.  And to be perfectly honest, this stuff really isn’t that complicated. Here it is in a nutshell: Proper financial planning really addresses two major issues…dying too soon and living too long.   It simply matches assets to liabilities.  That’s it!  Think about it.  It all boils down to life insurance and retirement planning.  Utilizing a suitable life insurance policy protects your family against you dying too soon.  Having a review done by the right person makes absolutely certain your life insurance policy is the correct type, correct amount, & best value.   On the other side of the equation, a suitable investment strategy protects your family from living too long.  Having an objective review done in this area makes absolutely certain your investments match your liabilities considering risk, growth, & value.  Both of these strategies assure sufficient money to fully fund a lifetime of financial needs and, at the end of the day, the average person would sleep much better at night knowing that these two issues were off of their “to-do” list.  Wouldn’t you?  It’s a pretty powerful thing to know that your family is set financially and won’t have to struggle if something were to suddenly happen to you (i.e. Death) that cuts off your family’s income stream.  The majority of people have others that are dependent on their income and this can be a major cause of stress if not properly handled.  Likewise, in the wake of one of the worst market crashes in history (2008), millions of Americans saw their retirement accounts dwindle anywhere between 37% and 50% seemingly overnight.  The subject of outliving their retirement (i.e. running out of money before you die) is a very new reality that many people simply weren’t prepared for.  Fortunately, there are incredibly practical solutions to both of these problems, and having a fiduciary (person of trust who acts solely in your best interest) in your court literally can make all the difference in the world.  To know whether or not your advisor is really on the same side of the table as you, here are two very easy questions that you can ask in order to see who’s best interest they have in mind.

2 Questions You Need to Ask Your Financial Planner

1.  Do You Offer More Than One Company’s Products?

In my opinion, this is one of the most important questions that you can ask any financial professional.  Why? Because the answer to this question reveals to you whether or not the person sitting across the table from you can offer you multiple solutions from multiple companies.  Remember, the end-user here is YOU.  Wouldn’t you prefer to have someone that can choose from a variety of different companies, products, and services in order to best serve your needs over someone who has to “fit” your situation into their limited arsenal of proprietary products and services? A red flag should go up if you have someone telling you why “their” product or service is better than everyone else’s when it comes to financial planning.  Each individual situation is unique.  There is no “one-size-fits-all” product to meet everyone’s needs.  The bottom line is this: the person who can offer multiple products from multiple companies may have more independence, freedom, and objectivity when it comes to providing the right solution to fit your individual situation.

2.  Do You Have Sales Quotas?

Let’s be clear…sales quotas are different from sales goals.  It is safe and healthy for a financial advisor (or anyone for that matter) to set goals for themselves and to have a plan to achieve them.  That’s a fact that most people wouldn’t argue with.  A quota, on the other hand, is much different and has the propensity to cause many good people to do not so good things.  Is it fair to say that anyone who is working under a quota system is going to do something unethical?  Of course not and I would be grossly ignorant to suggest such a thing.  Having a sales quota means that someone working in that environment is bound and obligated to meet certain performance standards (i.e. sales transactions) in order to maintain their position.  Typically, failing to meet a quota can result in demotion, replacement, or even termination.  This is exactly the type of high-stress environment that I would NOT want my financial advisor to be working under!  Imagine if it were the end of the month and he or she had to either make one more sale or risk being fired, only to have to go home and tell their spouse and children that they may lose the house because of it.  That scenario is not as far from reality as we may choose to believe!  The point is that someone in that position may be under extreme temptation to offer a certain product or service that pays them more than an alternative solution that may be better for their client.  Conversely, if the professional that’s helping you is under no pressure or fear of losing their job under a quota system, everyone involved in the relationship will be able to relax, breath a little easier, and take the time to figure out which solution makes the most sense for YOU.

Obviously, there are many more questions that can, and should be, asked of your financial advisor before moving forward.  However, starting off your relationship with these two practical (and revealing) questions can very quickly and easily help uncover who you are working with and can help you to avoid wasting time, energy and possibly thousands of dollars in the process!

Which question do you think is most important to ask your financial advisor?  Leave a comment and help empower someone else!

Image by Deklofenak/Shutterstock

Related Articles:

• 10 Questions to Ask a Financial Planner
• How to Avoid A Bad Financial Advisor: 5 Red Flags To Watch For
• Premarital Financial Counseling: Questions To Ask
• How to Budget: 5 Questions to Ask Yourself Before You Begin

Adam Simon is a devoted Christian, husband, and father of four. At age 19, his life was dramatically changed by God, forever transforming his life to one of unwavering passion and service to Christ. Today, through his writing, speaking, and love of God, Adam shares his personal message of faith and family with people everywhere. You can reach out to Adam directly at asimon126@gmail.com and through Facebook & Twitter.

I like to think of inflation as a silent killer of our money.  While you may not see it in action from one day to the next, inflation slowly kills the purchasing power of your dollar from year to year.  Economists define inflation as the gradual increase in the cost of goods over a certain period.  Put simply, it means that things get more expensive over time.  We can spend hours discussing the cause of inflation, but there really isn’t anything that we can do as individuals to stop it.

While you and I may not be able to prevent inflation from happening, we don’t have to sit helplessly while it eats away at our hard earned dollars.  With a little planning and change in behavior, we can lower the effects of inflation on our personal finances.

 1. Change Consumption Patterns

According to Bloomberg, the retail cost of beef was over 10% higher than February 2010 prices.  For a large family that spends $200 or more on meat products each month, the increase in price can really put a dent into their food budget.

How do you adjust?  Find ways to modify your meals.  Replace red meat proteins with beans or other meats that might be on sale.  Look for the ‘cost per unit’ on the price tag of the food items you’re buying and make sure you’re getting the best price you can for the food you buy.

2. Utilize Public Transit

It’s no secret that you can save money by using the public transit options in your city or town.  The American Public Transit Association estimated that households using public transportation and live with one fewer car can save more than $9,900 per year.  When you add up the cost of insurance, vehicle maintenance, fuel, parking, and loan payments, it’s easy to see how fast the savings add up!

3. Walk or Bike

The cost of gas is up nearly $1.00 since last fall.  For a person driving a modest 200 miles each week, they could easily pay $40-$50 or more each month just because of the higher gas prices.  If public transit isn’t an option, you might be able to fight inflation by cutting back on how much you drive.  While you may not be able to bike to work or school everyday, you can still try to decrease your dependency on a car gradually.  If you can, try walking or biking into town on the weekends.  A little exercise won’t hurt.

4. Buy Supplies in Bulk

Recently, two articles shared excellent tips on how you can invest in foods and non-foods.  I’d recommend that you read these articles for great tips on how to find the deals, store bulk items and how to stretch the life of these items.

On a personal note, my wife and I have benefited tremendously this past year through buying things in bulk and using it through the year.  By combining coupons and sales, we’ve bulked up on items that seem to get more and more expensive each year (stuff like shampoo, deodorant, and toothbrushes).  When we find a great deal, we buy a lot and pocket the savings!

5. Buy Stock

‘If you can’t beat em, join em.’  I don’t subscribe to this mindset for everything, but for the purposes of beating inflation, it can work quite nicely.  I’m not suggesting that you go out and buy stocks in oil, pharmaceuticals, or foods without doing the proper research first.  It’s just good to understand that some industries will perform well even in times of recession and inflation.  If you’re a stockholder, the increase in the price of these goods may not worry you as much if the value of your stock is increasing as well!

6. Invest in TIPS

TIPS stand for Treasury Inflated-Protected Securities.  They’re government bonds that actually increase in value with inflation.   The value of your principal will adjust according to the CPI (Consumer Price Index).  The great part about TIPS is that when your investment matures, you get the adjusted principal or original investment – whichever is greater.  TIPS can be purchased from the TreasuryDirect website in 5, 10, and 30 year terms.  For even more information on TIPS, you can read this article on How TIPS Work.

So where have you felt inflation lately?  What have you done to lessen the effects in your family’s finances?

Image from Lightspring/Shutterstock

Related Articles:

• Effects of Inflation
• How to Avoid Lifestyle Inflation
• Buying Groceries In Bulk: The Hidden Dangers
• 15 Ways to Cut Your Expenses – GS2

Tim is a personal finance writer at Faith and Finance a Christian financial help blog that provides financial insights for individuals, businesses, and churches. Outside of finance, Tim enjoys spending time with his wife, playing the saxophone, reading economics books, and a good game of RISK or Catan. Find him on Twitter and Facebook.

Many keep claiming gold and silver are in a bubble…  Many say it’s going to the moon… Who’s right?

We at Faith-Based Investor have been bullish on gold and silver for many years.  If you bought silver when we first presented the opportunity, you could have bought silver for under $17 an ounce and today could sell it for over $40! If you first bought gold when we discussed its potential you could have bought gold under $800 an ounce and now could sell it for well over $1,800 an ounce!

Just look where gold prices have gone:

2000 — $273.60
2001 — $279.00
2002 — $348.20
2003 — $416.10
2004 — $438.40
2005 — $518.90
2006 — $638.00
2007 — $838.00
2008 — $889.00
2009 — $1118.40
2010 — $1421.40

2011 (so far as of 9-4-11 ): $1,887.56

If you are like us and think gold and silver still have a long way to go upwards, then you may want to look at mining companies.  Some of our estimates for gold have it at $2,500 to $3,500 an ounce over the next few years as the global financial crisis lingers on.  We believe silver could hit $100-$150 an ounce.  Gold and silver mining companies may currently represent a cheaper way to participate in the rally. As always do your own homework, but here are ten mining companies we are watching closely…

Ten Mining Companies to Consider

1. Barrick Gold Corp. (NYSE: ABX): Barrick Gold Corporation engages in the production and sale of gold, as well as related activities, such as exploration and mine development. The company has a portfolio of 25 operating mines and a pipeline of projects located in North America, South America, the Australia Pacific region, and Africa. It also produces copper and holds interests in oil and gas properties located in Canada. The company was founded in 1983 and is based in Toronto, Canada.

2.  Compania de Minas Buenaventura SA (NYSE: BVN):  Compania de Minas Buenaventura S.A.A., a precious metals company, engages in the exploration, mining, processing, and development of gold, silver, and other metals in Peru. It also explores for zinc, lead, and copper.

3. Eldorado Gold Corp New (NYSE: EGO): Eldorado Gold Corporation, together with its subsidiaries, engages in the discovery, exploration, development, production, and reclamation of gold properties in Brazil, the People’s Republic of China, Greece, and Turkey. It operates the Kisladag gold mine in Turkey; the Jinfeng, Tanjianshan, and White Mountain gold mines in the People’s Republic of China; and the Vila Nova iron ore mine in Brazil.

 4. Gold Fields Ltd New Adr (NYSE: GFI): Gold Fields Limited engages in the acquisition, exploration, development, and production of gold properties. It also explores for copper. The company holds interests in mines located in South Africa, Ghana, Australia, and Peru. It has total attributable gold equivalent mineral reserves of 78 million ounces and mineral resources of 281 million ounces. The company was founded in 1968 and is based in Sandton, South Africa.

5. Iamgold Corp (NYSE: IAG): IAMGOLD Corporation, together with its subsidiaries, engages in the exploration, development, and production of mineral resource properties worldwide. It primarily explores for gold, silver, zinc, copper, niobium, diamonds, and other metals. The company holds interests in eight operating gold mines, a niobium producer, a diamond royalty, and exploration and development projects located in Africa and the Americas.

6. Pan American Silver Corp (NASDAQ: PAAS): Pan American Silver Corp. engages in the exploration, development, extraction, processing, production, refining, reclamation, and operation of silver properties. The company also produces and sells gold, zinc, lead, and copper.

7. Randgold Res Ltd Adr (NASDAQ: GOLD): Randgold Resources Limited, together with its subsidiaries, engages in the exploration and mining of gold mines in west and central Africa.

 8.  Royal Gold Inc (NASDAQ: RGLD): Royal Gold, Inc., together with its subsidiaries, acquires and operates precious metals royalties. The company owns royalty interests in various production, development, evaluation, and exploration stage projects, which explore for gold, silver, copper, lead, and zinc metals.

9.  Silver Wheaton Corp (NYSE: SLW): Silver Wheaton Corp., together with its subsidiaries, operates as a silver streaming company worldwide. The company has 14 long-term silver purchase agreements and 2 long-term precious metal purchase agreements whereby it acquires silver and gold production from the counterparties located in Mexico, the United States, Canada, Greece, Sweden, Peru, Chile, Argentina, and Portugal.

10.  Silvercorp Metals Inc (NYSE: SVM): Silvercorp Metals Inc. engages in the acquisition, exploration, development, and operation of silver mineral properties in China and Canada. The company holds interests in four silver, lead, and zinc mines, including the Ying Project, the HPG Project, the TLP Project, and the LM Project at the Ying Mining Camp in the Henan Province of China.

Why Miners?

When fear is at its peak gold and silver tend to soar!

Fear has taken the stock market as a hostage the past few months.  Gagged and tied up, the markets have been paralyzed unable to shake its yearly lows.  One of the biggest beneficiaries of the tough times in the global recession has been gold.  This precious metal is inching its way toward $2,000 an ounce, an increase of nearly 30% just since the beginning of 2011.

When investors become increasingly nervous they tend to flock toward perceived safe havens like gold, causing its price to rise, sometimes rapidly like we have seen this year.  One segment of the metals market that hasn’t quite enjoyed the nice ride to the top have been the mining companies who pull gold and silver out of the ground. Yet they are playing catch-up!

Historically gold and silver mining companies provide leverage on gold and silver prices.  Take for example a 1% increase in the price of gold.  Normally you would tend to see a 2% or 3% rise in the price of gold mining companies.  So far, this has not been the case. I believe this presents an interesting buying opportunity.

Because ultimately gold and silver mining companies are stocks, investors have been “throwing the baby out with the bathwater”. Meaning, investors are punishing the good along with the bad as they run from risk and seek safety.

Additionally when oil prices exceeded a $100/barrel this cut into profits for the miners.  Now that oil prices have fallen to around $80 or so a barrel, this also should help miners catch up to soaring gold and silver prices. Many of these miners also offer dividends which can add to the attractiveness of these shares.

So if you are bullish on gold and silver consider adding a miner or two to your overall mix.  You could even buy a basket of miners like the ten we listed above.  As always do your own homework!

Those who want exposure to miners without buying and selling the individual companies could also consider three miner ETFS: Market Vectors Gold Miners ETF (NYSE: GDX), comprised of large gold mining companies; Market Vectors Junior Gold Miners ETF (NYSE: GDXJ), comprised of small and mid size gold miners; and GlobalX Silver Miners ETF (NYSE: SIL), comprised of a basket of silver miners.

What opportunities are you watching?  Which ones did I miss?  Do you think gold and silver will continue to soar? Or is it in a bubble?

Related Articles:

• Selling gold for cash
• How To Invest In Gold & Should You
• Don’t get ripped off selling your gold!
• How to negotiate with credit card companies – GS5

Jay Peroni, CFP® is author of The Faith-Based Millionaire, Chief Investment Officer at Faith-Based Investor, and host of the Rethink Wealth radio show. His life passion is helping individuals and businesses keep Christ first in the investment and financial planning process.