5 Money Mistakes To Stop Making

Simple ways to put your best financial foot forward.
By Suze Orman

At this time of year, you might be tempted to draw up a long, overwhelming list of goals for the coming months. Fortunately, there's an easier way to put your best financial foot forward: If you can avoid a few common money missteps, you'll be on your way to a richer 2014 and beyond.

The Incredible Shrinking Paycheck

You'd like to save more for retirement, increase your emergency savings and pay off your credit card debt. But no matter how much you want to do the right thing, you find yourself spending your cash as soon as you earn it. Here's an easy fix: Automate as many financial decisions as possible. Have the bank transfer a set amount every month from your checking account to your Roth IRA and savings accounts, and set up auto-pay for your credit cards. (Be sure to submit at least 10 percent more than the minimum due to pay off the principal sooner and limit interest charges.) The less you have to think about how to spend every dollar, the more likely you are to spend wisely

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Estate Planning

This article courtesy of Feed the Pig. Copyright 2011 American Institute of Certified Public Accountants.

Estate planning is a process designed to help you manage and preserve your assets while you are alive, and to conserve and control their distribution after your death according to your goals and objectives. Estate planning is an important part of every financial plan, no matter the size of the estate. It's also an area that is often overlooked. With the right planning, you can save yourself, and your loved ones, money and emotional hardship. Here are a few things to consider.

Power of attorney. A durable power of attorney document lets you name someone to manage your property for you in case you become incapacitated and cannot do so yourself.

Advanced medical directive. The three main types of advanced medical directives are a living will, a durable power of attorney for health care (also known as a health-care proxy) and a "Do Not Resuscitate" order. Be aware that not all states allow each kind of medical directive, so make sure you execute one that will be effective for you.

A will. No matter your relationship or family status, it is a good idea to have a will. A will allows you to leave your estate to anyone you choose. If you've committed to a life partner but aren't legally married a will is essential if you want your property to pass to your partner should anything happen to you. Without a will state law directs that only your closest relatives will inherit your property.

An advisor. There are many factors that determine your particular estate planning needs. A financial professional, like a CPA, can help make sure you are doing everything necessary—and doing it correctly—to take care of your estate and provide for your loved ones.

For more estate planning information, visit 360 Degrees of Financial Planning

Roth IRA's

The primary advantage of a Roth IRA is that you make after-tax contributions—so when you withdraw that money in 20, 30, or 40 years, it’s tax free.

This year you can contribute up to $5,000 ($6,000 if you’re over 50) to a Roth or traditional IRA. With a traditional IRA, you get a tax break now—but you’ll owe taxes when you start withdrawing that money.

Bottom line: If you expect to be in a higher tax bracket when you retire—or you want a portion of your nest egg to be tax free—make a Roth part of your plan.

And remember: In many cases, you can open and fund a Roth in addition to your 401k.

Best and Worst Things to Buy in May

While every month features its own unique deal fluctuations, we often see overlap across months, especially when they fall within the same season. As such, some of the advice for May might sound familiar if you've diligently followed the April guide. That said, May has some unique shopping characteristics to take note of, like stellar Memorial Day sales later this month. So dive in and brush up on the best and worst things to buy in May.

Emergency Funds

by Donna Friedman

Suppose the first thing your boss says to you tomorrow is, “Clean out your desk.” Any idea how you’d manage?

Time for a financial fire drill: Imagine paring down your current expenses and creating a plan to cover just the basics.

“Basic” means exactly that—no indulgence left behind. Cut the cable. Nix eating out. Freeze the gym membership. Skip the salon.

You can be proactive in other ways, too: Investigate student loan forbearance. Find out how to apply for unemployment—and while you’re at it, stop by Benefits.gov to scan other forms of assistance.

Adjust your fire drill budget further by subtracting work-only expenses: extra child care, commuting, lunch.

Knowing your baseline budget is reassuring: If the SHTF, I could manage on as little as (scraped and sanded dollar figure) per month.

Compare that amount with your state’s unemployment benefits, plus whatever’s in your emergency fund. (Don’t have one? Start one.) Now you have some idea of how long you can manage until you find your next job. Or, God forbid, start a blog.

This came from an email I received from a site called Daily Worth.  I tried to find the article on the site to link to it but was unsuccessful.

What You Need to Know Before You Go

There’s a mountain of legal, financial, and accounting work after a death that nobody tells you about. Did you know that you have to file taxes for someone after they die? Or pay their bills on time to avoid penalties?

Do your family a huge favor and look death in the eye long enough to do these five things:

• Update the contact and beneficiary information in all of your important accounts (retirement, investment, insurances), then set a calendar reminder to check it yearly.
• Take inventory of all your assets and expenses.
• Complete a healthcare proxy with your desired medical/end-of-life instructions.
• Select someone to serve as executor or trustee to oversee your estate.
• Review your assets and medical wishes with your executor or trustee, then store the information somewhere secure.

From DailyWorth.com

Do You Know Your "ID Score"?

Everyone has heard of credit scores, but bet you are not familiar with "ID scores." Under changes to the Fair Credit Reporting Act going into effect on August first, financial institutions and others will have to have methods in place to detect and respond to instances of ID theft. As a result of this, more companies will want to assure themselves that customers they do business with are really who they say they are. To do this, they may use third party applications that help verify your identity. A popular system is to check your ID score -- a number from 1 to 999, where the higher the number the more likely that ID fraud is a possibility. You can get a free copy of your id score (based on one company's calculations) at MyIdScore. You will be asked to optionally input your social security number, among other things. Without your SS#, the system will render a significantly higher score than with it. (MrConsumer's ID score was 70 with, and 303 without.)

Everything You Always Wanted to Know about Personal Finance on One Page

The Simple Dollar is offering a free ebook of money management tips. [Look for the "Download it now" link.] Ebook? Isn't it supposed to be one page? The main tips fit on one page, and there are 48 more pages of explanation!