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Tax Preparation: Should You Do It Yourself Or Hire A Pro?

Filing income taxes is no small task to undertake. You must compile income earnings reports, tax statements, receipts for deductions, and certain legal documents in order to get started. Once tax preparations begin, you must also significant amount of free time to go through the nuances of the ever-changing IRS laws. These facts are true whether you meet with a tax professional or file on your own, but which choice is better for you? There are pros and cons to both.

Hiring a Tax Pro

Theoretically, a tax preparation specialist spends years studying tax law. Because laws change every year, a pro knows to stay on top of those changes, ensuring that you will have as little tax burden as possible, all while helping you to avoid an audit. Another bonus is that you can hand over your paperwork and go about your day while your taxes are done for you.

On the downside, professionals can be fairly costly. Likewise, if you hire a service that relies on a high volume of clients, you may not receive the hands-on care for which you are paying.

You Should Hire a Professional if any of the following are true:

  • You earn more than $200,000 per year
  • You have overseas banking/investment accounts
  • You are a business owner
  • You practice day trading
  • You have a large number of deductions
  • You have little free time on your hands
  • You are not confident with your own accounting skills

DIY Tax Filing

There are a lot of reasons to skip the professionals and do your taxes yourself. It is less expensive, the timing is flexible, and you have the ability to be as meticulous as you wish. Conversely, doing taxes yourself means that you must have the time and care to do a thorough job. Tax law is extremely confusing, even to professionals at times, which makes a proper job even more difficult. If you are audited, you will need to hire a tax attorney who is unfamiliar with your earnings.

Tax preparation software helps with understanding the complexities to income tax filing. Many choices also give you the option of hiring a tax consultant or audit representation. Unfortunately, these can sometimes cost nearly as much as hiring a pro from the outset.

You Should Hire a Professional if some or all of the following are true:

  • You earn under $200,000 per year
  • You have few income streams to report
  • You need flexibility with your hours
  • You have a quiet space to work
  • You have little money to spend on a tax pro
  • You are adept at math and organization
  • You enjoy accounting-related tasks

If you are still unsure about filing your taxes yourself, and you have some flexibility with your time, it may be wise to start your taxes at home. You can begin with a free tax preparation program or by completing free forms online. The IRS provides these items for you here. Once you get started, you may be able to judge more accurately if you can and should file your own taxes.

Even if you plan on hiring a professional, it is a good idea to understand tax law and deductions as completely as possible. One of the best ways to learn is with hands on experience.

Tax Prep Help

Some may be able to have the best of both worlds. The Volunteer Income Tax Assistance program provides tax help from certified tax preparers to people who want to file their own taxes. The program is free to those who qualify.

You may qualify for VITA if you…

  • Earn under $53,000
  • Have certain disabilities
  • Are a senior citizen
  • Do not speak English as your first language

Even if you don’t qualify for VITA, you may receive assistance through Tax Counseling for the Elderly if you are 60 or older. Click here to find the closest VITA or TCE center.

If you don’t qualify for free tax help under VITA or TCE, but you still want to file your own returns, you do have another option for answering any of your tax questions. The IRS has an Interactive Tax Assistant with FAQs and a searchable database. The ITA takes you through a step-by-step process pseudo-interview process with a goal to answer your questions thoroughly and with no fees.

filing taxes

Need to Know Info About Filing Your Income Tax

January is nearly at a close, which means most residents of the US are preparing their 2014 income tax returns. Whether you are expecting a big refund or dreading writing that check to Uncle Sam, make sure you have all the information you need before you complete this yearly chore.

You Can File for Free

Tax preparers make a fortune off of individuals who must file income taxes but do not want to carry the burden on their own. However, income tax preparation can be very simple and extremely inexpensive. This is especially true if you have few avenues of income and no special situations.

A family that makes under $60,000 per year can use this IRS tool to find a free software program. It is important to note that some companies, like TurboTax, offer free state filing as well, while other companies may charge a fee for this additional service.

If you make over $60,000, the IRS makes online forms available to you. These forms do not give you the same guidance as a software program, and they only apply to federal taxes.

Not Everyone Has to File

Some individuals find themselves going through the frustration of filing taxes though they do not have to according to the law. However, according to the IRS, even those who do not have to file should in order to get any refund that is owed to them.

Use this tool to learn if you can avoid filing a federal income tax return. In all likelihood, you will need to file a state return regardless of your federal status.

You May Have More Deductions Than You Realize

Deductions are arguably the most confusing aspect of income tax. Earnings are fairly straightforward: You report everything you earn throughout the year, including interest, winnings, and inheritance. However, there are some business expenses that you may think you can deduct that you cannot, and there are many deductions that you should take that you might not even consider.

Charitable contributions are tax deductible if you itemize. Any time you decide to donate garage sale leftovers, old furniture, or used clothing, be sure to calculate their reasonable worth and get a receipt. This goes for any other type of donation that is made to a not-for-profit organization. Note: Some charities offer free event tickets, food items, or other prizes when you donate. If you accept any of these, you cannot make the deduction.

State sales taxes are oft-overlooked deductions that can make a significant difference in the final figure. Use the IRS Sales Tax Deduction Calculator to get an idea of how much you could deduct on your taxes.

Were you looking for a job in 2014? You can deduct some job-hunting related expenses. This might include resume services, transportation, and even food and lodging if you are paying out-of-pocket to seek out-of-town jobs. You cannot deduct clothing even if it was purchased specifically for interviews. You also cannot make this deduction if you were employed while you were looking for work elsewhere.

Audits Are Rare and Mostly Avoidable

If you are both honest and meticulous when it comes to tax time, you are highly unlikely to face an audit. The IRS prefers not to conduct audits because they are very expensive and time-consuming. Indeed, only about one percent of tax filers face an audit each year.

If you want the lowest risk of an audit, avoid the “red flags” that cause the IRS to take a closer look at your return. While the largest red flag items may not be entirely truthful, like earning more than $200,000 or claiming a loss on rental properties, others can and should be double checked before filing the final tax documents.

Make sure to report all earned income. This includes primary employment, part-time jobs, gambling winnings, sweepstakes prizes, and inheritance. Debt forgiveness is also considered as a type of income and, unless the debt informally between two friends, it was likely already reported to the IRS. If your income does not match what the IRS already has on file, an audit may be on the horizon.

Excessive business deductions may lead to an audit as well. Significant travel expenses, entertainment expenses, clothing, and even surgeries that have been said to be job related have triggered audits in some cases. You should be able to deduct legitimate business expenses, but you need to always make sure that they are deductible items.

You Can Track Your Refund Online

The IRS has a tracking tool for refunds. You will need to remember the exact amount of your refund in order to check the status, which is updated once each day. If you are filing jointly with a spouse, you will also need to have the social security number for the head of household.


Stretch Vacation Dollars With Off-Season Travel

Travel dollars are often thought of as strictly entertainment expenses, which means that they are inessentials that are sadly pushed aside with relative ease. This is unfortunate, because many studies have shown that vacations are essential for overall health and happiness. Those who take regular vacations lower their risk of heart disease by 32 percent. They are also more productive and less stressed than their non-vacation seeking counterparts.

Vacations also stimulate the economy. The travel industry generates approximately $1.5 trillion per year and creates over seven million jobs. A recent Oxford Economics study shows that, if US workers took all of the vacation time they were allotted, an additional 1.2 million jobs would be created and an additional $52 billion would be added to the industry.

Of course, all of this information does little for those who believe they cannot afford to travel. Nearly half of all US workers with paid time off avoid spending vacation dollars, largely because they believe they cannot afford to travel. Luckily, there is a way to get away without over-spending.

Travel During the Off-Season 

The off-season, also referred to as low season, is the time when a location experiences its fewest number of visitors. Fewer tourists can be due to simple timing or expectations of poor weather. During this off-season, many expenses can be quite inexpensive. Hotels lower prices in order to fill their empty rooms. Airlines may drop prices in order to avoid flying without a full cabin. Cruise ships offer rates that make nearly any land-lubber excited to sail. Entertainment and even meals can be less pricey when businesses simply need to get more bodies through the door. Indeed, traveling during the off-season can allow tourists to experience the trip of their dreams for a fraction of the price.

Interestingly, the low season is not the same in every location. Most spots experience their highest tourism numbers in the summers and around holidays. Likewise, the holidays that cause prices to increase vary from country to country. For instance, domestic travel in the U.S. is at some of its highest prices during the fourth week of November in recognition of Thanksgiving. This is not so in other places that do not observe this American holiday.

Another factor that affects the price of off-season travel is local festivals. These events can draw massive number of visitors from all over the world, allowing hoteliers and restaurateurs to lift their prices with ease. Though most take place in the summer months, festivals can take over a region during various points of the year. A well-known example of this is Rio’s Carnaval, held in February. Holi, celebrated throughout India, is in March. Munich’s Oktoberfest is celebrated in September and October. All of these months are generally considered to be off-season or shoulder-season, but the special events change their status.

Stateside Travel In The Off-Season

Those who wish to stay domestic can find great off-season rates if they travel from mid-January through mid-March. Once Spring Break arrives, prices increase around the country. They tend to stay high through Easter, and then drop again until May. The month of May is often part of the shoulder-season, where prices are lower than the high season, but not as low as off-season travel.

The summer months of June, July, and August are the pricey in the United States, but those costs start to drop in the shoulder season of September and early-October. Mid-October through mid-November is another off-season time. Prices go back up for Thanksgiving and tend to stay elevated until after the New Year.

Off-Season In The Summer

Some families simply cannot get away during the off-season. Many employers count on their workers only taking summer breaks. Most schools are built on the premise of long breaks only occurring from June through August. Luckily, there are places where families can travel for less in the summer months.

The Caribbean is a tourist hotspot all year, but summer, particularly early summer, is hurricane season. Tourists who are willing to brave possible rain and high winds can get a fairly decent discount. Belize and Mexico are both inexpensive and beautiful, with plenty to see and do for couples, singles, or families.

Indo-china is a beautiful and exotic location. The off-season, known in this spot as the green season, presents the possibility of typhoons, instant flooding, and extreme heat. On the other hand, the rains typically only come in the early evening, crowds stay small, and prices are much lower.

Anyone who has ever wanted to visit the land down under can do so in the summer. Australia’s off-season is May through August, which is that region’s winter. July in Australia offers lower temperatures and about six hours of sunshine. Travelers will need a jacket for their trip abroad, but they will be rewarded with a low cost vacation of which others can only dream.


10 Tips for Credit Card Success

Credit card companies offer a number of benefits to those users, and those benefits are increasing in both quantity and quality with each passing day. As the number of credit card holders continues to decline, the industry finds itself needing to revamp its image as well as its offerings.

A recent Gallup poll found that of the 71 percent of Americans who own credit cards, 64 percent pay off their monthly balances at least most of the time. This is a five percent increase from just six years earlier and a 12 percent increase from the 2004 poll. While this is a great indicator that Americans are getting smarter about their credit card purchases, there is still more that can be done.

1. Pay The Full Balance Every Month

The Gallup poll indicates that less than half of credit card owners pay off their balances each month while another 16 percent usually pay off their credit cards. That usually is a big problem. The average APR on a credit card is 14.9 percent. If a user leaves a balance of $500 on a credit card for just one month, he or she will need to pay an additional $74.50 when the next payment cycle rolls around. Even the interest owed on a $100 balance could pay for a meal out and a cup of coffee.

2. Setup Auto Payments

Credit cards allow their users to pay online. Most, if not all, allow their users to setup auto payments that automatically deduct from a savings or checking account. Users can select to pay the minimum payment due, a set monthly sum, or the entire balance. Scheduling an auto payment safeguards those who may forget a payment date, which then leads to additional fees and interest.

3. Spend Minimally

It should go without saying that credit card users should not outspend what they can afford. Credit cards will set high limits, and in a few rare instances, no limits, but this should be viewed as a safeguard, not as a challenge. Like an all-you-can-eat buffet, a high limit credit card does not mean the user needs to overextend their spending. A good rule of thumb is to treat the credit card like a debit card, only spending what can be paid off in total by the end of the month.

4. Look For The Best Rewards

Some credit card companies offer outstanding rewards to their users. These often come in the form of cash back on purchases or points that are earned for gift cards or other perks. Even within the same company, different credit cards can have varying rewards programs. Likewise, some change their incentives annually, quarterly, or even monthly. While one credit card may offer five percent back on supermarket purchases, another may offer six percent on trips to the gas station. It may be worthwhile for some users to keep multiple credit cards, reserving each for the one that gives them the biggest bonuses. Naturally, this only works if the user can ensure all cards are paid every month.

5. Utilize Discounts With Discretion

Many credit cards include a special offers page for all users. The page lists a variety of retailers, letting the user know that they will earn discounts or increased points by clicking through this portal and then using the specific card for purchases. This can be a great feature unless the user intends to apply a discount code to the purchase. Often, any savings or earned rewards are negated with the utilization of a discount code. Likewise, codes for 20 percent off or free shipping are often worth far more than what a credit card’s portal can provide.

6. Search For Hidden Fees

The wisest card holders never allow their balances to carry over from month-to-month. However, if that does happen, some people will pay dearly. There are cards that charge an additional fee along with interest if a balance is left on the card. Other common fees include balance transfer, cash advance, foreign transaction fee, closure fee, and even an inactivity fee. In addition, some small businesses may issue a surcharge to cover their expenses for those who use credit cards. Though this is not legal in all states, many states allow retailers to provide discounts to customers who pay with cash.

7. Monitor Credit Ratings

A credit card user is only as valuable as his or her credit rating, or so believe the credit card companies. Knowing one’s own credit score is vital when seeking loans or rate increases. Keeping a close eye on credit ratings also allows a card holder to be immediately aware of any fraudulent activity.

8. Renegotiate Terms

Holding a credit card does not mean that one must settle for the same APR and rewards program for a lifetime. Card holders can and should attempt to renegotiate terms as often as they like. This is especially true of those who improve their credit score.

9. Shun Department Store Credit Cards

Department store offer excellent discounts to first-time card holders. They often offer a large percentage off of an initial purchase along with regular coupons for card holders. However, they also have much higher APRs, which means that if a user does manage to carry over a balance, he or she will be paying roughly double the amount of interest of a standard issue card. Likewise, store credit cards tend to have low limits. If a user charges close to the max, he or she could easily see their credit score drop in one shopping trip.

10. Scrutinize All Transactions

One of the most important aspects to wisely holding a credit card is safeguarding its usage. Too many people trustingly look at the lump sum due before making a payment in one fell swoop. They might miss small, seemingly innocuous charges that could later lead to big problems. Professional credit card fraudsters will start their usage of a card in this way. They may order small items online, like socks or batteries. If this charge is not caught, they will move on to bigger and better things until a card holder’s credit line is maxed out and the authorities have to get involved. Even without fraudulent activity, closely observing one’s own credit card can help them find any accidental double charges or simply better understand their own spending habits.

credit vs debit

Should You Use Credit or Debit? The Answer May Surprise You

Credit cards have long been treated as the scourge of the financial world. Too many people get far too overextended in credit card debt, resulting in financial struggle, poor credit ratings, and even bankruptcy. One of the first suggestions amateur financial planners make to individuals is to cut up their credit cards and live on a cash-only basis. However, using a credit card may not just be a good choice, it may be the best one.

Credit Cards Offer More Perks

When was the last time your debit card offered a cashback bonus? How many rewards points do you accrue from deducting money directly from a savings or checking account? If your answers are “never” and “none,” you are not alone. In fact, finding a debit card with any kind of earnings perks is like finding a needle in a haystack. There may be an occasional promotion from a bank, but they are often very small and short-lived.

On the contrary, credit card companies compete with each other every day. It is not enough for them to simply have you hold a credit card in your wallet; they want you to use their card for everyday purchases while shunning all others. They may do this by letting you accrue points that can be used to make purchases, cashback offers that can be applied toward your balance, or gift cards to various shops, restaurants, or even vacation destinations. These reward programs can vary greatly from company to company and card to card.

Credit Is Safer Than Debit

As more and more purchases are made online, there are more instances in which your fraud-protectionpayment data can be compromised. This is not a reason to avoid shopping; it is a reason to use a credit rather than a debit card. Most credit card companies have built-in fraud protection that will cover any unauthorized transactions. This means that if someone in Ohio buys three iPads using your credit card information, you will not be responsible for paying for them and your credit won’t be destroyed. Indeed, thanks to spending alerts, it may be your credit card company that alerts you to the fraudulent purchase in the first place.

The online world is not the only one in which credit card data can be compromised. Retailers like Home Depot and Target have suffered from breaches in their card reading systems. Whereas any credit card information obtained can lead to a worrisome hassle, if debit card information is stolen, your entire account can be wiped clean. If this happens, most people must brace themselves to face a lesson learned the hard way.

Credit Makes Traveling Easier

Filling up a tank of gas is less expensive than it was in the past, but most gas stations still put a significant hold on your account if you try to use debit or credit. As fewer people carry cash, it is most likely that tank of gas is accompanied by the swipe of a card. If you don’t have $200 in your bank account, you just may be out of luck. The same is true for car rentals, hotel stays, and various entertainment expenses. The companies that charge these holds do so to protect themselves. These account holds guarantee that you will be able to pay in case you overextend your rental, cause damage, or use more of a product than you initially intended.

Credit cards are even better if you plan to travel overseas. Debit cards may not be accepted at all, while currency exchanges can be confusing, to say the least. Though you do need to have some cash on hand while traveling in a foreign country, many of your hotel, transportation, and dining expenses are easily paid with a credit card. Just make sure yours has no foreign transaction fees before you travel.

Credit Cards Will Fight For You

If you are unhappy with your debit card, you can go through the trouble of switching banks and moving your accounts. If you are unhappy with your credit card, odds are pretty good that the company will do whatever it can to stay in your good graces. Sometimes this means lowering your APR or raising your spending limit. Other times they may offer an account upgrade, which gives you more perks. Some credit cards even offer free club memberships, gift cards, or cash that will be deducted from a future purchase. This is, of course, if you are in good standing with your company.

In order to keep your credit card from causing any financial problems, you simply have to remember two rules: Don’t spend more than you can afford and always pay on time. Treat your card like debit, but enjoy the rewards of credit. If you are able to master this, you will come out on top.

Why You Should Buy a Home in 2015

Why You Should Buy a Home in 2015

If you are looking for a starter home, a second home, or an upgrade, 2015 may offer your last best chance to buy for a while. With mortgage rates set to rise in the near future, more people will be competing over the same properties. If you buy now, you could save yourself tens of thousands of dollars or more.

Play the Down Payment Game

If you are a first-time home buyer or haven’t owned a home for three years or longer, and you have good credit, you may qualify for a loan with a three percent down payment through Fannie Mae or Freddie Mac. This is a great choice if you don’t have a lot in savings but still want to own your own home. However, if you want to take advantage of this low down payment, you will have to act fast. These rates are set to rise after March 23.

The downside of a low down payment is higher interest rates. According to recent census data, the average cost of a home in the U.S. is about $320,000. A three percent down payment of $9,600 is a steep drop from the more standard 20 percent, which would be $64,000. However, that $54,400 upfront savings is more than made up for over the course of a 30 year loan. Whereas a 20 percent down payment can offer you an interest rate of about 3.9 percent, a lower loan may be seven percent or higher. That extra $800 per month could end up costing you over $300,000 through the life of your mortgage. That is not including the additional insurance expenses and fees that arise from low down payments.

This is not to say that you should not jump on the low down payment while you can. If your plan is to invest in a home and sell at an eventual profit, you may come out ahead. You can also attempt to refinance a mortgage at a later date so you can take advantage of a lower future interest rate along with the present low down payment.

Take Advantage of Interest Rates

Low interest rates have been the norm for the last few years, but all of that is changing inmortgage-rates 2015. In order to stifle inflation, the estimated interest rate boost will likely be about .5 percent and will show up in the second half of the year. In the meantime, you can still enjoy a mortgage rate that comes in under four percent.

If you have more flexibility with your budget, you can get an even lower interest rate by choosing a 15 year term rather than 30. Though a 30 year mortgage has become the norm, the savings on a 15 year note can be massive. The standard interest rate can drop by almost a full percentage point. On an average home, that is a long-term savings of about $100,000.

Understand a Buyer’s Market

Experts believe that home values will drop in 2015. This is partly due to a poor overseas economy, which is causing fewer foreign investors to place their money in U.S. properties. Another major factor is the current low cost of oil. As materials get less expensive, production booms. New homes will rise at a rate of about half what they did for the last three years, making them available at prices that are very attractive to prospective homeowners.

Before you get overly excited about the prospect of a buyer’s market, remember that there is a downside. With house prices and interest rates relatively low, along with an influx of Millennials suddenly looking to buy rather than rent, there will be a lot of competition in the marketplace. Competition is great for sellers, not so much for buyers. Negotiating with sellers may become a bit trickier, especially as the year wears on. That standard offer of 10 percent less than the asking price may turn into 10 percent more if there are enough other offers on the table.

Consider Alternative Locations

If 2015 is the perfect time to buy a home, it is also the perfect time to look in a variety of locations. Flexible work environments and the rise in entrepreneurship means that more people are working from home. This gives you more fluidity with your home base, which means you can get a lot more bang for your buck if you are willing to relocate.

The coasts may be attractive for their sights and amenities, but the Midwest and south are known for being affordable.  In 2015, you can spend less than $300,000 on a 5,000 square foot home, five bedroom home in northwest Georgia. Look for the same specs on a home in San Francisco and you will pay seven figures, though you’re unlikely to get the same amount of space or any acreage.

The same logic can be applied to vacation homes. Though you may dream of a beachfront property, not all are created equally. Hilton Head, South Carolina and Gulf Shores, Alabama have stunning vistas and a year-round vacation vibe, but they are sometimes hundreds of thousands of dollars away from one another in price. A tweak in your location can be all it takes to afford the home of your dreams, and 2015 is the best time to make those dreams come true.


Turning Dimes Into Millions

You have a one in 175 million chance of winning the lottery.

Your ancestors may expect to leave you an average of $177,000 as an inheritance, but sudden catastrophes and medical expenses drop that number to about $60,000. That is, if you are fortunate enough to inherit anything at all.

The fact is, if you are looking for a sudden windfall to fund your retirement, you are setting yourself up for financial failure. Luckily, there is another way to achieve the retirement of your dreams. Better still, you don’t have to have a large sum of money to get started.

It All Starts With A Plan

How much do you need for retirement? That is a question that has a very subjective answer. In order to calculate how much money you need to save, you will have to estimate items such as the rate of inflation, how many dependents you will be supporting, and what kind of lifestyle you expect to lead. You will have to guess how long you will live and whether or not you will have any major medical problems. You can do all of the math yourself, you can use a calculator that takes into consideration how much you already have saved, or you can just assume that you will need to save $1 million dollars by the time you are 65. If you are 64 and haven’t started saving yet, you may have a problem. However, if you begin saving at age 25, it is actually achievable for nearly anyone to retire as a millionaire. But how?

The Miracle of Compound Interest

The idea behind compound interest is fairly simple. Money that is used to purchase dividend yielding stocks is not spent. It is also money that continues to grow based on both the initial amount as well as the added interest.

For example, assume that you are 25 years old and finally have a job that allows you to have some extra spending money. Maybe you eat out a couple of times per week, spending $10 each time like the average American. You probably also spend $1,100 on coffee as well. Instead, if you pack a lunch and drink your caffeine at the office, you could save much more than $2,100 per year. In fact, assuming a five percent dividend that is compounded over the course of 40 years, those lunches and coffees could equal to a whopping $265,000 by retirement age.

That figure may sound robust when compared to a cup of coffee, but it is still a significant distance from one million. However, in order to reach your retirement dreams, you could already be about a third of the way there. You will need to put away about $700 per month, or $8400 per year for 40 years assuming that you start from scratch. That is less than half of the allowable 401(k) limit set forth by the IRS. These figures assume you start with nothing. If you have any kind of money that you can invest from the outset, you can either expand your retirement plan or invest less to achieve that million dollar status.

Starting Out At 35

When you should start saving for retirement is often very different from when you actually do. According to a recent Employment Benefit Research Institute study, workers age 35 or older are more likely to save for retirement than their younger counterparts. Even those who are saving still have less than $10,000 put away. How can a 35 year old, without the benefit of time, reach that million dollar mark by age 65? Once again, compound interest comes to the rescue.

A five percent dividend that is reinvested over the course of 30 years, versus 40 years, can surpass $1 million if an individual is will and able to part with a figure close to the previously mentioned amount of retirement saving allowed by the IRS. A monthly investment of $1450, assuming no principal savings, can reach a staggering $1.2 million using modest accounting.

How Do You Save?

The next big question comes not from how compound interest works, but how to get that money to put into an investment account in the first place. Most financial experts recommend starting small. As mentioned earlier, cutting back on eating out and buying overpriced coffees will get you started. Other no-brainers like not carrying interest on credit cards, buying homes and vehicles that are within your means, and avoiding student loans should help you avoid overextending yourself. Perhaps the most important, and most difficult, is simply growing accustomed to viewing those investment dollars as a part of your future salary rather than your current one. Immediately reserving that money in a dividend yielding investment account gives you the security you need for your future without the temptation you don’t need today.



The Best 10 Stocks For Your Portfolio In 2015

Like most investors, you are probably looking for the best way to increase your earnings in 2015. The time-tested standards of investment continue to ring true: study stocks before investing, diversify your portfolio, and have a range of high-risk and low-risk investments. When adding new stocks to your portfolio, consider the following, which many analysts agree are poised to have a great year as well as many more to come.

1. Air Lease Corp.

The travel industry is projected to have a big year in 2015. While airlines like United Continental Holdings are safe bets, the relatives newcomer, Air Lease, is on the brink of a bright future. The company, founded in 2010, leases aircraft carriers to companies like Southwest, United, British Airways, and 76 others in more than 40 countries around the world. Analysts rate Air Lease as a buy for anyone wanting to diversify while adding little risk.

2. Danaher Corp.

The medical industry is arguably one that will never die. When looking to expand your portfolio in 2015, look to Danaher to provide that boost you desire. Why do experts argue that Danaher is the medical stock to buy in the coming year? This is possibly due to the company’s focus on key sectors: Tests & Measurement, Environmental, Life Sciences, Dental, and Industrial Technologies. The company has made its mark in everything from dental implants to cybersecurity, and its stock prices reflect its ever-growing profits. Most experts agree that you should wait for a dip, but when that inevitably comes, you should pounce on Danaher stock.

3. Honeywell International

Honeywell has had its ups and downs in 2014, but the stock has made it onto the buy list for many industry insiders. Indeed, Honeywell represents a new mainstay in any well-conceived stock portfolio. The company has met and exceeded its expectations over the course of the last five years and has a new five-year plan on the horizon. Honeywell is known for manufacturing aircraft and missiles, but the company is also involved in a wider variety of sectors, such as healthcare, fertilizers, and even plumbing.

4. Apple

If you don’t already own Apple, now is arguably the best time to rectify that problem. Stocks are relatively low entering into 2015, while earnings are projected to continue to grow over the next three years. If the low stock price isn’t enough to entice you to buy, the company is slated to unveil more products in 2015, including the much hyped Apple Watch.


Every investor who has done his or her research has seen as a buy for some time now. Though the company has yet to see a profit, the 15-year old has taken customer relations to the next level. The company itself has been highly ranked by Forbes and Fortune for innovation, which uses cloud-computing to connect companies to customers.

6. Iconix Brand Group

Brand management may not be the first sector that comes to mind when you are evaluating your stock portfolio, but many insiders think it should be. Iconix licenses brands such as Candie’s, Badgley Mishka, Rampage, Umbro, and Sharper Image to name a few. As a manager rather than a retailer, Iconix manages to earn a reasonable profit while maintaining no inventory and low overhead. It is also a prime time to buy as Iconix recently signed a deal with Peanuts. The long-beloved comic strip will release a feature film in December 2015, which will undoubtedly pave the way for more merchandising and higher profits for all involved.

7. General Motors

If there ever was a time to buy General Motors, it is now. The company has had a low year due to a number of problems, not the least of which were recalls that led to billions of dollars in losses. With those losses in the past, as well as a restructuring in Europe, GM stock can significantly rise. Experts think is probable, especially considering the boom in consumer confidence in the United States. Some expect a 60 percent rise in profit over the course of the next three years.

8. American Airlines

The rise in consumer confidence is truly expected to be realized by American Airlines. The carrier had a great year in 2014, thanks in part to its merger with US Airways. The drop in oil prices is a bonus for American in two ways as well. The biggest expenditure of all airlines is fuel, which has decreased and will, by most accounts, continue to stay low throughout the year. Likewise, the falling price rate of flights and the boom in employment will fill more seats in 2015.

9. Royal Caribbean

Investors who want to take stock in travel in leisure but are still weary of investing in airlines can look to the seas instead of the skies. The earnings for the company far outpaced projections in 2014, and those are slated to grow as well. The company is looking ahead to cruise routes in both China and Cuba, should the embargo with that company end. Likewise, cruise vacations offer an inexpensive alternative to resort stays, which is attractive to the baby boomer crowd.

10. Fluor Corp.

2015 is the year of the refinery. OPEC has stated that they will not stop drilling despite the surplus, which has caused a number of energy prices to plummet. Fluor, which focuses on refineries and pipelines, should stay strong through 2015. Since shares are down now, Fluor is poised to show growth to its investors, especially those expecting a hefty dividend. However, Fluor may not be the best bet for the long-term. Look to sell this stock when it reaches a high, as 2016 may not be the company’s best year.

happy new year

The Five Best Stocks For 2015

Nearly everywhere you look, you will find advice about which stocks are the best choices for the coming year. Every expert has plenty of reasons to suggest specific stocks. While none of these should be ignored outright, there are reasons to look at these top five above all others.

History is one of the best indicators of a stock’s performance. While you may get lucky with a start-up or a company that only recently went public, you will have the most reliable results with a company that has shown itself to be profitable at least over the last year. Likewise, looking at current trends and projections will give you a perfect marriage of past, present, and future.

1. Under ArmourUnder-Armour
The shoes, apparel, and accessories offered through Under Armour are seemingly seen on every man, woman, and child. This hasn’t passed by unnoticed to the company’s shareholders, who have seen a more than 50 percent gain in 2014. Projections for 2015 show more than a 26 percent growth, with a five-year growth expected to be in the mid-twenties as well. Under Armour is currently one of the fastest growing athletic companies, simply due to its size. As it is still a small company as far as athletic apparel is concerned, its likelihood for growth is enormous.

2. The Kroger Company
Supermarket chain Kroger is near an all-time high at the end of 2014’s fourth quarter. Thiskroger is the apex of a steady rise throughout 2014, even when competitors like Whole Foods and Target have seen ebbs and flows. As the largest supermarket chain in the country under brands like Gerbes, Dillons, and Ralphs, the company continues to spread its presence. Likewise, Kroger owns jewelry stores Fred Meyers Jewelers and convenience stores like Quik Stop and Loaf N Jug. According to analysts, investors can expect a growth of 10 percent in 2015.

3. Signet Jewelers
Though Kroger may have their claim on a few specialty jewelry stores, Signet Jewelers remains strong as the world’s largest retail jewelry store. The company operates nearly Signet_Jewelers_logo2,000 jewelry stores in the U.S. including Kay Jewelers, Jared the Galleria of Jewelry, and Friedlander’s Jewelers. The stock reached its high in early December, which is to be expected during the holiday season, but the company experienced highs throughout 2014. Likewise, Signet has gone above and beyond expectations nearly every quarter for the last four years. In addition, analysts expect this trend to continue, with a 23 percent growth on the horizon.

4. United Continental Holdings
Oil prices are lower than they have been in recent history. This is going to put more
people on the road and in the air. United Continental has already had a good year in 2014; united-continentalinvestors can look for that to increase in the coming months. Oil drilling is not scheduled to stop, therefore the surplus will allow for oil prices to continue to drop. Even if crude stays at its current level, the cost of air travel may lower enough to get middle class families on vacation once again. Likewise, the company’s overhead has already significantly dropped. You may not get rich quick off of United Continental, but of all of the airline companies, it is arguably the best bet.

5. Marriott International
All of those air travelers need a place to rest when they land, and Marriott is poised to be their top choice in 2015. Marriott International has been steadily profitable for a while now, with projections continuing through the coming calendar year. marriottThe brand is wide-reaching, owning luxury hotels, resorts, select-service, extended stays, and timeshares. With a
brand that ranges from Ritz-Carlton to Fairfield Inn, Marriott International is able to supply lodging to visitors at most price ranges. Better still, the hotel chain has proved that they are profitable by meeting all earnings estimates, save one, for two years.

These five companies offer excellent growth potential through 2015 and likely beyond, though there are other companies that are also worth a look for both serious and casual investors. Kellogg is a buy-and-hold stock that has a decent earnings forecast and a dividend that is well-covered by earnings. Merge Healthcare has had repeatedly high earnings, which is poised to continue. A recent partnership with Cisco is allowing the company to share its healthcare imaging services around the world, which is reflected in its projected growth. Conversely, American Vanguard has had a lower year than usual, which is expected to boom in the spring when insecticides and herbicides are needed once again. Likewise, Yamana Gold is at a price ripe for buying with analysts expecting a boom in the cost of gold in 2015.

money tree

Five Reasons Investors Should Look Forward to 2015

A new year is on the horizon, and with it will come a number of benefits for investors. Indeed, 2015 is poised to be one of the most profitable years in recent history. Even as the markets continue to rise, we can expect to see bigger and better things in the coming months. Following are five of the reasons why 2015 is going to be a great year.

Consumer Confidence Is In An Upswing

The price of oil has decreased, which has put more money in the pockets of consumers. As everyone knows, those who have more money tend to spend more money. Better still, experts are arguing that oil prices will continue their downward momentum thanks to more production than demand.

We have already seen the results of these low oil prices with higher personal consumption expenditures. According to the Bureau of Economic Analysis, expenditures increased .5 percent when adjusted for price changes on goods. Though that is not abnormal for the end of the year, a December 21 Gallup poll showed that consumer confidence was at its highest for the year.

Employment And Wages Are On The Rise

Last year, employment was projected to lift sharply in 2014. While it is true that 2014 saw more jobs, and saw those jobs hiring better than ever, the largest upsurge didn’t come until November when the country saw an additional 314,000 jobs in the private sector. That increase will affect 2015 in a big way.

According to Economic Modeling Specialists International, the majority of the top growing jobs are in the sales, marketing, and healthcare industries. This is excellent news for investors and prospective employees alike. Additionally, because unemployment is relatively low, those taking up the positions in these fields are likely already gainfully employed. This is a bonus to investors, because employers will need to continue to raise salaries in 2015 to get the employees they desire.

Americans Will Travel 

Along with increasing regular expenditures, more money in the pocket means more time to travel. Whether going away for a weekend or taking a much-needed vacation, Americans will travel more in 2015 than they have in the past. This spreads money all over the United States in a number of industries. Hospitality, travel, and entertainment are areas that should see significant growth in the coming year.

The likelihood of people heading on vacation increases as well with a job market that has high demand for skilled workers. Wages alone are seldom enough to woo an employee away from another position. Employers must include perks, like additional vacation time, to entice the cream of the crop. Though Americans are well known for not taking the vacation days they earn, experts believe that this will change in 2015.

The Cost Of Goods Is Dropping

Deflation may not seem like a good thing for the average investor. However, the deflated prices of everyday goods gives consumers more money to use on entertainment. The American mentality, unlike that of overseas counterparts, is to spend rather than save any excess funds.

Deflation does not solely affect consumers. Businesses that find themselves spending less on goods and transportation have more money to spend on employment. Again, this puts more money in circulation, which continues to be spent.

Improving Class Relations

It may seem strange, in light of recent racial unrest, but class relations are actually improving. The so-called 99 percenters slowed to a halt with their Occupy movement back in 2012. Still, those who were frustrated with the ongoing gap between the very rich and everyone else took to social media to continue the debate.

Class distinctions are still apparent, but they are no longer discussed with such vigor as they once were. This could be because it is simply no longer en vogue, but it is more likely due to the fact that more people are gainfully employed. With Occupy Wall Street being a thing of the past, more people are investing and will continue to do so.

Along with these five reasons, history shows that mid-decade years tend to be excellent ones for investors. With all of these items considered, now is the perfect time to start or add to an investment portfolio. Though there is no such thing as a guaranteed perfect year for investing, 2015 is poised to come as close as any year in recent history.

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