Financial Planning Truths

There were twins bothers, let’s call them Matt and Marc. Their uncle encouraged them to start saving and investing at an early age. Matt jumped on this advice right away and at age 21 he started contributing $5,500 to his Roth IRA every year. He did this for 10 straight years until he was thirty. He then decided he had enough saved for retirement and wanted to spend more money on his family. He did not contribute anymore to his retirement fund. His brother Marc waited ten years to act on his Uncles advice but at age 31 he began putting $5,500 a year into his Roth IRA and did so every year until he retired. Both brothers retired at age 65. Marc had taken a total of $192,000 out of his hard earned pay over the span of 35 years and put it toward his retirement. Matt only took a total of $55,000 out of his pay to put toward his retirement over a ten year period. They both got good advice from their uncle on how to invest the money and enjoyed an average rate of return of 8% over ...

The answer to this question depends on the person. As a general rule, if you pay off you balance every month and you are disciplined enough to not buy anything you would not buy anyway , a credit card is significantly better that debit card and both are significantly better than cash. If you have decent credit you should be able to get a no fee credit card, possibly with cash back or some other perk without any annual fees. You just need to shop around. First and for most: credit cards offer more and better protection than debit cards. Debit cards are governed under the Electronic Fund Transfer Act, (EFTA) and while that act provides you some protection there are holes in it and the timing of when you are get protected and getting your money back can present problems within itself. If there is a fraudulent transaction the money comes out of your account (usually checking account) right away. It can often take up to one billing cycle or more to get it back even if you prove t...