5 Money Management Tips for Newly Married Couples

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Congratulations on getting married! Now that you’re married, you and your spouse will probably learn to do things together as a team, one of which is managing finances. It’s advised that you and your spouse are on the same page when it comes to money to avoid financial issues. Mark Matson lists a few simple things that will help improve your financial future.

Agree on shared financial goals

You and your spouse should be on the same page regarding your short and long-term goals and how you will accomplish them together. Do you want to buy a home? Start a family? Are you focused on saving for retirement? Discuss your goals, agree on them, and determine how your income will work to meet those goals.

Set a budget and track expenses


To avoid encountering debt and achieve your financial goals, you should set a budget and track your spending. You might have different spending patterns now that you’re married and your budget might not be perfect the first time around. It could take time to figure it out but tracking your expenses will help.

Plan for retirement

Although you may have short-term goals you want to meet, or you think saving for retirement can wait, you should start saving now. Take into account that Americans tend to be living longer nowadays and retirement will be here before you know it. The sooner you begin saving, the less money you will likely need to save and you can enjoy a comfortable retirement. You and your spouse should each have a retirement account of your own and allocate what you can afford into it. Ideally, you should each target a savings goal of 10 percent of your individual income in your plan.

Get out of debt

Debt can be damaging to married couples since you are both responsible for paying the money back. Eliminate debt as soon as possible and avoid falling into it again. Living debt free helps you financially and is usually beneficial for your marriage.

An emergency fund is cash put aside, usually in a savings account, for when an unexpected emergency occurs, such as a job loss or illness. Set up a savings account with both of your names on the account and deposit money into the account each pay period. An emergency fund will help bring financial security and keep you protected in the instance that a disaster strikes.

 

 

 

Should You Chase The S&P 500?

The stock market can be a complicated place,  filled with unfamiliar terms and investments. One you’ll come across often is the S&P 500. To explain briefly, the Standard & Poor’s company, now known as S&P Dow Jones (majority owned by McGraw Hill Financial), created its first stock index in 1923.  The S&P 500 stock index in its present form was created in 1957 to track the performance of 500 large companies that have common stock listed on the New York Stock Exchange (NYSE) and the National Association of Securities Dealers Automated Quotations (NASDAQ). The 500 stocks comprising the index and their index weightings are determined by S&P Dow Jones. The S&P 500 is used as a measure of the general level of stock prices and includes both value and growth stocks.

The S&P 500 had a hard time during the great recession. However, on May 3, 2013, it closed above 1,600 for the first time in 13 years. Since then, it set a record intraday high value of 2,134.72 on May 20, 2015 and a record closing value the next day of 2,130.82. Of course, markets are uncertain, advisers can have different strategies and advice and past performance does not guarantee future results. That said, is the S&P 500 something you should be focused on?

Mark Matson answered that question when he appeared on CNBC recently. He explained that chasing the S&P 500 may not be the best idea. Investors are chasing it because it was one of the best performing asset categories. However, Matson Money wants to remind investors global diversification is important, because only 49% of the world’s capitalization is in the United States, so there’s more opportunity globally than domestically.

Everyone seems to be running away from emerging markets around the world because they’ve been down. However, buying things when they are down creates opportunities for your portfolio. Being a long-term investor often involves  forcing yourself to do  things that others are not willing to do. Waiting for positive market news could damage your portfolio. Rebalancing your portfolio and investing when the market is down creates the potential for gains without trying to rely on market timing and stock picking when no one really knows when the market will move.

Getting The Most Out Of Your Tax Return

Tax season may just be the highlight of the year for people who anticipate a refund, because the money could provide the opportunity to be used for anything they want. The average 2014 tax refund was $3,034, and it was slightly higher for those who opted for direct deposit which was $3,096 according to an article from USA Today. But what’s the smartest way to spend that extra cash? According to the same article, some  surveys showed that most Americans plan to pay down debt, although one survey conducted by a financial adviser cited in the same article concluded that young adults between 18 and 34 were likely to spend it on entertainment and shopping.

While everyone’s plans for their tax refunds may be different, knowing what you could do with that money is a great starting point. With that said, have you considered using your refund to invest in the stock market? After all, if you have excellent money management skills, you may not need to spend your tax refund to pay down debts or to fund a shopping spree. If you are treating your tax refund as discretionary income, than investing may be something you can try. Remember though, as Michelle Matson, the VP of Matson Money says, discretionary income is your extra money after you have paid all of your bills and living expenses.

Once you’ve determined that your tax refund is ‘disposable,’ you can begin looking into the stock market. Describing your tax refund as ‘disposable’ only means that the money won’t affect your current financial status or lifestyle. Also understand that investing in the stock market involves risks that  you must be prepared to take. The market fluctuates, which is ok because the fluctuation can provide the return, but may also result in losses should you need to liquidate your investment.

When you begin to navigate the fundamentals of the stock market, you have the opportunity to engage with investor coaches and advisers. Take, for instance, Mark Matson of  Matson Money, who  recommends balancing portfolios through diversification and focusing on long term investments. But remember, investment strategies are not guarantees, past performance is not indicative of future performance and investors’ financial goals may not all be the same. Your tax refund offers many potential benefits, but you should consider acting carefully when deciding what you want to do with it.

Managing Your Money

When it comes to managing your money, we all have to live within our means.  First and foremost, this means that we  always want to make sure we  have a roof over our head, clothes on our back, and food on the table before we consider all the things we want. With that being said, managing your money can be a challenge and poses some difficulties if  priorities aren’t set from the get-go. Without a doubt, poor money management can lead to financial stress, lifestyle difficulties and more, but by following some basic guidelines,  there’s a good chance you can meet you needs and still have a chance to satisfy at least some of your wants.

Redefine ‘Pay Yourself First’

As Vice President of Matson Money, Michelle Matson believes you should redefine the way you pay yourself. This means pay your needs first.  Then, if anything is left over, focus on your wants.  Start by creating a realistic budget, which allows you to  pinpoint what ‘needs’ must be paid, how much they cost and where your money is going. Your “needs” budget  should include a savings account or retirement plan before you begin to focus on ‘wants’. Sit down and outline your finances in order to start the budget process. By sticking to your budget, you will know exactly how much is left over on a weekly, monthly or annual basis to cover nonessential items.  By exercising healthy spending habits, you increase the potential of having extra funds available for wants.

The Next Step

Once you have successfully created and implemented a realistic budget, you will know whether or not you have any discretionary income leftover,  this is the time to hone in on your wants, which may include investing at least 10% of your annual discretionary income in the stock market. Investing has the potential of producing positive returns, but you should be aware  that the market is impossible to predict and not all outcomes will be positive. However, by building diversified portfolios with your extra funds, you have the chance of developing a stronger financial footing.

Just remember to live within your means and keep an emergency fund set aside. Remember to exercise caution when it comes to luxury items, because their value may be short-lived and at the end of the day, often aren’t worth the price you paid. By properly managing your budget and keeping your goals in mind, a well-rounded financial future can be within your reach. Always be absolutely sure you can afford something before purchasing it or investing in it!

How To Spot Bullies On Wall Street

Anytime an investor is considering Wall Street investing, there may be some people around that are only looking out for their own wallets – looking for an easy way to make money. Investors should be on the lookout for these folks so they don’t get caught up in a situation where they lose money, lose credibility and lose confidence. These unfortunate events occur on Wall Street more often than you may realize, but you can avoid it by knowing how to spot a Wall Street Bully.

First, let’s take a look at The Con Man, who you might be able to relate to by thinking of Bernie Madoff. This type of bully is sneaky and sly because they try to lure investors with promises of market-topping returns with little or no downsides. – Just remember, if the offer sounds too good to be true, it usually is. Madoff, himself admitted that he was operating a Ponzi scheme. He ultimately stole billions of dollars from thousands of investors. Madoff pled guilty to 11 federal felonies and admitted to using his wealth management business as a huge Ponzi scheme. Be sure you know who you are dealing with so you don’t fall victim to the next Madoff.

The second bully to be aware of is The Prognosticator who can be compared to a bad fortuneteller. This bully tried to attract investors with fancy and sophisticated graphs and charts, which they try to convince investors that they can predict where the markets are heading to next. The fact of the matter is, nobody knows what the future holds. If they tell you otherwise, walk away. It’s almost like trying to figure out what the weather is going to be like five weekends from now. You can guess, but the weather changes and is unpredictable.

And finally, the last Wall Street bully you want to look out for is The Guru which you could compare to many money managers who tout their 5 Star ratings. These types of bullies boast about past performance and how well their picks have fared over certain time periods. These so-called geniuses may try to tell you they have unique insights into undervalued companies and if you buy now, you are going to be able to capitalize when they take off. Think about the many price fluctuations and predictions made about companies like Facebook. No one can accurately determine the next successful sector or company. Be very wary of hype and buzz surrounding certain stock picks.

Wealth Transfers

‘After The Bell’ airing on Fox Business hosted Mark Matson to discuss wealth transfers during a time of uncertainty in the stock market. When’s the best time to buy? Is there a specific time to get into the market? Those questions can’t be clearly answered by anyone about the market because it is generally unpredictable, but there are ways to hold steady. Any time you are in the stock market, you want to look at equities in the long-term and be consistent: you want to focus on something for the next 20 years and not the next 20 minutes. It’s best to ignore short term volatility because they can generally see lower returns and aren’t worth the investment according to Matson’s philosophy.

Every time the market crashes, investors should be thinking, “Opportunity! Opportunity! Opportunity!” Because buying now when everyone is panicking can turn into a long-term wealth transfer if you hold out long enough. Say for instance the market does fall. Matson wants his investors to focus on the market as a whole and have a well balanced portfolio with their picks being situated for the long haul. However, avoid long bonds because they are risky in terms of interest rates and have the potential of harming your bond portfolio. When everyone in the market panicked in 2009, that could have been the opportunity for wealth transfers.

It’s all about keeping your investors from panicking and looking at the market with a long-term plan and strategy so they can have the potential of making great returns. Shying away from trending and popular stocks is another investment strategy to follow because being popular in the short term doesn’t necessarily mean it’s going to be the most fruitful picking in the market. Sticking to longer picks diversifies portfolios and helps give you more of a balanced offering.