We’re rolling into the new year, a perfect time for gurus to repeat their favorite nuggets of advice. Suze Orman, who writes a column for Yahoo Finance, has published the five best financial moves for 2007. Here are her tips, which don’t have much relationship to 2007 specifically, but are good ideas in general.
1. Lose Your Balance. Pay your credit cards off every month to avoid interest fees and late fees. I’ve been writing about credit cards lately, and I identified two types of credit card users. Type A users pay fees and do not pay down their balance while Type B users have mastered their credit cards by beating them at their own game. Suze says Type As should become Type Bs.
2. Make sure you rate high. ING Direct is falling out of favor, even with the major voices now. Suze says get your cash in HSBC Direct or Emigrant Direct where as of now it can earn more than 5% APY.
3. Win the match game. Invest enough in your company’s 401(k) to be eligible for the full company match. This is recycled from last year’s list.
4. Face your mortality. Suze suggests a term life insurance policy for protecting those who rely on you. This is not part of my 2007 plan, and won’t be until I’m no longer a single guy whose only dependent uses a litter box.
5. Stop kidding around. Here’s something I don’t hear often in the mainstream press. Suze says parents have a responsibility to teach their young children about personal finance and the value of living within one’s means.
I’m not Suze Orman’s biggest fan. I’ve seen her call-in television show and she can be nasty to the callers. I would assume the callers are familiar with the show and know what they’re getting into when they dial, but sometimes they seem to be taken by surprise. I was also not impressed when she started appearing in GM commercials touting the value of buying or leasing cars. This seemed to go against the values she reflected on her shows. For most people, living within their means would mean not buying or leasing a new car.
Nevertheless, when I can’t detect her attitude in her writing, I don’t mind her advice. It’s solid, but not particularly special.
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9:48 am (reply)
These are good tips. I am very interested in fostering financial awareness in my children. I am establishing a 529, early in January, for them. I am also looking to get started on some of the Sharebuilder promotions for them, and to get them involved in some of my side work, where they can be paid and earn some funds to sock away in a Roth IRA, at a very early age.
11:47 pm (reply)
About #4. What about death benefits? I mean… you might want to get coverage to cover costs related to death itself.
I agree that there is no point to term life if no one depends on your income, but some $15k to cover burial etc… might not be a bad thing.
3:39 pm (reply)
You should probably teach your kid how to use the toilet..
12:01 am (reply)
4:43 pm (reply)
I am interested in learning about hedge funds. I’m a novice and I want to know if these funds are good or bad? How much would be a good minimum amount to start off with in terms of money and investing? What financial firms offer these type of funds and which ones are reputable? I need advice….please get back to me.
10:28 am (reply)
I’m 30 years old and have one dependant. I have no financial debt except for school loans. I make over 80k a year and wanted to know what is the best move for me. I work in a school so I have a teacher’s pension. Should I do a Roth in addition to the 403b and a VUL or one or the other. What are the drawbacks to a VUL? Should I look to invest in other forums?
9:52 am (reply)
my husband died 15 months ago and i am disabled. After paying all debts i am left with 40,000. My morgage pay off is 103,912.33, not enough to pay our home off. I have the 40,000.00 in a saving drawing me interest of 4.25.. Should i take that money and put it down on the house to lower the monthly payments or do i just leave things as is? I recieve a widows pension of 1455.00 monthly…my house note is 755.00 monthly, however, i still find it hard to make ends meet with all the other debts..electricity..gas..phone…insurance on house and automobile, trying to collect my disability is a waiting process….what do i do?