The Ins and Outs of Retirement Accounts, Part 1: The 411 on 401(k)s
Like sunspots and wrinkles, saving for retirement is one of those things that can be hard to take seriously when you’re young. Still, in the same way skin damage accumulates over time, so do retirement savings. The more sunscreen you wear now, the better you’ll look in your 60s, and the more money you stash away today, the better your balance sheet will look then too.
Because investments can generate compound returns — that is, you can make profits on your profits, not just your principal — starting early makes a big difference. Consider this example, which I did with a simple retirement calculator:
Let’s say you’re 25 years old, you get paid twice a month, and you’ve decided that you are going to have $100 from each paycheck deposited directly into a retirement account. Read more…
Taxes Not Due Today – April 18 not 15
Wait! Actually, tax day 2011 is actually on April 18th thanks to a Washington D.C. holiday being observed on April 15th.
That means all you slacker, procrastinators, and just plain still working on them taxpayers out there get a whole other weekend to work on your income taxes.
Don’t forget, you can also file for an extension. Everyone is permitted an automatic tax filing extension of six months by filling out and submitting Form 4868 – Application for Automatic Extension of Time To File U.S. Individual Income Tax Return.
You still have to pay your taxes by April 15th. An extension to file is not the same as an extension to pay.
Wondering what happens if I don’t file my income taxes?
If you can’t pay your income taxes, you can ask the IRS for a payment plan. There is a fee for setting up a payment plan, however. If you can’t pay them now, but will be able to pay within a month or two, don’t set up a payment plan. Just send t Read more…
Chinese tourism to Japan rebounds
BEIJING, China – Japan will shorten its group visa approval process for Chinese travelers effective from July 1 in order to stimulate slumping tourism in the wake of the 9.0-magnitude earthquake, tsunami and ensuing nuclear crisis that hit the country in March this year.
Also from July 1, Chinese tourists will be able to visit Japan’s southernmost prefecture of Okinawa on multiple-entry visas.
Uichiro Niwa, the Japanese Ambassador to China, said that it is quite safe for Chinese tourists to travel in Japan.
Tax advice of the week: Move to France
Although Britons with holiday homes in France could be worse off due to a new annual tax on their properties (as reported in last week’s MoneyWeek), “people who become resident in France could find themselves better off”, says Alexandra Goss in The Times. From 1 January 2012, the 0.55% annual wealth tax levy on net assets between €800,000 and €1.3m will not exist. The tax rate on assets above €1.3m will be 0.25%, rising to 0.5% for those above €3m, and will apply to the entire net value of your French assets. In France, the top tax rate for incomes above €70,000 is 41%, not 50%.
This means, says accountants KPMG, that someone earning £150,000 would pay tax of £53,000 in Britain compared to £49,540 in France if he were single, and £39,815 if he were married and this were a couple’s total net taxable income. Mortgage terms are good
After Foreclosure: The Bounce Back Buyers
Fannie Mae, Freddie Mac and the Federal Housing Administration set guidelines for how long a borrower must wait after a significant derogatory event.
There are plenty of asterisks and conditions. But to generalize, the wait is longest after a foreclosure. Extenuating circumstances like a job loss, illness or divorce reduce the wait.
With such circumstances, Fannie and Freddie specify a two-year wait after a short sale, deed in lieu, or discharge or dismissal of bankruptcy, and three years after foreclosure. Without extenuating circumstances, waits can extend to four years after bankruptcy and seven years after foreclosure.
The key is to avoid the foreclosure, said Andrew Wilson, a spokesman for Fannie Mae. That is what will help you be eligible for the shorter period. Read more…
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