Historically, some of the most popular investments are the United States Treasury bonds, bills, and notes. While these bonds bring back memories of bond certificates in Grandma's safe deposit box, there are several misconceptions about U.S. treasury issues that are

commonplace. In this entry, we will address some of these investing misnomers, and parlay that knowledge into today's bond market.

 

"When you buy a Treasury security, you are actually lending the government money for a set period of time, from 30 days to 30 years, at a fixed rate of interest."

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Taxes imposed to finance Medicare

Medicare is financed in part by payroll taxes imposed by the Federal Insurance Contributions. When there are employees, the tax is equal to 2.9% (1.45% withheld from the employee and a matching 1.45% paid by the company) of the salaries and other compensation in connection with

employment. Until December of 1993, the law provided a cap on wages, etc., on which the Medicare tax could be imposed each year. On January 1, 1994, the compensation limit was removed. In the case of individuals who are self employed, the entire 2.9% tax of earnings must be paid by the self-employed individual, however half of the tax can be deducted from the income calculated for income tax purposes.

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First and foremost, for those who do not have a grasp on the definition of a pension plan, please read the following.

A pension plan is a way of saving for retirement in which an employee transfers part of his or her current salary toward retirement income. The two main types of pension plans are defined-benefit plans and defined-contribution plans. In the defined-benefit plan, the employer gives a guarantee that their employee will receive a defined amount of income upon retirement, regardless of how the investments perform. In a defined-contribution plan the employer makes a set contribution for the employee, but the salary taken at retirement is determined on the investment's performance.

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Life insurance is, and should be, a key part of every family's financial planning process. 

However, there are many different ways of obtaining life insurance coverage to protect your family. For example, life insurance can be offered through your employer, an alumni association, a professional group, of by purchasing it on your own. In this entry, we will review these methods of obtaining life insurance , and the pros and cons of each type of coverage.

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By Mike Rowan, 11/23/2009

I have noticed a major uptick in commercials for reverse mortgage income strategies for seniors recently. Many of the catchy taglines include promises that seniors can use their home to generate a lucrative income stream without selling their home. As with any financial planning strategy or tool, the reverse mortgage is right for some, but not for...

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By Mike Rowan, 11/23/2009

What does a Strong or Weak Dollar Mean?

The Dollar has been all over the news recently since it is currently extremely weak versus other world currencies. But what does that really mean? When I was new in the industry, I spent years hearing statistics on how the dollar was performing, but never had a clear grip...

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By Mike Rowan, 11/18/2009

Meet the DB(k) Retirement Plan

The recent history of the 401k plan has cast doubt on whether the savings plan is the best way for workers to prepare for retirement. As a direct result, there are some possible alternatives coming that might just catch on in a big way. One retirement plan that will become available...

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By Mike Rowan, 11/18/2009

401(k) Plans were Designed for an Employee's Retirement

A 401(k) plan is a cash or deferred arrangement under which a covered employee can elect to have a portion of his or her compensation (otherwise payable in cash) contributed to a qualified retirement plan as a pre-tax reduction in salary (however, some plans also accept after-tax contributions from...

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By Mike Rowan, 11/13/2009

The Dow Jones Industrial Average

The Dow Jones Industrial Average is one of the best known United States Stock indices, and is generally seen as a barometer of the overall stock market. The DJIA is comprised of 30 stocks that represent the major market sectors, and are among the largest companies in the U.S....

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By Mike Rowan, 11/13/2009

HSAs: A Tax-free Medical Investment Fund and Additional Retirement Account

The lack of health insurance is one of the biggest reasons more people don't retire before age 65. In addition, many Americans reach retirement age woefully unprepared for the medical expenses they'll face. Establishing an HSA, or Health Savings Account, is one solution that can...

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