One of the most common reasons people cite for why they’ve yet to start a Roth IRA is high initial mutual fund minimums.  Vanguard is a great mutual fund company, but most Vanguard funds require an initial investment of at least $3,000 (except the STAR fund, of course), which is beyond the reach of many investors, particularly those just starting out.  Furthermore, current Roth IRA contribution limits make constructing a diversified slice n’ dice portfolio virtually impossible.  With only $5,000 per year to play with, savers are able to buy at most 1 or 2 funds per year.  If your asset allocation is anything like mine and contains 9 or 10 different funds, it could take a while to round out your portfolio.

Start A Roth IRA Cheap At T Rowe Price

Enter T Rowe Price (TROW),  which for the past several years has offered a program allowing you to start a Roth IRA with as little as $50 so long as you agree to participate in an automatic investment plan, contributing at least $50 per month to your new IRA.  Almost everybody can afford to invest $50 per month, so there’s really no excuse not to start saving for retirement right away.  While Vanguard is my favorite, T Rowe Price is a well-regarded fund company in its own right.  T Rowe Price’s fund expenses tend to be higher than their Vanguard counterparts, and T Rowe is known more for its actively-managed funds than its index funds.  Still, the ultra-low minimums more than make up for the higher expense ratios, especially since the difference in expenses amounts to literally pennies with balances that small.  Besides, you can always roll over your Roth IRA to Vanguard after your account has grown large enough.

Good credit card customers don’t make money for the likes of JPMorgan Chase and Bank of America. They take money. If you’re like me, you rack up tons of points on your card, pay it off in full each month and never pay a cent in interest. Meanwhile, you fly across the country first class on your rewards and get cash back on almost every purchase.

So, who’s paying for your free rides? It’s sure as hell not Ken Lewis and Jamie Dimon. It’s Joe Sixpack and Sally Can’t-Pay-My-Rent. They are the ones who “buy now, pay later” out of necessity and they are the ones who end up paying the finance charges and late fees and penalties that fill the coffers of the card companies. It’s an interesting system – but all of that might change, depending on how some key credit card bills pan out.

There’s a lot of debate brewing about which fees are fair and ethical. Obviously, nobody likes to lose fistfuls of cash in “convenience” and “service” charges. But some of them make sense. Why shouldn’t you be penalized for spending more money than you have? But then again, could our insat

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With a massive budgetary deficit, a looming election and growing calls for action on risk-taking bankers; what’s actually in this year’s Queen’s Speech and what will it mean for you? So what is actually in it and how could the policies affect your finances if Labour can pass them ahead of the next election? Read all post…

If you’ve ever signed up for a free credit report, you’ve likely been pitched on TransUnion Credit Monitoring. Like most people, I declined this option and opted instead to save my $11.95 a month. But after finding one too many mysterious charges on my credit card statement, I decided to give it a whirl. Plus, there’s a free 30-day trial available – so I really had nothing to lose.

First, a little bit about TransUnion’s TrueCredit Credit Monitoring.  Basically, TrueCredit gives you:

• 24 hour notification of suspicious changes to your credit report
• Immediate and unlimited access to your credit report and credit score
• Ability to “lock” your TransUnion credit report for added security
• Slick “Trend” breakdowns for your debt, savings, credit score and more
• Daily updates your TransUnion report and credit score once a day
• $25,000 Identity Theft Insurance
• A library of educational articles, worksheets and other resources

You can cancel your TrueCredit account within 30 days and you won’t owe a dime. Of course, you get t

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Do you have some money socked away, or are you planning to sock some money away for the purpose of investing? Are you wondering why investing would be a smart idea and how you can best benefit from the act of investing? Simply put, you are going to want to invest so that you can create and build wealth. Investing tends to be relatively painless in nature, and there are numerous rewards to speak of. When you invest in the stock market, you will have much more money on hand for things like education, recreation and retirement. Whether you are starting from scratch with your savings or if you have some money lying around for a rainy day, the following investing basics will help you understand the journey ahead toward financial well being.

First and foremost, you should know what you are saving for so that you can set your saving and investing goals accordingly. Are you saving up for the purpose of retirement, so you can send your children or grandchildren to school or for a brand new car?

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I will no doubt be crucified for this one.  Americans love their tax deductions and there’s one deduction they like more than all the rest combined:  the mortgage interest tax deduction.  People love it because they think it saves them money, but in reality it does no such thing.  Here’s why.

Why The Mortgage Interest Tax Deduction Is A Bad Idea

The mortgage tax deduction was ostensibly enacted by congress in order to make home-ownership more affordable for the average American.  Perhaps the deduction did serve that purpose originally.  The day the mortgage interest tax deduction went into affect, the purchasing power of those in the market for a new home increased significantly.  Let’s give congress the benefit of the doubt and assume sellers didn’t immediately catch on.   Thus, the first round of buyers got a great deal on a new home courtesy of good ol’ Uncle Sam.

For the average modern American family, the deduction might be worth perhaps $100 per month.  Sounds great, right?  Not so fast.  The real estate market has become increasingly sophisticated over the past few decades as the home-ownership rate has skyrocketed.  While the mortgage interest deduction might once have actually improved home affordability, those days are certainly long gone.  Today, the value of the mortgage interest tax deduction is priced in to the cost of real estate.  That is, the market has automatically adjusted itself over the years (as markets are wont to do) to cancel out the benefits of the popular deduction.  Since buyers tend to base what they think they can afford on monthly cash flow instead of total cost, the mortgage deduction tends to increase the amount buyers are willing to bid on a given property compared to what they would be willing to pay in the absence of a deduction.  In essence, the deduction actually increases the average price of residential real estate by the average value of the deduction, rendering it useless.

“So the mortgage interest deduction is useless,” you say.  “But at least it doesn’t hurt anything, right?”  Ah, but it does!  Millions of dollars per year are wasted on tax services to account in large part for these deductions, money that could be invested far more productively elsewhere.  It is impossible to estimate, of course, but I feel confident the economy as a whole has suffered indirectly as a result of this deduction.  Every dime spent adhering to the tax code is a dime that could have been invested in new jobs, better infrastructure, better education, and better health care.  Too bad Americans will never give it up.