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Personal Finance in Your 20s & 30s, 5E

Book Description

Revised and updated, this new edition of Idiot's Guides: Personal Finance in Your 20s and 30s, Fifth Edition, explains all the basic information you need to get started in life and plan for your future. You'll learn how to manage all aspects of your personal finances, as well as enhance your financial plan to yield better returns on your investments.

+ The basics of personal finance, such as creating and following a budget, learning how to maintain a healthy savings, and building an emergency fund.
+ Up-to-date look at internet and online banking and choosing the best account options.
+ The truth about credit cards, how to wisely use them, and how to pay off debt wisely.
+ Creative ideas for developing a plan to pay off student load debt and understanding your choices if you choose to further your education.
+ Ways to make wise choices on big purchases such as homes and transportation.
+ Tips on how to make the right choices when you're unemployed or underemployed, short on assets/funds, or lack employer-sponsored healthcare options.
+ A thorough explanation of 401(k) plans, individual retirement accounts (IRAs), and how to make the most of them.
+ The basics on investing your money wisely.

Table of Contents

  1. Cover
  2. Title Page
  3. Copyright Page
  4. Contents
  5. Introduction
  6. Part 1: Your Financial Foundation
    1. 1 Your Financial Base
      1. Understanding Personal Finance
      2. Evaluating Where You Are
      3. Determining Your Net Worth
      4. Looking for Hidden Financial Assets
        1. Accounts
        2. Mutual Funds
        3. Stocks (Equities)
        4. Bonds
        5. Emergency Money
      5. Protecting Your Financial Base
        1. 401(k) Plans
        2. Compound Interest
        3. Lower Interest Rates
        4. The Best Possible Bank Accounts
        5. A Budget
        6. Learning Opportunities
    2. 2 Choosing the Right Bank Accounts
      1. Do You Have the Accounts You Need?
        1. Checking Accounts
        2. Savings Accounts
        3. Money Market Accounts
        4. Certificates of Deposit
      2. All Banks Are Not Created Equal
        1. Commercial Banks
        2. Credit Unions
        3. Thrifts
      3. Banking Online Versus Online Banking
      4. Beware of Bank Fees
        1. Overdraft Fees
        2. ATM Fees
    3. 3 Budgeting Your Living Costs
      1. Why Budgets Have Such a Bad Rep
      2. Everybody Needs a Budget
      3. What Your Budget Should Include
        1. Nonroutine Expenses
        2. Routine Expenses
      4. Trimming the Fat: Analyzing Your Expenses
        1. Fixed Versus Variable Expenses
        2. Nondiscretionary Versus Discretionary Expenses
        3. Spending Ratios
      5. One Job, Two Jobs, Three Jobs, Four …
      6. Sticking with It
      7. Budgeting Websites
      8. Budgeting Apps
  7. Part 2: Building Your Credit
    1. 4 Your Credit History, Report, and Score
      1. Building Your Credit History
        1. When Enough Is Enough
        2. When to Get Help
      2. Your All-Important Credit Score
        1. Why Your Score Matters
        2. How Your FICO Score Is Determined
        3. Getting a Copy of Your Credit Report
    2. 5 Finding the Best Credit Cards
      1. The Invention of Credit Cards
      2. Getting a Card
      3. Cosigners and Secured Cards
      4. How Many Cards Should You Have?
      5. Types of Cards
        1. Charge Cards
        2. Fixed-Rate Cards
        3. Variable-Rate Cards
        4. Elite Cards
        5. Rewards Cards
        6. Prepaid Cards
      6. Understanding Annual Fees
      7. Other Fees to Watch For
        1. Late Fees
        2. Cash Advance Fees
        3. Discretionary Fees
        4. Credit Limit Increase Fees
        5. Copy Fees
        6. Account Reopening Fees
        7. One-Time Processing Fees
      8. Making Sense of Interest
      9. Paying Down Your Balance
    3. 6 The Truth About Credit Card Debt
      1. Resisting the Urge to Spend, Spend, Spend
        1. Knowing When to Use Your Card
        2. Sometimes Cash (or Debit) Is King
      2. Understanding Credit Card Debt
      3. Getting to a $0 Balance
      4. Credit Counseling, Debt Settlement, and Bankruptcy
        1. Credit Counseling
        2. Debt Settlement
        3. Bankruptcy
      5. Credit Card Safety
        1. Safety Tips
        2. Electronic Safety Tips
  8. Part 3: Paying Off Your Student Loans and Debt
    1. 7 Student Loan Debt and Costs of Education
      1. Types of Student Loans
      2. Determining How Much You Owe
      3. Paying Off Your Student Loans
      4. Does a Graduate Degree Makes Sense for You?
    2. 8 Debt Consolidation and Payback Options
      1. How Much Debt Do You Have?
      2. Paying Off Bills, One at a Time
      3. Transferring Credit Card Balances
      4. Alternatives to Balance Transfers
      5. Refinancing Loans
      6. Considering Debt Consolidation
  9. Part 4: Your Money and Your Career
    1. 9 Employed, Unemployed, Underemployed
      1. The Ups and Downs of the Job Market
      2. Are You Employed, Unemployed, or Underemployed?
      3. Exploring Your Options
        1. Asking for a Raise
        2. Looking for Another Job
        3. Staying Where You Are
    2. 10 Employer-Sponsored Benefits
      1. What Are Employer-Sponsored Benefits?
      2. The Real Cost of Hiring You
      3. Employer-Provided Health Plans
      4. Employer-Sponsored Retirement Plans
      5. Other Retirement Plan Options
    3. 11 Surviving on Unemployment
      1. The History of Unemployment Compensation
      2. Accessing Unemployment Compensation
      3. If You’re Denied Benefits or Your Benefits End
      4. Stretching Your Compensation Dollars
      5. Staying in the Game While You’re Unemployed
      6. Finding Job-Hunting Help
  10. Part 5: Your Savings
    1. 12 Cutting Costs
      1. Spending in America
      2. Housing Costs
        1. Utilities
        2. TV, Internet, and Phone
        3. Insurance and Taxes
        4. Refinancing Your Mortgage
      3. Transportation Costs
      4. Food Costs
      5. Personal Insurance and Pension Costs
      6. Health-Care Costs
      7. Entertainment Costs
      8. Clothing Costs
      9. Charitable Contributions
    2. 13 Your Savings Options
      1. Where to Save Your Money
        1. Savings Accounts
        2. Money Market Accounts
        3. Money Market Funds
        4. Certificates of Deposit
        5. Treasury Bills and Treasury Notes
      2. The Magic of Interest
    3. 14 Your Investing Options
      1. When to Start Investing
      2. Your Investment Goals Matter
      3. What Kind of Risk Are You Willing to Take?
        1. High-Risk Investors
        2. Moderate-Risk Investors
        3. Conservative Investors
      4. Mutual Funds
        1. Types of Mutual Funds
        2. Advantages of Mutual Funds
      5. Exchange Traded Funds
      6. The Stock Market
        1. The Major U.S. Stock Exchanges
        2. Knowing What Stocks to Buy
        3. Enlisting the Help of a Broker
        4. Understanding the Risks of the Stock Market
      7. Bonds
  11. Part 6: Big-Ticket Purchases
    1. 15 Buying Versus Leasing a Car
      1. Car, Truck, or Something Else?
        1. Renting a Car
        2. Sharing a Car
      2. Owning a Car Costs More Than You Think
      3. Buying a Car
        1. Financing Your Car
        2. Cash Back Versus 0 Percent Financing
      4. Leasing a Car
        1. Pros of Leasing
        2. Cons of Leasing
        3. Before You Lease
      5. New or Used?
      6. Safety Counts
      7. Best Places—Online and Off—to Shop for a Car
        1. At a Dealership
        2. Online
        3. Helpful Apps
    2. 16 Owning Versus Renting a Home
      1. The Mystique of Owning a Home
      2. Advantages of Renting
      3. Advantages of Buying
      4. The Downside to Taxes
      5. Enlisting Help
      6. Qualifying for a Mortgage
        1. The Down Payment
        2. Your Income and Expenses
      7. Getting the Right Mortgage
        1. Fixed-Rate Mortgages
        2. Adjustable-Rate Mortgages
      8. Finding Your Dream Home
        1. Types of Homes
        2. Location, Location, Location
      9. Protecting Your Investment
    3. 17 Insuring Yourself and Your Property
      1. Insurance 101
      2. Insurance Must-Haves
        1. Types of Policies You Might Need
        2. Health Insurance
        3. Auto Insurance
        4. Property Insurance
        5. Disability Insurance
      3. Insurance You Don’t Need
        1. Dental Insurance
        2. Flight Insurance
        3. Credit Life and Disability Insurance
        4. Life Insurance for Your Kids
      4. Shop Around and Save
      5. When You’re Not Covered
        1. Document Your Losses
        2. Don’t Give Up
        3. Prepare Your Claim Carefully
        4. Get Help
  12. Part 7: Relationships and Money
    1. 18 Life, Love, and Money
      1. Footloose and Fancy-Free
      2. Living Together
        1. Financial Pros of Living Together
        2. Financial Cons of Living Together
      3. Getting Married
        1. What About Prenups?
        2. Filing Jointly or Separately?
      4. And Baby Makes Three
      5. Divorce and Financial Issues
      6. Borrowing Money from Family or Friends
    2. 19 Choosing Life Insurance
      1. Nearly Everybody Needs Life Insurance
      2. Term Life Insurance Versus Cash Value
      3. Which Type Makes Sense for You?
      4. How Much Life Insurance Do You Need?
      5. Shopping for Life Insurance
    3. 20 Wills, Powers of Attorney, and Health-Care Directives
      1. Everyone Should Have a Will
      2. The Advantages to Having a Will
      3. Creating Your Will
      4. Powers of Attorney
      5. Advance Health-Care Directive
        1. Living Will
        2. Health-Care Proxy
  13. Part 8: Looking to Your Future
    1. 21 401(k)s and IRAs
      1. Why Every Year Counts
      2. 401(k) Plans
        1. Participation in 401(k)s
        2. Taking Advantage of an Employer Match
        3. Investing in Your 401(k)
        4. When to Adjust Your Contributions
        5. Tax Advantages of 401(k) Plans
        6. Managing Your 401(k) When Changing Jobs
        7. Understanding Vesting
        8. Getting Money Early from Your 401(k)
      3. Individual Retirement Accounts (IRAs)
        1. Contributing to an IRA
        2. Roth IRAs
        3. SEP-IRAs
        4. Timing Your IRA Contributions
    2. 22 Working with Professional Financial Advisers
      1. Know Thy Finances, Know Thy Adviser
      2. Do I Need a Financial Adviser?
      3. Understanding Fiduciary Responsibility
      4. The Who’s Who of Financial Advisers
        1. Financial Planners
        2. Certified Financial Planners
        3. Financial Consultants
        4. Bank Customer Service Representatives
        5. Certified Public Accountants/Personal Financial Specialists
        6. Insurance Agents
        7. Money Managers
      5. Finding a Reputable Financial Adviser
        1. Meeting with Potential Advisers
        2. Finding an Adviser Online
        3. Go with Your Gut
      6. Financial Adviser Red Flags
        1. Too-High Fees
        2. Conflicts of Interest
        3. Past Bad Behavior
      7. More Financial Adviser Don’ts
        1. Misrepresentation
        2. Who Has Custody of Your Money?
        3. “May I Borrow a Few Bucks?”
        4. Ignoring You or Keeping You Out of the Loop
  14. Appendixes
    1. A Glossary
    2. B Resources
    3. C Helpful Forms