Is Your Money Safe?

As of October 24 2009, the FDIC has taken over 106 US banks. While the FDIC does not publish a troubled bank list, you can use Bankrate.com to check your bank's rating.

If you have concerns about your bank, you should maintain your bank balances below $250,000 at each bank. This limit has been increased from $100,000 until December 31, 2013.

Visit the FDIC - Frequently Asked Questions for more information.

Proven Ways to Become a Millionaire

The best way to become a millionaire is to do what millionaire do. The list I have compiled highlights several ways past millionaires have made their fortunes. It includes only proven ways to hit that million dollar mark and filters out the “get rich quick” schemes.

The Millionaire List:
1 – Real Estate Investing – Historically, real estate has been on of the best ways to accumulate wealth. The use of leverage or using others people’s money gives an investor the opportunity to multiple his wealth over time. Check out this video from Donald Trump about real estate investing.

2 – Living Within or Below Your Means – This is a tough one for most people but being dollar-wise with your money and saving works. If you use the power of interest rate compounding to grow your savings, your nest egg can grow to a sizable asset. Use this Millionaire Calculator from BankRate.com to calculate what you need to save to become a millionaire.

3 – Stock Market Investing – Historically, the stock market has made thousands of millionaires. Long term investing in fundamentally sound companies, many who pay dividends, allows you to leverage compounding again. Check out this power of compounding article from Fool.com - Want to Be a Millionaire? You Can

4 – The Corporate Route – Many millionaires come from the corporate America by either earning a high salary for years or being lucky enough to get stocks or stock options in quickly growing firms.

5 – Own a Business – This is the America dream of running your own business and becoming a millionaire. Check out this article from Entrepreneur.com – Young Millionaires

6 Inventions – The right invention can make you a millionaire. Check out these articles from Entrepreneur.com – Inventions

While there are many other ways to become a millionaire, this list gives the ways with the highest probably for success.

Also, check out these personal stories and articles:
Quicken.com – Hidden Millionaires
MSN.com – Millionaire Stories
Legal Zoom - Millionaire Moms

Find the Highest CD and Savings Interest Rates

As with any search, you should look locally first for the best CD and savings rate, usually a local paper will be a good start. Then check out these 2 websites:

1 – BankRate.com – This site lists the best national rates for all types of personal finance products.
2 – iMoneyNet.com – This site focuses on the best rates at money market funds.

In addition, you should always check your current financial institution (including banks, credit unions, brokerage firms) about the best rates. Often they will just roll you into an existing product when an option paying a higher rate is available. Many times, the highest rate will be with a institutional that is primarily online, like Ally.com.

Be sure to check the terms and conditions carefully. You sure know how the rate changes, how long your money is tied up for, and potential penalties or restriction.

In this low interest rate environment, every dollar counts.

How to Reduce Your Property Taxes

No one likes paying higher and higher property taxes but there are legal ways to reduce your taxes. If you own property be sure to file for a homestead exemption. Many states offer reduced real estate taxes if you file and qualify for a homestead exemption. The savings can be a couple hundred dollars a year. In addition, filing a homestead can potentially protect your home from certain legal actions.

Check out these links for more information:
1 - Wikipedia - Homestead Exemption
2 - LawCheck.net - List of Homestead Information by State

In addition, each homeowner should look into real estate tax exemptions, abatements or rebates offered by their individual state. For example, New York state offers tax reductions on the following:
1 - Cooperative or Condo Tax abatement to reduce the tax disparity between some properties.
2 - Disabled Crime Victim and Good Samaritan Exemption
3 - Military Request for Relief
4 - Senior owners of rent controlled property

Here are links to a couple state websites:
1 - New York City Finance - Tax Reduction & Rebate Programs.
2 - California Franchise Tax Board - Homeowner & Renter Assistance
3 - Florida Department of Revenue - Exemptions

Check your individual state for tax rebates, reductions and abatement programs.

Watch out for Hidden Bank Fees

Today, more banks are charging customers for services and penalties than ever. With bank bottom lines sagging and customers struggling to maintain balances, the potential for banks to impose fees is high and growing. If you have been hit by a fee or penalty at your bank, it may be time to review all the potential fees and penalties that could cost you more money in the future.

While there is talk about the government reviewing high bank fees, it is worth your time to do a quick review of your bank account fees.

The 3 most common fees include:
1. Overdraft fee – Check into overdraft protection and talk to the bank manager to see if he can waive the fee.

2. Monthly Maintenance fee – Check into free checking or savings accounts at other banks.

3. ATM fees – Look into maintaining an account at a bank that does not charge fees for out of network ATM transactions or has a large ATM network.

Remember you are the customer and you have choices on where to do your banking.

How to get money from your IRA before age 59 ½

If you have a traditional IRA and absolutely need cash now, there are several ways to get cash from your IRA before the age of 59 ½. While most financial advisors do not recommend these options because the money in an IRA is tax advantaged, meaning you can potentially earn a return on the entire lump of cash before taxes. This taxed advantage can be a substantial return over time.

But if you have run out of options to raise cash from other sources, tapping into your IRA may be an option. Here are 7 potential ways to get money from your IRA before age 59 ½:

1. Use SEPP rules - (substantially equal periodic payments) rules or the 72(t) rules. This allows IRA owners a way to withdraw a fixed amount of cash for a minimum of 5 years or to the age of 59 ½. While you have to pay ordinary income taxes on the distributions, you do not have to pay the penalty. Be aware that this option is somewhat complicated to apply for and obtain.
2. Medical expenses - You can withdraw money to pay for medical expenses if they exceed 7.5% of you adjusted gross income. Penalty free.
3. Total or permanent Disability – If you become totally or permanently disable, you can apply to get distributions. Penalty free.
4. Education expenses - You can withdraw money to pay for educational expenses for you, your spouse or your children or grandkids. You must make sure the eligible student attends an IRS-approved institution. Penalty free.
5. First Home Exemption – You can potential use $10,000 single or $20,000 if married, it purchase home for the first time. Penalty free.
6. Military Exemption - Members of the military can receive early IRA distributions without penalty if they meet certain criteria.
7. Straight withdrawal – As a last resort, you can withdraw money from your IRA for any reason but will be required to pay a 10% penalty and ordinary income tax on the amount withdrawn.

For more information, check out the IRS publication 590

For more information about alternative sources of cash, please go to MyNoteMarket.com

*Please consult your financial or tax professional to review you options and confirm eligibility.

Tips on Selling a Structured Settlement

If you watch any TV or surf the internet, you probably have seen numerous advertisements from companies wanting to purchase your structured settlement or annuity. If you have a structured settlement or annuity to sell, it might make sense to explore this option if you need the cash immediately. But you should be aware of the potential draw backs and issues concerning selling a structured settlement.

Some issues concerning the sale of a structured settlement include:
1. Roughly two thirds of states have laws that restrict or limit the sale of structured settlements. Most of these laws were enacted to protect the consumer and ensure the original intent of the settlement will benefit the holder.
2. The sale of a structured settlement generally must be approved by the court which has legal costs and implications.
3. Some insurance companies who back the structured settlement through an annuity limit or prohibit the sale or transfer. Or there may be additional costs imposed by the insurance company.
4. Buyers of structured settlements are in business to make money. You should be aware that the amount you receive in a lump sum with be greatly discounted. The amount of the discount will depend on the amount of the settlement, time remaining, interest rates, discount rate, and many other factors. For this reason, you should obtain multiple quotes.
5. Do forget the potential tax implications of receiving a lump sum versus annual payments.

For more information about selling your strucutred settlement, please go to MyNoteMarket.com

* Please consult a lawyer, licensed insurance agent, securities broker, tax professional or other financial professional for advice regarding your personal situation.