A Tech Tool that Will Save You Time & Money!

A loss of data is not only frustrating, it can be debilitating. In my business, losing all my client files and documentation would create a major and irreversible problem. Parting with my personal files would also mean the loss of cherished photos, tax information, writing, and not to mention, all the business school files I kept. (Since grad school cost me $40k, it would not be a small loss!)

So I follow a very careful protocol to secure my data that includes weekly transfers to an external hard drive, monthly disc burns for off-site storage, and now, online file storage. I searched extensively for a simply, easy to use and cost effective provider and I'm thrilled with the SOS online back up service I chose. (So is PC Magazine, which has given the company two awards of excellence.) It's simple, easy to use and cost effective.

In the event of a computer crash, fire or complete melt down, I know my data is protected. Check it out today. For $50 or less per year, it will save you sleep and money in the event of a melt down.

PS - hmm, which wine would pair with technology? I'm thinking about the clean branding of Apple, SOS, and many other tech companies. How about a clean tasting, floral and fruity Riesling Kabinett?

Online Coupons

I know, I know -- "coupons?!!" The image that comes to mind is the frumpy woman at the grocery check out with a change purse counting pennies while simultaneously digging through her large coupon bill fold. Very annoying, especially when you're trying to dash out of the store with the evening's dinner.

No worries -- the coupons I write about today are in the e-form, so you won't be "that guy" (or LMF4HMW reader as it were). So many of us are into online shopping -- it's easy, there's no parking, no wondering around, no lines, and it can be done in the comfort of your own home (or office - ha!).

Shopping online with coupons is super simple. Let's say you're looking for a birthday or baby shower gift. STEP 1: Go to one of the popular e-coupon sites like DealCatcher or CoolSavings to see if there are any deals at the moment that fit your needs. (A simple Google search will provide you with numerous coupon sites.) STEP 2: either decide to shop at e-tailers based on available deals or at least know that you've tried to save on your purchase.

Either way, you're a savvier shopper and you might save precious money which may be invested for your future!

WINE PAIRING: How about a nice fun variety like Semillon, which has lemon and fig flavors with a hint of acidity -- perfect for online shopping after brunch. The grape is best known in France and Australia. In the former, it's typically blended with Sauvignon Blanc for a very special treat.

It's "That Time of Year"

Nope, I'm not talking about the supposedly depressing time between the holidays and spring where people are tightening purse strings and lightening intakes to compensate for December's over indulgences. (By the way, is that why Valentine's Day was invented -- something cheery in the middle of the winter doom and gloom?) Nor do I mean it's time to make sure you're keeping those resolutions -- at least another week or so.

By "that time of the year", I mean an annual date with your portfolio to rebalance. Why? Over the course of 365 days, a lot will change. Some investments gain, others lose. Those that gain usually hold a higher than intended percentage of your funds; those that lose a lower amount than you'd like. For example, you decided to hold 50% US and 50% international funds. In this hypothetical year, the US did really well and those abroad declined, so now you hold 60% of the former and 40% of the latter.

Trying to "ride" the better returning assets may seem like a great idea -- why would I sell something that's doing well and re-invest in something that is lagging? The answer lies in risk mitigation. When you unknowingly stray from your intended allocation, or do so to "ride the wave", you move away from your investment strategy. And that's not recommended because it usually means you're acting with emotion -- chasing returns, or trying to avoid normal market volatility. Furthermore, the process might repeat in year two and intensify the effect.

Some advocate rebalancing every 15 months to take advantage benefits associated with sale of long term gain. I recommend every year for two reasons: 1) it's easier to remember; and 2) most LMF4HMW readers hold the majority of our investments in our retirement accounts, so we don't have to worry about tax ramifications until we're receiving distributions.

A lot of retirement accounts have handy "rebalance" buttons where all is done in a matter of a quick mouse click. In others you'll need to send in a fax or make a phone call. But in any case, it's 5 or less minutes well spent and that is time you won't spend eating or spending money!

The 403(b) Plan

Since I have a part-time gig instructing at a community college, I'm eligible for its 403(b) contribution plan. As someone who has contributed to a 401(k) for nearly 10 years, I'm familiar with the way retirement plans work in the private sector, but had to do some research on this new retirement option.

The 403(b) is defined as a TSA or tax-sheltered annuity plan for those working in the non-profit sector, including educational institutions and churches. (I usually cringe at the word "annuity" and nearly left the website as soon as I read this.) Thankfully, my interest in saving for retirement and hope that I might just be able to contribute all of my part-time earnings kept me reading.

There are three possibilities in a 403(b): 1) a retirement account for church employees; 2) an annuity contract through an insurance company; and 3) a custodial account with mutual funds. Number three is my winner! And I was very pleased to find that my vendor company of choice offers index funds.

The 403(b) and 401(k) are actually pretty similar other than the sectors they serve. The deduction is for pre-tax earnings and the contribution limits for 2009 are a cool $16,500 for those under age 59 and $22,000 for those over. In both cases, the investor owns the account -- the institution (or employer sponsor in the latter) only holds the assets and facilitates transactions. Some 403(b) plans allow for employer contributions -- sometimes matching, although sadly, mine does not do so. And just like the 401(k), there are usually penalties for early withdrawals unless the transaction qualifies under the hardship rules. Finally, when you change jobs, you need to decide whether to leave the funds in the plan, roll them into an IRA, or roll them into a new employer's 403(b). (Notice I don't mention the fourth option, taking the lump sum payment. The penalties are too stiff and most importantly, it's a RETIREMENT ACCOUNT, not a bank account! One rare exception is the LMF4HMW reader who has actually reached retirement, and depending on the balance, a lump sum may or may not be advisable.)

So if you're eligible for a 403(b), I'd recommend funding it to the maximum allowable amount. Just know that a LMF4HMW reader who works full-time in the private sector and is already contributing the maximum allowable amount to her 401(k) can not participate in a 403(b). It's a shame, but the USG doesn't want you doing that -- too much lost "revenue" for them, I suppose.

How about a nice Barbera from Italy's Piemonte to warm the soul on the cold winter nights? I particularly like the value in the Briccotondo from Fontanafredda -- a steal for $11! Nice zippy red fruit, earth, licorice and a surprising amount of depth for this price. And the powers that be even scored it at that sooo important 90 point benchmark. (FYI, if I ever open a wine shop it will be called 87 thru 89.)

Nifty Finance Site

It's no surprise that Google would offer a nifty financial site. This one, Google Finance, offers an in depth guide to companies, stocks, mutual funds, currencies and the like. It also contains links to relevant news releases, trends and sector summaries. To view international companies, there are similar sites like Google Finance U.K., Canada, etc.

As a long-term buy-and-hold investor, I do not advocate daily checking of stocks, portfolios nor performance. This site could be useful on a macro level for a LMF4HMW reader looking for information and knowledge about finance and the markets. Or on a micro level to view a particular index's performance over time, such as the MSCI EAFE or S&P 500.

In honor of tonight's celebration and the New Year we're welcoming tomorrow, I recommend Cristalino, a delicious Cava from Spain that offers a tremendous value.

Fail to Plan, Plan to Fail

Last night while discussing an annual off-site strategy meeting for my business, it occurred to me that individuals could benefit from doing something similar for their financial planning. Taking time out and outside of the box (i.e., moving to a different location to stimulate creativity) to brainstorm and formulate a strategic plan is a familiar tactic for successful businesses. So how does a LMF4HMW reader use an off-site strategy meeting to enhance her financial position? Below are some simple steps:

1. Take it seriously. Put an hour appointment on your calendar to plan the meeting. In this hour, you'll decide on topics for discussion (if it's a family plan -- i.e., you and a spouse or significant other) or further thought (if it's solo mission). These might include cash management/budgeting, debt service/payment plans, wealth building strategies, goal setting, evaluation of 2008's performance, etc. At this point you're merely deciding on the topics, not tackling them -- that's for the off-site.

2. Create an agenda. Decide where you'll go, perhaps to a night away or a more simple location such as a quiet restaurant. Plan your time given the topics above. How long will you tackle each topic? How will you record your thoughts? (I love using colored markers and big white sticky "Post it" style notes -- buy them at an office supply store.) I suggest that you divide the topics into separate sessions if possible to avoid burn-out. Gather any notes or files you'll need.

3. Mix in some fun. Maybe you're going to a spa hotel? If so, be sure to book an appointment -- businesses always blend some relaxation or fun into the equation which helps stimulate the creative thought process. If you're dining out for the day, perhaps drive to a different town and combine the trip with an invigorating hike.

4. During the meeting, employ the "Happy Tree". No fair using blaming or negativity. This off-site is a chance to brainstorm in the "happy tree" (think Will Ferrel and his new bride in the therapist's office during Old School). I'm not suggesting that you ignore any failed moves or mistakes from the past, only that you don't use blame or negative words during the discussion. If yours is a group, appoint a mediator and a note taker. If it's a solo mission, write out your "rules" beforehand and be sure to take notes.

5. Follow up! Don't let all of your hard work go to waste. One of the most important steps you can take post meeting is creating a plan for implementation. Again, pick an hour to write a formal plan for attack. During this time, check with your accountant to see if it's a deductible expense -- if you're discussing any side business you might have, it should be. So save those receipts!

6. Check in on your progress. Put a 30 minute quarterly review appointment on your calendar to assess your performance. Get yourself back on track if you fall of the wagon. Or reward yourself if you're progressing well.

This commitment to your financial strategy for 2009 means that you're much more likely to succeed. And if you achieve your goals beyond your expectations, the 2010 planning meeting can add a little more fun!

"He's Makin' a List... So Should You!"

Santa has been busy making his lists, and his better half is likely juggling quite the good wife act frantically planning dinner parties, cleaning the house, preparing the sleigh and (hopefully) keeping the "fun" in the dysfunctional Claus family Christmas.

As the season's cheeriest couple tackles the holidays, I urge LMF4HMW readers to start making a list of their own -- a 2009 goal commitment sheet.

I'm not calling your goals "resolutions" for a simple reason -- these financial commitments are not made to be broken. They are identified, written, agreed to and planned for. This list need not be long; it must only be specific. In fact, I urge you to keep it shorter and focused on a limited number of BHAGs (Big Hairy Audacious Goals or a corporate HR favorite). Below are four simple steps:

1. Identify your most pressing financial needs. Are you in debt? Saving adequately? Unaware of or avoiding your complete financial picture?

2. Write down your specific goal(s). For example, "pay down $8,000 in credit card debt", or "refinance car" or "revisit my investing strategy and lock on a better long-term plan".

3. Commit to the goal(s) with specific, measurable tactics and a timeline for achievement. This might be "pay $500 monthly to credit card to decrease debt by $6,000 and use $2,000 of bonus to cover final payment by December", or "research refinance options in January, contact preferred providers in February and lock on deal by end Q1".

4. Put the above appointments on your calendar to create accountability. Stick to them! For extra good measure, I recommend your keeping a signed copy near your home work area or as a file in the calendar reminder.

Following these four steps will ensure that you're on Santa's "nice" list come 2009 gifting season. And more importantly, doing so will provide a true and lasting gift to yourself.