Where do you keep your money?

I posted a poll to see where people that read this blog put the bulk of their money. From what I understand, nobody will be able to see who chose what option, so don't worry about that.

Just a little bit of information on the interest rates. These are the highest I've been able to find:

Cash: no interest earned
Checking: 1.75% APY
Savings: 1.80% APY
Money Market Account: 1.60% APY
CDs: 6 month 1.65% APY
Investments: Depends on how risky you want to get!

Work Ethic

I think that it's important for people to realize that life just takes hard work. If we motivate ourselves and do an excellent job, we will normally reap the benefits.

So let's not be like this guy at work!

http://www.youtube.com/watch?v=FM3r7nbG9M8

Taxes Part 3

I've been looking into doing work as a Spanish-English translator, and that means I would be self employed (or a free-lancer). That means that the people that pay me do not withhold income for taxes (including Social Security and Medicare). So who has to take care of that? Me! I would have to pay my taxes quarterly (four times a year). There are, however, some really good benefits for being self-employed. For example, I would be able to deduct my Health Insurance premiums! If you have any questions about that, there is lots of information on www.irs.org

Taxes Part 2

If you're married, have at least one kid, and don't make a lot of money, then there is a way to get some really nice tax credit! It's called the EIC (Earned Income Credit). You should go to their website and see how much money you can qualify for. You'd be surprised at how much. Also, you should read up on taxes and find out all of the tax deductions and adjustments you are allowed to make.

If you find out that you could have qualified for the EIC last year, but didn't know, you can download a form called the 1040X and amend your taxes for last year. That means that you might be able to get it after all!

Well, I hope that helps!

Taxes

I've been learning a little about taxes, and I was told something from my professor that I didn't know before. I'm sure those who are experienced in paying taxes know this already, but for someone just starting out, this is interesting.

We have right now what is called a marginal tax system. That means that the amount you get taxed increases as your income increases. I knew this already, but what I didn't know is this: Lets say that if you make between $20,000 and 29,999 a year, you get taxed 10% (this is just arbitrary). And lets also say that if you make $30,000 to 39,999 a year you get taxed 20%. What I thought before was that if you were to make $30,000 a year, that ALL of your income (that is $30,000) is taxed at the higher (20%) rate, but that is not true. In our marginal system, what would happen is that the first $29,999 is taxed at 10% and only the last $1 is taxed at 20%. Did that make sense? Your money stays within its respective tax bracket. I was pretty happy to hear that! Not that I have to worry about that any time soon...

Automatic Payment

We signed up for the Automatic Payment option for our gas bill, which means that they withdraw money from our Checking Account automatically when the payment is due. It's a pretty convenient way to do it as long as you know you'll always have enough in your account at the end of the month.

One warning, though. Signing up for Automatic Payment, we didn't realize that it wouldn't come into effect until next month, so we looked today and saw that the payment was never made! We called the gas company and explained what happened. They'll most likely waive the late fee, but we were worried!

So when signing up for Automatic Payment, always check the first month and see that the payment is made!

Always Checking Paperwork

Laura did a great job today and saved us (actually our landlord) $70 dollars. We had a repairman come and see our broken microwave the other day and he made an estimate and gave us a copy. He came over today and after installing a new door to the microwave, he tried to charge us more. Laura went and found the paperwork and showed it to him, so he agreed to charge us the original estimate. Pretty cool, huh!

So always keep paperwork like that in your filing system until you don't need it anymore. It can come in handy!