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So you meet with your new financial planner, they give you a bunch of suggestions on how to invest your life savings and provide for your retirement and then leave you with a bamboozling pile of paperwork to sign. Is everything okay?

Sometimes yes, sometimes no. An astute investor reported a bad experience recently when his new financial planner promised the investment plan costs would include just a 1.35% fee per annum for the financial planning consultancy. But when the investor took the paperwork home, he found a bunch of other fees listed, such as fees for entering particular funds, that the financial planner hadn’t mentioned. The investor didn’t sign.

This example goes to show that it pays to shop around for a financial planner that you feel comfortable with. The experts recommend you choose a financial planner who’s not only someone you like, but whose investing philosophy makes sense to you. Above all, don’t sign anything in a first meeting, and as tempting as it seems, don’t sign a pile of paperwork without taking it home to have a look at it. Be especially suspicious if your financial planner is pitching “no fees” packages to you, because if it’s too good to be true, it probably isn’t.

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The U.S. housing crisis has caused much hardship and now, experts say that it has begun to affect many American’s retirement possibility and prosperity. Indeed, in addition to losing their homes and businesses, many citizens have also seen a marked decrease in their 401(k), IRAs, and other investments.

Stocks and investments fluctuate constantly; in the 90s, tech stocks were hot, in this decade, real estate was the favorite choice. Many of those investors who chose real estate have now found that, though they may still own their home and live a relatively comfortable life, their portfolio has likely lost value. In fact, CNN Money goes so far as to say that “big bets on the investment du jour are more often a recipe for downsizing your wealth than growing it.”

Indeed, no matter how much you invest, you should always keep some money in hard-cash saving. Your home, though it used to be a sure thing, can no longer be considered an unbeatable investment: A home’s value, especially in today’s market, can show bloated values one day and a shocking loss almost the next.

As we move into a new age of investment, be wise and diversify. Don’t be afraid to invest in the market or to purchase your own home, but remember that cold, hard cash invested in interest accounts will never lose value, except against inflation.

Overdraft protection is a simple concept: If you incur charges to your bank account without having sufficient funds to cover that charge, your bank will temporarily “loan” you the difference for a flat, $25-35 fee. For many, though, overdraft protection is more hindrance, less help, as bank customers get slammed with multiple fees.

Many banks have the policy that larger transactions get debited first. Therefore, if you have $100 in your account, and charge $10, $10, $150, your $150 transaction will be debited first, incurring you three $35 dollar fees instead of one, despite the chronological order of your transactions. Given this scenario, many believe that this bank “service” is anything but, hurting those who can least afford it.

Nevertheless, incurring any overdraft fee is a poor financial practice. Basic skills, like knowing how to balance a checkbook, will help anyone prevent spending more than he or she earns. Simply put, expenses should not exceed income, and overdraft fees will not occur.

Banks, on the other hand, claim that overdraft protection is a valuable service meant to help. “We process checks and other debits starting with the largest amount. That way, important, large bills such as mortgages, rent and car payments will be paid first,” spokesman for Chase bank, Tomy Kelly, said.

Overdraft protection, depending on your side of the bank statement, can be a very positive, helpful service. However, many have expressed their desire for it to be opt-in, so that those customers who prefer for checks to bounce, will be able to elect that option.

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For the seventh year in a row, 2009’s salary raises will only compensate for interest and cost-of-living increases. The 3.8 percent expected raise will do little for most workers, though experts believe that certain top performers will likely receive much larger raises. In addition, one-time performance pay will increase by 10.6 percent, a small number than 2008’s 10.8 percent 2007’s 11.8 percent.

Ken Abosch, of Hewitt Associates, a compensation consulting business, says that “most of the compensation growth today comes from (one-time merit-based) pay - it accounts for almost three-quarters of the increase.” In contrast, more than ten years ago, base pay increases accounted for the majority of all yearly compensation growth. While Abosch did not mention why such trends began, he did note that it will likely continue in coming years.

In fact, in a study by Hewitt Associates, the most common of these one-time performance increases are signing bonuses (65 percent of companies), incentives (63 percent), special reconditions (56 percent), individual performance (41 percent), and retention bonuses (39 percent). Nevertheless, many longtime employees don’t realize that they’re eligible for such bonuses, and so the majority of American workers subsist on cost-of-living raises only. Do yourself a favor, though, and find out whether you are eligible for such an increase - doing so could really help out in the year to come.

photo credit: dan taylor

You can never predict when a hurricane, earthquake, fire or other disaster is going to hit - but you can predict that they will keep occurring, somewhere in the world. And that’s why being prepared for disaster is not just a matter of having an escape plan but also making sure you won’t be financially devastated. Continue Reading Preparing Your Assets for Potential Disaster »

A survey released in April shows that only 48.3 percent of high school seniors could answer basic questions about personal finance. They can’t balance a checkbook or put together a personal budget.

Does this sound like your kids? If so, here are some places on the web that can help.

Continue Reading Online Resources to Teach Your Kids About Money »

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Sometimes it’s hard to learn without making your own mistakes, but this great list of 10 things that will put in you in the poor house should help you avoid at least some of your own disasters. Some of the highlights of big financial mistakes you can make include:

• Spending more than you have - it sounds obvious, but many people do this. If you don’t have it, don’t spend it.
• Investing in some kind of scheme that promises to make you rich quickly - if it was so easy, everybody would be doing it. If it sounds too good to be true, it probably is.
• Working only the minimum amount - nobody ever became financially well-off by slacking off. If you’re lazy about working then it’s likely you’ll either slip into poverty or float just above it.
• Not making a financial plan for yourself and your family - if you don’t know where you’re going financially, chances are you’ll get nowhere.
• Wasting money on unnecessary things - before you spend, stop and think if the item you’re going to buy will really (truly) make your life better or not.
• Not being prepared for surprises - if you don’t have an emergency fund and don’t have the right kind of insurances at the right levels, then an emergency could cause you serious financial damage.

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Paying bills is one of those tasks in life that nobody really wants to do, but it’s definitely necessary. It’s also important to pay your bills on time so that it doesn’t affect your credit rating or require you to pay extra fees or penalties.

One way to make sure you pay your bills successfully is to follow the Bills in a Box system. A few tips on how to set up such a system include:

• Use folders to separate bills by the month in which they are due.
• Use a calendar for the year to write due dates for bills on the right days.
• Sort through your stack of bills once per week - try to pick a regular day.
• Note when each bill is due on the calendar and file it in the right folder.
• Spend some time once a month writing out all the bill paying checks in advance - you can post them later if you don’t want to pay too early or are waiting for income first.
• For bills that can be paid through online banking, instead of writing a check you can schedule them online in advance, and they will be automatically paid on the date you want.

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We often think about “good” and “bad” debt, and mortgages on a home and student loans for your education normally come down on the side of good debt. But a recent Laura Rowley article prompts us to think otherwise - and perhaps it’s timely advice for you, if you’re about to start college or are planning for your children’s future at college.

First up, an interesting statistic: the proportion of graduates who say they borrow less if they could go back and start college again is rising, and is now up to 54%. Many are realising that they could have approached college life differently, and spent less money, or could have chosen their school different (and more cheaply) but still ended up with a useful qualification and perhaps even got into the same job.

Considering whether an expensive college is necessary or not is one of the major decisions to make. For students who intend to go on to graduate school, then attending a home state college with low costs for the undergraduate degree is often perfectly alright - future employers will pay much more attention to the name of your graduate school, anyway.

The best tip is to consider the average starting salary for graduates of your course - this information is easily available from student advisors - and then only borrow a maximum of this amount for the total of your college years. Then you should be able to pay it back within ten years or less.

photo credit: Gaetan Lee

Cell phone bills are sometimes part of an ever-increasing build-up of debt and you might decide you want to save money by getting out of an expensive cell phone contract. But especially in the last few years, the fees that telecommunications companies charge you to leave a contract have been so high that it’s barely worth it.

But maybe things are changing. Recently, there have been a few law suits that established early termination fees from some companies were much too high and violate laws because they were only to discourage customers from leaving the company, rather than being charges for any concrete cost incurred. These results in court mean that many providers are now lowering the fees they charge for broken contracts, so it’s becoming possible to shop around and find contracts that won’t be so expensive to break.

The other way you can avoid paying large early termination fees is to trial your new provider before you commit - most allow this, and if they don’t, then simply go to the next provider. Alternatively, using a pre-paid plan might provide you with the flexibility and freedom you want to help your budgeting and perhaps save money - but do your homework first and make sure they don’t end up costing you more.