From there, they will be able to outline their holiday plans. If these plans include events, trips or traditions that involve finances, budgets for each of them must also be established and adhered to. For instance, if gift-giving is a holiday tradition of yours, you and your spouse must determine who you will give gifts to and how much you will spend on each person. A budget is no good if you don’t stick to it, so no deviating!

Make it your own….

Over the years, I’ve found that the most memorable holiday experiences were the ones that I spent doing something meaningful with the ones I loved. My family and I have come up with our own holiday traditions that cost little or no money, such as serving food at our local homeless shelter. Ever since my boys were young, we have volunteered our time at the shelter. Not only has it saved us money, my family is better from the experience, which continue to show them the true meaning of holidays.

Plan ahead…

While the holidays usually bring good sales and discounts, leaving purchases to the last minute can sometimes leave you in a bind. I suggest that couples shop throughout the year keeping an eye out for discounts on non-perishable items that they will need for holidays (napkins and plastic cutlery, charcoal or specific gifts.) This will help couples get the best price while spreading out spending throughout the year and avoiding that massive credit card statement in January.

Be creative…

Put your creativity to good use. Many holiday traditions and events can be reshaped to reduce the budget while still maintaining the warmth of the special occasion. For example, instead of catering a fancy holiday dinner, host a potluck and ask everyone attending to bring their favorite holiday dish. You could even suggest that they bring recipes cards along with their dish, so they can share them.

For those who have loved ones living far away, soaring travel costs can be a major concern. Use the “Plan Ahead” strategy to monitor discounts on fares, and rates. However, if travel costs are not in the budget, always remember that loved ones can still celebrate in spirit by taking advantage of the various communication tools out there, Couples can send digital photos, record an send voice greetings or host video chats.

Dr. Jacqueline Del Rosario is President and CEO of Recapturing the Vision International, an organization dedicated to promoting healthy marriages and family strengthening. Also a published author, speaker and nationally regarded media personality, Dr. Del Rosario has been a certified pre and post-marital counselor for more than 20 years. Her cutting-edge series, Marriage Solutions and The Marital Constitution™, help couples successfully work through problems and find healthy solutions. She has two children and currently resides in Miami, Fl with her husband of over 20 years. Dr. Del Rosario may be reached online at www.doctordelrosario.com.

How will the new bank fees affect your money? (Image: Thinkstock)

Consumers scored a victory recently when Bank of America and a host of other banks decided to forgo charging bank fees on debit cards. But that doesn’t mean Americans won’t face other new fees and unexpected charges by the banking industry.

Here are several ways that U.S. banks are likely to sneak in new fees—and start squeezing money out of their customers in order to pad banks’ own coffers.

Lowering Interest Rates on Savings and Deposits

Think the interest you’re earning on your savings or money market account is pitifully low right now? It could get worse in the future if banks further decrease their deposit rates as a way to save money and, in effect, boost revenue.

According to Dan Geller, founder of Market Rates Insights, banks could lower their deposit rates by a scant 0.01% per month and still produce nearly twice as much in interest-expense savings as the new fees on debit cards would have generated.

By Geller’s calculations, a monthly decrease of 0.01% in the national average deposit interest rate reduces interest expense for banks by about $1.5 billion a month, which impacts a bank’s bottom line in the same way as earning this amount through fees.  And that $1.5 billion in monthly savings is far more than the potential $875 million banks stood to gain in monthly debit card fees.

In 2010, banks already lowered their interest rates by an average of 0.01% a month. So financial institutions that choose to progressively drop rates again in late 2011 or 2012 can simply say that they’re continuing a “normal” business practice as part of operating in a low-interest environment.

But make no mistake: by lowering the interest rates they pay on your savings, “banks can maintain a healthy net interest margin and protect their bottom line in the next two to three years until the economy recovers,” says Geller. “Better yet, this objective can be achieved with minimal effort and, most importantly, without alienating customers.”

(Image: Thinkstock)

Hiking Various Fees Tied to Credit Cards

In recent years, late payments on credit cards have averaged about $35. One possible way for banks to increase their income would be to slap delinquent customers with even bigger late-payment penalties.

That’s a potential scenario, but not as likely as fees that are under the radar of the average consumer.

For instance, credit card issuers might impose foreign currency or transaction fees when you use a credit card out of the country, or they may charge a fee on a rewards credit card when you redeem a “free” airline ticket, says Curtis Arnold, founder of CardRatings.com, a credit card comparison site that helps consumers find the best deals on credit cards.

“They may even start charging for the printed statements that you get in the mail under the guise that they’re trying to be environmentally friendly,” says Arnold, noting that “banks are very creative.”

“The public outcry over rising fees has become such a toxic issue and it generated such buzz in the media that I expect banks to regroup and figure out what to do next. They’re not going to just lay down and take this,” Arnold adds. “They’re going to fight back.”

Arnold’s advice: Be on guard and constantly read the fine print of your credit card and banking agreements. Also, even though the new Consumer Financial Protection Bureau will be a watchdog for consumers Arnold says “we shouldn’t trust regulators to be our life preservers.”

(Image: Thinkstock)

Escalating Checking Account Fees

Despite many claims about “free checking,” the truth is that most checking accounts cost consumers dearly. And those checking-related fees may rise as banks look to make up lost revenues.

Already, the average banking account customer who doesn’t meet minimum balance requirements pays an average of $5 to $12 per month for a checking account, according to a September 2010 research report from JP Morgan Chase.

Moreover, all the top 10 U.S. banks charge non-sufficient funds fees that range from $19 to $37 per occurrence. “To replace lost maintenance fees, banks have increasingly turned to punitive fees (e.g., NSF, extended overdraft, stop fees, etc.),” Chase researchers wrote.

So it’s not far-fetched to think that this trend could be magnified in the future.

In the meantime, however, the fact that BofA, Wells Fargo, Chase and other banks have abandoned their plans for debit fees “should give us hope as consumers for what we can accomplish if we work together,” says Arnold. “This is a great victory and it demonstrates that we can fight back against big banks.”

“Ask The Money Coach” is a syndicated column written by personal finance expert Lynnette Khalfani-Cox, co-founder of the free financial advice blog, AskTheMoneyCoach.com. Follow Lynnette on Twitter at @themoneycoach.

In fact, gas prices have edged higher in the past two weeks in October, with the average price for regular gasoline now at $3.46 per gallon, That’s up 64 cents a gallon from a year ago, according to AAA’s Daily Fuel Gauge Report.

Even more dismaying, some experts say gas prices in 2012 won’t decline.

Since we’re all trying to save a buck, here are 10 easy ways you can save money on gasoline:

1: Consider an “off brand” gasoline station.

You may be used to buying gas only from Chevron, ExxonMobil, or some other well-known oil company. But many experts will tell you that gas is gas. For example, experts at AAA in California did blind testing of “brand name” gas versus “off brand” gas and found no difference.

They tested samples of each type of gas for fuel economy; emissions; performance and drivability – and they were exactly the same. Unlike a few decades ago when cheaper gas was harmful to your car and its performance, that’s not the case today. Why? Regulations requiring cleaner, better-performing fuel apply to nearly all gas companies. So that no-name station offering gas that’s 10 cents or cheaper per gallon may be worth a try.

2. Fill up when you are not under the gun.

Why fill up your gas tank when you’re on empty, rushing to work, or under the gun? If you do, chances are you’ll hit the first station you see – which could be the most expensive. Instead, identify the cheapest station in your area, then filler up.

3: Identify “deal days”.

Find a gas station that offers a break on specific days of the week (i.e. 10 cents off Tuesdays, etc.) and routinely patronize that business.

4: Calculate the savings achieved by driving across a state border.

For example, buying gas in Northern New Jersey is typically a lot cheaper than New York. If you work, shop or visit the next state, can you fill up there?

5: Use Turnpikes and Parkways.

In New Jersey, where I live, the state government regulates turnpikes and parkways – as well as gas stations in the Garden State. Consequently, gas stations can only change their rates on specific days of the week. The same may apply in your state. If so, be sure to fill up before the normal day that price hikes kick in.

6: Lose weight, save gas.

What are you towing around in the trunk of your car? Are you willing not to carry a spare? Or can you avoid lugging around so much stuff to minimize gas consumption? Doing so could decrease your gas consumption, thereby lowering the amount of money you have to lay out for fuel.

7: Keep those tires inflated.

Studies show that properly inflated tires on your car lead to better fuel efficiency. So don’t roll around with a set of deflated wheels that make you look like you’re in a low-rider (chances are, you’re not).

8: Slow down speedy.

Like to gun your car engine? Why not just toss a few dollars out the window, same thing. Driving at slower speeds conserves gas.

9: Find the owner’s manual.

Your owner’s manual can tip you off to several ways to operate your vehicle at maximum efficiency, including making the most of your gas use. For instance, circle the octane, memorize the octane, and buy the recommended octane — today and forever.

10: Gimme something.

Check your credit card rewards programs for incentives to buy a particular brand of gasoline over another. Your credit card may offer frequent flier miles or cash back for your gas purchases. Don’t forget to pay off the balance in full each month. Also, beware of gasoline cards. They may offer you a deal (like 5 cents off per gallon) for filling up with their brand of gas. But they usually make up for that by charging you higher than average interest rates on the card.

If you take a few minutes to think about, and plan for your gas consumption, you’ll find plenty of crafty ways to save money at the pump.

“Ask The Money Coach” is a syndicated column written by personal finance expert Lynnette Khalfani-Cox, co-founder of the free financial advice blog, AskTheMoneyCoach.com. Follow Lynnette on Twitter at @themoneycoach.

(Image: Thinkstock)

Daily deal sites are a bargain-hunter’s dream come true. You can subscribe to online websites and score deals ranging from 10% to 90% off practically anything from food and clothing to travel and electronics and more.

That’s why sites like Groupon, LivingSocial and other daily deal sites have captured the attention of many savvy shoppers—as well as some shopping fools too!

To avoid falling into the latter category, it’s important to avoid getting caught up in a shopping frenzy if you get an email about a “daily deal.” No matter how tempting the offer, you should still exercise some basic smarts when using daily deal sites.

One big caveat: you need to make absolutely sure that you’re actually going to use your deal before it expires. According to a Yipit study, people who buy these coupons and deals only redeem them about 80% to 90% of the time.

Since “daily” deals typically only last about 24 hours, you need to make a fast decision to buy—or not buy.

Use these tips to make the most out of Groupon and other daily deal sites:

READ THE FINE PRINT

Every daily deal site has to list the terms and conditions of the deal clearly. The fine print is usually listed right below the deal’s description and will explain exactly what the limitations and terms of use of your deal will be.

This can include anything from dates and times the coupon is valid, if you can buy and use more than one at a time, and how you might end up forfeiting the deal. Review the fine print of any offer carefully so you are confident you’ll actually end up using it and won’t forfeit the deal.

CONSIDER THE ACTUAL VALUE OF THE DEAL

If you’re purchasing a $10 off coupon for a $20 meal at a local restaurant—but the average price of a meal is really in the $30 to $40 range—you could end up spending much more than you usually do overall on the entire meal. By the same token, what good is it to get “half” off a restaurant dinner if it’s way overpriced in the first place?

So ask yourself if you would normally spend a certain amount at the restaurant. Take a look at menu prices to estimate the average cost of a meal. If you’re only going in there to redeem your daily deal coupon, it’s probably not as great a bargain as you think, and you may spend much more than you’re comfortable with.

GIVE YOURSELF TIME TO THINK ABOUT IT

Sites like Groupon and LivingSocial are a magnet for impulsive shoppers. The deals are only offered for a very short period of time, so you’re under pressure to snag the deal before it’s too late. Just remember that you usually have about 12 hours to make the purchase.

Really think through whether you will be able to use the coupon and get something out of it. If it’s a bit of a stretch, don’t do it. These deals are non-refundable and non-negotiable, so you could end up losing money if you buy on a whim and then decide—for whatever reason—not to redeem your coupon or discount lot. This is just one reason why I advise online and offline shopaholics to give themselves a 24-hour cooling off period before buying on impulse.

Admittedly, though, this 24-hour cooling off strategy is much tougher with a daily deals site, since waiting the full 24 hours may mean you’ll “miss” the deal. This isn’t always the case though. For instance, Groupon is currently running a deal in Northern Jersey—where I live—for $40 worth of vitamins, supplements or health products from GNC for just $19. As of this writing, there’s still two full days left to advantage of this promotion.

DOUBLE UP WHEN YOU CAN

Some daily deal sites will allow you to purchase more than one deal at a time, but may have restrictions on when you can redeem them. If you’re already a frequent customer of the business, this can be a great way to save extra money on purchases you already make.
Daily deal sites can be a great way to scoop up a great deal in your neighborhood and save some money—if you had already budgeted or planned to make certain purchases anyway.

If you’re buying just to get a “two for one” deal or if you have to go out of your way to cash in on a deal, it’s likely that you’ll end up spending much more than you hoped. Really consider the value of the deal before you push the “buy” button.

And remember, if you can’t afford something or simply don’t need it—no matter how low the price is—it’s not a bargain at any price.

Do you see people in line at the supermarket handing over a wad of coupons and saving a ton of cash at the register? Does a little twinge of envy and wonder well up in your chest? Well, there’s no need to be jealous. You, too, can learn the tricks of “couponing” and stretch your grocery budget. You may be surprised to know there’s a right way and a wrong way to use coupons.  The right way saves you money. The wrong way will drain your cash (and time) while giving you a false sense of accomplishment. (We’ll discuss the wrong way in Part 2 of this series on couponing).

Here are four tips on how to work those coupon savings in your favor.

Step 1: Plan ahead. Plan your meals for the week ahead of time. This way, you’ll clip coupons according to what you need instead of what’s on sale. This will also save you from wandering aimlessly through the grocery store aisles, deciding what you need to buy.

Step 2: Look for coupons. Store circulars and the Sunday paper aren’t the only places you’ll find coupons. There are also coupons online. Some of the most popular coupon sites are Coupons.com and CouponCabin.com. Some store website also feature printable coupons.  In addition, if you sign up for a  store’s mailing list, you’ll often get coupons in the mail or via e-mail.

Step 3: Look for sales. The best way to maximize your savings is to use coupons when they match up with the store sales for the week. Also go to stores that double or triple coupons for even bigger savings.

Step 4:  Branch out. Don’t feel obligated to only stick to certain brands. If you see a coupon for an item that you need, but it’s not the brand you usually buy, try it. The savings will be worth it. Also try shopping at different stores. For example, Target has great deals on groceries. In addition, make sure to sign up for store loyalty cards.

Now that you’re armed with information, you can go out and shop with confidence!  And don’t forget to let us know how much you saved! Say tuned for part 2 of this series to learn about the wrong way to use coupons.

(Image: ThinkStock)

Recently, I was invited to give a speech on the economic empowerment of women. I’m usually pretty relaxed about public speaking, but this was a heavy duty group of mostly female politicians, philanthropists, entrepreneurs, executives, and internationally renowned women’s rights activists, including Kerry Kennedy Cuomo and Naomi Tutu.

The assigned topic was fodder for tons of statistics, some encouraging and others deeply disturbing. The speech had the potential to be very heavy, which I wanted to avoid. So, along with all the sober economic news and calls for ongoing vigilance in the fight for gender equality, I talked a lot about my mom.

Vera Clarke has always been a walking testimony to women’s financial independence. Most of her lessons in economic empowerment were stated explicitly and often. Others were self-evident but never lost on me, her only child.

First and foremost, she urged me to always have my own job and my own money, including a secret account—as in secret from my husband. A Depression-era child whose father worked several jobs while her mom raised five kids, she loved her own mother deeply but didn’t want her life. So, she became the first in her family to graduate from college, she got a master’s degree and began a career in education, a field that she knew would allow her to balance the work-mother scales well.

My mom insisted that any woman who works outside the home should pay someone else to clean the inside of her home. I know cleaning is therapeutic for some people but my mother is not one of them, and I’m here to testify that the apple doesn’t fall far from the tree! She made it clear that hiring other women to help with the house or my after-school care wasn’t just helpful to her, it was helpful to them, enabling them to do for their families and pursue their dreams as well.

“Money is freedom,” she always said. “If you have it, you can go where you want, buy what you want, and do what you want. If you don’t, you will always be trying to get someone’s permission.”

The amount of money one made was never her preoccupation. “Don’t measure yourself by what you have,” she’d say. “Measure yourself by what you have accomplished.”

The handling of whatever amount you had was what counted. As a New York City public school teacher, she never made a killing and, in 50 years of marriage, she never earned as much as my father did. But she had an equal say in the family’s financial decisions and she made the most of what she had on her own terms, treating herself to cultural events my dad had no interest in, trips he couldn’t get away for, and generally buying whatever she damn well pleased (which often meant surprise gifts for him or me).

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(Image: ThinkStock)

Don’t get me wrong: She lived well within her means. In fact, she lived below her means (another great lesson I wish I’d learned better). But my parents often disagreed about what those means were. My dad was more financially conservative (some might say cheap) than my mom was. She wasn’t a big spender, but she was a big giver and a big believer in indulging a fantasy from time to time. She often took the life’s-too-short approach to financial decisions (as in life’s too short not to get those shoes, go on that vacation or spring for those really good concert tickets)—something my dad never did.

Whenever my parents reached an especially tense impasse over financial issues, she’d end the argument by channeling her best Billie Holiday and belting out, “God Bless the Child That’s Got It’s Own.” This drove my father crazy, but he never figured out how to override her message, which was clear: “I’ve got mine, and I’ll decide what to do with it.” That, even to my child’s eye, was clearly a form of power and she wielded it well.

My mom’s other lessons in economic empowerment were gleaned less directly. She and my dad had a joint bank account, joint ownership of their home, they paid joint taxes and made all significant purchases jointly. But, in addition to their shared holdings, she made sure she had her own credit card accounts, her own investments, and her own credit rating. She was mindful of finding bargains but she understood quality and she never sacrificed one for the other.

“It’s not a steal if it’s garbage,” she’d say, whenever I spotted something she deemed unworthy of any price tag. “Unless they’re paying you to take it home, you’re getting taken.”

In a pinch, my mom could always “find” money in the house—and not just pocket change, but significant amounts tucked away in unused coffee cups, between the pages of books, or inside old boxes kept on high shelves. She never said a word about this, but I knew that if the world fell apart, she could buy enough food or gas or water to keep us afloat until somebody figured out how to put it back together.

When New York offered its most experienced teachers an early buyout package, she took it, maxing out her pension and benefits without putting in the extra time. Now widowed, she’s still stubbornly independent on every front and still as generous as the day is long.

She takes pleasure in giving to the causes she deems worthy and to her grandchildren often for no reason at all. Every once in a while, she asks them to lift an old coffee or juice jar for her, claiming to be testing their strength. Filled to the brim with coins, the jars weigh a ton, but if the kids can lift one, she says, they get to keep it. The record, so far, is held by my daughter, who emptied her jar into the CoinStar once and got back more than $100. That’s not a bad haul for picking up an old jar of loose change. And it’s not a bad lesson to learn young: Every little bit counts. It’s a lesson, like the ones my mother taught me, that will last a lifetime.

Twum’s parents, business owners in Accra, Ghana, would send him $5,000 per semester to buy books and other necessities for his studies at Westminster College in Fulton, Missouri. Like any teenager flush with cash Twum burned through all his spending money halfway through his first semester. He had no budget. He remembers buying school supplies and a pair of Nikes. He also spent upward of $60 a day on meals for himself and his friends. “My first semester I abused the money,” admits Twum, now 29 and working in financial advisory services for New River Systems in the Washington, D.C., area.

He was certain that a quick phone call to his parents would solve his financial dilemma. To his surprise, his parents refused to send additional money. “That was a rude awakening for me,” says Twum. “At home I had access to everything and didn’t have to worry much about how I spent my money.”

For the rest of the semester the freshman ditched the high-cost meals, learned to tolerate campus cafeteria food, and lived off the earnings from the $5.15-an-hour work-study job as a network security administrator.

The next semester yielded different results. “I balanced my checkbook and created a budget,” recalls Twum, who had $700 left over at the end of his second semester. “That was the first time I started saving,” he adds. He took the extra $700 and put it in a savings account. Each semester of college, and through graduate school at DePaul University in Chicago, he continued to put money away and build his account.

Even after he entered the workforce, Twum stuck to his financially responsible ways. He became a homeowner in 2005 and developed a financial plan for his short- and mid-term goals and retirement. He first set up his employer-sponsored retirement fund, to which he contributes 10% of his paycheck.

Twum then established an emergency fund of a year’s worth of living expenses. “I wrote down my expenses, which came to $2,200 per month and multiplied that by 12.” “So I decided that, based on my budget, I could save $700 per pay period to reach my goal,” says Twum, which he did in a little more than a year. With an emergency cushion in place, he now puts another 6% of his paycheck into a savings account, which currently yields about 1%.

Each December, Twum says he sits down and reviews his financial goals. “They change every year. I may want to make a purchase and need to create a savings plan to reach that goal,” he says. For example, three years ago he began thinking of starting a technology consulting firm that will provide financial services such as account fraud analytics and financial advisory planning. To finance his dream, he readjusted his budget and set up a plan to save $250,000 in five years. The centerpiece of his plan: “I just made it automatic,” explains Twum. About $700 is deducted from his biweekly paycheck and funneled into an account at his local credit union. He is about two and a half years away from his goal.

As a single young man with no children and a roughly $100,000-a-year salary, it can be tempting to live a spendthrift lifestyle. If he wants to make a purchase he pays for it in cash or sets up a savings plan for it. But, grateful for the lesson from his parents, “I always ask myself, ‘Is it a need or a want?’ If I need it,” he says, “I’ll save for it.”

HOW I DID IT
• Make it automatic. Instead of making savings an afterthought, “Pay yourself first,” says Twum. “At least 10%, and don’t give yourself access to it,” he adds. No matter how little you have to start with, get in the habit of saving consistently. Have a portion of your paycheck automatically deposited into a savings account.

• Establish an emergency fund. Set aside a certain amount of your income to go into this account each pay period. “I started looking at what my expenses were for the year and then created a savings goal that would protect me if I came across any unexpected expenses,” says Twum. “I asked myself, ‘If I were to lose my job, could I survive for the next eight months to a year?’” The best place to save your emergency fund money is in an online high-yield savings account or money market account. You want to earn as much interest as possible while keeping the cash liquid and easily accessible.

• Review financial goals annually. “Your goals can change from year to year. So, it’s important to review them at the end of each year,” suggests Twum. Your aims, especially long-term goals, will evolve and grow as you get older. It’s important to identify your short-, mid-, and long-term goals. Short-term goals are generally two years while mid-term goals are those you hope to accomplish in five to 15 years. Long-term goals include your ambitions for retirement and how you plan to pass on your wealth. 

(Image: Thinkstock)

When’s the best time to buy a home? Many real estate experts might say right now. Interest rates are at historic lows and home prices are the more affordable than they’ve been in 20 years according to the Housing Opportunity Index. Still, the best time to buy is whenever it makes the most sense given your finances, your stage of life, your family circumstance, and your vision for the future. Premature home buying–buying a home before your finances and the rest of your life are ready for the long-term financial commitment to a mortgage–is how many families ended up losing their homes.

To help you avoid some of the common mistakes, here are 5 steps toward sustainable homeownership:

1. Write out your “Vision of Home.”

Get clear on your vision, not just of your home, but for your life as a homeowner, and write it down. Where do you work, for whom, and how much? What work do you do? Do you entertain? Garden? Do you spend your weekends fixing your home, or walking downtown? Who lives with you? What do you all do in your spare time? This vision will drive a number of the other decisions you’ll make along your home buying process.

2. Do some research.

Get online and start getting a sense for what states, cities, and even neighborhoods you would like to live in. Educate yourself about the going home prices in those areas; most sites will also give you a VERY rough idea of what the monthly costs associated with a given home would be. Use a site like Trulia.com, where you can both search for properties and ask questions about your local market from an online community of local real estate pros.

3. Get clear on your current financials.

Go to AnnualCreditReport.com and pull all 3 credit scores. Get a clear understanding of all of your consumer, student and other debt – including how much you owe, to whom, and how much your monthly payments are. Also make sure you are clear on all your income and other expenses. From there, formulate a clear idea on what the maximum amount of money you want to spend on housing is.

4. Meet with local real estate professionals.

Get referrals from family or friends, or connect with a local real estate broker and mortgage professional on a site like Trulia.com. Sit down and talk with the mortgage broker to find out what it will take to qualify for the general price range you think:

• Find out how much cash you’ll need as a down payment and for closing costs. Today’s buyers normally need 3.5 to 7 percent of the purchase price of their home, in cash, to close the deal with a Federal Housing Administration-insured loan. Visit HUD.gov for more information on low-down payment FHA loans.
• Research first-time buyer assistance programs. One of the few programs that still offers a wide array of resources for buyers across the country can be found at NACA.com.
• Review any bills you need to pay down or derogatory credit marks you need to address – and how – to qualify for a home loan.

5. Set up an action plan with a step-by-step plan for the following:

• Completions. Set up a plan for “completing” bills you want to pay to free up cash for your mortgage payment, or bills you need to pay to qualify for a home loan.
• Savings. Decide how much you will put aside every paycheck or month toward your savings target – then get started!
• Budget. A friend of mine calls this a “Map of Intentions.” Set up a monthly spending plan prioritized in alignment with your home buying goals and the rest of your “Vision of Home.” Visit ConsciousBookkeeping.com for more information, if you get stuck at this step.
• Credit. Make sure your action plan includes the steps provided by the mortgage broker you consulted in Step 4, above, to get you to the score you need to qualify for the loan and interest rate you want. Some credit actions have counterintuitive impacts on your credit, so consult closely with your mortgage broker before doing things like paying all of your credit cards all the way off.
• Life, Family and Career. Before buying a home, get a level of comfort that you can commit to owning that home for 5 to 10 years, longer if your town has been hard hit by the foreclosure crisis. If you feel uncertain about the long-term employment prospects in your town, think carefully before you buy a home there. Also, avoid changing careers right before you buy.

Tara-Nicholle Nelson is a real estate broker and attorney, author of two real estate guides for women and the Consumer Educator for real estate search engine Trulia.com. Tara is also the Founder and Chief Visionary of REThinkRealEstate.com, which offers expert guidance on real estate decision making.

Ilyas Akbar, a retirement planning specialist for AXA Advisors, says it’s good for young professionals just starting out to think of their money as three buckets; short, mid, and long-term. BLACK ENTERPRISE and Akbar created a plan to help you identify your financial goals and some possible investment options for achieving those ambitions.

• Short-term

Short-term goals are generally defined as those goals you want to achieve within two years. Akbar says these can include building an emergency savings fund, saving for a down payment on a home, purchasing a car, or going back to school etc. In the event of an unexpected expense “you want to have liquid cash available that’s not tied up in the market,” he adds.

Savings Vehicles:

1. Savings account: Although interest rates are lower, your money is liquid and your deposits are FDIC-insured up to at least $250,000 per insured bank. You can easily transfer or withdraw your money from savings accounts.

2. Checking accounts: Although most are non-interest bearing, some banks and credit unions offer higher interest rates. These accounts are FDIC-insured and can be easily accessed. Banks may impose minimum balances, limit the number of transactions that can be made within a time period or may require direct deposit to qualify for the high-interest rate.

3. Money Market Accounts: The rate of return is typically higher on MMA’s since they are based on the current market rate of interest. They are generally FDIC-insured. Banks may impose minimum balances, or limit the number of transactions that can be made within a time period.

4. Certificates of Deposit: CDs generally receive a higher interest rate, especially on longer terms, which range from one month to five years. They are fairly liquid, but there is a penalty if you withdraw the funds before its maturity date.

Rate of Return: The average rate of return that one might target is 1-2%. “You won’t earn a lot on your money, but the benefit is liquidity and stability,” says Akbar.

• Mid-term

Mid-term goals are generally those goals that you want to accomplish in the next 5-15 years, such as early retirement, business, education, a second home or a large purchase. “This bucket provides financial flexibility, freedom and allows people to enhance their abilities in their lives,” says Akbar.

Where to Invest:

1. Mutual Funds: By investing in a pool of stocks, bonds, and other instruments with multiple investors, gives you holdings in several different companies (diversification). Like stocks, they can also be converted into cash.

2. Stocks: Ownership of a corporation represented by shares that are a claim on the corporation’s earnings and assets.

3. Real Estate: A publicly traded company that invests in a specific type of property, from shopping centers and office buildings, to apartment complexes and hotels.

4. Exchange Traded Funds: ETFs are similar to mutual funds in that they represent a collection of investments. Unlike mutual funds, ETFs trade on an exchange (hence the name). Some investors prefer ETFs to mutual funds because they have low expense ratios and generate lower capital gains taxes than similar mutual funds.

Rate of Return: The average rate of return that one might target is 6-10%.

• Long-term goals

“This is probably this biggest thing you’ll ever save for,” says Akbar. This savings for your retirement. Social Security won’t be able to fund your retirement. Here are other investment vehicles you may want to consider to help you start investing for your golden years.

Where to Invest:

1. 401(k)-Tax deferred retirement account that an employee elects automatic contributions from their paycheck to the plan on a pretax basis. Distributions received before age 59 1/2 are subject to an early distribution penalty of 10% additional tax unless an exception applies.

2. Individual Retirement Account: An IRA is a fund earmarked for retirement savings (There are several types of IRAs: Traditional IRAs, Roth IRAs, SIMPLE IRAs and SEP IRAs.)

3. Cash Value Life Insurance: An insurance policy that covers you for the duration of your life. It builds cash value

Rate of Return: The average rate of return that one might target is 8-10%.