How Real People Grow Their Wealth

For most people, wealth does not come in a windfall but instead gathers gradually as a result of years of hard work and diligence.

Bankrate readers offer their tips for growing wealth. You'll find no winning lottery numbers or surefire stock recommendations among them, but all are sensible suggestions for savings.
AP Photo/Bloomsburg Press Enterprise, Bill Hughes

1. Grow Your Own Food
I have a plot in our local community garden that I share with two of my friends.
It is a fun, inexpensive hobby for us -- plus it keeps us active and teaches our children important life skills.
We keep our 20- by 30-foot parcel planted year-round, and it provides our three families with fresh, organic produce.
-- Anonymous
2. Set Limits and Stick to Them
I try to save at least three to four part-time paychecks so that I can elect to make a hefty payment on a credit card account and buy myself a little something I waited to get.
Also, I have inventoried my home and gathered up all half-full or almost empty bottles of lotions, soaps, hair creams, cleaning products and vowed not to make a purchase until we absolutely had not one drop of a particular thing. So I have not been to the store to buy these items -- including makeup and colognes.
I limit my driving and only buy $20 (of gas) at a time about once a week …so $80 a month. Not an ounce more.
As for groceries, I am using only fresh or frozen vegetables. At the store I purchase only the item that is $0.99 per pound and pull out my cookbook to find an exciting way to cook it and make great meals. Chicken can be cooked 100 different ways.
-- Sharon Dorsey
3. Buy Savings Bonds
I have always made a 10 percent deduction on my pay.
If you do it every week, you will see that you don't miss it. After a few years it can really accumulate into a nice sum of savings. The best vehicle is savings bonds. You buy them and just hold them.
-- Michael de Gennaro
4. Redirect Your Raises
Anytime I get a raise or a bonus, I don't have the additional money deposited into my checking account.
I have already proven I can live without the money, so first I direct it to my 401(k).
Once I maxed out my 401(k) contributions, my raises went directly into my HSA.
Once that was maxed out, they went directly into a savings account.
I now have my 401(k) fully invested, my HSA fully funded and a great emergency fund.
-- Sam Hohman
5. Split Raises in Half
Each and every job raise should be split -- half you keep and half is put into a monthly retirement vehicle. It is a foolproof way to retire early.
-- Chere
6. Track Spending
Tracking spending (even for 30 days) allows you to know exactly what you spend.
Have you ever gone to the ATM and two days later asked yourself, "I know I got $60 on Tuesday -- where did it go?"
You may remember some of it, but you will not remember all of it. Tracking spending takes out the guesswork and puts you firmly in control of your finances.
From there, it's easy to determine what you can cut or, better yet, what you can save.
-- Jude Gilford
7. Spend Less by Budgeting
We found that if we keep track of our spending on a month-to-month basis, we spend less.
We are also good at paying ourselves first through auto-pay on the paycheck that goes into savings and 401(k) accounts.
We also are good at putting our loose change in the change jar so that maybe we can take that trip someday.
-- Brenda
8. Save by Using Credit
My husband and I do not carry any significant amounts of cash -- have approximately $20 to $40 maximum in each wallet.
All purchases -- food, gasoline and nominal retail purchases -- are on the card. All credit purchases are paid up completely every billing. Savings are twofold: 30-day float and no credit card interest ever for the past 30 years or more. Our motto is, if we pay any interest charges, they must be tax-deductible!

-- Kathleen McHugh

9. Take Advantage of Rewards
I charge all food, gas and household bills such as electricity, car loan and house insurance.
I pay the card off each month. I am left with reward points to turn into cash, restaurant certificates, gift cards at various stores and so on. I actually make $40 to $70 a month by doing this.
-- Diann Williams
10. Save With Coupons
Use coupons at the grocery store and put that money in a piggy bank. It's amazing how much it adds up.
Years ago the stores gave you cash back for coupons you used, but now it's just deducted from the balance you owe at the store and your receipt shows how much you saved. But you haven't really saved if you aren't actively saving that money -- you are just spending less.
Start saving by taking the amount of cash out of your wallet and putting it away.
-- Lisa Anderson
11. Use Direct Deposit
The best savings secret is using direct deposit from your paycheck into a savings account.
I also have direct deposit to an additional savings account at a bank that I don't frequent very often for my vacation and Christmas fund. Even small amounts add up if you leave it alone.
-- Karla
12. Leverage Automatic Savings
The key in our household is automatic deposits. Here are some examples:
A. Every month we have a set amount taken out of our checking account and put into our two children's college savings plans -- $50 each.
In this way we are setting aside $600 per year for each child for their college education. At $600 each year for 18 years we will have a lot more than I, or my parents, had saved for my college education. They will be expected to work, apply for scholarships and take out loans if necessary to help fund their education.
B. Part of our paychecks goes to various savings accounts automatically:
Savings accounts for each of our children (both are under age 8) to buy them clothes or other necessary items. We save $10 per month for each, so that is $120 per year for each child, plus birthday and Christmas money they receive from relatives helps toward clothing expenses.
A money market fund for future vacations to the tune of $50 every two weeks, which turns out to be $1,300 per year. We usually take a big vacation every two years, so we have at least $2,600. Any money not spent on a previous vacation is left in the account.
A money market fund for the down payment on our next vehicle. Whenever we pay off a vehicle, that money gets set aside instead of spent, currently $150 every two weeks, which turns out to be $3,900 per year. We try to go at least two to four years after paying off a vehicle before replacing it.
A savings account for Christmas spending; we save $80 per month, or $960 total, to put toward Christmas presents for family and friends.
C. We fund our 401(k)s directly through our employer, taken out of our paychecks pretax. Paying for our retirement comes first.
By having our money moving automatically around to various savings accounts or into the college funds or 401(k) plans, there is no way not to have that money available for those reasons.
-- Jen Richardson
13. Don't Touch the Money
I have a certain amount allotted to a bank account each payday that I do not use to pay bills, nor do I withdraw that account. I never miss the money because it is allotted before my pay is deposited.
-- Christina
14. Pay Attention to Progress
I keep a chart of my debts and assets, including school loans, car loan, mortgage, my savings account and 401(k).
Then I watch them closely, actually daily right now, to see my savings grow and my debts come down. At the top of the chart I put how much I originally owed, and it has been very motivating. My savings account shows me daily how much I'm earning -- by doing nothing!
I've always been a saver, but don't have much. For many years, I was a single mom with two children, no education and no child support -- earning $5 an hour in Southern California.
The kids are now on their own, and I've been at the same job for almost 10 years making a decent income. I just can't figure out why I didn't make the chart before. It has significantly helped me save while paying off my debts.
-- Cindy Troyer
15. Save a Little Each Week
I needed to save money for several long-term goals and ongoing bills, such as a new car, vacation fund, emergency vet fund for my pets and my personal emergency fund, and so on.
So I created an ING account for each fund. I started out the first week by putting $1 in each account. The second week I put $1 into each account plus an extra $1 into the personal emergency fund, third week went $1 into each account plus $2 into the personal account, and so on.
The second month I put $2 a week into each account plus the extra $1 into the savings. Third month was $3 into each account each week plus the extra.
Doesn't sound like much, but you slowly learn to live without the money -- paying yourself first!
At this point I am putting away almost $100 a week spread out over several accounts. Some accounts are just gathering funds for long-term goals, for instance a new car, while others get tapped into on a regular basis.
-- Alexis Heydt
16. Check Grocery Store Ads
I have found that one of the best ways to save a few bucks is to watch out for grocery store ads.
I retired about 10 years ago and love to grocery shop. At my local grocery market there is never a week that goes by that they don't have a great discount on something. I save on average $40 to $45 per week, or $1,300 to date this year.
Every item I buy is something to eat or use for the household. It beats the heck out of coupons.
-- David Swanger

LCD or Plasma HDTVs: Which to Choose?

By Krissy Rushing, Digital Trends

The war between plasma and LCD flat-panel TVs rages on, and no doubt you've heard the propaganda from both camps. While LCD has traditionally been more expensive than plasma at the larger sizes, that gap is diminishing -making other factors such as performance and features more significant. We'll take you through the pros and cons of each technology to help you make the important decision: whether to buy a plasma or LCD television?

Plasma Flat Panels
Benefits:
• Better contrast and deeper blacks. Plasma displays are known for their deep, inky-black levels, which result in better contrast and a more three-dimensional picture. Panasonic and Pioneer are especially well known for their sets' high-quality black levels, setting the standard for all other plasma sets.
By comparison, LCDs have a more difficult time "turning off" their backlighting mechanisms for a truly dark image. On the other hand, they are generally brighter than plasma displays, and therefore perform better in situations where there is a lot of ambient light (more on that later).
• Don't suffer from motion blur on action. Due to technical reasons we won't get into here, LCDs are often victims of motion blur- aka image smearing - which results in fast-action or sports footage looking blurry or smeared across the screen. In a very bad case, if a golf ball is flying through the sky, you might see a comet-like trail behind it.
• Unlimited viewing angle. Unlike LCDs, off-axis viewing of a plasma set will look the same as if you were looking at the plasma sitting directly in front of it. In short, image quality is consistent from any seat in the house.
• Cost slightly less than LCD sets. While the difference in price is shrinking, plasmas are slightly less expensive than LCDs, especially at larger sizes. However, this doesn't necessarily apply to top-end models.
Drawbacks:
• Short-term image retention a possibility. Plasmas have always gotten a bad rap for burn-in or image retention: When an image, such as a station logo or stock ticker, remains on the screen for too long, you may see a faint ghost of the image after it disappears. For most good plasma displays though, this is a non-issue, and any ghosting that appears should quickly go away. A lot of manufacturers use screen savers if an image is paused for too long to prevent image retention.
• Screens can suffer from glare in bright rooms. Plasma TVs' glass panels are known to reflect light and make them harder to watch in a bright room. Many manufacturers are using special techniques to minimize reflections, however, and some of them, such as Panasonic's anti-reflective filter, minimize these reflections and improve performance in brighter rooms. Look for antiglare options when you are shopping for a plasma TV.
• Use slightly more power than LCD displays per square inch.
• Fewer choices. LCD panels are everywhere and come in a wider variety of sizes. There is a little less variety to choose from when it comes to picking a plasma display.
The bottom line:
While we could take the stance that both technologies are equally good, and the choice is up to your personal preference, we won't go for the easy cop-out. The fact is, plasmas have a slight edge when it comes to a truly cinematic picture. If you are a cinephile who likes to watch a lot of different film sources such as Blu-ray discs or DVDs, plasma is your best bet - especially if you have some control over ambient light. The technology's deeper blacks, sharper contrast and absence of motion blur make it ideal for almost any application. Just watch out for image glare on untreated plasma displays, and make sure your plasma can stand up to the amount of uncontrollable light in your room.

LCD HDTVs
Benefits:
• Brighter images. LCD panels offer brighter pictures than plasma, making them great models for viewing in a well-lit room.
• No screen reflection. LCD televisions' matte screens don't fall prey to screen glare like plasma displays do. However, there are some exceptions to this rule, so be on the lookout for that errant non-matte screen when shopping for an LCD.
• No risk of image retention. Unlike plasma, there is absolutely no fear of image retention on an LCD display.
• Slightly lower power consumption. In a world that is becoming more energy-conscious with every passing day, consuming less power is a strong selling point. However, almost every manufacturer-plasma and LCD- is incorporating special energy-saving modes into their sets. Check power-consumption ratings and features before you buy.
Drawbacks:
• Limited viewing angle. LCD TVs' viewing angles are not as wide as plasmas. This means that if you are sitting off to the sides of the TV (or below it), the image may appear somewhat off in terms of color, contrast, and brightness.
• Blacks are not as deep as plasmas. LCDs don't begin to compare with plasmas in the black-level department. However, there are some new LCDs that use light emitting diode technology (LED) to more effectively "turn off" the black parts of the image during dark moments. These models are relatively expensive, however.
• Can suffer from motion blur. While motion blur or image smearing can be a factor when watching fast-moving action on an LCD, most manufacturers have introduced frame-interpolation technology into their LCD sets that add frames to double or even quadruple LCD's 60Hz frame rate. If motion blur is a concern, demo the LCD using sports source material. Most consumers won't notice motion blur on a screen with frame-interpolation technology.
The bottom line
While LCDs have a slight disadvantage when it comes to watching cinematic content, they do have their benefits. They can stand up to almost any viewing environment, such as watching a football game during broad daylight in a room flooded with natural light. If this sounds like your viewing space, LCD may be the way to go. Additionally, if you are looking for an HDTV at a smaller screen size, then LCD is the only way to go, as plasmas are not manufactured below 42 inches. You have a lot more choice when it comes to picking an LCD panel, and most of them are quite good, especially those from Samsung, Sony, and Sharp.

Every Day a Saturday

Every so often I have lunch with the guy who preceded me as editor. He's been gone a few years, and at our most recent gathering, I asked what life is like for a retiree. Ted Miller thought for a moment, then replied, "Fred, it may take a few months, but there will come a morning when you'll wake up and realize that every day is a Saturday."
A stunning insight that was. Saturdays are days of boundless opportunity. You can do almost anything you wish on a Saturday. Best of all, it will be enjoyable. What's not to like about that?
The Janet test
This is my last column -- my last conversation with you on this page -- and my final issue of Kiplinger's Personal Finance to put to bed. I'm going on to the next phase of my life. It won't be as challenging as the one I'm leaving, but it ought to be fun, like Saturdays. In a moment, I'll tell you what I've learned -- my so-called pearls of wisdom. First, I'll share a few thoughts about the men and women who create this magazine every month, starting with my successor.
I met Janet Bodnar 22 years ago. Before Ted hired me as his deputy, he asked her to take me to lunch. Janet was then a young senior editor of the magazine. Ted trusted her to detect any bs -- false signals or insincerity on my part. Even then, in her thirties, Janet clearly exhibited the qualities I admire her for: poise, self-confidence, excellent instincts as a financial journalist and budding leadership abilities. (By the way, I guess I passed the Janet test.)
Janet went on to establish her franchise as an authority on kids and money. Her magazine column, "Money-Smart Kids," began appearing in 1993. She wrote a book of the same name. Three years ago, Janet became my deputy and took over responsibility for the magazine's Money section.
I am in awe of Janet for how she inspires the love and affection of the staff she will soon direct. In this tough business, I've never seen such charisma. I recently sat in on a story-idea meeting she chaired with the writers. Uproarious laughter. Voices all talking at once. Excitement in the air. Creative mayhem. And through it all, there was Janet, contributing to the flow of ideas even as she scribbled notes that would later give birth to stories you will read in this issue.
Now, let me ask you: Were you ever in a large work environment in which you thought every single person was pulling his or her own weight and more? It doesn't often happen that way. Yet for the past several years, that's the sort of organization I've been blessed with. As we've expanded into online journalism, effectively doubling everyone's workload, this staff of mine rose to the challenge -- jumped at it. There's an excitement about this place that is sometimes palpable. It affects the interns and young reporters as it does old bulls like myself. We're all still learning, getting better at what we do. And you, dear reader, are the beneficiary.
What I've learned
So now I know that work is a pleasure when you do it with good people. A few other thoughts to leave you with: Don't believe too much in your own hustle. Every so often, even the best investor is incompetent. Your kids are never too old to hear you say that you love them. There will be another bull market -- really. Your worst enemy is not as bad as you think. The best friend of a man who retires in times like these is a working wife. Please, never completely grow up.
I wish all of you the best.

5 Reasons Why Deflation Is Good for Retirees

by Philip Moeller

Living on a fixed income is looking downright sexy these days. Consumer and commodities prices are headed south, and inflationary pressures have gone way underground. Toss in the 5.8 percent cost of living rise in Social Security next year—the largest annual increase since 1982—and it may be party time in some circles.
There are no sure things, but if the recession is as steep as forecast, then prices are not rising anytime soon—short of natural or man-made catastrophes. Consumers, who generate 70 percent of consumption in the U.S., simply are not buying. So, we're looking at anywhere from six to 18 months of flat or falling price levels. Now, that's either deflation—prices actually fall—or disinflation—prices increase at a decreasing pace. Either way, it is not the kind of economic death spiral that would occur if deflationary forces took long-term hold. That picture is ugly—declining demand causes business layoffs, causes further shrinkage of income, causes even less consumption, etc.
The prospect of short-term deflation has silver linings, particularly for retirees who are not worried about losing a job and have access to Social Security, defined-benefit pensions, and other stable sources of financial support.
"In some sense, deflation is an ideal environment for someone who is on a fixed income," notes Dean Croushore, an economist at the University of Richmond's Robins School of Business. "Part of the story is good news," agrees Boston University economist Laurence Kotlikoff. With deflation, "the price of consuming in the future becomes cheaper. You have to put aside less money today to consume in the future."
Tips for a deflationary world:
Decrease your debt. Accelerate debt payments. "If there is deflation, you will be paying them off with more expensive dollars," Croushore says.
Restructure your debt. Interest rates on everything will decline, so it's a good time to restructure your debts. "If you do get a sustained period of reduced prices, you will really see low nominal interest rates on everything," Croushore says.
Refinance your home. "Everything else being equal," Kotlikoff says, "deflation should lower mortgage rates." Together with government-backed mortgage supports, this will be a good opportunity to refinance a home and sharply reduce monthly payments. Lower house payments traditionally support higher home sales prices, so deflation will be good for housing values so long as it doesn't depress economic growth too much, which would be bad for home values.
Buy TIPS. Treasury Inflation-Protected Securities, better known as TIPS, make a lot of sense for stock-averse investors, especially those who fear both a low-inflation environment over the next couple of years and higher inflation as the economy recovers. At 3 to 4 percent, "the TIPS return is quite impressive right now," Kotlikoff says.
TIPS pay a fixed interest rate but the principal of the bond changes to reflect inflation, as measured by the consumer price index. So, if the CPI rises, so does the principa of the bond, meaning that interest payments would rise and afford inflation protection. If prices fall, the principal amount of the bond would fall as well, but it can never fall below its face amount when issued, so holders are protected against deflation as well. TIPS are exempt from state and local income taxes. Outstanding bonds have maturities out to 2032, there is a liquid trading market, and auctions of new TIPS occur several times a year.
Buy inflation-protected annuities. Older investors should consider locking in future income streams and guarding against inflation by purchasing inflation-indexed annuities. For many people, Kotlikoff says, the cheapest way to do this is by reapplying for Social Security. Social Security payments are available at age 62 and lots of people begin taking them as soon as they can. But a person's maximum payment rises each year until their 70th birthday. Those annual increases average a hefty 7 to 8 percent a year plus whatever annual cost-of-living adjustments are provided to beneficiaries.
Persons who have taken Social Security before the age of 70 can pay back their accumulated payments, without interest, and then reapply for Social Security and receive payments at the higher level associated with their current age.

5 New Investing Rules for Retirement

by Katy Marquardt

Many of the old rules for retirement investing no longer apply. Facing longer life spans, increasing healthcare costs, and a market in crisis, retirees will need more growth in their portfolios during the coming years and decades. At the same time, they need the assurance that a 37 percent market drop--as we saw in 2008--won't completely devastate their remaining nest egg. A growing number of financial planners are rethinking the conventional wisdom. (Remember the old adage that you should subtract your age from 100, and devote that percentage of your portfolio to stocks?) Here are five new rules to consider:

Separate your investments into different pots. Often, investors in retirement lump all of their money together, with which they pursue one strategy, says Eric Bailey, managing principal of Captrust Advisers in Tampa. His firm, which works with pensions, endowments, and high net-worth individuals, takes an approach ripped straight from the institutional investors' playbook. Clients' money is separated into three categories: Short-term funds reside in very low-risk investments, such as high-quality bonds; intermediate-term money goes in a balanced mix of stocks and bonds--such as a 50-50 or 60-40 split; and long-term investments starting with five-year time horizons are heavier on stocks. "This way, you can take advantage of a market sell-off with your long-term investments and you'll avoid needing to liquidate investments when stocks are down," Bailey says.
Don't reach too far for yield. Cash may be king in this market, but decent yields are hard to find. Treasuries present the ultimate in safety, but the pay is meager: The one-year bill currently yields just 1.1 percent and the five-year 2.2 percent. Unfortunately, if you're looking for a bigger payout, you'll have to take on some risk. Says Oliver Tutt, managing director of Newport, R.I.-based Randall Financial Group: "You'll have to make a trade-off somewhere, particularly if you're dealing with large amounts of money." Stick with quality: If you're considering a bond fund, for example, be sure to look under the hood at its various holdings and review the fund's prospectus to see what types of bonds--and credit ratings--it targets. "Quality is always important, but more than ever it is now," says Bill Walsh, chief executive officer of Hennion & Walsh, an asset management firm based in Parsippany, N.J. "Know what you're buying."
Make it a muni. Government bonds are airtight when it comes to safety, but their yields are near all-time lows. As an alternative for retired investors in the upper tax brackets, municipal bonds are worth considering. With munis, investors get the benefit of tax-free income, less volatility than corporate bonds, and, theoretically, more safety. "Right now, there's more value in munis than almost every other area. But be sure you know the issuer," says Walsh. Among munis, he recommends high-grade, general-obligation bonds and essential-purpose bonds such as the sewer authority. "Stay away from things like nursing home bonds, which could go out of business," he says. Walsh prefers single-issue bonds over bond funds, which "will work, but you have to be careful," because there is no set maturity date, no set yield, and managers can sometimes buy outside of that asset class.
Go for dividends. It's a no-brainer that quality matters in a market like this. But how do you know if a stock is "quality"? Dividends are one indicator. That's because dividend income--which is essentially a portion of company profits paid out to shareholders--helps offset fluctuations in a stock's share price, creating a cushion during turbulent markets. "During trying times, dividend-paying stocks tend to do well," says Paul Alan Davis, portfolio manager of the Schwab Dividend Equity Fund. Davis also looks for companies on solid footing, which have plenty of cash and aren't in "financial straits." During the first 11 months of year, Davis says, the S&P's dividend-paying stocks fell by roughly 36 percent; meanwhile, nondividend payers were down about 45 percent. You'll find those dividend payers in more developed industries such as consumer staples, utilities, and healthcare. Examples include Philip Morris, Coca-Cola, General Mills, Bristol-Myers Squibb, and Pfizer.
Consider "alternatives": This asset class, which is used most often by pensions and other institutional investors, runs the spectrum from commodities and annuities to real estate. But individual investors can also use them to dramatically reduce volatility in their portfolios, says Gary Hager, founder and chief executive of Integrated Wealth Management in Edison, N.J. He likes real estate investment trusts, or REITs, which have historically provided a smooth ride for investors. A sample portfolio from 1978 through 2007 shows that putting 10 percent of equity holdings in U.S. REITs improved returns by 0.3 percent and cut volatility by 0.9 percent, compared with investing in stocks alone, according to The Only Guide to Alternative Investments You'll Ever Need: The Good, the Flawed, the Bad, and the Ugly. Other alternative investments to consider include commodities and inflation-protected securities, both of which are offered in ETF form.

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Alzheimer's: Who Makes Investment Decisions

by Roya Wolverson

Who’s responsible for the investment decisions of someone with dementia or other forms of diminished mental capacity—the investor, family members, a broker? The law isn’t always clear. Here’s where things stand now.
The law
Financial advisers are “fiduciaries” and legally have to put their clients’ financial interests above their own. Brokers, while not fiduciaries, must give clients a balanced picture of risks, costs and benefits in recommending products. Brokers must also make reasonable efforts to obtain information about a client’s finances, tax status and other factors to inform “reasonable” recommendations. All brokers have to do a “suitability analysis,” says Mary Shapiro, chief executive of the Financial Industry Regulatory Authority.
The gray area
Neither brokers nor other financial advisers are required to figure out if their clients are suffering from dementia or other maladies. Brokers are required to sell only “suitable” investments, but arguments over what is suitable for an aged client have led to lawsuits and arbitration cases.
Protecting yourself and loved ones
Follow the 70-40 rule. When an investor turns 70 or a child turns 40, discuss options such as holding joint accounts with children or assigning power of attorney, says financial adviser Jeff Broadhurst. Consider joining your older relatives at broker meetings, or draft a document that sets out specific investing goals. Some advisers also recommend hiring a money manager to ensure bills are in order.

Dementia Can Wreak Havoc on Family Finances

by Roya Wolverson

BILL BRIDGWATER HAD the investing bug. Even as he was busy working as an executive for several IT companies, he made time to juggle more than $1 million in assets. At any given time, he was buying and selling foreign stocks, municipal bonds, certificates of deposit and real estate. On family vacations, in lieu of a novel, Bridgwater brought a laptop to the beach to check on his investments. "Nothing could come between me, my phone and my emails except a coast-to-coast flight," says Bridgwater, who lives outside Denver.
But something did get in the way of Bridgwater's mental acuity. At work his concentration began to slip, so he pulled all-nighters to try to keep up. Soon problems were cropping up in his investing life. Picking stocks, which for decades had been an enjoyable hobby, became an overwhelmingly complex chore. Bridgwater couldn't even muster the focus to correctly fill out his checkbook. When he did manage to get the numbers written in the right order, he would mix up how to write them on the next line or tear the carbon out and have to call his bank. He quit his job, and after consulting with numerous doctors, Bridgwater, then 48, was eventually diagnosed with early-onset Alzheimer's disease. He put his wife in charge of his personal accounts, moved his assets into simpler, more conservative investments and became active in the Alzheimer's Association. But by the time he figured out what was wrong, he had already lost tens of thousands of dollars.
Wild mood swings. Memory loss. Confusion. The symptoms of dementia have long been the stuff of nightmares for people as they grow older. But there's an often overlooked side effect: how the malady can cause people to make terrible financial decisions. According to dementia experts and victims' family members, the problems are often a lot more serious than forgetting how to balance your checkbook. People suffering from dementia have looked on as their investments plunged in value, misread how much money they owed in taxes, even told their brokers to buy when they meant to say "sell." Already, there are thousands of cases of seniors beset by dementia who are trading stocks to their own detriment or investing in risky products that have led each to lose hundreds of thousands of dollars. It's a situation that leaves everyone from brokers and financial planners to family members caught in a tragic bind. Financial matters can become treacherous for people who "may not even be able to spell their own name," says John Gannon, director of investor education for the Financial Industry Regulatory Authority, or FINRA, the broker-funded agency that oversees brokers and securities firms.
And things could get much worse. A Duke University study, funded by the National Institutes of Health, estimates that 14 percent of people over age 70 have some form of dementia. If that trend holds, then more than 11 million baby boomers could develop the condition. Combine that unsettling statistic with the fact that this demographic controls more than $19 trillion in assets, and experts fear that over the next decade boomers will be increasingly at risk of unwittingly destroying their own nest eggs. At the moment, there is little in the way of laws, standards or policies to deal with the problem. Some brokerages and regulators "are almost blind to the idea that folks have diminished capacity over the years," says Seth Lipner, a Garden City, N.Y.-based securities lawyer.
Like many of these cases, the story of Janet Hilowitz and her now-deceased mother, Eleanor, started as a disagreement over investment styles and turned into a multiyear struggle to prove that Eleanor had dementia. In the mid-1990s, Janet, a retired university professor in Boston, started to question her mother's financial decisions after Eleanor, then in her early 70s, moved more than 75 percent of her portfolio into technology stocks. Janet says she feared the move was too risky, but her mother was intensely stubborn and accused Janet of trying to meddle with her money. For years nothing anybody said could persuade Eleanor to alter her investments. But eventually, Janet claims, her mother admitted she couldn't keep up with her stocks anymore. That concession came in 1999 and prompted a worried Janet to contact her mother's broker at Smith Barney. Janet wanted her mother's investments moved into safer holdings, but the brokerage wouldn't help. The reason, according to Janet: She was not authorized to trade on her mother's account. It took years of court hearings, doctor appointments and psychiatric analysis for Janet to prove that her mother was, in fact, incapacitated. And while Janet argued to get control of her mother's accounts, Eleanor's assets rose and fell with the tech boom. By 2003, the year Janet was granted guardianship to manage her mother's account, the bursting of the tech bubble had claimed almost $1 million, most of her mother's life savings.
The brokerage's caution might have been justified. After all, Smith Barney had worked with Eleanor for many years. And when Janet requested to have her mother's assets shifted into more-conservative investments, she had neither her mother's permission nor power of attorney. According to Janet and her lawyer, Janet took Smith Barney to arbitration, arguing that the company was not acting in her mother's best interests. She lost. (Smith Barney won't comment on the specifics of any case. "We take retirement advice and servicing our clients very seriously and have taken great strides in training and informational material for both clients and employees," says company spokesperson Alex Samuelson.)
Some brokers try to be proactive and talk to family members if they suspect their clients are losing their faculties. "Usually, I notice the problem before the family does," says Alexandra Armstrong, a Washington, D.C.-based financial planner who has dozens of clients over age 65. More often, though, brokers and investment advisers have so little contact with an aging client that subtle shifts in behavior can easily fly under the radar. In Roseville, Calif., for example, Jim Wilson grieved as his mother, Ruth, far away in Connecticut, developed dementia. Because he was focused on dementia's outward symptoms, Jim says he didn't know about an account containing stock options Ruth had inherited from her mother. Complicating the matter: Ruth lost touch with her local brokerage, which eventually transferred her account to a Florida-based broker she would never meet.
Years later Jim got a call from his mother, who had a $33,000 capital gains tax bill stemming from the account. He discovered that most of the $228,000 in the account had been invested in risky, high-yield junk bonds — not a traditionally sound investment for an older person. Jim didn't know it at the time, but his mother had received a call from the Florida-based broker months earlier to get permission to change the account's investments. Jim says his mother had no idea what she had authorized the broker to do. "I'm sure she was happy to chat, because she was lonely," Jim says. He took the brokerage, Advest, to arbitration and won $16,000. The broker was reprimanded, but Jim wasn't satisfied. "He clearly didn't know his client and took advantage of her," he says. Merrill Lynch, which now owns Advest, declined to comment.
Of course, regulating how securities are sold to seniors is no easy task, partly because dementia is hard to prove. Financial advisers say investors with dementia can be confused and then an hour later be totally lucid. The brokerage industry and the agencies that regulate it also do not want to be responsible for trying to figure out whether a client has dementia. "I'm not a medical professional," says Mary Shapiro, chief executive of FINRA, the broker regulator. Granted, there are laws against flat-out fraud, but FINRA's guidelines on investors who suffer from diminished capacity are just that, guidelines. Unlike financial advisers, who are legally bound to act in a client's interest first and foremost, brokers are required only to sell clients products that are "suitable." FINRA has fined brokers whom it felt took advantage of mentally incapacitated clients, but it is loath to write specific rules, Shapiro says, because every client is different. Stricter limitations on brokers could also lead to ageism, wherein brokers, leery of lawsuits, shun older clients regardless of their health. Rather, brokers and financial advisers have to find ways to be cautious with older clients without "stereotyping when Grandpa walks in," says John Rother, the public-policy director for AARP, the senior advocacy group.
Indeed, among regulators, politicians and some advocacy groups, writing new laws or regulations regarding mentally impaired investors has taken a backseat to merely getting people educated about the topic. The Senate Committee on Aging is looking at introducing legislation that would require stricter limitations to prevent outright fraud by brokers and financial advisers who intentionally mislead clients with phony "senior specialist" titles or other designations. The Securities and Exchange Commission is aware of the problem of investors with diminished mental capacity — it made the issue a topic at its annual Senior Summit in September. The AARP released a booklet this spring in conjunction with the Financial Planning Association about how to deal with clients as they age, but the organization doesn't have any position on new policies.
Even under existing rules, it can be difficult to finesse a client into doing what is financially "suitable" if the client, like Hilowitz's mother, wants to do something else. Brokers also say that being too forceful with senior clients can anger them or send them running to another broker. "Unless the person is clearly incapacitated, they have to make their own mistakes," says elder-care attorney Linda Anderson. Bridgwater, the former IT executive, blames himself for his financial losses. In one slipup, he lost $9,000 when a stock he had held for several years suddenly dropped over a period of two weeks, during which he was struggling with concentration. Even in situations where he lost money through actions taken directly by his broker, Bridgwater still considers himself responsible. When, for instance, he called his Merrill Lynch broker to request that his IRA be rolled over to his Smith Barney account, the broker instead cashed it out and sent him the proceeds, leaving Bridgwater with thousands of dollars in capital gains tax he could have avoided. Bridgwater realized the mistake only when he received a check in the mail for the proceeds — he could not remember what had transpired over the phone and wondered if the broker had erred. Bridgwater now believes he only thought about telling the broker to roll over his IRA, and when he actually articulated it, he must have gotten it wrong. He chalks it up to an "Alzheimer's moment."
And there are plenty of healthy, active senior traders who have no plans to quit investing. Bruce Bailey, 80, began seriously playing the market only after he was in his early 70s. His health is great — "I don't have any health issues except a hard head," he says — and his investing interest has grown with age. Bailey says his portfolio is doing very well; the retired Army colonel started with stocks but these days likes investing in oil futures. And the Pensacola, Fla., resident loves swapping investment ideas with his adult children, along with thoughts on the economy, the stock market and geopolitics. But when asked which company manages his brokerage account, Bailey goes blank, then spends several minutes searching for an account statement.
"Scottrade," he says with an embarrassed chuckle. "I don't know how I just forgot that."

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Are You Born To Be A Billionaire?

Maureen Farrell

Empire builders like Bill Gates and Sam Walton aren't just great businessmen. They are bona fide revolutionaries.
Self-made billionaires don't dominate industries--they transform them and spawn new ones. That takes more than intelligence, courage and luck. It takes divine-like vision.
Billionaire entrepreneurs are "not working within the confines of the current market," says Gerald Kraines, chief executive of the Levinson Institute, a business consulting firm in Jaffey, N.H. "They're anticipating things much further afield. You have to see spaces that no one else sees."
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The world's self-made billionaires certainly have vision in spades, spanning everything from how computers work to how people shop. But the ability to see around corners isn't the only quality that separates the very accomplished from the stratospherically wealthy. To crack the $1 billion barrier, you need total, unwavering belief in your vision--and an immutable will to pull it off.
"[Billionaire entrepreneurs] need a deep passion and a point of view about the future," says Peter Skarzynski, chief executive of Strategos, a Chicago-based consulting firm that advises global companies, including Nokia (nyse: NOK - news - people ) and Whirlpool (nyse: WHR - news - people ). "They fundamentally believe that they have a better way to solve a set of problems than how they're being solved now."
Billionaires also have a seemingly ravenous appetite for risk. It's hard enough for many of us to muster the courage to abandon our cubicles and start a small company, let alone build an empire. And while the risks pile up as businesses expand, billionaires have a confidence bordering on arrogance that checks their fear and doubt, says Skarzynski.
Are you a born billionaire? Before you tackle a serious growth strategy and all its attendant hassles, ask yourself some hard questions at the outset, says executive psychologist Debra Condren, who has worked with big names like 3M (nyse: MMM - news - people ), Chevron (nyse: CVX - news - people ) and Hewlett-Packard (nyse: HPQ - news - people ).
The most important one: Why go big at all? Are you looking to cash out in a sale? Enamored of the thought of having your own stock ticker? Suffused with competitive desire? Whatever your reason, get a grip on it before you decide to kick your zealous pursuits into high gear.
Next, ask yourself if you are willing to make tough decisions for the growth of your company. If you have an intense loyalty to the small group who helped get things off the ground, understand that those folks may not be able to come along for the ride. If you're not comfortable supplanting (or firing) them, stay small.
For entrepreneurs who prize their independence, ask yourselves how much of it you're willing to give up. As the demands mount, both your schedule and decisions become less your own; worse, you may have investors and board members to appease.
"It becomes very hard for company founders to accept that they are no longer the real boss," says Carl Robinson, a psychologist who works primarily with growing, middle-market companies.
Like holding forth in public? You'd better, because companies of any significant size need a public face. Entrepreneurs who thrive on public performances--weekly meetings, shareholder gripe sessions, even television interviews--have an easier time than those who shun the spotlight.
"You need to have the ability to fill a room and inspire people," says Condren. If public speaking isn't your forté, but you're still hankering to grow, find a confident substitute who can sell your story.
Not only do you have to be able to communicate, you need a knack for building consensus. In most cases, the bigger your business, the more input you need from those around you--and that means being willing and able to marshal them to your cause. Have a my-way-or-the-highway mentality? Can your growth plans.
In the end, chasing billionaire status--and not crashing along the way--is as much about knowing who you are as it is about knowing how to nab new customers or manage inventory. Who knows? Maybe a modest $100 million might be a better fit.
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Restaurateurs' Recession Survival Guide

Melanie Lindner

Rosati's Pizza has been serving up pepperoni pies since 1964. Lately, though, things aren't looking so saucy.
"We always thought pizza was a recession-proof business," says Jeff Rosati, chief financial officer of the Warrenville, Ill.-based franchiser, now with 170 stores throughout the Midwest and Southwest. "But in 2008, for the first time, our customer count went down 5%."
Rosati navigated previous downturns by angling for customers looking to substitute swank dinners with more modest pizza nights. Coupons worth a dollar or two help, but in recent months he's gone to further extremes to stay afloat--like offering a free 12-inch cheese pizza with the purchase of a large or extra large pie.
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He also jacked up prices by some 10% last year to offset the spikes in critical commodities like cheese, cooking oil and flour--each up anywhere from 70% to 300% between 2007 and 2008. Prices have since come down, but not nearly enough. "The bottom line is that people just aren't spending, and you can't make them spend money they don't have," laments Rosati.

How Ex-Presidents & Prime Ministers Make Their Money

by Ethan Trex

Upon taking up residency in the White House, a president also assumes a tidy salary of $400,000 a year, plus extra cash
for expenses. That’s certainly not the kind of change you’d find under most couch cushions, but it’s not such a princely sum that the president will be set for life when leaving office. While many leaders are either independently rich enough or old enough that they just retire after leaving office, others are desperate to make a buck or a pound. So how do ex-presidents and other former world leaders support themselves as they while away the autumn of their years?

Harry Truman:
When Truman’s presidency ended in 1953, he headed home to Independence, Missouri, but there was a nagging problem: he didn’t have any money. His business interests from prior to his political life hadn’t generated any sort of savings for him, and he thought that taken a corporate position or endorsing products would cheapen the presidency. His only income was a $112-a-month army pension, so he did what former presidents now do without thinking: he sold his memoirs. Truman received a $670,000 deal for the two-volume memoirs, but after taxes and paying his assistants, he only netted a few thousand dollars on the project. Things got so dire that Congress passed the Former Presidents Act in 1958, which gave retired commanders in chief pensions of $25,000 a year. At least his health insurance was eventually covered; when Lyndon Johnson signed Medicare into law in 1965, he presented President Truman and his wife, Bess, with the first two Medicare cards.

Carter:

Carter famously rose to the presidency from humble roots as a Georgia peanut farmer, but when he assumed office he placed his business and farming issues in a blind trust to avoid any potential conflicts of interest. It was a noble act, but it didn’t play out so well for Carter; when he resumed control of his assets, he was a million dollars in debt. He needed dough, so he started writing. And writing. Although he’s known for his work with Habitat for Humanity and his willingness to go on global diplomatic missions, Carter is a shockingly prolific author of over 20 books. Some of his tomes are standard memoirs and political texts, but Carter’s also penned children’s books, a volume of poetry, a historical novel, and Bible-study guides.

Bill Clinton:

Hillary Clinton may not have won the Democratic presidential nomination, but the Clinton family shouldn’t be standing in any bread lines in the foreseeable future. Bill Clinton pulls in $250,000 to give a speech, which has been a fairly lucrative racket for him. A 2007 report in the British newspaper The Independent estimated Clinton’s earnings from speeches alone at somewhere in the neighborhood of $40 million since he left office six years earlier. Clinton also sold his memoir My Life to Knopf for $15 million, and he serves as an advisor for the private equity firm Yucaipa Companies, a post that has pulled in at least $12.6 million. When the Clintons released their tax data in April as part of Hillary’s campaign disclosures, they showed income of $109 million since leaving the White House.

Margaret Thatcher:
Although declining health has slowed her down lately, Thatcher was fairly busy after stepping down as Prime Minister in 1990. She remained in the House of Commons until 1992. She received the title Baroness Thatcher that year, which got her a spot in the House of Lords. Thatcher also penned a two-volume memoir, The Path to Power and The Downing Street Years, which hit the New York Times’ best-seller lists in 1993 and 1994. On top of that, she served as Chancellor of the College of William and Mary from 1993 to 2000 and penned the international relations text Statecraft: Strategies for a Changing World in 2002. All of this work must have left Thatcher pretty set; after all, she has given Cambridge two million pounds to endow a chair in her name.

John Major:
Thatcher’s successor as Prime Minister has had a decidedly more low-key life since leaving the post in 1997. As an avid cricket fan, he served as the president of the Surrey County Cricket Club from 2000 to 2001 and has been on the Committee of the Marylebone Cricket Club since 2005. He also joined the private equity firm the Carlyle Group’s European Advisory Board in 1998 and supposedly rakes in 25,000 pounds for each speech he gives on the lecture circuit.

Tony Blair:
Like Bill Clinton, Blair got a book advance that ensured he wouldn’t have to hit up any of his friends for a pound or two from time to time. In October 2007 the New York Times reported that Random House purchased Blair’s memoir for a staggering $9 million. Or rather, they purchased the rights to the memoir once it’s written; despite receiving the gigantic advance, Blair’s spokesman admitted that the former Prime Minister hadn’t gotten a chance to “put pen to paper” when he signed the deal. On top of the sweet advance, Blair’s also pulling in cash as an advisor on climate change for Zurich Insurance and as a senior advisor for JPMorgan, both of which have been reported as six-figure-a-year jobs. He’s also making 500,000 pounds for a series of speeches and will teach a course on faith and globalization at Yale this year.

Resolved: This Year, I'll Keep More Cash

by Stacy Rapacon

Given the recent turmoil in the financial markets and the prospect of a continuing economic downturn, 2009 may be the year you finally make good on your resolve to start an emergency fund, pay off credit-card debt or beef up your retirement kitty. Our guidelines on cutting your expenses and saving on taxes are guaranteed to put money in your pocket -- and your savings accounts.

1. Get your spending under control by using a free online budgeting Web site, such as Mint.com. This secure site tracks your checking, credit-card and investment accounts and offers money-saving tips, such as where you can cut costs or get a better rate on your credit card. Other free sites, including Wesabe and Geezeo, offer similar budgeting tools, but focus more on their online communities where users share strategies.
With the meat and potatoes of your finances laid out, it will be easier to see where you can trim the fat. For example, assuming that you and your significant other pay the average $33 per person for a restaurant meal (according to a recent Zagat survey) and $7 per ticket for a movie, one fewer date night a month will save you a total of $960 per year.

2. Set up a flexible spending account to help pay for medical expenses. If your employer offers this benefit, you can stash pretax dollars in the account and use the money to pay for out-of-pocket bills, including physician co-payments, prescription drugs, eyeglasses and braces for the kids' teeth. You can even spend the money on over-the-counter medications, such as antacids and pain relievers.
A flex account can save you hundreds of dollars in federal, Social Security and, in most states, state income taxes. For example, if you're in the 25% tax bracket and you put $1,450 in your account -- the average contribution for 2007 -- you'd save $546 for the year, assuming a 5% state income tax and 7.65% for the FICA tax. Plus, you can tap the entire amount at any time, even if you've contributed for only a couple of months.
Under the use-it-or-lose-it rule, you could forfeit any money left in the account at the end of 2009. But many companies now offer a grace period until March 15 of the following year. In fact, if you have money left over from 2008, treat it as a bonus to help pay for a major expenditure in early 2009.

3. File a new Form W-4. If you got a tax refund for 2008, adjusting your withholding will fatten your paycheck for 2009. With an average refund of about $2,400, you could be entitled to three extra exemptions. In the 25% tax bracket, that could boost your take-home pay by $2,625 per year.

4. Raise your insurance deductibles. Increasing the deductible on your car insurance from $250 to $1,000 can save up to 15% on your premiums -- or about $125 per year on an average premium of $829. Upping the deductible on your homeowners policy can slice your rate by about 25%, or $191 on an average premium of $764.

5. Cut the cost of credit. If you tend to carry a monthly credit-card balance, go with a low-interest-rate card, such as Wells Fargo's Prime Rate card, with a 5% interest rate and $19 annual fee. For gasoline or travel perks, try the BP Visa card or >Simmons First Visa Platinum Travel Rewards card.
If you'd rather pocket a cash rebate, consider the American Express Blue Cash card. You'll get a 1% rebate for gas, groceries and drugstore purchases, and you'll get 0.5% back on everything else. Big spenders can bump up those rewards to 5% and 1.5%, respectively, after dropping $6,500 for the year. Charging $15,000 worth of everyday purchases would save you $490.

6. Open an online savings account, such as the one at www.fnbodirect.com, which was recently paying 3.25%, or about $100 a year on a $3,000 deposit. You can open the account with just $1, and there are no monthly fees or minimum-balance requirements. To avoid the temptation to spend all the money that's now lining your pockets thanks to our first five tips, set up an automatic monthly transfer from your checking account or arrange to have part of your paycheck deposited directly into your new rainy-day fund.

7. Bump up your 401(k) contributions. Already have an emergency stash? With stocks on sale, now is a great time to build -- or rebuild -- your retirement kitty. For 2009, the contribution limit for 401(k) accounts rises to $16,500, and you can add another $5,500 if you'll be 50 or older by the end of the year. Contributions aren't subject to federal or state taxes, so loading up on the full $16,500 would save you $4,950 in taxes for the year, assuming a 25% federal tax bracket and a 5% state income tax.

Can't afford the maximum contribution or want to use part of your savings for something else? Try to kick in at least enough to capture any employer match.

Five simple ways to save yourself hundreds of dollars a month

Kelsey Hubbard


NEW YORK (MarketWatch) -- We are a country of spenders who must learn the hard way to practice what our grandparents have always known: A penny saved is a penny earned.

Consider that about 43% of Americans spend more than they earn, according to estimates from the federal government, and the average household carries some $8,000 to $10,000 in credit-card debt.

To make matters worse, the average American no longer saves money. That's tumbled from a 10.8% average savings rate in 1984 into negative territory today. It's no wonder that many of us have been living way above our means for some time.

But that is getting harder and harder to do. Available credit for people to finance their lifestyles has shrunk if not dried up altogether and many Americans are standing by in shock watching their mortgage payments surge while the value of their 401(k)s drop.

It's clear Americans need to start spending less and saving more. That may sound easier said than it's done. The key is to be aware of your where your money is going and take steps to stop the leaks. Here are five simple tips that could save you hundreds of dollars a month:


1. Cash back at the pump

In the past five months gasoline prices have dropped 56%, from an average price of $4.11 to $1.80 a gallon. Somehow, households found the money to pay the higher price and survive so now people should take that excess money they are saving and bank it.

Jean Chatzky, author and personal finance expert suggests using the money you were spending on gasoline to build up that rainy day fund or to pay some your holiday expenses instead of racking up more debt.


2. Supper savings

Another great way Americans can cut costs each month is to eat at home, says Jonathan and David Murray, twin brothers who are financial advisers.

According to a recent Zagat survey, Americans will spend an average of $34 this year every time they go out to eat dinner, that's for one dinner, drink and gratuity; $76.00 if they live in one of the 20 most expensive cities. If a couple does that four times in a month the expense is close to $300 in low-cost areas and $600 in higher-cost regions, and if you have more than one drink or are treating family or friends, costs can add up quickly.

Plan a dinner or party at home and ask guests to bring a dish. If you're big on getting together with friends, family and work associates, this could save you hundreds of dollars a month.


3. Renegotiate bills

You may not be able to negotiate with the gas company or the electric company, but you can with credit cards, cable and phone services, among others. Do the homework and find out what competing cable companies, for example, are offering and ask your provider to renegotiate your bill. You may have to get through to a manager but Chatzky said she recently did this and got her monthly bill reduced by $50.


4. Smart shopping

Retailers are poised to have one of the worst holiday shopping seasons in decades and are offering deep discounts to move merchandise. But smart shoppers can save even more money by hunting down coupons. Before ordering online or going to a store, go to sites like Couponcabin.com and Ultimatecoupons.com or Google the name of a store and often you'll get a coupon code to enter at checkout. You can save 10% to 20% or more on the total order or maybe get free shipping.

There are also coupons to print out and take to the store for deeper discounts. And don't be afraid to pit one retailer against another by asking for a price match on sale items.


5. Keep the receipt

It is important to hang on to all your store receipts and keep track of sales. Savvy shoppers can possibly save even more on purchases by checking back to see if the retailers lower prices even further. If that happens within two weeks of your purchase, most stores will credit you the difference.

7 Tips for a Better Resume

by Alesia Benedict, GetInterviews.com

Want more interviews? Job searches in tough times like now demand polished resumes more than ever. If you are attempting to write your own resume, these seven tips are important to follow:
1. Select the best format.While most resumes are written in a history chronological format, often a better technique is to evenly balance between skill-set description, achievements, and employment.
2. Make certain your document is error free.Since you are familiar with your own writing, you will "see" what you were thinking and not what is actually on the page. Do not rely on yourself to proofread your work and do not rely on spell-check. Find a friend who has strong grammar skills to check your work.
3. Find a balance between wordiness and lack of detail. Employers need to see details about your work history and experience, but they don't need to know everything. The fact that you were den leader in your Cub Scout troop is irrelevant. Keep information germane to the goal of attaining an interview. Eliminate information that is not related and will not have a direct impact on winning the interview.
4. Do not use personal pronouns."I," "me," "my," "mine," and "our" should not be on a resume. Resumes are written in first person (implied). Example: For your prior job description, instead of writing: "I hired, trained and supervised a team of assistant managers and sales associates" you would instead state that you "Hired, trained and supervised a team of assistant managers and sales associates." Fragment sentences are perfectly acceptable on a resume and actually preferred.
5. Use numerical symbols for numbers.While we are taught in school to spell out numbers less than ten, in resume writing, numerical symbols serve as "eye stops" and are a much better method. Instead of writing "Developed a dynamic team of eight consultants." it would be much more advantageous to state "Developed a dynamic team of 8 consultants."
6. Think "accomplishments" rather than "job duties."What makes you stand out from the crowd? How did you come up with a way to do things better, more efficiently, or for less cost? What won honors for you? Information such as this is vital, will grab attention, and put your resume at the top of the list.
7. Keep it positive.Reasons for leaving a job and setbacks do not have a place on a resume. Employers are seeking people who can contribute and have successfully performed in the past. Concentrate on communicating these issues and avoid any detracting information.
Remember, many first-time job interviews are conducted via telephone rather than in person. Make sure you are prepared for that telephone call when it arrives. And make sure you have a resume that will make the phone ring!

Alesia Benedict, Certified Professional Resume Writer (CPRW) and Job and Career Transition Coach (JCTC), is the president of GetInterviews.com, a resume writing firm that provides mid-management and senior level professionals with customized, branded resumes and career marketing documents. GetInterviews.com offers a free resume critique and their services come with a wonderful guarantee -- interviews in 30 days or they'll rewrite for free!

To Retire Early, You Must Get This Move Right

by George Mannes

Paul Weber has nearly every aspect of his retirement in place. He knows when it will start: The 56-year-old, who earns some $103,000 a year doing graphic design for investment research firm Morningstar, plans to empty his desk by year's end.
He knows where he'll live: with his girlfriend Nadia in their Fox Lake, Ill. home. He knows how he'll finance it: with the $900,000 he's saved. And he knows what he'll be doing: After years of squeezing in his passion for oil painting during odd hours, Weber imagines spending his days in the studio. There's just one part of this picture-perfect retirement that Weber hasn't figured out yet: what he'll do for health insurance.
Retirement will mean the end of Weber's employer-provided health coverage. He can stay on his company's plan for 18 months by paying the full premium, thanks to the federal law known as COBRA. That would take him only to age 58, far short of when he qualifies for Medicare at age 65.
He has thought about braving that gap without insurance to avoid what he expects will be high premiums. But he recognizes that a single medical crisis - cancer, for example - could put his savings at risk. "Something like that could wipe me out," he says.
If you're dreaming of early retirement - or finding yourself forced into it - you'll likely face a similar dilemma. Two decades ago, 66% of large employers offered retiree health benefits, according to the Kaiser Family Foundation. Now only 33% do. And as Weber suspects, getting decent coverage on your own - if you can - is a pricey proposition.
Families headed by people ages 60 to 64 pay an average of $9,201 a year for a private policy, according to a health insurance trade association. Covering your deductible, co-pays and other out-of-pocket expenses could add another $6,000 a year. No wonder some young retirees resort to working at Home Depot or other companies that offer health benefits to part-time workers.
Finding affordable retiree health insurance is intimidating, no question. But it's usually not impossible, says Carolyn McClanahan, a Jacksonville financial planner and medical doctor - especially if you start your planning early.
Do a reality check. Before you get too carried away with an early-retirement dream, you need a realistic idea of whether you can buy insurance on the open market and, if so, whether you can afford it.
Unfortunately, many conditions render you virtually uninsurable in most states, Type 1 diabetes, heart disease and recent cancer among them. Even high blood pressure and obesity can eliminate your chances of buying a policy. Just as bad, you might be able to get only coverage that excludes a particular problem and its complications. So if high blood pressure were on that list, for example, you'd get no help were you to suffer a stroke.
Long before you plan your good-bye party, talk to an independent insurance agent (you'll find a directory at the National Association of Health Underwriters site at nahu.org). Armed with underwriting guidelines from different insurers, he can give you an unofficial appraisal of your odds, gratis. (Don't fret yet. If you can't get insurance this way, you may still qualify for coverage; see "Look for a last resort.").
Also ask for an estimate of your premiums. Then do the math. Assume these will continue to grow at their recent average of nearly three times the rate of inflation, or 10% annually. Add up what you'll pay through age 65. If that comes to $100,000, you may need to save that much more to afford early retirement.
Weber feels pretty healthy, though he recalls that his cholesterol level was a high risk 250 last he checked. If that's his only chronic condition, he might see premiums close to $300 a month, says John Garven, president of the Illinois State Association of Health Underwriters. But if Weber is not in as good shape as he thinks, he could pay as much as $800 monthly.
Get in better shape. The healthier you are, the easier your insurance search will be and the lower your premiums. So it's worth remedying whatever problems you can, says McClanahan. A few years before retiring, get a physical to see if key measurements - like weight, blood pressure and cholesterol - are where they should be. If not, you may be able to improve these and other conditions with medication, exercise or a change in diet. Aim for better health at least a year before you apply for insurance. As for Weber, McClanahan suggests he get to a doctor soon to gauge his health and start fixing any problems.
Probe the paperwork. Even if you're in the best of health, your medical records may paint a less flattering portrait due to errors or omissions. So when you schedule your checkup, ask your doctor to set aside time to review your medical history with you for accuracy.
Also, if you've applied for individual life, health, disability or long-term-care insurance within the past seven years, the industry may already have a file on you. You can get a free copy of what's in yours from the MIB Group (mib.com, under Consumers), an insurance industry clearinghouse. Quickly correct any errors.
Stay with the company. Firms with 20 or more employees must give you the option of staying on your insurance plan for up to 18 months. It's guaranteed coverage, but it isn't cheap. Your premium is roughly what you've been paying plus what your employer's been kicking in. (Weber, a single guy, will cough up $370 a month.)
If nothing else, COBRA buys you time - without risky coverage gaps - before you go into the private market. And if you can't get insurance because of health problems, exhausting COBRA makes you what's known as HIPAA-eligible, guaranteeing certain backup coverage (see last step).
Start the search. Launch your hunt for an individual policy a few months before you leave your job or before COBRA expires (once offered a policy, you usually have to start it within a month). You may want to begin your search at a site like EHealthInsurance.com, but keep in mind that those rates apply to the healthiest applicants. That's why an agent can be helpful in finding the best insurer and deal for your circumstances.
To keep your premiums affordable, your best bet may be a high-deductible insurance plan coupled with a health savings account (HSA), if you qualify. While you'll be on the hook for, say, the first $5,000 in expenses annually, you're protected from big-ticket disasters.
An Aetna plan from AARP (aarphealthcare.com) recently quoted $246 a month for a healthy 56-year-old male in Weber's zip code. You then pay for out-of-pocket costs with money from your HSA, which doubles as a tax-deferred savings plan. HSA contributions are tax deductible - the 2009 limit is $3,000 for an individual, $5,950 for a couple; plus another $1,000 if you're 55 or over. Funds grow tax-free; any nonmedical withdrawals after 65 are taxed as ordinary income.
Look for a last resort. If you can't get individual coverage, you have options, though they're not ideal. By law, states must make last-resort insurance available if you're HIPAA-eligible. But these plans can be limited and costly.
Another tack: Some states mandate guaranteed group plans for businesses with even one employee, which may make sense if you'll do any consulting work. For a national overview of your options, go to statehealthfacts.org and click on Managed Care & Health Insurance. Get in-depth information about your particular state at healthinsuranceinfo.net.
Finally, if you're up for adventure and can bear cold winters, you could move to one of the five states - Maine, Massachusetts, New Jersey, New York and Vermont - that forbid insurers from rejecting applicants for medical reasons. You'll pay for the privilege, however: Monthly individual HMO premiums in Albany, N.Y., for example, run from $666 to $1,333.
Weber, meanwhile, is intrigued by the high-deductible plan linked to an HSA. "It sounds like an attractive option," he says. Gently reminded by McClanahan that he may need to take better care of himself to qualify, Weber says that he'll get his cholesterol tested at an upcoming company health screening and see his doctor soon. He's willing to put in the effort to make his retirement a masterpiece.

How to Save $8,919.45 a Year

by Jessica Dickler

In tough times, consumers are looking to stretch their dollars further. Here are six simple ways to save thousands.

1. Strategic Shopping
Potential annual savings: $5,200

Stephanie Nelson, founder of couponmom.com, a site that tracks deals at your local grocery store, says that shoppers can save an average of $50 to $100 a week on their groceries if they spend about 30 minutes once a week planning out their supermarket trip.
Not only are there plenty of savings to be found in newspaper circulars and on online coupon sharing sites like coupons.com, but grocery stores like Safeway and Pathmark often have coupons on their sites. There are also coupons available direct from manufacturers. For example, SC Johnson offers printable coupons on its Web site for $2 off Windex and other popular household products. "People can save 50% on their grocery bill by using the store's sales, putting coupons on top of that and going to the Web for additional online coupons," Nelson said.
2. Skip Starbucks
Potential annual savings: $2,425

David Bach, the author of Go Green, Live Rich, contends that it is easy to save a few thousand dollars a year and cut down on waste simply by eliminating that morning coffee and a muffin. That's what he calls the "latte factor," and you'd be surprised how quickly that $5 breakfast-on-the-go every morning adds up. The same goes for lunch. The average American worker who buys lunch during the workweek spends $6.60 a day, according to a recent "Brown Bag" survey by ConAgra. And they are eating up a substantial savings opportunity. Buying enough ingredients to pack a lunch from home just three days a week can save about $600 a year.
3. Upgrade Your Appliances
Potential annual savings: $150

While we're on the eco-friendly bandwagon, using compact fluorescent light bulbs saves about $30 in electricity costs over each bulb's lifetime. But to really impact your bottom line, consider upgrading an old appliance like a refrigerator or dishwasher. Newer energy efficient appliances can save $50 to $150 a year in energy costs, according to Energy Star.
4. Go Generic
Potential annual savings: $161.20

Generic brands of food and drugs can cost 20% to 50% less than the name brand and you're not likely to tell the difference. "Don't be afraid to try a cheaper brand," advises ShopSmart deputy editor Sue Perry.For example, just buying the store's own brand of butter instead of Land O'Lakes can save about 25%. If you switch to your supermarket's generic brand of milk as well, that will translate into about $3 a week in savings, and that does a wallet good.
5. Pay an Extra $1 On Your Credit Cards
Potential annual savings: $203.25

Everyone knows that carrying a credit card balance can be costly. But if paying off that balance isn't in the cards, even the smallest change can pay huge dividends. Instead of buying a soda from the vending machine, Bill Hardekopf, CEO of LowCards.com, recommends putting that dollar toward your credit card balance.For example, if you typically pay $100 a month on a $5,000 balance with a 14% APR, try upping that payment by just a dollar a day. By paying an extra $30 a month, you'll pay off your balance in 52 months rather than 76 months, or cut your payments by two years. And you'll save $874 in interest payments over that time.
6. Sitter Sharing
Potential annual savings: $780

Sheila Lirio Marcelo, CEO of Care.com, which helps families find local caregivers, suggests teaming up with neighboring parents to share one babysitter. Although most providers pro-rate their fees according to the number of children they are watching, families that pool together can still save between 20% to 50% off the cost of childcare while they enjoy their weekly date night.

10 Steps to Retire a Millionaire

by Lisa Smith

Having a million-dollar portfolio is a retirement dream for many people. Making that dream come true requires some serious effort. While success is never a sure thing, the 10 steps outlined below will go a long way toward helping you achieve your objective.
1. Set the Goal
Nobody plans to fail, but plenty of people fail to plan. It's a cliché, but it's true. "Plan" is the leading self-help advice from athletes, business moguls and everyday people who have achieved extraordinary goals.

2. Start Saving
If you don't save, you'll never reach your goal. As obvious as this might seems, far too many people never even start to save. If your employer offers a 401(k) plan, enrolling in the plan is a great way to put your savings on autopilot. Simply sign up for the plan and contributions will be automatically taken out of your paycheck, increasing your savings and decreasing your immediate tax liability. If your employer offers to match your contributions up to a certain percentage, be sure to contribute enough to get the full match. It's like getting a guaranteed return on your investment. Finding the cash to stash may be a challenge, particularly when you're young, but don't let that stop you from pursuing future riches.

3. Get Aggressive
Studies have shown that the majority of the returns generated by an investment are dictated by the asset-allocation decision. If you are looking to grow your wealth over time, fixed-income investments aren't likely to get the job done, and inflation can take a big chunk out of your savings. Investing in equities entails more risk, but is also statistically likely to lead to greater returns. For many of us, it's a risk we have to take if want to see our wealth grow. Asset-allocation strategies can help you learn how to make picking the right mix of securities the core of your investing strategy.

4. Prepare for Rainy Days
Part of long-term planning involves accepting the idea that setbacks will occur. If you are not prepared, these setbacks can put a stop to your savings efforts. While you can't avoid all of the bumps in the road, you can prepare in advance to mitigate the damage they can do.

5. Save More
Your income should rise as time passes. You'll get raises, you'll change jobs, and maybe you'll get married and become a two-income family. Every time more cash comes in to your pocket, you should increase the amount that you save. The key to reaching your goal as quickly as possible is to save as much as you can.

6. Watch Your Spending
Vacations, car, kids and all of life's other expenses take a big chunk out of your paycheck. To maximize your savings, you need to minimize your spending. Buying a home you can afford and living a lifestyle that is below your means and not funded by credit cards are all necessities if you want to boost your savings.

7. Monitor Your Portfolio
There's no need to obsess over every movement of the Dow. Instead, check your portfolio once a year. Rebalance your asset allocation to keep on track with your plan.

8. Max Out Your Options
Take advantage of every savings opportunity that comes your way. Make the maximum contribution to tax-deferred savings plans and then open up a taxable account too. Don't let any chance to save get away.

9. Catch-Up Contributions
When you reach age50, you are eligible to increase contributions to tax-deferred savings plans. Take advantage of this opportunity!

10. Have Patience
"Get-rich-quick" schemes are usually just that - schemes. The power of compounding takes time, so invest early, invest often and accept that the road to riches is often long and slow. With that in mind, the sooner you get started, the better your odds of achieving your goals.

The Reality Of Retirement
Retirement might seem far away, but it when it arrives nobody ever complains about having too much money. Some people even question whether a million dollars is enough. That said, with lots of planning and discipline, you can reach your retirement goals and live a comfortable life after work.

5 Daily Brain Exercises

By Bernard Croisile, M.D. Neurology, Ph. D. Neuropsychology

Many men are devoted to exercise to bulk up their bodies, but the phrase “use it or lose it” applies to more than just the muscles in our bodies -- it also applies to the neural pathways and connections in our brains. There are a variety of exercises and activities that can successfully work each of the brain’s five major cognitive functions on a daily basis. In addition to the tasks you can perform daily, you can also train your brain with HAPPYneuron online brain games and a personalized brain fitness program.Our minds consist of five main cognitive functions:
memory,
attention,
language,
visual-spatial skills,
and executive function.It’s important to challenge, stimulate and effectively exercise all five areas to stay mentally sharp as our brains age. Here are 5 daily brain exercises that can help you do this.
1- MemoryMemory plays a crucial role in all cognitive activities, including reading, reasoning and mental calculation. There are several types of memory at work in the brain. Taken together, these are the cognitive skills we may notice most when they begin to fail. To maintain a good memory, you need to train for it, which can be easier than you think. Listening to music is not only enjoyable, but by choosing a song you don’t know and memorizing the lyrics, you boost the level of acetylcholine, the chemical that helps build your brain, and improve your memory skills. Challenge yourself even more by showering or getting dressed in the dark or using your opposite hand to brush your teeth. These challenges help build new associations between different neural connections of the brain.

Improve your memory with this HAPPYneuron game.
2- AttentionAttention is necessary in nearly all daily tasks. Good attention enables you to maintain concentration despite noise and distractions and to focus on several activities at once. We can improve our attention by simply changing our routines. Change your route to work or reorganize your desk -- both will force your brain to wake up from habits and pay attention again. As we age, our attention span can decrease, making us more susceptible to distraction and less efficient at multitasking. By combining activities like listening to an audio book with jogging or doing math in your head while you drive forces your brain to work at doing more in the same amount of time.

Improve your attention with this HAPPYneuron game.
3- LanguageLanguage activities will challenge our ability to recognize, remember and understand words. They also exercise our fluency, grammatical skills and vocabulary. With regular practice, you can expand your knowledge of new words and much more easily retrieve words that are familiar. For example, if you usually only thoroughly read the sports section, try reading a few in-depth business articles. You’ll be exposed to new words, which are easier to understand when read in context or easier to look up on a dictionary site if you are reading the news online. Take time to understand the word in its context, which will help you build your language skills and retrieve the word more readily in front of your boss in the future.

Improve your language skills with this HAPPYneuron game.

4- Visual-SpatialWe live in a colorful, three-dimensional world. Analyzing visual information is necessary to be able to act within your environment. To work this cognitive function, try walking into a room and picking out five items and their locations. When you exit the room, try to recall all five items and where they were located. Too easy? Wait two hours and try to remember those items and their locations. The next time you’re waiting on your coworker or friend to arrive, try this mental exercise. Look straight ahead and note everything you can see both in front of you and in your peripheral vision. Challenge yourself to recall everything and write it down. This will force you to use your memory and train your brain to focus on your surroundings.

Improve your visual-spatial skills with this HAPPYneuron game.
5- Executive FunctionWithout even realizing it, you use your logic and reasoning skills on a daily basis to make decisions, build up hypotheses and consider the possible consequences of your actions. Activities in which you must define a strategy to reach a desired outcome and calculate the right moves to reach the solution in the shortest possible time are actually fun activities you do daily -- like social interaction and, yes, video games. Engaging in a brief visit with a friend boosts your intellectual performance by requiring you to consider possible responses and desired outcomes. Video games require strategy and problem-solving to reach a desired outcome -- like making it to the final level. “It’s not just Halo, honey; I’m exercising my executive brain functions!”

Improve your executive function skills with this HAPPYneuron game.

10 (More) Reasons You're Not Rich

by Jeffrey Strain

Many people assume they aren't rich because they don't earn enough money. If I only earned a little more, I could save and invest better, they say.
The problem with that theory is they were probably making exactly the same argument before their last several raises. Becoming a millionaire has less to do with how much you make, it's how you treat money in your daily life.
The list of reasons you may not be rich doesn't end at 10. Caring what your neighbors think, not being patient, having bad habits, not having goals, not being prepared, trying to make a quick buck, relying on others to handle your money, investing in things you don't understand, being financially afraid and ignoring your finances.
Here are 10 more possible reasons you aren't rich:
You care what your car looks like: A car is a means of transportation to get from one place to another, but many people don't view it that way. Instead, they consider it a reflection of themselves and spend money every two years or so to impress others instead of driving the car for its entire useful life and investing the money saved.
You feel entitlement: If you believe you deserve to live a certain lifestyle, have certain things and spend a certain amount before you have earned to live that way, you will have to borrow money. That large chunk of debt will keep you from building wealth.
You lack diversification: There is a reason one of the oldest pieces of financial advice is to not keep all your eggs in a single basket. Having a diversified investment portfolio makes it much less likely that wealth will suddenly disappear.
You started too late: The magic of compound interest works best over long periods of time. If you find you're always saying there will be time to save and invest in a couple more years, you'll wake up one day to find retirement is just around the corner and there is still nothing in your retirement account.
You don't do what you enjoy: While your job doesn't necessarily need to be your dream job, you need to enjoy it. If you choose a job you don't like just for the money, you'll likely spend all that extra cash trying to relieve the stress of doing work you hate.
You don't like to learn: You may have assumed that once you graduated from college, there was no need to study or learn. That attitude might be enough to get you your first job or keep you employed, but it will never make you rich. A willingness to learn to improve your career and finances are essential if you want to eventually become wealthy.
You buy things you don't use: Take a look around your house, in the closets, basement, attic and garage and see if there are a lot of things you haven't used in the past year. If there are, chances are that all those things you purchased were wasted money that could have been used to increase your net worth.
You don't understand value: You buy things for any number of reasons besides the value that the purchase brings to you. This is not limited to those who feel the need to buy the most expensive items, but can also apply to those who always purchase the cheapest goods. Rarely are either the best value, and it's only when you learn to purchase good value that you have money left over to invest for your future.
Your house is too big: When you buy a house that is bigger than you can afford or need, you end up spending extra money on longer debt payments, increased taxes, higher upkeep and more things to fill it. Some people will try to argue that the increased value of the house makes it a good investment, but the truth is that unless you are willing to downgrade your living standards, which most people are not, it will never be a liquid asset or money that you can ever use and enjoy.
You fail to take advantage of opportunities: There has probably been more than one occasion where you heard about someone who has made it big and thought to yourself, "I could have thought of that." There are plenty of opportunities if you have the will and determination to keep your eyes open.