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Durable goods are just that: hard goods; they don't wear out quickly and can be used over and over again for at least several years. Think your car, TV, refrigerator or computer. These are certainly not disposable, one-time use items.
The opposite of a hard good is (surprise!) a soft good or, if you like, a non-durable good. These are products you use once, like your lunch at McDonald's, the gas in your car and the ugly sweater your grandmother bought you for your birthday. These items have an intended lifespan short of three years, or are consumed immediately.
Investors pay attention to the monthly durable orders report released by the Commerce Department around the end of each month. When durable goods are strong, it means that U.S. manufacturing is humming along, though economists tend to parse the numbers pretty closely. Big-ticket items can skew the overall results, since an order for, say, 75 Boeing 747s has a bigger impact than 75 iPods. Luckily, the data lets economists break down the sectors.
Home / Personal Finance
Friday, March 21, 2008
Spring Clean Your Home Finances
Erin Peterson
Bankrate.com
It's not just about tossing out old paperwork; it's about doing the regular maintenance to ensure that you're getting the most out of every dollar. A regular checkup can help you get -- and stay -- on track with your finances.
Spring is an ideal time to schedule in a few hours for your
financial review. Clearing out the financial clutter won't just make your life simpler; it could save you some serious cash.
Here are five good areas to get started.
Spring cleaning
While you're attacking those cobwebs in
the corner of the spare bedroom, take a swipe at the dust collecting in these five rooms of your financial house.
5 places to get your financial house in order:
While some financial whizzes use different accounts for different reasons, piling up benefits and perks, most will benefit by streamlining accounts with a single financial institution.
After you've
determined which bank best suits your needs, be sure to switch any automatic payment plans to that bank, such as gym memberships,
car payments and Internet service -- or risk hefty fees when payments don't go through.
You'll benefit by paying as many bills as possible electronically. Not only will you save the price of a stamp, but you also can have payments deducted automatically to ensure you never incur a late charge again.
Once you have an accurate credit report, check the interest rates you pay on balances and compare the rates with other cards. You may be able to use that as leverage to improve your credit card terms. Credit card companies are happy to use any opportunity to hike your rates, but that doesn't mean you should just accept it. If you have a history of making your payments on time, give your credit card companies a call and ask if they can do better with their rates. Many will drop them if you're just willing to take the time to ask.
Finally, develop a plan to pay off any debt. Tackle high interest credit-card debt first, says Lankford, to guarantee the best bang for your buck. Any tax return you've got coming can help you make a big dent in your debt, so consider paying it off before blowing it on the latest gadget or a luxury vacation.
If you've got any property at all -- a home, a car, a flat-screen TV, or jewelry with real or sentimental value -- a will can help make sure it gets to the right person upon your passing, and it can help prevent a lengthy probate process.
As you're working on a will, also consider drawing up a financial power of attorney document, which specifies a trustworthy person to control your finances if you become too sick to handle them on your own. A living will, also commonly included in these types of documents, is helpful to specify your wishes if you're unable to communicate them because of illness.
"If you had a major life event -- if you had a child, if you got married or divorced, or if a parent died and you inherited a lot of property -- you'll have different things to think about," says Randolph. "Most people need more than one will in their lifetime." Make sure you're still comfortable with the executor and beneficiaries of your estate.
If you've made any updates to these documents, get rid of the old ones, says Bob DiQuollo, president of Brinton Eaton Wealth Advisors. "People have a habit of keeping copies of estate planning documents, even when they have an updated one," he says. "There's no reason to keep a prior versions, because it just adds confusion."
Consolidating accounts is one key to reducing your stress. "It's tough enough to figure out what's going on with your money, but if you've got several statements a month coming in, you may just let them pile up and not even open them," says Gichon. "It's a huge obstacle for people when they try to move forward financially."
Gichon suggests moving old 401(k) accounts into the one at your current job -- check with your human resources department about the logistics -- or moving them into a self-directed IRA through a major mutual fund company, such as Vanguard, Fidelity or T. Rowe Price.
"If there's an office for one of these companies nearby, you can bring the information about all of your accounts and they can help you make the transfers," says Gichon. "You can get one statement with all your information with IRA, Roth IRA and 401(k). It's much easier."
If
you're happy with where your accounts are, an annual rebalancing is a smart idea. Even if you planned your initial investments
wisely from the start, big gains or losses over time can skew your portfolio, says Weston. After a few years, your ratio of
investments may have shifted significantly, resulting in a portfolio far more aggressive or conservative than you intended.
Finally, consider increasing your 401(k) savings: At the minimum, be sure to save enough to earn the full match from your company. If you increase your savings at the same time as your annual raise, you probably won't even miss the extra cash.
As you're shopping around, be sure you're sufficiently covered. "After the recent California wildfires, a lot of people discovered they didn't have enough coverage," says Lankford. If you've done significant renovations or additions to your house and haven't revised the policy, be sure to take those upgrades into account. "It doesn't cost that much to add, but it could add hundreds of thousands of dollars in your payout," Lankford says. Web sites such as www.Accucoverage.com can help you determine the replacement cost of your home as you update your information.
Give your life insurance policies a second look if you've had a major life change. A new baby might warrant increased coverage, for example, while a divorce or death might require a beneficiary change.
If you renew or change any policies, shred your old documents, says DiQuollo. "Once you renew a policy, you can get rid of the old one," he says. "I"ve never heard of anyone needing an old one."
Interest Rate Roundup
Fed Slashes Rate to 2.25 Percent
Borrowing Options That Offer a Lifeline
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