Consumer Reports recently asked its retired readers what they wish they had done differently in preparing for their later years. Their biggest regrets had to do with their saving habits. Some 35 percent wish they had started saving earlier (only 15 percent started in their 20's) and 30 percent wish they had saved more each year. One overall conclusion: the sooner a person started saving, the more satisfied they were with their retirement.
Matt's View
This article brought to mind a book I read last year called Stumbling on Happiness
by Harvard psychologist Daniel Gilbert. After spending most of the book explaining, often with a lot of humor, why we tend to make decisions that work against our happiness, his advice was simply to talk with people who have gone before us to see how their decisions worked out. Think a red sports car is the key to a blissful future? Talk to owners of red sports cars. So, while we've all heard it before that we should save more, coming from those who are now trying to live on what they've saved adds a few exclamation points to the advice.
Speaking of Daniel Gilbert, he was asked by the Washington Post for some suggestions on making choices that'll make us happier in 2008. Gilbert said one mistake people often make is overestimating the negative impact of a bad decision, and that keeps us playing it safe. Got a dream? His advice is to go for it. The unhappiness of wallowing in indecision, he says, will be even greater than trying something and failing.
Matt's View
That isn't to say we should all throw caution to the wind and start investing in penny stocks. But it does suggest that we'd be better off trying to achieve one of our dreams rather than hanging out on the fence for another year. Have you been dreaming of taking a year off, but the fear of leaving your job is holding you back? Maybe this is the year to begin saving for a sabbatical fund.
What dream is on your heart? What steps could you take this year toward making it happen?
Is your household one of the few that still has rabbit ears on your television? (Mine, too!) Come 2009 the set-top contraptions will become useless. That's when most TV stations will be required to broadcast with digital signals. And that means if we want to keep watching TV without cable or satellite, we'll have to buy a converter box for $50 to $70. But wait; there's a silver lining. Uncle Sam is stepping in to help foot the bill via $40 coupons--up to two per household. You can request the coupons online
or by calling 888-388-2009.
Matt's View
The coupons will be available on a first-come, first-served basis. So, if your house is a cable-free zone, fill out the short online application today.
If you usually get a tax refund, why not make this the year to stop giving Uncle Sam a free loan? The IRS withholding calculator
, now updated for 2008, helps you estimate how much you should pay in taxes. It just takes a few minutes, so run the numbers and then compare your results with the amount that's being withheld from your paycheck. If you're having too much taken out, ask your human resources department to make an adjustment.
Matt's View
If getting a refund helps you build savings--meaning that your refund check goes straight into a savings account via the direct deposit option on your tax return--it's not such a bad thing. But you'll make a bit more interest by taking that money in income each month and having it automatically deposited into an interest-bearing account.
While overpaying on taxes is not the best move for most people, taking out a "refund anticipation loan" is not a good move for anyone. I was in a Wal-Mart today and was dismayed to see a Jackson Hewitt tax preparation service table with a sign boldly promoting, "Money in Minutes." Within an hour, shoppers could get a high-interest loan against the value of their anticipated refund. Attention Wal-Mart shoppers, never, never do that. I sent a friendly note to Wal-Mart customer service
suggesting that offering such a disservice to their customers hardly lives up to their tag line, "Save money, live better."
