Personal Finance

Title Page
Copyright Page
Table of Contents
Introduction
	About This Book
	Foolish Assumptions
	Icons Used in This Book
	Beyond the Book
	Where to Go from Here
Part 1 Getting Started with Personal Finance
	Chapter 1 Embracing Financial Literacy
		Understanding Everything Financial Literacy Includes
			Starting with the basics: Budgeting and transaction accounts
			Making your money work for you: Investing
			Protecting your income and assets: Insurance
		Talking Money at Home
		Identifying Unreliable Sources of Information
			Understanding the dangers of free financial content online
			Recognizing the dangers of following financial gurus (and celebrities)
				Knowing who’s talking
				Beware celebrity endorsers
				Seeing the red flag in outrageous performance claims
			Publishers pandering to advertisers
		Jumping over Real and Imaginary Hurdles to Financial Success
			Discovering what (or who) is holding you back
			Developing good financial habits
	Chapter 2 Establishing a Financial Foundation
		Understanding Your Cash Flow
			Uncovering where your money goes
			Sizing up your income
				Investing in your career
				Securing a side hustle
		Utilizing Transaction and Investment Accounts
			Transaction/checking accounts
			Savings accounts and money-market funds
			Investment accounts
		Budgeting to Boost Your Savings
		Understanding and Improving Your Credit Score
			Deciphering how lenders use credit reports and scores
			Obtaining your credit reports
			Getting your credit score
	Chapter 3 Measuring Your Financial Health
		Avoiding Common Money Mistakes
		Determining Your Financial Net Worth
			Adding up your financial assets
			Subtracting your financial liabilities
			Crunching your numbers
			Interpreting your net worth results
		Examining Your Credit Score and Reports
			Understanding what your credit data includes and means
			Reviewing your credit reports and score
			Improving your credit reports and score
			Getting credit-report errors corrected
		Knowing the Difference between Bad Debt and Good Debt
			Consuming your way to bad debt
			Recognizing bad debt overload
			Assessing good debt: Can you get too much?
			Playing the credit-card float and reward games
		Analyzing Your Savings
		Evaluating Your Investment Knowledge
		Assessing Your Insurance Savvy
	Chapter 4 Establishing and Achieving Goals
		Creating Your Own Definition of Wealth
			Acknowledging what money can’t buy
			Managing the balancing act
		Prioritizing Your Savings Goals
			Knowing what’s most important to you
			Valuing retirement accounts
			Dealing with competing goals
		Building Emergency Reserves
		Saving to Buy a Home or Business
		Funding Kids’ Educational Expenses
		Saving for Big Purchases
		Preparing for Retirement/Financial Independence
			Figuring out what you need for retirement/ financial independence
			Understanding retirement building blocks
				Counting on Social Security
				Planning your personal savings/investment strategy
				Making the most of pensions
			Crunching numbers for your retirement
			Making up for lost time
Part 2 Spending Less, Saving More
	Chapter 5 Managing Where Your Money Goes
		Examining Overspending
			Having access to credit
			Misusing credit cards
			Taking out car loans
			Bending to outside influences and agendas
			Spending to feel good
		Assessing Your Spending
			Tracking spending the “low-tech” way
			Tracking your spending on “free” websites and apps
	Chapter 6 Dealing with Debt
		Using Savings to Reduce Your Consumer Debt
			Understanding how you gain
			Finding the funds to pay down consumer debts
		Decreasing Debt When You Lack Savings
			Reducing your credit card’s interest rate
			Understanding all credit-card terms and conditions
			Cutting up your credit cards
			Discovering debit cards: The best of both worlds?
		Turning to Credit Counseling Agencies
			Beware biased advice at credit counseling agencies
			Ask questions and avoid debt management programs
		Filing Bankruptcy
			Understanding bankruptcy benefits
			Coming to terms with bankruptcy drawbacks
			Deciphering the bankruptcy laws
			Choosing between Chapter 7 and 13
			Seeking bankruptcy advice
		Stopping the Spending/Consumer Debt Cycle
			Resisting the credit temptation
			Identifying and treating a compulsion
	Chapter 7 Reducing Your Spending
		Unlocking the Keys to Successful Spending
			Living within your means
			Looking for the best values
				Don’t waste money on brand names
				Tread carefully online
				Getting your money back
			Eliminating the fat from your spending
			Turning your back on consumer credit
		Reducing Your Spending
			Managing food costs
				Eating out frugally
				Eating healthy at home without spending a fortune
				Joining a wholesale superstore
			Saving on shelter
				Reducing rental costs
				Reducing homeowner expenses
			Cutting transportation costs
				Research before you buy a car
				Don’t lease, don’t borrow: Buy your car with cash
				Replace high-cost cars
				Keep cars to a minimum
				Buy commuter passes
				Use regular unleaded gas
				Service your car regularly
			Lowering your energy costs
			Controlling clothing costs
			Repaying your debt
			Indulging responsibly in fun and recreation
				Looking at low-cost entertainment
				Vacationing for less
				Using thrift with gifts
			Lowering your phone bills
			Technology: Spending wisely
			Curtailing personal-care costs
			Paring down professional expenses
			Managing medical expenses
			Eliminating costly addictions
			Keeping an eye on insurance premiums
			Trimming your taxes
	Chapter 8 Managing and Reducing Your Taxes
		Understanding the Taxes You Pay
			Focusing on your total taxes
			Recognizing the importance of your marginal tax rate
			Defining taxable income
			Being mindful of the second tax system: Alternative minimum tax
			Analyzing recent tax law changes
		Trimming Employment Income Taxes
			Contributing to retirement investment plans
			Shifting some income
		Increasing Your Deductions
			Choosing standard or itemized deductions
				Organizing your deductions
				Shifting or bunching deductions
			Purchasing real estate
			Trading consumer debt for mortgage debt
			Contributing to charities
			Remembering auto registration fees and state insurance
			Deducting self-employment expenses
		Reducing Investment Income Taxes
			Investing in tax-free money-market funds and bonds
			Selecting other tax-friendly investments
			Making your profits long term
			Does funding retirement accounts still make sense?
		Enlisting Education Tax Breaks
		Getting Help from Tax Resources
			Obtaining IRS assistance
			Consulting preparation and advice guides
			Using software and websites
			Hiring professional help
				Preparers
				Enrolled agents (EAs)
				Certified public accountants (CPAs)
				Tax attorneys
		Dealing with an Audit
			Getting your act together
			Surviving the day of reckoning
Part 3 Building Wealth through Investing
	Chapter 9 Considering Important Investment Concepts
		Establishing Your Goals
		Understanding the Primary Investments
			Looking at lending investments
			Exploring ownership investments
		Shunning Gambling and Get Rich Quick Vehicles
			Forsaking futures, options, and other derivatives
			Ditching day trading
			Sidestepping “get rich quick” schemes
		Understanding Investment Returns
		Sizing Investment Risks
			Comparing the risks of stocks and bonds
			Focusing on the risks you can control
			Discovering low-risk, high-return investments
		Diversifying Your Investments
			Spreading the wealth: Asset allocation
			Allocating money for the long term
			Sticking with your allocations: Don’t trade
			Investing lump sums via dollar-cost averaging
		Acknowledging Differences among Investment Firms
			Focusing on the best firms
				No-load (commission-free) mutual-fund companies
				Discount brokers
			Places to consider avoiding
				Commissions and their impact on human behavior
				Investment salespeople’s conflicts of interest
				Valuing brokerage research
		Seeing Through Experts Who Predict the Future
			Investment newsletters
			Investment gurus
		Leaving You with Some Final Advice
	Chapter 10 Understanding Your Investment Choices
		Slow and Steady Investment: Bonds
		Building Wealth with Ownership Vehicles
			Selecting stocks
				Discovering the relative advantages of mutual funds and exchange-traded funds (ETFs)
				Understanding exchange-traded funds, hedge funds, and managed accounts
				Investing in individual stocks
			Investing internationally in stocks
			Generating wealth with real estate
				Real estate: Not your ordinary investment
				The best real-estate investment options
				The worst real-estate investments
			Investing in small business
				Launching your own enterprise
				Buying an existing business
				Investing in someone else’s small business
		Off the Beaten Path: Investment Odds and Ends
			Precious metals
			Bitcoin, Ethereum, and other cryptocurrencies
			Annuities
			Collectibles (including NFTs)
	Chapter 11 Investing in Funds
		Understanding the Benefits of Mutual Funds and Exchange-Traded Funds
		Exploring Various Fund Types
			Money-market funds
			Bond funds
			Stock funds
			Mixing bonds and stocks: Balanced funds
			U.S., international, and global funds
			Index funds
			Specialty (sector) funds
		Selecting the Best Funds
			Reading prospectuses and annual reports
			Keeping costs low
				Eliminating loads
				Minimizing operating expenses
			Evaluating historic performance
			Assessing fund manager and fund family reputations
			Rating tax friendliness
			Determining your needs and goals
		Deciphering Your Fund’s Performance
			Dividends
			Capital gains
			Share price changes
		Evaluating and Selling Your Funds
	Chapter 12 Investing in Retirement Accounts
		Looking at Types of Retirement Accounts
			Employer-sponsored plans
				401(k) plans
				403(b) plans
				457 plans
			Self-employed plans
			Individual Retirement Accounts (IRAs)
			Annuities: An odd investment
		Allocating Your Money in Retirement Plans
			Prioritizing retirement contributions
			Setting up a retirement account
			Allocating money when your employer selects the investment options
				Money market/savings accounts
				Bond mutual funds
				Guaranteed-investment contracts (GICs)
				Balanced/target date mutual funds
				Stock mutual funds
				Stock in the company you work for
				Some asset allocation examples
			Allocating money in plans you design
				Vanguard
				Fidelity
				Discount brokers
		Transferring Retirement Accounts
			Transferring accounts you control
			Moving money from an employer’s plan
	Chapter 13 Investing in Taxable Accounts
		Getting Started
			Paying off high-interest debt
			Taking advantage of tax breaks
		Understanding Taxes on Your Investments
		Fortifying Your Emergency Reserves
			Bank and credit union accounts
			Money-market mutual funds
				Watch out for “sales”
				Recommended money-market mutual funds
		Investing for the Longer Term (Several Years or Decades)
			Defining your time horizons
			Bonds and bond funds
				U.S. Treasury bond funds
				Buying Treasuries from the Federal Reserve Bank
				State- and federal-tax-free bond funds
				Federal-tax-free-only bond funds
			Certificates of deposit (CDs)
			Stocks and stock funds
			Annuities
			Real estate
			Small-business investments
	Chapter 14 Investing for Educational Expenses
		Exploring Higher-Education Options
		Figuring Out How the Financial Aid System Works
			Treatment of retirement accounts
			Treatment of money in the kids’ names
				Traditional custodial accounts
				State-sponsored college savings plans: 529
			Treatment of home equity and other assets
		Strategizing to Pay for Educational Expenses
			Estimating college costs
			Setting realistic savings goals
			Tips for getting loans, grants, and scholarships
		Investing Educational Funds
			Good investments: No-load mutual funds and exchange-traded funds
			Bad investments
			Overlooked investments
	Chapter 15 Investing in Real Estate: Your Home and Beyond
		Deciding Whether to Buy or Rent
			Assessing your timeline
			Determining what you can afford
			Calculating how much you can borrow
			Comparing owning versus renting costs
				Mortgage
				Property taxes
				Tax savings in homeownership
			Considering the long-term costs of renting
			Recognizing advantages to renting
		Financing Your Home
			Understanding the two major types of mortgages
			Choosing between fixed- and adjustable-rate mortgages
				How willing and able are you to take on financial risk?
				How long do you plan to keep the mortgage?
			Shopping for fixed-rate mortgages
				Trading off interest rates and points
				Understanding other lender fees
				Shunning balloon loans
			Inspecting adjustable-rate mortgages (ARMs)
				Understanding the start rate
				Determining the future interest rate
				Looking at the adjustment period or frequency
				Understanding rate caps
				Being aware of other ARM fees
			Avoiding the down-payment blues
			Comparing 15-year and 30-year mortgages
			Finding the best lender
				Shopping for a lender on your own
				Hiring a mortgage broker
			Increasing your approval chances
		Finding the Right Property
			Condo, town house, co-op, or detached home?
			Casting a broad net
			Finding out actual sale prices
			Researching the area
		Working with Real-Estate Agents
			Recognizing conflicts of interest
			Looking for the right qualities in real-estate agents
		Putting Your Deal Together
			Negotiating 101
			Inspecting before you buy
			Remembering title insurance and escrow fees
		After You Buy
			Refinancing your mortgage
				Spending money to save money
				Using money for another purpose
				Changing loans
			Mortgage life insurance
			Considering a reverse mortgage
			Selling your house
				Selling through an agent
				Selling without a real-estate agent
				Should you keep your home until prices go up?
				Should you keep your home as investment property after you move?
Part 4 Insurance: Protecting What You Have
	Chapter 16 Insurance: Getting What You Need at the Best Price
		Discovering My Three Laws of Buying Insurance
			Law I: Insure for the big stuff; don’t sweat the small stuff
				Take the highest deductible you can afford
				Avoid small-potato policies
			Law II: Buy broad coverage
				Recognizing fears
				Preparing for natural disasters — insurance and otherwise
			Law III: Shop around and buy direct
				Looking at employer and other group plans
				Buying insurance without paying sales commissions
		Dealing with Insurance Problems
			Knowing what to do if you’re denied coverage
			Getting your due on claims
				Documenting your assets and case
				Preparing your case
				Approaching your claim as a negotiation
				Practicing persistency
				Enlisting support
	Chapter 17 Insurance on You: Life, Disability, and Health
		Providing for Your Loved Ones: Life Insurance
			Determining how much life insurance to buy
			Comparing term life insurance to cash value life insurance
				“Cash value policies are all paid up after X years. You don’t want to be paying life insurance premiums for the rest of your life, do you?”
				“You won’t be able to afford term insurance when you’re older.”
				“You can borrow against the cash value at a low interest rate.”
				“Your cash value grows tax-deferred.”
				“Cash value policies are forced savings.”
				“Life insurance is not part of your taxable estate.”
			Making your decision
			Buying term insurance
				Selecting how often your premium adjusts
				Ensuring guaranteed renewability
				Deciding where to buy term insurance
			Considering the purchase of cash value life insurance
			Getting rid of cash value life insurance
		Preparing for the Unpredictable: Disability Insurance
			Deciding whether you need coverage
			Determining how much disability insurance you need
			Identifying other features you need in disability insurance
			Deciding where to buy disability insurance
		Getting the Care You Need: Health Insurance
			Mandating health insurance: The Affordable Care Act (Obamacare)
			Choosing the best health plan
				Major medical coverage
				Choice of healthcare providers
				Lifetime maximum benefits
				Deductibles and co-payments
				Guaranteed renewability
			Buying health insurance
				Clarifying why prices rose because of the Affordable Care Act
				Understanding subsidies
				Coping with higher health insurance prices
			Looking at retiree medical care insurance
				Closing Medicare’s gaps
				Long-term care insurance
				Making sense of Medicare’s prescription drug program
	Chapter 18 Covering Your Assets
		Insuring Your Home
			Dwelling coverage: The cost to rebuild
			Personal property coverage: For your things
			Liability insurance: Coverage for when others are harmed
			Flood and earthquake insurance: Protection from Mother Nature
			Deductibles: Your cost with a claim
			Special discounts
			Buying homeowner’s or renter’s insurance
		Auto Insurance 101
			Bodily injury/property damage liability
			Uninsured or underinsured motorist liability
			Deductibles
			Special discounts: Auto edition
			Little-stuff coverage to skip
			Buying auto insurance
		Protecting against Mega-Liability: Umbrella Insurance
		Planning Your Estate
			Wills, living wills, and medical powers of attorney
			Avoiding probate through living trusts
			Reducing estate taxes
Part 5 Where to Go for More Help
	Chapter 19 Working with Financial Planners
		Surveying Your Financial Management Options
			Doing nothing
			Doing it yourself
			Hiring financial help
				Commission-based “planners”
				Percentage-of-assets-under-management advisors
				Hourly-based advisors
		Deciding Whether to Hire a Financial Planner
			How a good financial advisor can help
			Why advisors aren’t for everyone
			Recognizing conflicts of interest
				Selling and pushing products that pay commissions
				Taking a narrow view
				Not recommending saving through your employer’s retirement plan
				Ignoring debts
				Not recommending real-estate and small-business investments
				Selling ongoing money-management services
				Selling legal services
				Scaring you unnecessarily
				Creating dependency
		Finding a Good Financial Planner
			Soliciting personal referrals
			Seeking advisors through associations
		Interviewing Financial Advisors: Asking the Right Questions
			What percentage of your income comes from clients’ fees versus commissions?
			What portion of client fees is for money management versus hourly planning?
			What is your hourly fee?
			Do you also perform tax or legal services?
			What work and educational experience qualifies you to be a financial planner?
			Do you carry liability (errors and omissions) insurance?
			Can you provide references from clients with needs similar to mine?
			Will you provide specific strategies and product recommendations that I can implement on my own if I choose?
			How is implementation handled?
		Learning from Others’ Mistakes
	Chapter 20 Using Technology to Manage Your Money
		Surveying Software, Apps, and Websites
			Adding up financial software benefits
			Understanding how apps can benefit and harm your bottom line
			Surfing hazards online
				Considering the source so you can recognize bias
				Watching out for “sponsored” content
				Steering clear of biased financial-planning advice
				Shunning short-term thinking
		Accomplishing Money Tasks on Your Computer, Tablet, or Smartphone
			Paying your bills, finding ways to save, and tracking your money
			Planning for retirement
			Preparing your taxes
			Researching investments
			Accessing economic and financial data
			Trading online
			Reading and searching periodicals
			Investing through automated investment managers: Robo advisors
			Buying life insurance
			Preparing legal documents
	Chapter 21 Consuming Financial Content
		Observing the Mass Media
			Alarming or informing?
			Teaching questionable values
			Worshipping prognosticating pundits
			Navigating social media
		Rating Radio, Podcasts, and Television Financial Programs
		Finding the Best Websites
		Navigating Newspapers and Magazines
		Betting on Books
			Understanding the book publishing business
			Books at the head of their class
Part 6 The Part of Tens
	Chapter 22 Survival Guide for Ten Life Changes
		Starting Out: Your First Job
		Changing Jobs or Careers
		Getting Married
		Buying a Home
		Having Children
		Starting a Small Business
		Caring for Aging Parents
		Divorcing
		Receiving a Windfall
		Retiring
	Chapter 23 Ten Tactics to Thwart Identity Theft and Fraud
		Save Phone Discussions for Friends Only
		Never Respond to Emails Soliciting Information
		Review Your Monthly Financial Statements
		Secure All Receipts
		Close Unnecessary Credit Accounts
		Regularly Review Your Credit Reports
		Freeze Your Credit Reports or Place an Alert
		Keep Personal Info Off Your Checks
		Protect Your Computer and Files
		Protect Your Mail
Glossary
Index
EULA