Ever Wonder What The Government Spends Money On?

By: Vincent Mortensen

Each year, our federal government creates a budget that will dish out money to all the programs deemed worthy.  We often hear the federal budget deficit is spiraling out of control….and it is.  Ever wondered what lies in our nations yearly spending?  Find out below:

Health (23.6%) – The largest spending of the budget lies within health care costs.  This includes programs such as Medicare, Medicaid, and other public health services.

Social Security (24.3%) – Coming in second place is Social Security.  Of course, this includes financial benefits given to those as early as age 62, but this also includes those who qualify and have become disabled.  It has been noted Social Security may be one of the largest cut programs when the government is forced to end overspending and balance the budget.  Save today to create financial peace tomorrow!

Defense (17.3%) – Many Americans believe spending on the military and defense is number one in the budget.  In reality, it actually takes the bronze medal.  This part of Federal Spending Chartthe budget includes paying for military expenses on foreign soil, expenses to keep our home land safe, and also perks for soldiers such as the G.I. Bill.

Income Security (14.7%) – This sounds like a broad and confusing category, but what it entails is simple.  Interestingly enough, the largest expense within this category are tax rebates like the Earned Income Tax Credit.  Other programs include affordable housing and food stamps for those in poverty.

Interest (6.5%) – This is where things get alarming.  The government is spending about 6.5% of the budget to simply stay recent on loans taken from other governments such as Canada, Japan, and China.  Think off all the cool things America could do with that money if they drastically reduced the spending in this category.

Other (13.6%) – The individual expenses are small and the categories are numerous at this point.  Some of the “other” expenses include environmental affairs, education, and international affairs.

If you are interested in learning more about this subject, there are a couple of websites you can visit:


Banks vs. Credit Unions: What’s the Difference?

By: Vincent Mortensen

Some consumers are confused when it comes to banks and credit unions.  There are even some that believe they are the same institution under a different name like Target is different from Walmart.  Both are super stores, but different companies.  This is not the case.

Below is a chart that explains the basic differences between banks and credit unions. 

  Credit Union Bank
Structure Non-profit Institution For-profit Institution
Insurance Up to $250,000 by the NCUA Up to $250,000 by the FDIC



Volunteer Board of Directors elected by members of the credit union. Paid Board of Directors voted in by stockholders that may or may not be customers of that bank.
Earnings Net income is used to lower interest on loans and higher interest on savings. Stock holders may receive a share of the profits through dividends.
Products Full range of financial products and services. Full range of financial products and services.
Service Delivery Branches, online, ATMs, mobile Branches, online, ATMs, mobile
Fees Low to no fees Fees usually apply

Currently, I keep my money in a credit union and I like it very much.  The loan rates are lower and savings accounts make a little higher interest than commercial banks.  I have also been with a bank in the past and enjoyed their services as well.  Whatever you decide to choose, you now have a better understanding on what your financial institution is all about.  Good luck!

How NOT to pay for college.

Hey yall,

If you are like me, a poor college student that doesn’t have school payed for, you would be interested in what I have to say. Yes there are grants that are given out every year but if you don’t qualify it can be frustrating, trust me! Let me give you scholarship websites that are great for matching money to you.





All of these websites let you add in personal information so that you can be matched to the scholarships you qualify for. Also most of these websites have filters, if you want scholarship applications that don’t require an essay you can filter that!

There are many scholarships out there that support diversity, unlucky for me I don’t qualify for a lot of those.

There are also a lot of scholarships that are picked based purely on a random drawing, they are the most simple to apply for but you don’t really get to sell yourself!

If you have spare time, go ahead and apply for as many scholarships as you can using these easy websites!

Brought to you by: Megan Carson 


What the heck is a 401(k)/IRA/Roth and how do you get one?

So what is a 401(k), IRA or Roth? All of these numbers, letters and words can be scary and overwhelming. Basically, these are all just different types of requirement accounts. We will break down each account to help you decide which account is best for you.



A 401(k) is a basic retirement savings account that many employers offer. This account is a “defined contribution pension” where you invest towards your own retirement instead of your company providing a pension. Typically the way this works is you decide how much of your salary you will put into this account each year and the money in the account is invested. This contribution also reduces your income that is taxed so that you owe fewer taxes now. The catch to this type of plan is that you will pay tax on this money in retirement when you begin taking payments from this account. With this type of account, you are deferring your taxes until you retire. At age 70½ or the year after you retire, you will have to begin collecting payments from this account. Some jobs will offer a “match” where you can contribute a percentage of your salary, and your company will match some portion of that percentage.

The Problems

  • With this solution your retirement may be so far ahead in the future that it is impossible to predict what your tax bracket will be, at what age you will retire, or if your state will even tax income.
  • You cannot take the money out before you turn 59 ½ or you will have to pay a 10% penalty on top of regular income taxes on this money.
  • You will have less money in retirement (compared to investing in a Roth) if you are in a low income tax bracket now and are in a higher tax bracket at retirement.

The Bright side

  • You and your spouse can each contribute up to $17,500 to this type of account in addition to contributing to other retirement accounts like a Roth.
  • It is portable. You can switch jobs and roll it over into another account and take it with you. This contrasts a company defined benefit pension that pays you money based on how long you work at a company.
  • This is a great option to save for retirement if you cannot afford to both contribute to a retirement account and pay the taxes on your full current income. By contributing, you basically put off paying your taxes until you take the money out at retirement.
  • If you plan to retire before you turn 70 ½ and have little income, you will likely be in low tax bracket which makes this option attractive especially if you are currently in a high tax bracket.
  • If your company offers a match, you are getting free money to retire on! Even though you will pay taxes later, the money that your company contributes will cover your taxes and you will still have some of their money left over. If your company offers a match, take advantage of the full match before contributing to a Roth.

Traditional IRA

An IRA is a retirement option that your employer may offer or that you can open at most financial institutions. A traditional IRA is very similar to a 401(k). When you contribute to an IRA you get a break on taxes now and then pay taxes when you pull the money out. You will then pay taxes on every dollar you take out, which will include all of the growth and compounded interest from the account.  

The Problems

  • Unlike a 401(k), IRA’s have a maximum contribution limit of $5,500 per person. This is the maximum you can contribute to any type of IRA. If you have any combination of a Roth, a Simple IRA (where your employer matches your IRA) or a traditional IRA, the sum of all of these account contributions cannot exceed $5,500 per year.
  • If you are married and make over $191,000 or are single and make over $129,000, you cannot contribute to this type of account.
  • You have to start taking payments out of your account (called distributions) starting at age 70 ½ which means if you are still working, your taxes could be really high if you are in a high tax bracket.
  • To withdraw money penalty-free, you have to be age 59 ½ and that your first contribution be five years before the distribution begins.

The Bright side

  • If your employer doesn’t offer a 401(k) then you can still save for retirement by opening an IRA and you can do so at bank, credit union, or investment firm.
  • You can save for retirement even if you can only afford to contribute a small amount each month. This is because you get a tax break now which helps you save more money (like a 401k)

Roth IRA

A Roth IRA is a retirement account that you hold with your employer or on your own. The difference between a Roth IRA and any other type of retirement account is the way that this account is taxed. You are not given any tax break now and you will still pay your full income tax on any money that you earn and contribute. This account has already paid its taxes once and will never be taxed again. That means that all of your growth and the magic of compound interest will be yours forever.

The Problems

  • Similar to the traditional IRA, there is a maximum contribution limit of $5,500 per person. This is the maximum you can contribute to any type of IRA.
  • With a long term projection of how much money you will earn in Roth IRA versus a 401k or IRA that your company matches, the IRA/401(k) with a match wins out.
  • To withdraw money penalty-free, you have to be age 59 ½ and that your first contribution be five years before the distribution begins.

The Bright side

  • Roth IRA’s do not have a minimum distribution requirement. This means at no point in your lifetime will you be forced to take money out of your investments. This is because the government has already taken their share and has no further interest in the account.
  • If you are age 50 or older, catch up rules apply allowing you to contribute extra money to your IRA.
  • Money can be withdrawn penalty-free to cover first time home buyers costs and other qualified expenses (not that we recommend this).


So how do you decide?

Consider all of the options. If your employer matches in any of these accounts, take the full match first. If you have money left over, consider a Roth but use your current tax bracket and future predicted tax bracket to really think about it. I used my current income and tax bracket with my future predicted tax bracket and plugged it into this calculator. You can see my results.Image

For me, the calculator says I would be better off with a traditional IRA. The difference between the two was only $1,500 which is less than a 2% gap. I am fortunate to make enough money with my spouse that I am in a pretty high tax bracket and I also qualify for good tax breaks that this calculator doesn’t factor in. In the long run, 2% isn’t a big enough deal to pull you hair out over. For my retirement, I’ve decided to hedge my bets and put 50% into a Roth and 50% into a 401(k), making sure that I take advantage of my entire 401(k) match. I am young and I can afford to start off risky/aggressive with the funds I choose and a target date fund is a good way to go because it becomes more conservative as you age. I can always change the proportions I contribute to each account and my investing strategy. Hopefully this will help you navigate the confusing world of retirement planning and help you make an informed decision on saving for your future.

Buying Sexy Cars the Smart Way

By: Vincent Mortensen

We Americans sure do love our cars.  Many of us are thrilled to purchase the next coolest, best, most awesomeist…. car that rolls off the line.  Who can blame us?  The automobile industry does a great job advertising their product by making them look sleek, sexy, and the key to total happiness.  Oh, and if you drive their car, you’ll meet a lot of beautiful women or good-looking men, too.

What’s the problem, then?  We tend to spend more money than we should on these transportation treasures.  The average car payment in America today is a staggering $475 a month!  That’s a good portion of rent or groceries for some families.  Below are a few tips and tricks to save money finding the correct car for you while still feeling “sleek and sexy.”

  1.  Purchase an automobile that is three to five years old.  Car models are still good-looking and in good shape at this age.  On top of that, you’ll save thousands of dollars purchasing gently used over brand new.  For example, a 2014 Honda Accord STARTS at $22,000 while a 2010 Honda Accord with 30,000 miles averages around $15,000.  That’s a good chunk of change.
  2. Hold on to your car as long as you can.  If you’re currently driving a reliable car that has good gas mileage, keep it until it becomes too costly to fix.  Not only does this save the hassle of purchasing a new ride, your insurance will most likely drop as your car gets older.
  3. Research your purchase before you buy.  Consumer Reports is an excellent source to find out which cars were reliable and which were duds in any given year.  You could save thousands in repairs, insurance, gas, and overall hassle.
  4. Make a large down payment.  Not everyone can purchase a car with cash, but it helps to put as much down as possible.  This lowers the car payment and interest.  Only put as much down as you are financially comfortable doing.
  5. If you’re like me, looking “sleek and sexy” is not an issue.  If you are able to purchase a “clunker” car with cash or not own a car at all, save and use that monthly $475 car payment for other things like a down payment on a home or a much needed vacation to the Bahamas.  The money really adds up over time.


I’d like to conclude with a quote from financial guru, Dave Ramsey:  Today, if you decide to live like no-one else, later, you can LIVE like no-one else.

Saving Money For The Holidays

It’s the Most…..Expensive Time of the Year!

By Vincent Mortensen

Summer has come and gone.  The heat has transitioned into the cool, crisp weather of autumn.  With the changing weather brings the changing of the seasons and all the fun holiday’s attached to them.  In a three month span, we dress up and get candy, gorge ourselves on delicious foods and top it off with giving and receiving presents.  Even the holiday season can cause stress.  In this sense, it can harm us financially.

Chances are you’re cooking Thanksgiving dinner this year for all your closest family and friends.  If you’re not cooking, you’re probably traveling to get to said meal.  With the steady rise of gas prices, long distance car trips or flying can cause a financial squeeze.  This is why we must start saving now instead of later.

Let’s do an example.  A family of four needs to travel to Denver, Colorado from Salt Lake City, Utah to reach grandma’s house for Thanksgiving dinner.  Even booking in September will cost each person on average $200 for round trip.  $800 is considered by many a major purchase and should be saved for.

Now for driving.  Let’s say gas prices are averaged out to $3.70 a gallon throughout the road trip.  Your car receives 25 mph on the highway for the 550 mile trip.  This will round out to about $162.50 round trip.  This is a much better deal but still on the expensive side.  There may be additional costs including hotel as well.

Imagine if you had to travel even further than the next state over.  Things could become even more expensive than $160 to $800.

If you don’t have to travel far for Thanksgiving, enjoy your meal and be merry!  But, if you have to spend a significant amount to see your loved ones, it’s never too early to start saving for your upcoming adventure.  Good luck!