Looking for A Job? Here's the Best Cities With Promising Job Opportunities in 2013

Looking for a Job? Here's The Best Cities With Promising Job Opportunities for 2013

Available published evidence shows that the ability to secure a steady job and paycheck depends on where you call home. Generally speaking, most job seekers are of the view that big cities (for instance, cities like New York, Florida, and Washington DC) will offer the biggest paychecks. However, it should be acknowledged that cost of living is an important metric that many of them  undervalue. This important point may be clarified by the following example: Living in New York, will obviously costs more than twice as much as the national average. This implies that if you live in New York City, your paychecks will be eaten up by rent bills and other household needs. The bottom line: don’t assume that the biggest city is the best place to work because, at the end of the day, what really matters is your net paycheck (Goudreau, 2013).

In a study to find out which are the most promising hubs for job seekers, NerdWallet, a financial literacy website, examined 26 biggest cities in United States. Their study covers such issues as population growth between 2010 through 2011, the local unemployment rate, cost of living, and the median income of the residents. They examined these variables in their study for two main reasons: First, population growth is a reliable indicator of the overall business growth in this city - a city is growing quickly will experience an underlying ripple effect of more companies and a greater need for services. Second, the cost of living in any given city reflects how far your dollar will go ((Goudreau, 2013).

According to NerdWallet’s (Goudreau, 2013) study, the following cities topped the list of the best cities for job seekers.

No. 1: Austin, TX
Population Growth: 3.8%
Unemployment Rate: 6.2%
Median Income: $31,170
Median Rent: $968

No. 2: Washington, DC
Population Growth: 2.7%
Unemployment Rate: 10.2%
Median Income: $43,993
Median Rent: $1,823

No. 3: San Francisco, CA
Population Growth: 0.9%
Unemployment Rate: 8.6%
Median Income: $46,777
Median Rent: $2,702

[More from Forbes: The Worst Cities For Job Seekers]

No. 4: Denver, CO
Population Growth: 3.3%
Unemployment Rate: 9.1%
Median Income: $32,051
Median Rent: $931

No. 5: Houston, TX
Population Growth: 2.2%
Unemployment Rate: 8.2%
Median Income: $26,849
Median Rent: $1,311

No. 6: Fort Worth, TX
Population Growth: 2.3%
Unemployment Rate: 8.0%
Median Income: $24,270
Median Rent: $980

No. 7: Dallas, TX
Population Growth: 2.1%
Unemployment Rate: 8.5%
Median Income: $27,251
Median Rent: $792

No. 8: Seattle, WA     
Population Growth: 2.0%
Unemployment Rate: 7.5%
Median Income: $41,695
Median Rent: $1,417

No. 9: San Antonio, TX
Population Growth: 2.4%
Unemployment Rate: 7.4%
Median Income: $22,333
Median Rent: $823

No. 10: Charlotte, NC
Population Growth: 2.7%
Unemployment Rate: 9.2%
Median Income: $31,667
Median Rent: $790

                                                                      Source

Goudreau J. (2013): The 10 Best Cities for Job Seekers. Forbes Magazine. Retrieved January 27, 2013 from

Car Leases – Pros and Cons

They are Very Attractive

Automobile leasing companies  calculates the cost of a lease  using the difference between two main variables: the worth of the vehicle now and its residual value, that is, what the car is expected to be worth when you return it plus fees and interest. This means that:

         Cost of a Lease = Current Value of Vehicle – Residual Value(including interest + fees)

Hence when you lease a car, you will generally pay less if the company forecasts that it(the car) has a high chance of retaining its residual value,  meaning that the higher the residual value, the lesser you pay for leasing the car. It should be noted that manufacturers often priced residual values higher because they believe that the supply of cars is on the low side. This explains  both why you can lease some new cars for less than the loan payments on a gently used model(Money Magazine, 2013) and why car leasing is especially attractive today.

Car Leases Are Flexible and Easy To Negotiate

If you know how to haggle very well, most dealers will typically drop the sticker price (which is also known as the capitalized cost) by as much as 5 per cent. Even the money factor – the number that determines your interest rate – is up for grabs(Money Magazine, 2013). But to find lower offers or to compare offers, or to locate the money factor itself , you will need to search through the fine print. Today,  the interest rates  being paid for leasing a car are down. Hence it is currently not a wise move to put more money down in exchange for a price break.

Eventually, Long-Term Car Leasing Will Cost You More

While leasing usually lasts for three years, some companies may be more lenient by allowing you to stretch the payments out longer than three years. For instance, the car company Toyota has five-year deals on the Camry, Corolla and the Yaris(Money Magazine, 2013). My advice: Steer clear of long-term leases! Given that most comprehensive warranties  last three years,  you could be left with costly repairs. Besides, short leases are more likely to be subsidized since car makers want you back for new wheels.

Costly Traps

You will need to avoid some costly traps when leasing a car. Most car leasing companies in United States typically  caps the miles you can drive to 10,000 – 20,000 miles a year(Money Magazine, 2013). This means that you can owe an additional amount – say  20 cents  more a mile  - if you exceed this mileage limit. But if you are a heavy driver, you can request for a higher mileage cap and save as much as $10 or more a month. Paying more for gap insurance will also be a good move.  Note that a gap insurance covers the difference between the insured value and the higher amount you owe the leasing company if you total the car(Money Magazine, 2013). While most car dealers typically include gap insurance free of charge, banks do not always do so.

Sources

Money Magazine. (2013, January/February).  Plan – 5 Things to Know  About Car Leases.  Special Double Issues, p. 38

   

Financial Future Quiz

The threat of unexpected financial turmoil is something that hunts almost everyone and we naturally want to avoid it at all cost. Broadly, an unknowable twist of fate can affect your bank balance adversely and, like reasonable person, you know you need a plan to prepare and protect yourself financially. Relying on some outdated advise or overly general rule of thumb will make you to have the false belief that you have accounted for every possible contingency – a very dangerous financial move. An open question here is whether you have actually charted the right path to financial security? Answering that question requires that you test your financial knowledge and measure your progress by taking this financial future quiz. This quiz will enable you to transform your financial future from solid to impregnable.

The Quiz

1.  How many Americans have at least six months of expenses in an emergency fund?

A. 17 per cent             B. 45 per cent             C. 85 per cent

Answer: B

According to bankrate.com, another incidence of job loss or financial blow will have a very catastrophic effect on Americans because more than half of them have not earmarked a six-month pot of money to tide them over if they lose their   job or when such financial blow occurs.  That is really risky. It is important to note here that you will be fine with a three-month financial cushion  if you are in a high-demand profession(for instance, if you are an engineer, a programmer or a pharmacist) or if you are a retiree collecting a pension and Social Security. However, you will need to save up to a year’s expenses if you work in an unstable industry – or if you are  50 years or older – which adds three more months to the average time it takes to find a new job.

2. What is the likelihood that my money will last until I hit 95 if I save 10% of my income every year and retire at 65?

A. 40 per cent

B. 75 per cent            

 C. 95 per cent, unless I developed a taste for Rolex watches and Faberge eggs.                                                                                    

Answer: A

You will be ahead of the typical 401(k) participant(who contributes  8 percent) if you save at least 10 percent  of your income(not including your company match). But, of course, you will like your savings to reach the finish line. The bottom line here is that the likelihood that your savings(or funds) will last until you turn 95 increases to 83% if you bump savings to 15 per cent of your income.

3. I will continue to receive paychecks for a very  long time because there’s a high chance I’ll keep working until I’m:

A. 62 years                  B. 65 years                  C. 72 years                  D. Six feet under.

Answer: A

The median age of retirement is approximately 62 years, even though as much as 37 percent of workers think they will call it quits after age 65. The gap between this expectation and reality is mainly cause by health problems, lack of relevant job skills, or the possibility of being laid off.

4. My bills should not consume this percentage of my income.

A. Trick Question. Any Debt is too much

B. 21 percent

C. 30 percent

D. 36 percent

Answer: C

If your payment for a loan will exceed 36 percent, banks will typically turn you down for the loan. The best thing for you is to maintain a debt-to-income ratio of about 30 percent. It is also important to start cutting your spending now if you exceed the 30 percent mark with respect to your debt-to-income ratio. Note that you will get better terms for mortgages, loans and credit cards if you minimize your debts significantly. So use any extra funds you have to ramp up payments on your debts.

5. My contributions to my 401(k) is just enough to get a full match. What is the best thing to do with a new income if I have a raise?

A. Put it in my 401(k)             

B. Open a Roth IRA

C. Buy lottery tickets

Answer: A or B

Check out a Roth IRA if it is still early in your career. With a Roth, you will pay taxes on contributions. However, you can make tax-free withdrawals. This feature makes the Roth IRA  a good fit for anyone who is paying a lower tax rates now than they will in retirement. But if you are in a high income bracket, then it is best to stick with the 401(k).

6. I am all set if my life insurance would replace eight to 10 times my salary.

A. True                        B. False

Answer: B

It is true only if you have no kids, is retired  or have no dependents. Otherwise, you may need up to 20 times your salary, depending on your circumstances. See the calculator at lifehappens.org to get a personalized estimate.

7. If my spouse and I are typical, how much should we plan to spend out of pocket on health care in retirement?

A. $0. That’s what Medicare is for.

B. $177,000

C. $240,000

D. $443,000

Answer: C

Excluding long-term care, today’s average 65-year old couple will need an average of $240,000 to pay out-of-pocket  health care costs in retirement.  It is best to create a designated  account for health care costs  if you are already  maxing out your 401(k) or IRA.

Reference

Rosato, D.(2013, January/February): Shore Up Your Financial Future. Money Magazine  - Special Double Issue.