The first Carnival of Money Stories is now up at Money Walks.

There are 38 different articles on topics such as investing, debt, real estate, and saving money, including our own contribution on Emergency Funds.  Check it out!

CNN Money’s website had a great article on cutting health care costs today ~ 50 Ways to Cut Health Care Costs. 

I think this article is especially important for self employed folks who may not have access to a group health insurance plan. 

Some of the tips in the article I found interesting include:

#3 Pay up front, in cash - I have done this several times, and have gotten a 15% discount as a result.  If it’s a cost that won’t be covered by insurance (because you have a high deductible), then it benefits you to pay up front to get the discount.

Uncle Sam is now going to help you pay your mortgage insurance premiums! 

Mortgage insurance is typically required when home buyers purchase a new home with less than 20 percent down. 

The newest tax legislation allows taxpayers to deduct premiums paid for mortgage insurance.  Mortgage insurance premiums typically range from $50 to $150 per month, which could mean a $600 to $1,800 deduction on your tax return.

This deduction is only available to taxpayers who itemize, but many home owners (especially if you’ve just purchased your home) have enough mortgage insurance, real estate tax, and other deductions to itemize.

As a small business owner, I know how tight cash can be at times.  Many small business owners turn to credit cards and other sources for short term loans when business is slow and cash is tight. 

I’ve noticed that payday loan stores have been popping up in my area lately, so I thought I’d do some research to find out how these places work.  Here’s what I found out…

First, if you’re not familiar with payday loans, basically, they are short-term loans, usually in small amounts.  Typically, you write a check for the amount of the loan plus fees, and the lender cashes the check on a specified date, usually one to four weeks later.

As a financial planner, I encourage my clients to have an emergency fund.  This is especially important for WAHMs and other solo professionals who rely on their business for their main source of income.

I’m often met with the following questions when I recommend an emergency fund:

1.  Why do I need an emergency fund? and
2.  How much should it be?

To answer the first question, you need an emergency fund for the following unexpected expenses or situations:

* Car repairs
* Home repairs or improvements
* Job loss (spouse)
* Business slowdown due to illness or other unexpected events
* Unexpected medical expenses

If you or your spouse are a teacher, you probably know about the $250 deduction that is allowed on your income tax return.  While this is a very small tax break, every little bit helps. 

So, I was glad to see that Congress extended this deduction for two more years, until the end of 2007. 

If you’re not familiar with this tax deduction, here’s a brief summary:

Teachers can deduct up to $250 that they spend out of pocket to buy classroom supplies.  The deduction is an above the line deduction, which means you don’t have to itemize to take the deduction. 

Q. I am making my first home purchase. Can I take money out of my IRA to help with the down payment?

A. Generally, withdrawals from a traditional IRA before the age of 59 ½ are subject to income tax and a 10% penalty. There are several exceptions to the 10% penalty, one of which is a distribution for a first time home purchase.

You can take up to $10,000 from your traditional IRA to purchase your first home without incurring the 10% penalty.

There are some rules to keep in mind, however:

One of the biggest savings goals that work-at-home-mom’s have is saving for their children’s college education. 

This is a challenging goal for most parents, especially as fast as tuition has been rising lately.

Tuition and fees rose an average of 6.3 percent for public 4-year colleges, and 5.9 percent for private colleges in 2006.

Tuition at 2-year colleges rose at a slightly slower rate of 4.1%, while room and board rose an average of 5.1 percent.

The average total cost of a college education in 2006 was $16,357 for a 4-year public college and $33,301 for a private college.