OCR Text |
Show 2008 SUNDAY, AUGUST 24, BUSINESS EDITOR Grace tang gteongOtwraMotraxom 344-291- 0 Jean Chatzky Talking Money rV'V'' I , v- -' Howto come up This economy has left people cifrmdfl card bills, on mortgage payments . and low pn cash to cover basics like gas and food. Those are gaps , in the budget that have to betiUed, and too often, people are raiding, their 401(k) to come up with the . extramoney. If you're one of those thinking 7.'"' about it, I wait you to stop. Then V keep reading ... '. When you pull money out of in 7 your 401(k) prematurely other words, before you readt age 59 12 you're essentially robbing yourself. Not only do you have to .t pay taxes on the cash you pullout, but youll also be hit with a penaky , of 10 percent. .V It is rarely, if ever, worth it. , v . . .A-.-- : Lettakea3Dyear-aldwhoex- - . 7. pects to retire at age $5l They have. $20,000 in their 401(k). If they cash out, theyre only going to take $12,000 of that money home be-- 7 cause of taxes and penalties. Thats $8,000 of your money, gone. But. 7 thats not even half the story. By pulling out, youre also passing up y an opportunity for your money to grow. If left invested, (hat $20,000 could easily turn into upwards of $100,000 by the time you reach .. retirement age. The good news is that there are ways to come up with the money ou need without sabotaging your ?uture. : ' I Balance your budget I know, 7 youve bent over it with a fine-- . toothed comb and you simply cant find a place to cut back. But have you gone through the exercise of tracking your spending for a week or two? Cash often flies out of our pockets and we have no , idea where it went. You go to the ATM. take out $20, and by the end of the day its gone. This is where writing everything down helps, because you can look back and see that $3 went to that coffee you could have made at home; you put $ 1 in the vending machine at work for a bag of chips, and that $10 biH was spent at the grocery store on 7 a gallon of milk and a magazine. Eliminate the coffee and the chips, and you have an extra $4. Do it every day and you've saved dose to $30 a week. If tracking doesn't highlight any such discretionary spending, then you might need to consider taking, on a part-timjob far a while, or 7 asking for a few overtime hours: 7 at work. I know it doesn't sound .. fun, but remember that it's a tem- and often unavoidable '7 porary . . . . w$? -- A, . it n j(j r- v' -i Y W! : - . .. . . . Illustration by CMCY ROBEMDaily HnU. . . . . . . . Rob Gillies THE are fueling the provinces oil boom. Questions about developing Aherta's ofl sands have seeped into the U.S. Since its costly to extract oil from the sands, using the process on a widespread presidential campaign and the debate in basis began to nuke sense only when Canada and the U.S. over keeping down crude prices started skyrocketing earlier the price of gasoline while still protecting e : ASSOCIATED PRES? he largest dump truck in lthe world is parked under a 'massive mechanical shovel this century.. But the enormous amount of energy waiting to transport 400 tons of oily sand at an open. and water needed in the extraction pro- cess has raised fears among scientists, . A- - pit mine in the northern reaches of Alberta. environmentalists and officials in an Each Caterpillar 797B heavy hauler aboriginal town 170 miles downstream. threestories high, with tires twice as tall from Fort McMurray. The critics say as the average man carries the equiva- the growing operations by major oil lent of 200 barrels of heavy oil worth companies will increase greenhouse gas emissions and threaten Albertas rivers $23,000 per haul at todays prices. and forests. "Its like sitting on your back porch and driving your house," said Todd Their projected rates of expansion Dahlman, the manager of Shell Canada's are so fast that we dont have a hope in Muskeg River open pit oil sands mine in hell of reducing greenhouse gas emisAlberta's Athabasca region. sions," said Dr. David Schindler, an environmental scientist at the University of Shell, which has 35 of the massive loaders working 24 hours a day, 7 days Alberta. Oil sands operations, including extract a week, has ordered 16 more at $5 million each as it expands its open pit tion and processing, are responsible for . mines. And it is not alone among major 4 percent of Canada s greenhouse gas oil companies rushing to exploit Alberemissions, and thats expected to triple ta's oil sands, which make Canada one of to 12 percent by 2020. Oil sand mining is Canada's fastest growing source of the few countries that can significantly ramp up oil production amid the decline greenhouse gases and is one reason it in conventional reserves. reneged on its Kyoto Protocol commitShell, Exxan-MobChevron, Canada's ments. Experts say producing a barrel of oil from sands results in emissions three Imperial and other companies plan to times greater thana conventional barrel strip an area here the size of New York state that could yield as much is 175 bilof oiL lion barrels of oil DaOy production of 1.2 Worries about environmental damage million barrels from the oil sands is exhave gotten enough attention that even the oil industry realizes it must tread pected to nearly triple to 3J million barrels in 2020. Overall, AJberta has more softly on the issue. Industry has to imoil than Venezuela, Russia or Iran. Only prove its environmental performance, Brian Maynard, a vice president of the Saudi Arabia has more. High prices a barrel reached almost Canadian Association of fttroleum Pro$150 last month and is around $115 now ducers, said recently. . . solution. back your contributions. I know the general advice is to con- - : tribute, contribute, contribute, but if you're feeling the squeeze and your credit is likely to be affected by late or missed payments, you need to take action. I'm giving you permission to slow your contributions to your 401(k) for a bit and redirect some of thd money to your bills and other fixed expenses. The key words are; for a bit. People are creatures of inertia, and once you turn it off, it 's a lot harder to go and turn it back on. ; You can always find excuses to spend the additional cash, warns Sri Reddy, head of retirement income strategies at INGl Dont let yourself fall into this trap as : I Scale . . . ..... the environment. The Bush administration sees Alberta as a reliable source of energy that wiH help reduce reliance on Middle East ofl. U.S. Ambassador to Canada David Wilkins said the oil sands will define the relationship between the two countries for the next 10 years. We are blessed by the fact that our friend and neighbor is also our number one supplier of foreign oil, Wilkins told The Associated Press. However, Democratic presidential candidate Barack Obama's top energy adviser said ofl sands emissions are unacceptably high and may run counter to Obamas plan to shift the US. away from . e fossil fuels. "The amount of energy that you have " to use to get that ofl out of the ground ' is such that it actually creates a much greater impact on cbnate change, as wen as using much more energy than even traditional petroleum, Obama adviser Jason Grumet said. Mining oil sands also was criticized by American mayors in a resolution adopted at their annual conference in d June urging a ban on using ofl vehicles. in municipal gasoline They alleged the ofl sands mines damage carbon-intensiv- . soon as youre bade on your feet, you need to get back on trade wkh your retirement contributions as welL I Take out a loan. This is your last resort. One option is a home equity, if you have good credit and enough equity in your home. A home equity loan is one of the lowest cost loans you can get, and you can still deduct the interest from your taxes in most situations, says Reddy. Another option is to take a 40 l(k) loan instead of withdrawing the cash for good. A loan allows you to pull out a . sands-derive- boreal refers and slows the transition to cleaner energy sources Canada's boreal forest to the earth's northern zone intheUS. See CANADA, C9 portion of your money when you See CHATZKY, C9 L. i j. - r - - I. : |