Financial Freedom A Guide to Achieving Lifelong Wealth and Security

If you're one of the millions of Americans who is buried in credit card debt, or maybe you're having trouble deciphering the fine print on your 401(K)—that is, if you even have a 401(K)!—don't dismay. You can start taking steps toward closing your financi

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Reuben Advani

Financial Freedom: A Guide to Achieving Lifelong Wealth and Security Copyright © 2013 by Reuben Advani All rights reserved. No part of this work may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopying, recording, or by any information storage or retrieval system, without the prior written permission of the copyright owner and the publisher. ISBN-13 (pbk): 978-1-4302-4539-1 ISBN-13 (electronic): 978-1-4302-4540-7 Trademarked names may appear in this book. Rather than use a trademark symbol with every occurrence of a trademarked name, we use the names only in an editorial fashion and to the benefit of the trademark owner, with no intention of infringement of the trademark. President and Publisher: Paul Manning Acquisitions Editor: Morgan Ertel Editorial Board: Steve Anglin, Mark Beckner, Ewan Buckingham, Gary Cornell, Louise Corrigan, Morgan Ertel, Jonathan Gennick, Jonathan Hassell, Robert Hutchinson, Michelle Lowman, James Markham, Matthew Moodie, Jeff Olson, Jeffrey Pepper, Douglas Pundick, Ben Renow-Clarke, Dominic Shakeshaft, Gwenan Spearing, Matt Wade, Tom Welsh Coordinating Editor: Rita Fernando Copy Editor: Ann Dickson Compositor: Bytheway Publishing Services Indexer: SPi Global Cover Designer: Anna Ishchenko Distributed to the book trade worldwide by Springer-Verlag New York, Inc., 233 Spring Street, 6th Floor, New York, NY 10013. Phone 1-800-SPRINGER, fax 201-348-4505, e-mail [email protected], or visit www.springeronline.com. For information on translations, please contact us by e-mail at [email protected], or visit www.apress.com. Apress and friends of ED books may be purchased in bulk for academic, corporate, or promotional use. eBook versions and licenses are also available for most titles. For more information, reference our Special Bulk Sales–eBook Licensing web page at www.apress.com/bulk-sales. To place an order, email your request to support@ apress.com The information in this book is distributed on an “as is” basis, without warranty. Although every precaution has been taken in the preparation of this work, neither the author(s) nor Apress shall have any liability to any person or entity with respect to any loss or damage caused or alleged to be caused directly or indirectly by the information contained in this work.

To my sister, Ramona Advani, for showing me that anyone can master the art of personal finance.

Contents About the Author������������������������������������������������������������������������������������������vii Acknowledgments������������������������������������������������������������������������������������������ix Introduction�����������������������������������������������������������������������������������������������������xi Chapter 1: Assets����������������������������������������������������������������������������������������������������������������� 1 Chapter 2: Liabilities������������������������������������������������������������������������������������������������������������ 9 Chap