Over the course of 13 seasons in the NBA, basketball star Antoine Walker of the Boston Celtics made a mind-numbing $110 million. Now Walker is practically broke. How did a renowned star blow through so much money in such a short time? ESPN’s interview with Walker provides the sad story.

Walker’s outsized spending was legendary in a league where high rollers are the norm. Think racks of custom-tailored suits, a driveway littered with Bentleys and Hummers, and mansions for himself and his family.

Add to that Walker’s entourage of 8 or 9 buddies who would travel the world with him in high style. Walker blew $2.5 million on a Chicago mansion for his mother with an indoor pool and – count ‘em – 10 bathrooms. Another $3.1 million went for a Miami home and yet another $4.1 million went for a downtown Chicago condo, both of which are now for sale.

And then there was the gambling. He would regulalry play blackjack for a couple of thousand dollars a hand. He finally surrendered to authorities in South Lake Tahoe for bouncing checks totaling $1 million at Harrah’s Casino.

With all that spending came numerous creditors including his former agent who won almost $600,000 from Walker for unpaid fees. To compound Walker’s woes, a $10 million real estate investmen in Chicago is in the process of going south.

If there is a moral to be had from the sad tale of Antoine Walker it is this: how you spend your money is just as important as how much money you make. Unfortunately for Antoine, he found out the hard way.

The Bottom Line: no matter how much money you make, always be careful with how you spend and invest it.

photo credit: Keith Allison

If you have a stack of old electronic gadgets like out of date iPhones, old MP3 players, or ancient laptops, there is not an alternative to recycling or throwing away these items. Gazelle pays you to recycle your old electronic products.

Gazelle buys a wide range of gadgets including cell phones, laptops, DVDs, gaming consoles, camcorders, desktops, GPS devices and even calculators. They have also started buying eBook readers, so if you’ve grown tired of that Kindle you bought awhile ago you don’t have to put it on eBay.

The prices you get for old – sometimes very old – products is remarkable. For example a Blackberry RIM Curve in good condition will get you about $116. An Apple MacBook Pro will get you about $217.

When you sell a product to Gazelle you answer a few basic questions about the condition such as whether it powers on successfully or not. The website then gives you an instant price quote for how much they will pay for your item. You then just send your gadget in to Gazelle – shipping is free, by the way – they inspect it, and send you a check. Easy!

While you might be able to get higher prices if you auctioned your stuff on eBay, the hassle of going through the auction process is often not worth it for smaller ticket items. With Gazelle you know exactly what you’re going to get for each item – no guessing an no waiting for the highest bidder.

Gazelle resells most of the products they buy and recycles the ones that have no value. So while the site is great for your wallet, it’s also a boon for the environment.

The Bottom Line: Get cash for your gadgets. If you have an old gadget gathering dust, sell it to Gazelle. If you have a very high ticket item you might do better selling it on eBay, but for everything else Gazelle is a great option.

photo credit: Nils Geylen

If you usually use Priceline to save money on hotel rooms, you now have another option. Travelocity has launched a new service called Top Secret Hotels where consumers book a hotel before learning its name.

Travelocity is hoping to break into what is known in industry terms as the “opaque travel market” which has been dominated by the likes of Priceline and Hotwire in recent years. Travelocity says that consumers can save up to 45 percent off of three and four star hotels.

You book a Top Secret Hotel in much the same was as a regular hotel: choose your dates and locations and a number of options is presented. But instead of seeing the hotel’s name you only see the star rating and the price.

This is different than Priceline where you make an offer on a room and your offer is either accepted or rejected by the hotel. With Travelocity you know the price upfront so there’s less guesswork involved.

This is likely to appeal to consumers who want an easier way to book discount hotel rooms and it smartly builds off Travelocity’s existing customer base.

The bottom line: Book a hotel room through Travelocity’s Top Secret Hotels service to save money as long as you are comfortable not knowing the hotel’s name until after you book.

Becoming a parent means getting your financial house in order. While you could let your finances slide a bit when you were single, you now have people depending on you. Doing some basic financial planning today can mean the difference between making your golden years happy and productive or stressful and uncertain. Whether it’s your your mortgage, insurance, or savings, every aspect of your finances should be reviewed to make sure your family is safe and secure.

Here are the 8 most important financial steps you can take for your family:

1. Buy life insurance. When you were a swinging single you didn’t have to even think about life insurance. Now that you have a family that’s depending on you, it’s imperative that you and your spouse get a life insurance policy. Term life insurance is usually sufficient and you want to make sure you get enough that your family can continue to live comfortably if you pass away, so think about at least $500,000 in coverage. If you’re healthy, term life insurance is not a huge monthly cost and it can really put your mind at ease. Use one of the many life insurance comparison websites to instantly get a rate quote.
2. Build up a rainy day fund. Life is unpredictable and having a family multiplies that unpredictability. Unforeseen medical expenses, automotive costs, or even natural disasters can quickly put a dent in your monthly budget. Take the time now to sock away at least three to five months worth of living expenses and put that money in a savings account that is accessible. But remember – this is emergency money only, so don’t go blowing it on a big vacation.
3. Review your health insurance. Medical expenses are eating up an increasingly huge chunk of the average American family’s income. It’s time to review your health insurance to make sure you have enough coverage and that your deductible isn’t too high. If you have children, chances are you’re going to the doctor on a regular basis. While having a high deductible is a good way to save money on health insurance while you’re single, frequent doctors visits will mean a lot of money out of your pocket. Review last year’s medical costs, see how much you had to pay, and adjust your deductible accordingly.
4. Buy a house. Although the housing market has been in a tailspin for the last several years, buying a house has traditionally been one of the best investment vehicles for families over the long term. Take advantage of today’s historically low interest rates to lock in a lower cost 30 year fixed mortgage. While it might feel like a stretch to pay for it now, chances are in 30 years you will be very happy about making the decision to buy.
5. Start a college fund. Sure, when your kids are toddlers college can seem like a lifetime away. But the years pass by faster than you can imagine, so start saving up for college now. Putting away even a small amount every month or quarter can allow the power of compounding to take hold and build up your savings over the long term.
6. Get a will. No one likes to think about death, but if it happens your family needs to be ready. Having a will prepared does not have to cost an arm and a leg – ask around to see which lawyers specialize in this type of work.
7. Plan for retirement. Saving for retirement on top of all your other family expenses can seem like an overwhelming burden, especially in the current rough economy. But like starting a college fund, time is your friend. The sooner you start saving, the longer your money will have to grow. Make sure you take full advantage of any 401k plans offered through your work.
8. Create a budget and track it. You can’t control your expenses unless you know exactly where your money goes each month. Use a program like Quicken or Mint.com to track your expenses and see what the trend is. Are you spending too much on entertainment or groceries? Find where the big expenses lie and figure out ways to cut back. You can also use these programs to monitor your budget month to month. The nice thing about a program like Mint (which is free, by the way), is that your accounts are linked together so there’s little to no manual entering of data. Login at anytime to check how close to your budget you are.

While these eight steps may seem like a huge amount of extra work, you don’t have to do them all at once. Take one item from the list to complete per week and eventually you will get through them all. By the end, you’ll know much more about your present financial condition and will be able to successfully plan for the future.

photo credit: Sukanto Debnath

Health Savings Accounts (HSA’s) can be a great way to save for medical expenses on a tax advantaged basis. Just like it pays to be informed of the various policy options when comparing car insurance it can also pay off to know the basics of the different types of health insurance plans when beginning your search for health insurance. Here are the basics of using a Health Savings Account.

Deposits

Once you join a qualifying health insurance plan, you will want to make contributions as soon as possible. Deposits can be made by anyone: an employer, yourself, or any person who wants to put money in your account. The yearly maximum for individual contributions is $3,000 and the maximum for family contributions is $5,950. While you don’t have to contribute the maximum amount each year, some health savings accounts do require a small monthly contribution. If you’re not certain how much you truly spend on medical expenses, go with a smaller amount (that you know you will use) and carefully track your expenses for the next year. That will put you in a great position to take advantage of the tax savings the next year.

Use of HSA Funds

For ease of use, a health savings account will generally provide you with a debit-type card or checkbook. Then, you’ll use that method to pay for your medically approved expenses. You don’t need to worry about getting approval from the person who oversees the plan. However, keeping your receipts just like you would for any other tax deductible item is wise. Of course, you need to be established in an HSA before you incur expenses, or else they will not qualify for reimbursement.

Withdrawals can be made for any reason, but if they are made for non-qualifying medical expenses, expect to pay a 10% penalty. For those aged 65 and over or disabled, the penalty is waived and only income tax is paid.

Rollovers

You’ve also got the option to add funds from your IRA to your health savings account. This is a one time deal and there are caps on how much you can contribute. Employees can have a one-time transfer opportunity from a health reimbursement account or their flex savings accounts. Again, this is tax free, but a one time deal. So use it wisely.

Beneficiaries

When a participant in a health savings account dies, the money from their HSA is reassigned to the beneficiary of the account and if the beneficiary is a surviving spouse, the transfer is tax free. Ask a qualified agent if you have any question about assigning beneficiaries on your health savings plans.

Benefits

As with any type of health insurance benefits, there are reasons why a plan might be right for you. With a health savings account, you are entitled to deduct all of your contribution from your taxable earnings. Also, you will earn interest on the amount of money that sits in your health savings account. One of the biggest benefits is that this interest is tax free! And don’t worry because there are no penalties or taxes when the money is used to pay for qualifying medical expenses.

Also, unlike a Flex Spending account, health savings account monies remain in the account at end of every year and earn interest tax-free for future medical expenses. The most important reason to consider a health savings account is the HSA-eligible insurance plan with a lower premium than a plan with higher premiums and lower deductible.

Drawbacks

Critics have rejected HSA’s as only benefitting younger, healthy people and making the health care system more costly for everyone. Since people with health savings accounts pay smaller premiums and more from their own pocket, insurance expenses are spread among a smaller number of people, therefore making health care plans more expensive.

There is also concern that low-income people will opt for the HDPD plans (designed for HSA’s) that have lower premiums and sacrifice necessary health care because of the higher deductible. Still, no one but you is really qualified to decide if this is a good plan for your needs. Consider both the significant tax savings and your ability to pay a higher deductible out of pocket when making this important decision about your family’s insurance funds. Finally, be sure that you take the time to compare the plans, options and providers out there. While your job may offer a group insurance, it may be worth your while to look into more affordable private insurance options too.

photo credit: D Sharon Pruitt