Money Minute: China’s Alibaba Files Massive IPO in U.S.

You may not have heard of it yet, but it’s the buzz of the tech world, and China’s Alibaba is about to increase its profile — big time.

The Chinese Internet giant has made it official, filing plans for an initial public offering in the U.S. It’s expected to be one of the largest IPOs of all time. The trading debut is still months away, but the deal could value Alibaba at as much as $250 billion. The e-commerce company has hundreds of millions of customers, and handled $11 billion last year — more than Amazon.com (AMZN) and eBay (EBAY) put together. And get used to hearing the name Jack Ma. He’s the dynamic Internet tycoon who founded and runs the company.

There was a time long, long ago — before the housing market collapse of 2008 — that consumers would tap the equity in their homes to help finance other expenses. Now, those in need of cash are turning to their 401k retirement accounts. That’s not necessarily good news because it can trigger tax penalties, and as Bloomberg reports, it reduces workers’ retirement nest eggs, leaving them with even greater financial crises later on.

Here on Wall Street, the Dow Jones industrial average (^DJI) fell 129 points on Tuesday, the Standard & Poor’s 500 index (^GPSC) lost 17, and the Nasdaq composite (^IXIC) slid 57 points.

Two stocks to watch are Electronic Arts (EA) and Activision Blizzard (ATVI), the leading makers of video games. Both posted better than expected earnings and offered an upbeat outlook for the year. They’re being helped by the success of a new generation of video game consoles rolled out late last year — Microsoft’s (MSFT) Xbox One and Sony’s PlayStation 4. Activision has high expectations for the latest version in its “World of Warcraft” series, while EA thinks the upcoming World Cup will give a big boost to its FIFA soccer games.

Finally, former Federal Reserve Chairman Ben Bernanke has a book deal worth at least $1 million. The Associated Press reports the book, due out next year, will focus on Bernanke’s leadership in avoiding a world banking collapse at the start of the Great Recession.

"Your daily habits and routines are the reason you got into this mess," writes Trent Hamm, founder of TheSimpleDollar.com. "Spend some time thinking about how you spend money each day, each week and each month." Do you really need your daily latte? Can you bring your lunch to work instead of buying it four times a week? Ask yourself: What can I change without sacrificing my lifestyle too much?
1. Change your habits

Remove all credit cards from your wallet and leave them at home when you go shopping, advises WiseBread contributor Sabah Karimi. “Even if you earn cash back or other rewards with credit card purchases, stop spending with your credit cards until you have your finances under control,” she writes.
2. Leave your credit cards at home

If you do a lot of online shopping at one retailer, you may have stored your credit card information on the site to make the checkout process easier. But that also makes it easier to charge items you don’t need. So clear that information. "If you’re paying for a recurring service, use a debit card issued from a major credit card service linked to your checking account," Hamm writes.
3. Delete credit-card info from online stores

Reward yourself when you reach debt payoff goals. "The only way to completely pay off your credit card debt is to keep at it, and to do that, you must keep yourself motivated," Bakke writes. Just make sure to reward yourself within reason. For example, instead of a weeklong vacation, plan a weekend camping trip. "If you aim to reduce your credit card debt from $10,000 to $5,000 in two months," Bakke writes, "give yourself more than a pat on the back."
4. Reward yourself when you reach milestones

“Establish a budget,” writes Money Crashers contributor David Bakke. “If you don’t scale back your spending, you’ll dig yourself into a deeper hole." You can use personal finance tools like Mint.com, or make your own Excel spreadsheet that includes your monthly income and expenses. Then scrutinize those budget categories to see where you can cut costs.
5. Create a budget

Sort your credit card interest rates from highest to lowest, then tackle the card with the highest rate first. "By paying off the balance with the highest interest first, you increase your payment on the credit card with the highest annual percentage rate while continuing to make the minimum payment on the rest of your credit cards," writes Mint.com spokeswoman Hitha Prabhakar.
6. Pay off the most expensive debts first

To make a dent in your debt, you need to pay more than the minimum balance on your credit card statements each month. "Paying the minimum -– usually 2 to 3 percent of the outstanding balance -– only prolongs a debt payoff strategy," Prabhakar writes. "Strengthen your commitment to pay everything off by making weekly, instead of monthly, payments." Or if your minimum payment is $100, try doubling it and paying off $200 or more.
7. Pay more than the minimum balance

If you have a high-interest card with a balance that you’re confident you can pay off in a few months, Hamm recommends moving the debt to a card that offers a zero-interest balance transfer. "You’ll need to pay off the debt before the balance transfer expires, or else you’re often hit with a much higher interest rate," he warns. "If you do it carefully, you can save hundreds on interest this way."
8. Take advantage of balance transfers

Have any birthday gifts or old wedding presents collecting dust in your closet? Look for items you can sell on eBay or Craigslist. "Do some research to make sure you list these items at a fair and reasonable price," Karimi writes. “Take quality photos, and write an attention-grabbing headline and description to sell the item as quickly as possible." Any profits from sales should go toward your debt.
9. Sell unwanted gifts and household items

If you receive a job bonus around the holidays or during the year, allocate that money toward your debt payoff plan. "Avoid the temptation to spend that bonus on a vacation or other luxury purchase," Karimi writes. It’s more important to fix your financial situation than own the latest designer bag.
10. Put work bonus toward paying off your debt

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