Q: I have friends who have made major mistakes when buying or selling homes.

What are some ways I can avoid this?

A : There are many pitfalls to avoid when buying or selling. The decisions you make in both pursuits can have a major impact on your financial condition for years to come, so you can't make these decisions too carefully.

If you're buying

Here are some key issues you should consider to make the right decisions:

1. How long do you plan to be in your new home? If there's a good chance you'll move within seven years, perhaps because of your job, the costs involved might make this a better time to rent than buy.

Q: Can you offer advice on things people should know about 401(k) plans?

A : Sure. How much money you have in your 401(k) account when you retire depends in part on how you handle it (the choices you make), having a solid plan for managing it and the degree of discipline you bring to this challenge.

These plans are how most Americans save for retirement. They enable people to invest pre-tax dollars, and these contributions can take the sting out of saving money by lowering your tax bill in the years that you earn them. For many people, this is highly advantageous because they're in a lower tax bracket after retiring than during their working years. For those contributing to a Roth 401(k) account (offered by some employers), withdrawals at retirement can be tax-free, but taxes must be paid on this income in the years that you earn it.

Q: We want to buy a bigger home and are bewildered by the mortgage process. How can we make this easier?

Q: My wife said she read something about women being potentially better investors than men. I told her this is nonsense. Your thoughts?

A: I'm sorry to tell you, but according to well-regarded research, your wife is correct. What she probably read is a reference to a classic behavioral finance study, published in 2000. This study concludes that women tend to be better investors than men. The apparent reason for this is that they lack something that often hurts men's investing performance: overconfidence.