Monthly Archives: June 2010

Giveaway Reminder

Written by in RSS
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This is only going out to the RSS and email feed readers because I want you guys to enter the $50 giveaway I’m currently hosting! It’s super easy to enter (just leave a comment). I’d much rather have a regular reader win it than someone who came just for the contest.

How often is it that you have a chance to win the lottery without the risk of losing anything?!

Also, as an added bonus just for you guys, I have a $25 gift certificate to give away to restaurants.com, and I’m giving that away to one of you. Only you guys know where to find the page (click here or on the title), and all you have to do is leave a comment there. Say anything to enter.

Thanks and good luck!

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Financial Changes: Take Charge of Your Money

Written by in Money
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Do you constantly check the amount of money in your saving or checking accounts? Is this a nervous habit that occurs mainly before the next payday? If so, then maybe it’s a good time to make some financial changes that will help your bottom line and put you firmly in charge of your money.

Do you know where your spending money goes each month?

If you don’t even bother looking at the credit statements in the mail or online, it is impossible to figure out where the problem lies. There may be clues there that can give an indication as to where the problem lies. Take the time to track your spending in a spreadsheet or notebook.

Do you pay too much attention on the short term, rather than the long term?

Many people have trouble budgeting month to the month. One-time expenses or unexpected costs can throw off the entire process. If you look at your finances over the time span of a year, you can see the big picture and plan more effectively. Research at several universities has demonstrated that college students were much more accurate when they budgeted by the year.

Are there any everyday expenses that you can cut?

These can add up quickly, even when it’s just a daily pack of gum or a beer after work. Many people like to point to that cup of coffee many buy on the way to work every morning. That money could make
you a millionaire if invested wisely.

Do you understand what your own particular weaknesses are?

You may not recognize all your weaknesses, but you surely understand some of them. Whatever the items that you feel compelled to spend money on, you can control that spending. If you just feel the need to
shop, go to the dollar store. If you spend too much time shopping, bring a stopwatch. Consider bringing a long a buddy who is also trying to curb spending. There is strength in numbers.

Are you setting aside too much of your paycheck?

Although this may sound odd, compulsive saving can put you in a situation where you can’t pay the bills. If you are socking money away into your savings instead of paying off your credit card bills, you are really losing money on the interest you pay for those credit cards. Be level-headed about your savings. Pay off your debts and switch to debit to avoid problems like this coming up again.

Are big ticket purchases hurting your situation more than the smaller ones?

It’s easy to convince ourselves that a large purchase is a one-time event. But the expense is easily forgotten a few months later and another tempting big expense comes along. Don’t fall into that trap. When you take measures to save money on every large expense and only buy the big ticket items you really need, you’ll save yourself from overspending.

Should you be carrying so much debt?

It costs $1,500 per year to carry the debt on a $10,000 dollar credit card at 15% interest. A $10,000 car loan at 6% costs you $600 per year. Is it worth it, or can some of this be paid off? How can you cut expenses elsewhere to pay down the debt and stop throwing away money on interest.

Jessica Bosari writes for billeater.com. For more help managing money, pay a visit to the site.

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Carnival of Money Stories: Spending Wisely Edition

Written by in Money Stories
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Welcome to the 60th edition of the Carnival of Money Stories!

A quick reminder:
I’m currently giving away $50 in return for encouragement on paying down my student loan debt! It’s super easy to enter and will only take a second!

Most people focus on how much they can save, but I prefer to focus on making smart spending decisions. Spending wisely is all about thinking about what we are buying instead of trying to save on everything we buy.

Craig Ford presents What To Do When You Have A Late Estimated Tax Payment posted at Money Help For Christians. Better late than never, right? In this story we learn that there’s a financial lesson to that.

Joshua Dorkin presents The Deal the Realtor Left to Rot posted at The BiggerPockets Blog. Follow up with your business contacts or you could lose a ton of money!

Kristina presents Did I Mention I Was Broke? posted at DINKS Finance. Most people don’t start out in great financial shape, but the process of getting there helps so much.

Squirrelers presents Movie Tickets are Free When You Use a Credit Card, Right? posted at Squirrelers. If only credit cards worked the way kids thought they did!

Alan presents The Benefit of Employee Benefits posted at Canadian Finance Blog. Less pay but increased benefits sometimes makes the entire package more attractive.

Silicon Valley Blogger presents Thoughts on Tipping Etiquette: Why Should I Tip? posted at The Digerati Life. There are some clear imbalances in the tipping system and offers an interesting alternative.

Sometimes we see a great deal, and even if we don’t need it, we go for it anyway. How can you pass up a deal that good. The problem is that that leads us to buying more than we need.

MD presents Is It Safe to Rely On Experts All The Time? posted at Studenomics. I love the lessons from the World Cup.

Peter presents Should I Pay Off My Home Mortgage Early Or Invest? posted at Bible Money Matters. You’ve already build up the emergency funds, so go for it! Imagine all the stress of the mortgage disappearing that much more quickly!

Joe Plemon presents The Envelope Story: A Reminder of Hope posted at Personal Finance By The Book. This one blows me away. Is that crazy or what?!

Ryan @ CML presents Should Your Financial Advisor Have a Fiduciary Duty to You? posted at Cash Money Life. Should your financial advisor, investment broker, or insurance agent have a fiduciary duty to recommend the best investment for your needs?

PT presents What to Do if You Can’t Pay Your Car Note: Stop Car Repossession posted at PT Money. Have any of you ever gotten a visit from the repo man?

Miss Bankrupt presents Counting My Financial Blessings posted at Miss Bankrupt. It’s time to count five important financial blessings.

In the short term, it’s what we spend. However, in the long term, all that matters is how much we are able to save at the end of the month. I won’t be proud of you if you saved $1,000 on your tv by purchasing one for $3,000!

Amanda L Grossman presents When Being Cheap Upfront Costs Big Bucks in the End posted at Frugal Confessions. In a way, parking garages are insurance so that you don’t get towed!

Antonia presents Why I’m going to stop saving money posted at A Nomad’s Lot. Love the line: “If something doesn’t add value to my life, I won’t buy it.”

Donna Freedman presents Turf wars. posted at Surviving and Thriving. The real lesson? Take care of your finances early and often and you’ll be in great position later.

MoneyNing presents Learning to Say “No” to Your Kids posted at Money Ning. Setting limits with kids can be hard but necessary.

J. Money presents The Car That Guzzles Money posted at Budgets Are Sexy. SO glad I don’t have a car. Yay public transportation!

2 Cents presents Stereotypes: Toss the Rule Book & Write Your Own posted at Balance Junkie. Erase the stereotypes to take control of your situation

Super Saver presents Over Delivered and Over Committed posted at My Wealth Builder. Don’t stress yourself out more than necessary if you’re in good financial shape.

Want to know how to prevent yourself from overspending? Lose the plastic! Rationally, it makes no difference, but even Ivy Leaguers are irrational when it comes to money.

FMF presents How One Family Went from Two Incomes to One — And Developed a Business in the Process posted at Free Money Finance. Sometimes, making cuts to make living on one income is a lot more reasonable than we think!

Ella Moss presents Shrinking Dollars posted at Zodiac Times. A lesson in how important it is to save for a rainy day.

Bucksome presents eBay Sales Woes posted at Buck$ome Boomer’s Journey to Retirement. I think just about all sellers run into eBay problems eventually.

VH presents Just can’t believe it! posted at Funny about Money. Oh no! I say take the short-term hit, get healthy, and start fresh again!

Jim presents Checked Baggage Fees List posted at Wanderlust Journey. I used to fly Southwest a ton, and checked bag fees drive me crazy!

Money Beagle presents Price Increases Bum Me Out posted at Money Beagle. Sometimes you have to suck up price increases, but customer loyalty is super important!

Ace presents Facing the Truth About My Debt posted at Ace of Wealth. I love taking student loans by the horns. From what I hear, the earlier you pay it off, the better you feel!

Thanks for reading, and don’t miss next week when the carnival is hosted over at Out of Debt Again!

Joshua Dorkin presents <a href=”http://www.biggerpockets.com/renewsblog/2010/06/16/the-deal-the-realtor-left-to-rot/” >The Deal the Realtor Left to Rot</a> posted at <a href=”http://www.biggerpockets.com/renewsblog” >The BiggerPockets Blog</a>.
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Investing for Recent Graduates

Written by in Investing
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The following is a guest post from Brandon Langston of RothIRA.com, a free resource for everything about Roth IRAs and retirement investing.

Starting a financially fit life after college is a lot like starting an exercise routine to lose weight. You’re only going to truly benefit from it if you commit to making consistent progress towards your goals.

Here are some tips for the recent graduate and investor:

Get free money with your 401(k)

If you work for an employer that will match your contribution up to a certain limit, you’ll want to take advantage of this free money. Contribute at least as much as your employer will match. You’ll need to choose between a Traditional or Roth plan. The Traditional plan takes your 401(k) contribution from your paycheck before taxes, while the Roth takes your contribution after you’ve been taxed. Which option is best? For most new graduates, a Traditional plan is a better option because it lets you bring home the most amount of money in your paycheck possible each month, but keep in mind the disadvantage to this option is that you will be taxed later in life and you may have a higher individual tax rate at that time.

Be honest with yourself

If you want to invest in stocks, you need time to research and analyze stocks. You can’t just pick stocks out of a hat and expect to earn a return on your investment. If you aren’t willing or able to put in this research and analysis time, be honest with yourself before investing. You can let someone else do the research for you.

When you invest in both mutual funds and 401(k) plans, you can select the general investment sector, and level of risk, and allow a professional to pick individual stocks and funds for you. Unless you are going to be a financial planner or stock market professional, it’s usually advisable to go this route when investing.

Control Your Finances – Don’t Let Them Control You

Stay in control of your personal finances by creating a budget. Sure, no one wants to be tied down and strapped to a plan of how to spend or save every last penny of their income, but having a budget in place will keep you on track. Make sure to include all of your expenses, including non-monthly expenses like taxes, car maintenance, and emergencies. Remember you have both fixed and variable expenses, and your budget must be flexible enough to accommodate your variable expenses as well as your fixed expenses. Plan for the worst but be prepared for the best.

A good rule of thumb is to save 10% of your income. You should strive to keep your total debts under 20% of your annual net income, and your monthly debt repayments at 10% or less of your monthly take-home pay. If you’re able to follow these rules, even as your income increases, you’ll maintain control over your finances rather than the other way around.

Understand Time Constraints of Each Type of Investment

It’s obvious that the earlier a personal begins investing the more money they stand to earn. It’s a result of compounding interest and the money having more time to grow. As you are selecting retirement investments, the most attractive long-term investments for the recent graduate include stocks or stock mutual funds instead of money market accounts, bonds, and certificate of deposits. As you get older, you may wish to diversify your portfolio more by adding bonds, CDs and/or money market accounts, but the beginning investor is typically better off sticking to the more attractive, long-term investments and allowing compounding interest to do it’s thing over time.

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