Paying For College

Written by in Student Loans
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In addition to help from my parents, I took out unsubsidized student loans and private loans to help cover the cost of tuition. I left college with about $25,000 in student loan debt, a little more than the average. In the 2 years since I graduated, I’ve paid off all the high interest debt and have about $9,000 left on a variable 2.25% loan, which I’m happy to pay off a little less aggressively.

I get a lot of requests for adding junk to my blog, and for the most part, I decline those requests. Then, every once in a while, I get a video like the one below from an online college, which is by far the most comprehensive overview of paying for college. Check it out and let me know what you think.

I’ve done several posts about student loan repayment options, but this covers a lot more. One of the things I absolutely love about it is the importance put on keeping current with payments as well as making payments during school!

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Is Buying My Own Home Better Than Renting?

Written by in Money
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So you’ve recently moved out of home. The apartment you were simply isn’t cutting it, or perhaps it’s time to leave the parental nest.

You want your own pad, but you’re feeling uncertain about taking the plunge into property ownership – let alone knowing where – or how – to start.

Without having the ability to see 10 years into the future to determine whether buying will serve your needs, we’ll outline general pros and cons around property ownership.

What are the benefits of buying?

You’ll own your own bricks and mortar.
For some, owning bricks and mortar and creating a beautiful home is high on the wish list. For others, renting, and investing money elsewhere (such as in stocks and shares) is a better way to go.

When you own your own property, nobody can pull the rug from under you and evict you…unless of course you default on your loan.

You’re building an asset that you can eventually sell.
Whether you’re buying a home to live in or to rent to someone else, every loan repayment is contributing towards something you might one day own – and sell.

You could own a property that’s profitable.
There are good investments and bad one – whether it’s a property you’re living in or renting out, placing a bet, or trading shares. Property investments are long term propositions of 7-10+ years.

Property ownership is not risk-free, however, and has been proven to be susceptible to market highs and lows. However, there are smart buying decisions and less sensible ones: when you buy property, where you buy it and of course what you buy matters. Researching rental returns and likely capital growth, and anticipated ongoing costs, can shape your experience of property ownership.

What are the downsides of buying?

Meeting loan repayments.
Renters and owners have financial obligations. Failure to meet these obligations has consequences such as a bad credit record. Potential homebuyers need to consider whether their home loans repayment will be manageable over the long term. Repayments depend on several factors: the loan interest rate; whether the rate is fixed or variable, and whether when you’ve been clever enough to factor in an ongoing 2-3% interest rate buffer (protecting you from nasty surprises).

The additional expenses.
Council fees, utility bills and property maintenance costs are additional costs you must pay. However, over time your property may appreciate in value and your investment returned, two, three or even tenfold.

Renting can be cheaper in the short term – but essentially you’re paying off someone else’s FHA Home Loan. If you’re devoted to your lifestyle or a keen traveller, think twice before taking on hefty mortgage repayments. Renting can be a great way to experience a suburb before you buy into it.

Tips for Getting into Property Sooner

Expecting a dream home as your first purchase? Aim high, by all means, but be realistic. Here are some tips to get started:

Think big, but start small.
Manage your expectations about what you can afford. A mortgage broker or your lender will give you a clearer picture of what’s achievable, based on your income, assets, liabilities (credit cards, existing loans) and ongoing expenses.

Generally, first homebuyers need to have at 20% of the purchase price saved. Lenders generally base the amount they will lend you on your monthly repayments not exceeding a quarter of your gross income. Factor in buying costs such as legal fees, loan application fees, stamp duty, insurance, adjustments to council rates and utilities costs (water, electricity).

Start a savings plan and a comprehensive budget.
It takes time and effort to be financially disciplined. Your mortgage broker can provide plenty of budgeting guidelines and saving tips.

Start saving
Write down everything you spend for 3 months. Where can you cut back? Put aside $20 a week to begin with; put it in a high interest paying account and grow your own deposit.

Get your paperwork in order
Make sure you can provide pay slips, earnings statements, tax returns, credit card history and other evidence of your earnings, income, assets (things you own, such as a car) and expenses.

Where to find a home loan

Once you have worked out how much you need, you’re ready to visit a lender or a mortgage broker.

A quality mortgage broker can help you with everything from comparing lenders (many mortgage brokers have extensive lender panels) to unearthing competitive interest rates, assist with home loan paperwork and provide professional support throughout the home loans process and beyond.

A mortgage broker will assist you with choosing a suitable lender, finding a loan that matches your requirements – whether that’s a loan with features (such as loan redraw, offset account, no penalties for paying out the loan early) or finding one with low application fees, a competitive interest rate or even interest rate discounts.

Choose a broker that’s industry-certified, too – and be sure to ask whether they are giving you independent home loan advice. Are they independently owned and operated? A broker knows the home loan process inside and has a strong knowledge of each of the lending products available that satisfy your criteria.

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Frugal Exercise Routines

Written by in Saving
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The following is a post from staff writer Crystal at Budgeting in the Fun Stuff, where she writes about finding the balance between paying your bills, saving for your future, and budgeting in the fun stuff along the way.

Are you looking for easy ways to get in shape and not spend a bunch of cash? You can drop those extra pounds or tone up affordably by working out on your own. Here are a few frugal exercise routines to keep in mind.

Exercise Option 1 – Cardio Routines

The key to any good weight loss program or health plan is cardiovascular activity. The good news is that you can fit in some cardio just about any place, at any time. One easy way is to start running, jogging, or power walking around your neighborhood or work place. A 30 minute daily routine will result in significant weight loss and will only cost you a pair of decent shoes.

Exercise Option 2 – Workout DVDs

A gym membership can be incredibly expensive thanks to that continuous monthly membership fee. On the other hand, a workout DVD is comparably cheap. Workout DVD programs typically range from $39 to $99 brand new. Some popular programs right now are the P90x, Tae Bo, and Boot Camp DVDs. You can perform these workout routines day after day, month after month. My coworker has lost 30 pounds in 3 months doing the P90x 3-5 times a week.

Exercise Option 3 – Strength Training

A set of dumbbells is perfect for the frugal workout enthusiast. They can be bought for under $50 very easily and can last your entire lifetime! A quick search of Houston Craigslist popped up with several sets listed at $25-$40. You can do presses, curls, rows, shrugs, and lifts. This will get your upper and lower body into shape in no time. Plus, muscle naturally helps burn fat so it is good for weight loss too!

Exercise Option 4 – Abdominal Exercises

Working out your abs has never been easier. You don’t have to buy expensive abdominal machine or electronic belts. All you need is a mat or padded floor in an area of the house to do some crunches. Take about 10 minutes to look around online for the best abdominal workout for you and just take off.

Exercise Option 5 – Balance Exercises

You can do balance exercises like Pilates and yoga in your own home. Stability balls, pillows, and balancing balls are very cheap and can be used to do a number of flexibility exercises as well. These exercises help improve agility and loosen up the entire body while also strengthening your core muscles.

My mother found that yoga helped lessen her back pain while she was pregnant with me and helped her lose the baby weight after I was born.

My Exercise Routine

My own personal exercise routine is very simply. I walk around the back parking lot at my job for 15-25 minutes 3-5 days a week as the weather will allow. I also walk our dogs occasionally in the evening. Other than that, the occasional short softball league at work is my only other nod to workouts. This new routine coupled with eating less calories and a more balanced diet via Weight Watchers Online, has helped me lose 20 pounds in the last 3 months!

What affordable exercise routines come to mind for you?

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How to Make Money Buying Contact Lenses

Written by in Money Stories
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When my insurance company and optometrist both duped me into paying an extra $60, I learned my lesson. Still, I needed a year’s supply of contact lenses, and the only way to get the $130 credit from my insurance company was to buy through the same provider, Hour Eyes.

I really hate that store. The first time I walked in, I was greeted and asked to hold on for a minute. So I stood there as the woman behind the desk wrapped her pencil in scotched tape for two minutes. Already, I knew I was going to get some great customer service.

Goal: Purchase 8 boxes of contact lenses (a one year supply) for as little as possible.

Expected Outcome: Pay as little as possible.

Knowing their policy on price-matching (they’ll match any price as long as there’s proof), I brought in my iPhone with the best price I could find for 8 boxes. But when I tried to get my entire order price matched and then have them price match the rest, I was left with 4 boxes covered by the insurance company and a bill of about $110 for the other 4 boxes, way more than I was expecting to spend.

Since I didn’t know what the best price I could find for 4 boxes, I went home and came back 3 days later, this time with the prices for both 4 and 8 boxes of lense.

I knew I just wanted to buy 4 boxes this time and I would get the rest online or later in the year (hoping I could stretch 6 months of lenses into about 9 months).

But the woman tried to convince me that I would get a discount if I bought 8 boxes. Knowing their price match policy for real this time, I told her it wouldn’t be worth it, but I asked anyway what it would come out to. She spent about 5 minutes doing some math that I couldn’t follow (adding discounts where they shouldn’t be and starting over about 4 times).

I knew I’d still be looking at a $100+ bill, so I just waited for her final number. $189.92. How she got there, I have no idea, it’s possible she price matched the entire thing, but I didn’t even give her that number. Since the insurance company would cover $130, that brought the total down to $59.92. Then she said I could take another $25 via mail in rebate because I bought 8 boxes of Acuvue lenses and Acuvue gives rebates for purchases of 8 boxes or more.

Of course, I already knew that, but I also knew that since I had an eye exam and this was my first time buying contact lenses, I would be getting a $60 rebate.

So I walked out of the store with 8 boxes of contact lenses, having paid $59.92, and I was going to be able to get a $60 rebate for my troubles.

The totals?

Outcome: 8 boxes of lenses (valued at $287.92 had I walked into the store and purchased without any rebates) for -$0.08. Yup, I made 8 cents on my transaction and I couldn’t be happier.

I’d like to thank the woman behind the desk for their shoddy math, Hour Eyes for employing people who don’t know their company policy, and Davis Vision for stealing my $60 a week earlier so I didn’t feel bad about getting my money back by just going along with it.

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