Personal Finance

Personal Finance is a catch-all for anything that falls under the umbrella of taking care of your money. A lot of people think of their personal finances as some "other" thing they don't always have to pay attention to. I think it's integral to your life and health.

Take a look at the articles below and get your personal finances in shape.

Best Financial Advice You’ve Received

Published or updated August 21, 2016 by Glen Craig 22 Comments

There’s a meme going around that I saw at The Digerati Life who got it from Sound Money Matters. It’s basically asking everyone to answer:

What’s the best financial advice you ever received?

Probably one of the best pieces of advice I received was from my dad. When I go my forst credit card he told me to be careful and not go into debt with the cards. “Pay off your balances every month,” he said. Unfortunately I was young and headstrong and had to learn mistakes the hard way. I’d go onto opening numerous credit cards – Macy’s, Bloomindale’s, two CitiBank cards, and others.

At first I was real good with my cards and paid them off. But as I got older with more responsibilities the balances started to grow (that and I couldn’t keep my hands off buying “stuff”). In the end I had debt in the thousands. I was able to slowly pay everything off with a little help from my family as I moved back in with them for a while.

I was foolish for not taking my dad’s advice to heart. I’m sure many people out there have a similar story. They know what the right thing to do is but somehow their credit card debt got out of hand anyway.

If you’re one of these people – You can get out of debt! It may take a while but small steps will lead to big changes over time in paying back your cards. Start now!

If you’re not in credit card debt then make sure you stay that way! Be responsible with your charges and make sure you can pay back everything once the bill arrives.

I’m not one of those who thinks that credit cards are evil. The mistakes I’ve made with them I take full responsibility for. They can be very useful in fact. But you have to be responsible with them.

I’m tagging the other members of the Money Life Network to answer the question: What is the best financial advice you ever received? (MiB Smarter Money, Bible Money Matters, Sense To Save, Remodeling This Life, Prime Time Money, and Milk Your Money).

If you’re reading this then consider yourself tagged too! Write about it or drop a comment here.

What’s the best financial advice you ever received?

photo credit: mikebaird

What We’re Doing To Adjust To One Income

Published or updated May 6, 2013 by Glen Craig

As I told you yesterday we’re moving from a two income family to one income. This will take some adjusting on our part. If you’re considering moving from two incomes to one you should check out 9 Tips For Going To One Income from PT Money.

Among the things we have done so far to adjust:

Changed my 401(k) contributions – I was contributing more than the company match for my 401(k). I’ve now lowered it to the company match. Anything lower than the company match and I would be missing out on free money.

Roth IRA contributions – We lowered our monthly contribution to our Roth IRA’s. Yes it’s important to save for retirement but for right now we need to make sure we can handle our new budget constraints. If we find we have enough left over we’ll up the amount.

529 Plans – Again, it’s important that our kids are able to go to college but having money now is more important. We didn’t eliminate contributions, just lowered them.

Tax Withholding – With my wife not working I plan to change my tax withholding so I can keep more of my paycheck. We’re waiting to hear back from our accountant for advice on what we should set my withholding for.

Health Care – Our health care was through my wife’s job. I’ll have to switch it over to my company’s once my wife’s coverage officially ends. This will cost us as my wife had free coverage and I don’t. We had to keep this in mind when we worked out our budget.

Look for ways to trim expenses – The Starbucks days are coming to an end. And now when we go to Target or BJ’s we’ll go in with a set list of things we need and not buy things we want.

Work on finding alternate sources of income – We’re keeping an eye out to see if there are any ways to earn some extra money. I’d love to say this site would help support us but blogging isn’t as lucrative as some make it out to be.

Go through all of our monthly bills/expenses – We made sure to see where our money was going monthly. We didn’t want to build a budget then find out we skipped something that would make us go over. Make sure you check for any automatic contributions or payments you may have set up!

This will be a big adjustment for us but it will be worth it. We’ve saved and planned and budgeted and I think we’ll be fine. A little tighter than we used to be but fine.

Do you have any other ideas?

photo credit: Jeff Belmonte

What Is Raising A Child Worth – We’re Going To One Income

Published or updated May 6, 2013 by Glen Craig

What is it worth to raise your child? Is it worth giving up an income? For us the answer will be yes. First the first time in a long while my wife will not be heading back to work this September (she works in education). Instead she will be staying home to raise our little guy and our princess (19 months and 8 yrs old respectively). This wasn’t an easy decision for us. Giving up her income will require us to be a lot more frugal and we’ll really have to watch our spending now. Our future savings will also decrease as we won’t have as much to put away. We have a nice cushion already and I think we can do this; it just requires us to change our lifestyle.

Here is why we’re moving to one income:

Child Care Cost – We were paying a LOT in child care. And yet for all we were paying our son was getting sick way too often, catching bugs from the other kids at day care. Not that the day care was bad; it’s just inevitable that a child gets sick and spreads it around.

Sick Days – My wife took a lot of sick days during the last school year. As I mentioned the little guy was getting sick a lot. Day care is supposed to help us go to work but it was causing a lot of stress instead. Let’s face it, it’s painful seeing your child sick and not be able to do much about it. And my wife was getting to a point where her sick days were going to start costing her.

Stress of getting around and making arrangements – Mornings were hectic to say the least in our home. Getting two kids ready and getting to work on time s a big deal. The evening before we had to make sure everything was prepared and laid out for the next day. Then there’s actually dropping the little guy off and picking him up (sitting in traffic, finding a spot, etc…). Ever leave you child with someone else and have him cry for you? It will break your heart! We also had to find arrangements for our daughter after school for a good part of the year. And because I was dropping her off in the morning I was getting to work and leaving later.

Enjoying raising our children – Last on this list but first in our hearts, the main reason for my wife staying home to raise the kids is because we feel it’s the right thing to do. We feel strongly about being there for our children in their formative years. My wife originally intended to take more time out when the little guy was born but she ended up going back anyway. Now she will take the time off to be there for them.

It’s a shame that in today’s economy having a parent stay at home to raise the kids has to be a difficult decision. When did it switch from a second income being gravy to it being just about necessary?

Stay tuned to see what we have done so far to adjust to one income!

Have you moved from two incomes to one? How is it working for you?

photo credit: quarxdmz

Five Things Indiana Jones Can Teach Us About Personal Finance

Published or updated August 21, 2016 by Glen Craig 10 Comments

I saw Indiana Jones and the Kingdom of the Crystal Skull (among all the prior movies).

Was it as good as Raiders of the Lost Ark? How many movies are?

Was it a lot of fun to watch? Absolutely!

I got to thinking about ‘ole Indy. What makes him successful in his movies? What is it about him that keeps him coming out ahead? And can those qualities be translated to personal finance?

Here are five things I think Indiana Jones can teach us about personal finance:

Indiana Jones doesn’t need a lot of stuff

When he goes off on an adventure he has a few items: His whip, hat, jacket, side bag, boots, pants, shirt, gun holster, and notebook. This is basically his adventure “uniform” and it doesn’t change. Indy makes do with what he has and makes his stuff last. Ever see him buy a new hat? How about shiny new boots?

How this translates for us: Find out what you need in your life. Note the word “need” and not want. Don’t clutter your life with stuff. Stuff takes up space and uses up money. Also it usually pays to buy quality when you can. If you take care of a good item it can last many years (like a trusty fedora hat).

Indiana Jones has focus and persistence

When he has a goal he goes after it with all of his focus until he can’t continue any more. Do Nazis stop him? Angry cult member? Communists? Even his enemies recognize this quality in Indy. Think of the times he’s been caught, kidnapped, or blackmailed into helping the enemy. Indiana Jones is the go-to guy if you want an artifact found.

How this translates for us: Create personal finance goals and stick to them. Are your goals worth fighting for? Will you retire? Will you be financially independent? Develop persistence and focus to stay on track with your goals and complete them.

He’s daring, brave, and well educated

There’s times where Indy is doing some crazy things (climbing into an archaeological dig surrounded by Nazis anyone?). What keeps Indy afloat when he goes off on a daring adventure? Luck has a bit to do with it. But it’s his education that tempers bravado. R emember, not only is Indiana Jones an adventurer he’s also a doctor of archeology that teaches at the university level (and a Boy Scout). A big part of why he’s successful in his adventures is because he’s already done extensive research on what he’s going after. As wild as he sometimes seems he doesn’t blindly go off looking for adventure. He’s put years into learning his subject.

How this translates for us: Don’t blindly make investments or make purchases without out doing your homework first. Educate yourself about personal finance. Keep learning. Know why you are putting money into an investment and understand what the risks are going in. When making a major purchase study up on different brands and their reliability and consumer responses. Try to find the best value and price (maybe you can pick up a really good hat).

He carries a notebook full of information

We see Indy go back to small notebooks all the time. Whether it’s looking up a map or deciphering a language, he keeps notes on all his research.

How this translates for us: Keep your own notebook. Track your expenses to see where your money is going. Keep notes of things you did that saved money. Make to do lists to stay on top of your life. Write out grocery lists so you only buy what you planned on. And these days there are so many apps out there for notes that you can’t use not wanting to carry a notebook as an excuse.

He tries to do the right thing

There are many times Indy can get quick cash by obtaining an artifact and selling it. But he doesn’t. He tries to do the right thing. Whether it’s saving children from slavery or keeping biblical artifacts from Nazis, Indy does the right thing.

How this translates for us: Act right in your life. Don’t lie to your spouse about finances however small the lie may be. Don’t take part in get rich quick scams – they don’t work.

There you have it. Five ways we can learn about personal finance from Indiana Jones.

Can you think of any more?

photo by Gaetan Lee

15 Things To Do With Your Economic Stimulus Check

Published or updated August 21, 2016 by Glen Craig 14 Comments

The government Stimulus checks started going out on April 28th. If you are expecting one you should start looking for it in May (here’s a post listing the dates).

So what are you going to do with the extra money? Here are a list of ideas for using your stimulus check:

Pay off credit cards – If you have any credit card debt the stimulus check will be a great way knock some of that out! Paying off the debt gives you an instant return in savings of whatever you would have paid in interest fees. Psychologically, you will help in getting the debt monkey off your back.

Contribute to a Roth IRA – You can take your money and put it into your Roth IRA. For 2008 the contribution limit is $5000.

Start an emergency fund – If you don’t already have some sort of emergency fund (three to six months expenses seems to be the conventional wisdom) then your stimulus check is a good way to start one. Even if you have one you can use the money to increase your fund. A great place to start one is with ING Direct (you can even get a $25 bonus by opening your account with $250).

Contribute to a 529 college savings plan – You can use the money to help save for your kid’s education by putting the money in a 529 plan. Not only do you help save for college but you might get a tax break as well depending on your home state’s plan.

Pre-pay your mortgage – Take the money and make additional payments to your mortgage. By making additional payments you will own your home faster and pay less in interest. Just make sure the payments go towards the loan principle and not next month’s payment (also check that your lender will accept pre-payments without fees or penalties).

Buy a gift card – Many retailers are waiting to get their hands on your dough. Some are offering incentives to buy gift cards with your stimulus checks. It seems Kroger’s and Sears are offering 10% bonuses if you buy a gift card with your check. But be careful though and make sure there are no additional fees and know that you will actually use the card (and if the store goes out of business your gift card may be worthless).

Go on vacation – You may have been planning to do this anyway so here is a good way to fund the vacation. Go and do something that will be a great experience for the family that you will all remember.

Improve the house – If there’s something you’ve needed to improve on your home, such as a furnace, you can use your stimulus check to pay for it (or at least help). Other options could be new paint job, carpet, furniture, appliances, etc…

Car maintenance – Have you been putting off a car repair? Need new brakes? New tires? Your stimulus money can fund it. If your car is about to go kaput your stimulus check could help pay for a new car (or a good new used car).

Learn to invest – Do some research and take the money and start investing. Companies such as Sharebuilder and Zecco offer low-fee investing. You have to do your homework with this option but it might be just enough money to start investing but not so much that you will be crazy worrying if you lose it. If you invest through Sharebuilder you can buy partial shares of Berkshire Hathaway B class shares. I hear that Warren Buffett is pretty good at investing.

Pay off student loans – If you have high interest student loans then your stimulus check can be a great way to help pay your student loans off. Just like with credit cards paying off your high interest student loans give you the instant return in savings of what you would have paid in interest.

Have a nice evening out – Take your spouse out to a really great meal. Get babysitting and go to that great restaurant you wanted to try. Go see that new show that everyone’s talking about. Make an experience you will always remember.

Get physically fit – The stimulus check should be enough to pay for a year’s gym membership (or more than a year). Use the stimulus check as a catalyst to get in shape and make your life healthier. Not sure about a gym? Find a class such as yoga or martial arts to join. Not into that? Buy a new bike and go riding. Or get yourself some good running sneakers and running attire. Join your local running club and enter a few small races. You never know, you may one day run a marathon.

Go to school – Use your stimulus check to enroll in a college course or two. This can be toward a degree or just continuing education. Hey, you can take a personal finance course. Maybe learn a second language?

Do nothing – This is the easiest of them all. Put the money in your savings account and forget about it. You don’t have to spend it or find any particular purpose for it. It doesn’t have to burn a hole in your pocket. One day you might find a good use for it but for now it adds to your savings.

Personally, we’re closer to the Do Nothing suggestion. Our stimulus check will come via direct deposit right into our ING account. We have no specific plans for the money so it will be added into our savings. Our check may pay parts of many of the suggestions or for none of them. Either way it will earn interest until it finds a home somewhere else.