July 31, 2009
"The biggest shock when I lost it all was the realization that so much of my life had been out of my control. When I started to make the money back, I vowed that it would never happen again. I bought things only when I could afford them. There was no big mortgage, no cars on hire purchase. I remember buying a TR6 sports car for £6,000, and funnily enough it gave me more pleasure than the Porsche ever had."
July 30, 2009
I admit it, I'm a convert. Despite my friends' criticism and laughter, I love wine in a box. Basically, it is inexpensive and it is good. I can get a nice box of wine (emphasis on the word nice) for about $20, and that is about $5 a bottle. Plus, it lasts a long time, which is nice when I'm home alone and not drinking much wine. If you are a wine drinker, give it a try. Ask your wine reseller or ask your friends for some decent brands and see if boxed wine might work for you.
July 29, 2009
June Walbert of USAA offers advice on saving money and having the right insurance when you rent a car.
July 28, 2009
As our country's financial markets change, credit cards are adding new fees and enforcing old ones. Today on Financial Columnist Liz Weston's blog: 8 Credit Card Fees to Beware. We've talked about some of these here at The Paycheck Chronicles but Liz's list puts the most common fees in one article.
Military members are uniquely fortunate to have a number of low cost banking and credit sources: USAA, Navy Federal Credit Union, and many other small branch or installation credit unions. Don't let the big banks charge you unnecessary fees. If you're not sure where to look, ask around your unit and find out where people are banking.
July 26, 2009
Over at Wisebread, the Frugal Duchess has done a great post on getting free Boingo (and other) Wi-Fi at airports that only offer pay-for-use service. I'm so glad to hear about these great tips!
July 25, 2009
For all the world's focus on modern ideas and thoughts, often the same advice that our grandparents followed is still appropriate for our world.
Today, CreditLoan did an excellent article (Buying Food: Grocery Shopping Tips from 1950) based on a 1950's Home Economics (Buying Food) movie about grocery shopping. While the tone is dated and very sexist, the core concepts are still solid.
Use a shopping list. I am hugely in favor of shopping lists (and menus) because I know I spend more when I don't have one, plus more food gets wasted because I didn't have a plan when I purchased it.
Compare unit prices, but don't buy more than you can use. I find this to be particularly true as we approach a move - how much mayonnaise can we use before we leave? I hate giving away loads of food because I didn't plan well.
Consider different forms of the same food: fresh, canned, dried or frozen. Sometimes one form is clearly more appropriate for your meal, sometimes it just doesn't matter. Frozen has great quality and a good price but canned is usually the most inexpensive.
Purchase quantities when the price is good. Of course, this requires that you know your prices. Don't stock up unless you're sure the price is right.
Buy in-season fresh fruits and vegetables.
Learn to cook!
The video itself is only about 11 minutes long and it is a fun look at grocery shopping in the 1950s. Even if you already know all these things, it is always good to have a little more encouragement.
July 24, 2009
"The amount of money you have has got nothing to do with what you earn.. people earning a million dollars a year can have no money and.. People earning $35,000 a year can be quite well off. It's not what you earn, it's what you spend."
July 21, 2009
Click on the picture to see it bigger:
Visual by Visual Economics Check them out - fantastic stuff over there!
Hmmm, this looks remarkably like my life. Here's the challenge: Where are you in this cycle? (And if you are not - good for you!) How can you make a small change that will have a big effect on the rest? For some people, it might be paying off that one department store credit card. For others, it might be paying off two car loans. For me, it is making those last few payments on a home equity loan.
As cute and fun as this picture looks, it is a sobering reminder about the economic life of an average American family. While I'm a little discouraged to see how closely it mirrors my life, I'm also encouraged that I can make the future look different. How about you?
July 20, 2009
As I've noted before, being busy and being careful with your money can be hard to do at the same time. Last month, Forbes magazine did an article titled The High Cost of Laziness, and the CreditLoan website did a good review of the article. It is a smart read, even if I'm a little bothered by the use of the word lazy. It doesn't seem to me that most of these things are related to laziness at all, but more that we haven't chosen to make them a high priority in our lives. (I admit I might be a little sensitive about this, as I still haven't finished these two tasks.)
Regardless, it is a good list with suggestions that apply to many people, myself included. Even if you do just one of the things on the list, you'll have made a positive change for your family.
July 19, 2009
"I really should check my credit report."
"I wonder about my credit score."
How many times have you had these thoughts? I always encourage you to check your credit report regularly, but I know it is hard to keep up with everything. Today I've been lucky enough to stumble across one more way to make it easier: a free (with promotional code) credit report and BrightScore from the FINRA Investor Education Foundation.
FINRA, the Financial Industry Regulatory Authority, is a non-governmental regulatory group for US securities firms. The FINRA Investor Education Foundation offers a wide variety of educational information and tools, including SaveAndInvest.org and the Military Spouse Fellowship for the Accredited Financial Counselor Program, plus they are a partner in the Department of Defense Financial Readiness Campaign.
BrightScore is a comprehensive and detailed analysis of your credit report and credit score. BrightScore uses information pulled from Experian to estimate your FICO score, including information about how it was calculated and the key factors that are influencing your credit score. It also makes recommendations for areas to improve.
I used this program today and it is by far the easiest credit reporting tool I've used yet. The layout is clear and sensible, and the level of detail is excellent. I was quickly and easily able to tell the areas in which my credit score has room for improvement. Plus, the program helps you set up a set-by-set plan for improving your score and includes 90 days of free telephone access to financial counselors who can answer your questions.
The FINRA Investor Education Foundation is making it's BrightScore product available free to active duty military members and their spouses. In order to access this free report, you will need a promotional code that can be obtained from your command or installation Personal Financial Manager. It may be a small effort to get the code but I think it is more than worth it. The information in this particular report is presented so well that you are sure to benefit from it.
July 17, 2009
"Money is only a tool. It will take you wherever you wish, but it will not replace you as the driver."
July 16, 2009
It seems that we've come to a point where many families have as many cars as they have drivers - heck, I know lots of people who have more cars than drivers. In spite of that trend, there are families who manage to survive, or even thrive, with only one car. If you are used to having two cars, having one car can be an adjustment, but it often presents as many benefits as handicaps.
Why might you be trying the one-car lifestyle? Maybe you're moving and one car is in transit, maybe one car is in the shop, maybe parking is scarce and annoying. Or maybe you hope to cut back one of your family's biggest expenses by eliminating the extra registration, insurance, maintenance and other costs of a second car. (I didn't include gas because sometimes eliminating a car can use just as much gas - it all depends.)
My family has lived with one car a couple of times, usually for a number of months but once for several years. When we moved to Hawaii, we brought my old Honda and did not purchase a second car for nearly two years. It was made a lot easier because we didn't have children and Hawaii has an excellent bus system. We quickly learned that cooperation and communication were key to making it work, and we did get a cell phone (this was back before they were quite as common as they are now.) Looking back, it doesn't seem hard, despite the fact that we lived a half-hour from pretty much everything.
Since then, we went single car for a longish stretch when we moved overseas, and then again coming back. I would love to go back to having just a one car again and have hopes that we might be able to do it next time we move. I'm trying to acclimate our family to walking and riding bikes as much as possible, despite living in a very car-centric suburb of DC with virtually no public transportation.
All of this is a very long introduction to a great article at Five Cent Nickel, Testimony of a One Car Couple. In this post, Matt doesn't advocate giving up your extra cars but rather tells of his family's experience during an unplanned adventure into one-car-land. The comments provide even more insight into the possibilities of surviving with just one vehicle.
Having only one car isn't a good choice for everyone, but it is an option that some families might want to consider. It requires effort but the rewards might be worth it!
July 14, 2009
It is commonly reported that financial issues are one of the top reasons that couples disagree or fight. Certainly, money is a topic that can bring much stress to a relationship. Add the craziness of a modern military marriage, with its limited communication and frequent separations, and the possibility for problems increases dramatically.
Fortunately, there are ways to prevent disagreements and misunderstandings about money. While it is easy to summarize the overall battle plan as "communication," there are specific tactics that can ensure that the communication is effective and efficient.
Share information. Both partners need to know about your assets and liabilities, your cash flow, and your overall financial picture. The level of detail that an individual feels they need to know is up to that individual - their partner should respect their wishes for information.
Work together. Financial plans have the best chance of succeeding if both parties have had a chance to create the plans. The doesn't mean that one partner makes the plans and the other partner is coerced into agreeing, but rather that there is actual back and forth discussion before agreement.
Set big, long-term goals. Do you want to buy a house? How long do you want to keep working? What type of lifestyle appeals to you? For newlyweds, some common goals might include starting and funding IRA/TSP/401k account, buying furniture, paying off student loans or credit card debt, or saving a small emergency fund. Once those goals have been accomplished, move on to other goals. Having a big goal makes it easier to stick to your plans.
Consider setting rules for yourselves, such as not making any purchases over a certain amount without consulting the other party, or never carrying a balance on your credit card.
For more suggestions, read Let's talk credit: 8 must-have couple conversations, by CreditCards.com and Ten Ways to Improve Financial Intimacy in Marriage by Bible Money Matters. If you communicate and work together as partners, you can alleviate much of the stress that surrounds financial issues. Your marriage will be stronger and happier because of it.
July 13, 2009
Self-employment often looks good to military spouses looking for a flexible and mobile careers, and to military members looking to supplement their military income and possibly prepare for a job once they leave the military. There are many benefits to self-employment, but there are also many negatives as well. The Happy Rock has put together an enlightening post called 29 Reasons Why Being A Part-Time Entrepreneur Sucks. I agree whole-heartedly with everything in the article, and I have a few more that I think apply to military families:
Moving is disruptive. Even if your business is online, you'll still have downtime as you physically move. A physical business will surely suffer with every move, as you will basically have to build a new business at each new location.
Small businesses don't like deployments. If the deployed service member is the business owner, the deployment can kill the business, or at least have a huge impact. If the military spouse is the business owner, the spouse will find the usual demands of entrepreneurship more challenging, especially if the couple has children. The temporary single parent and small business owner combo is really, really hard - we all still get just 24 hours in the day. (And as I write this, my 9 year old has stumbled out of bed to ask, "When are you going to bed?")
Running a home-based business can affect your housing situation. If you are living in already-small government quarters, running a small business (if allowed) will eat into your living space. If you live on the economy, you will be looking for a space that will work with your business, making house-hunting more challenging.
I don't mean to suggest that entrepreneurship is a bad idea for military families, but rather to point out that there are challenges with any small business, and some of those challenges can be compounded by the military lifestyle. It can be a lot easier to deal with these potential problems if you are aware of the challenges before you start, or if you know that you are not alone in facing those challenges once you've gotten into it. Being your own boss can be a great choice for a military member or spouse who has the right skills, ideas and attitude to persevere in spite of the obstacles.
July 12, 2009
I found this excellent chart at Visual Economics (thanks to ericabiz at Twitter). It breaks down the spending of an "average" US economic unit. Fascinating stuff. Do you notice anything odd?
Graph by Visual Economics. click on the picture to make it larger and easier to read.
Here's what I think is unusual about this chart: there is no mention of savings. Now, we know that people are saving. But where?
July 11, 2009
My family loves books. We love to read them, we love to buy them, we love to terrorize the movers with the sheer volume of them. One thing that this family's Chief Financial Officer doesn't like, however, is the price of them. Seriously, it is insane how expensive books can be.
Fortunately, I've discovered a couple of excellent ways to keep the prices of books down:
photo by: chillihead
Half.com - this is my absolute favorite way to buy books (and movies and music, too.) At Half.com, individual sellers list their new or used media at excellent prices. Most books I've purchased have been less than $5.00 including shipping and handling, and by ordering more than one book from the same seller you can save even more. Popular or specialty books can be more expensive, but still usually quite a discount off retail. Depending on the purpose, I can order a brand new book (like for a gift) or a slightly used copy. I've been delighted with the prices, the service, and the books usually come quite quickly. IN addition to the great prices, Half.com has a phenomenal selection of rare and out-of-print books, plus searching online is quick and easy.
Scholastic book clubs - if you have a child in public schools in the US, you may have seen the Scholastic book club order forms coming home. Scholastic's books are often at a great discount off of the regular retail price. If your child's school doesn't participate or you homeschool, you can register online at Scholastic to access their excellent prices and nice selection. In addition to traditional children's books, you can find excellent values on popular titles that aren't age specific: Harry Potter, the Chronicles of Narnia, etc.
Yard Sales - these can be hit or miss, but occasionally I'll run across a yard sale with a nice selection of books that interest me. Prices are usually fantastic (25 or 50 cents a book).
The library - most libraries have a small area where they sell books that have been removed from circulation or books that have been donated to be sold. If you are lucky, you might stumble across last year's bestseller for a dollar or two, plus proceeds benefit your library.
Thrift shops - most thrift shops have a book section. The selection is sometimes questionable but the prices are usually quite good. Look for half-price days, dollar days, or bag sale days for even more savings.
Used book stores - check your area for used book stores and pay them a visit. Quality, selection, prices and service vary widely between used book stores, so don't quit looking at used book stores just because the first one (or couple) don't feel right to you. Many offer credit for selling your old books, which can help clear out books that aren't being loved and make room for new titles.
Loving and buying books doesn't need to break your budget. Use these six strategies to keep your shelf full of fresh reading material without emptying your wallet along the way.
July 9, 2009
We've all heard the ads on the radio: "Do you have old gold and silver? Bring it to Joe's Jewelers and we'll turn your unwanted items into cash." The number of stores and companies advertising that they buy gold has been increasing over the last year or so, and so are stories of scams and bad deals. Is selling your gold and silver a good idea? Is it safe? Will you get a decent price for your items?
A few weeks ago, I decided that my jewelry box needed a thorough cleaning. It was full of mismatched earrings, broken jewelry and items that I'll never wear. After sorting out the trash, items for the kids' dress-up box, and things that need repair, I had a few items that I didn't want but seemed like they might be valuable. The small pile included four mismatched gold hoop earrings, my high school class ring, a charm, two odd rings that I'd never liked, a broken bracelet, and four broken necklaces. I put them in a baggie in my drawer and figured that I would deal with them some other time.
Being uptight, as I am, I figured that I would do a ton of research before talking to anyone about selling these items. I was afraid that a disreputable dealer would take advantage of my lack of knowledge about jewelry, and I didn't want to make a bad decision. I read a bit online, where the advice included knowing the karat of your jewelry, weighing it before you went in, and knowing the daily cost of gold. Consumer Reports recommends this online calculator to figure out how much your gold should be worth, then trying to get at least 85% of the calculated value when you sell the items. I saw several problems with these suggestions: I don't have a jewelry scale, not all of my jewelry was readily identifiable as a certain karat, and I'm pretty overwhelmed trying to manage a family while my husband is deployed. Non-essential items need to be dropped, and honestly, all that stuff seemed pretty non-essential to me. I figured the jewelry would continue to clutter up my drawer indefinitely, if my high school ring is any example. I haven't worn my high school ring in at least 20 years and I've been moving it around all this time.
Then I saw an advertisement for an old, established local jeweler that mentioned that they buy old gold jewelry. I was going to be in the area this afternoon for another errand, so I dropped the baggie in my purse and stopped in.
When I entered the store, the salesperson greeted me and I said that I was interested in getting rid of some old jewelry. I feared that I would be treated a little poorly, but he was very cordial and cheerful, and invited me to a desk off to the side of the sales floor. He looked at all my jewelry carefully, first checking with a jeweler's loupe to look for any identifying stamps and sorting the jewelry into different carat weights. A few chains and the charm were returned to me as not being solid gold but it was done in a very polite and friendly fashion. He then tested the pieces that he couldn't identify visually, using a small kit that contained a dark stone and several mild acidic solutions. When he was finished, we had three small piles: 10K (my class ring, a small thin ring, and a broken chain), 14K (two hoop earrings, one thin ring and a broken necklace), and 18K (one broken bracelet and two hoop earrings.) He weighed each pile and then multiplied the weight by today's selling price, as listed on a small flyer-type piece of paper. After finishing the calculations, he presented me with an offer of a little over $200 for the items.
I'll be honest, I didn't know if this was a good price or not. However, I was considering the money to be a bonus for cleaning out my jewelry and getting rid of some unwanted or unusable pieces, and I appreciated the ease of the transaction, so I accepted the offer. If I had been seriously interested in the financial side, I would have taken his offer home and done more homework to see if I could find a better deal elsewhere. I have specifically NOT calculated the value of what I sold because I don't really want to know. I'm happy with the deal I made and I don't want to be made unhappy at this point. The entire process took less than a half hour, it was convenient and pleasant, and I've cleared some clutter out of my life. The money is a pleasant reward but not my primary motivation.
I'm not really sure I'm qualified to tell you the best way to sell your gold for the maximum profit, but I suggest you consider the following questions:
Considering your goals, your personal time constraints and your own preferences will help make selling your old jewelry a positive, and hopefully rewarding, experience.
July 8, 2009
Good news! Beginning July 1, 2009, states are required to offer in-state tuition to active duty military members, their spouses, and dependent children, who reside or are permanently stationed in their state. In addition, once enrolled and paying in-state tuition, they will not lose the in-state tuition rate if the service member is reassigned outside the state, as long as they remain continuously enrolled at the institution. This is a great change for military families across the country.
This change is a part of Higher Education Opportunity Act (H.R. 4137), which extends the Higher Education Act of 1965 (HEA), and applies to all public institutions that receive funds under the HEA program.
The Department of Education has worked with the states and their university systems to ensure that they are aware of the changes in the law. If service members or their families find that their school is unsure about the law, they should contact the financial aid, registrar’s, or Veterans Affairs’ office at the institution. If they are unable to resolve the situation at the school level, they can contact the Department of Education’s Ombudsman’s office (toll-free at 877-557-2575) or utilize the online Ombudsman Assistance Form: www.ombudsman.ed.gov/OmbudsmanWebApp/do?action=getRequest.
As a military spouse who has paid out-of-state tuition on more than one occasion, I am delighted to see this change occur. This will remove one more barrier to pursuing further education and improve the quality of life for many military families.
July 6, 2009
Saturday's Wall Street Journal online featured this excellent article: Ten Ways Banks Take Your Money. Most of these fees can be avoided by using a good credit union or banking with USAA, but some small fees may start appearing on good accounts as banks and credit unions adapt to the changing economic environment. Knowing the places to look is your best defense against paying unnecessary fees and charges.
July 5, 2009
I ran across this neat visual explanation of what a trillion dollars would look like: What does one TRILLION dollars look like? I knew that one trillion dollars was a lot of money, but I didn't really quite grasp just how much it is. I'm not entirely sure that I've completely digested it yet, but the picture really helps me a lot.
July 4, 2009
The Virginia State Legislature has made a few changes to the Landlord-Tenant laws in Virginia and those new changes are effective as of July 1st. The most important change is a requirement that landlords notify their tenants, in writing, if the mortgage on the rented property has gone into default or if a pending foreclosure notice has been received.
In the past, renters have been surprised to discover that their rented home has been subject to foreclosure proceedings. If properly applied, this change will benefit renters greatly. The potential problem is that most landlords aren't familiar with the landlord tenant laws, and it seems likely that some landlords won't adhere to this new law. When facing a foreclosure, the landlord is probably dealing with multiple problems at one time and talking to the tenants might be the last thing on their mind, or that they want to do.
You can read the complete changes to the law at HB 2080.
Regardless of what state you live in, there are some common thoughts on foreclosure and tenancy:
How can a renter protect themselves from a surprise eviction due to a landlord's mismanagement? First, keep an eye on the mail and the local papers. Foreclosure proceedings are published in the newspapers, and foreclosure notices may be sent to the property address. If you have reason to suspect that your landlord might be facing foreclosure on your home, call your local courthouse and ask them how to check.
What if you discover that your landlord is facing legal action? Check with an attorney who works in your area. One possible choice is to make your rent payments into an escrow account held with a third-party (someone other than you or your landlord.) This way, the payments are still being made, but you aren't just handing the money over to a landlord who isn't paying the bills.
For links to state specific information, see What If Your Landlord is Foreclosed Upon?
Also, be aware that the military does pay for moves due to landlord foreclosure. See Some Relief for Military Renters for more information.
July 3, 2009
"He that is of the opinion money will do everything may well be suspected of doing everything for money."
July 1, 2009
One place where I occasionally make a mistake with my finances is paying the credit card bills. We have two cards that we use regularly, plus we have a couple of cards that we don't use - a military Star card, my husband's American Express, and I have an extra Mastercard (I don't know why.) I pay all the bills online by making manual transfers. Once every couple of years, I will forget to make the payment by the due date. In the past, this was a minor inconvenience, as our cards are all with reputable companies and they've never assessed any nonsensical fees because of my slips. One time, however, my husband's interest rate went up from 7.9% to 9.9% because I didn't pay his bill on time. I hadn't set up automatic payments because I like to pay the whole balance, but I'm not always exactly sure that there is going to be enough money in any single account. This is especially true if we are traveling or PCSing.
Fortunately, I've figured out a solution that works. I have set up all my credit cards to automatically debit the minimum payment from my checking account on the due date. The minimum payments aren't much, so I'm not in danger of overdrafting my account by making the minimum payment, but it makes sure that a payment is made. So far, it has worked great!
July 1, 2009
The Paycheck Chronicles has been noticed a few places around the internet this week:
Both these compilations include many fantastic and informative articles. I encourage you to click over to read more good stuff.
Welcome to Military.com's Finance channel blog, hosted by military spouse and finance writer Kate Kashman. The military money experience is unique and challenging. The Paycheck Chronicles is here to help with daily tips on the special financial situations of military servicemembers and their families
Got a question or advice based on a real world money experience? Click on the "Tell Kate" link to the right and let us know about it.
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The content on this blog are my personal opinions and thoughts. I am a blogger and writer with a strong personal finance background. However, I am not a certified financial planner or financial professional of any sort, so content on this personal finance blog should be treated as entertainment only. Listen to what works with you, verify it with the real professionals, and make your own decisions.
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