Archive for May, 2010

Money Mavens: How to Not Go Anywhere and Still Have Fun During My Summer Vacation

By: Mike | Date posted: May 31, 2010 (5:00 am)

At the Money Mavens Network, we have decided to share our summer vacation projects. It is always fun to see what others are up to during their vacations so we can get more ideas for our own.

On my side, summer vacations will be pretty quiet this year. I am still taking my 2 weeks of vacation but since I am broke, I’ll be looking for frugal-stay-at-home (most of the time) kinds of activities. We recently purchased a second car, we will move into a new house and I will reimburse the loan from my parents shortly. This is how we ended-up with no budget for summer vacation this year ;-) .

So how can we still have fun while staying home for our summer vacation?

When you think about it, there are several things you can do even if you don’t plan on going somewhere for your summer vacation. My wife and I sat down and started thinking about some cheap activities:

#1 Picnic by the lake

We are lucky enough to live in a city with a huge public lake. There are water games, playground for the kids and a nice place to have a picnic by the lake. While the kids will have fun in the park, we will be able to enjoy a nice sunny afternoon on a comfy blanket.

We will probably rent a kayak for an hour or two. This won’t cost too much and will be a great activity for the entire family.

#2 Invite people over

Since we are not going anywhere, why not invite people over for a BBQ? We will invite a bunch of our friends and everybody will bring something to eat. Hot dogs and hamburgers are quite cheap and when friends bring chips and refreshments, we’ll be all set to have a great time :-D

#3 Museums and libraries

I like to learn new something new everyday and I like to share that with my children. On a rainy day, we will prepare to visit a museum or will borrow a few books from the library. Here again, these are cheap activities and we will have the opportunity to spend quality time together.

#4 Camping!

We are planning to go camping for 2-3 days on a trip. While this option is not completely free, camping is a good compromise between going away and staying home for the entire 2 weeks! It will be a lot of fun to chase bugs and tell my children scary tales ;-) .

#5 Building a cabin in the trees

Now that we have purchased a house with a lot of land with plenty of trees, my son asked me for a cabin in the woods. So we will gather building materials here and there (and maybe recycle old furniture at the same time ;-) ) and we try to build something. I am not a handyman but I am very excited about the fun we will have to hammer nails with my son ;-)

#6 Take some time off for me!

I have a few books that I got for Christmas and a few videogames that I have wanted to try. This will be the perfect occasion to just escape to my cave, turn on the TV and relax! There is nothing like reading a good book in the sun with a nice glass of wine ;-) I just can’t wait for that moment of peace!

So as you can see, my summer vacation will be pretty quiet and frugal this year. In the end, what is really important about vacation is to:

#1 Take some time to rest

#2 Have a good time with the ones you love

Once those 2 objectives have been met, I will consider that my summer vacation is a success.

Now let’s take a look at what other members of the Money Mavens Network have to say about their summer vacations:

Having Fun Yet? 8 Ways To Ensure Your Road Trip Sucks @ Len Penzo

Cheap Vacation @ Canadian Finance Blog

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Green Panda; What is Cool Around the Web This Week

By: Mike | Date posted: May 28, 2010 (5:00 am)

Every Friday, I’ll pull out the 15 coolest personal finance article I found on the blogs I read weekly:

#1 Top 5 Personal Finance App on Androids @ 20 Something Finance

#2 Using credit cards overseas @ Money under 30

#3 Why Buy IPO Stocks? @ The Oblivious Investor

#4 Extreme circumstances call for extreme measures @ Enemy of Debts

#5 12 business ideas with low cash down required @ Wealth Pilgrim

#6 The 5 Biggest Home Repairs Ripoffs @ Len Penzo

#7 How To Pay Off A Mortgage Early @ Money Help for Christians

#8 How much our debt costs @ Debt Free Adventure

#9 Looking to start a business? @ Studenomics

#10 Maternity Leave and Parental Leave 101 @ Canadian Finance Blog

#11 104 ways to save money @ PT money

#12 Nintendo Wii to cut down on gym membership @ The Digerati Life (I think the Wii is overrated when it comes down to exercise!)

#13 Don’t devaluate yourself @ Budgets are Sexy

#14 Which IRA should I invest in? @ Christian PF

#15 Co-signing for a loan : Never a good idea @ Smart on Money

Debt Repayment Strategies

By: Mike | Date posted: May 27, 2010 (7:14 am)

When I had announced that I bought Green Panda Treehouse, I asked you which kind of topics you wanted me to cover. One of them, was to explore debt repayment strategies. Especially in these rough economic times, paying off your debt becomes the #1 priorities. So I sat down and started thinking about all the ways I know and use to pay off debt. There are also several the experimental debt repayment strategies included. Since I came up with a lot of ideas, I thought of listing all the debt repayment strategies that I know today then follow up with a full detailed post on each of them later on. As you will see, some are very basic while others are quite original.

#1 Flip and Pay Back Your Debts

The flip and pay back your debt strategy only works for a limited time. This is for people with credit card debt with high interest rate. By flipping your debts to a zero percent balance transfer credit card and maintaining your minimum payment, you will still end-up paying off your debt during the zero percent promotion. Unfortunately, these cards offer a low balance transfer rate for only a limited time period.

#2 Consolidate Your Debt

As a banker, I have seen many people lose control of their debt because they were taking too much time to manage the ten thousand statements they received per month instead of managing their budget to repay the debt. Consolidating all your debt into one loan with a fixed rate and determined amortization is a great way to clear your debt, once and for all.

#3 Snowball Debt Repayment Strategy

Snowballing has been one of the most popular debt repayment strategy over the past few years. Combined with a frugal way of living, it has a powerful impact on how fast you can pay off your debt. By concentrating your effort into a single debt until it is gone and use this extra money to pay off the next one, you are growing your monthly debt repayment pace each time you pay off a credit card.

#4 Use The Cutter To Pay Down Your Debts

Take your budget as is, cut down all the extra expenses and start a very frugal way of living. Use all the “unused” money towards your debt. The cutter is a very demanding debt repayment strategy but it is definitely effective!

#5 Track Your Expenses Like a Hunter

This is a slightly different strategy than the cutter since tracking down your expenses is done on a daily basis. Each time you are about to take your wallet out of your pocket, you think twice and each time you don’t spend your money, you take the same amount and apply it on your debt. This is a trick to ensure you always have your debt repayment strategy in mind.

#6 Remodel Your Life to Pay Back Your Debt

Instead of doing a classic budget review and cut where you can, do it differently. The classic way of cutting in your budget is to ask yourself: “is this expense necessary or can I live without this one”. While managing your budget is important, there is only so much you can cut when looking at your expenses this way. So try something new: Instead of starting from your established budget, start from a blank sheet of paper. Write down what you need each month and how you can manage it so it costs less.

#7 Make a Debt Repayment Schedule

This is definitely my favourite way to pay back my debts. I sit down and make a debt repayment schedule. I combine different debt repayment strategies together in order to get maximum results. I setup a plan so I know how much I will be paying every month and when I will become debt free. Having an objective, a date ensures your motivation is at its highest.

Do you know any other debt repayment strategies?

While I will cover these 6 debt repayment strategies in detail in the near future, I’d like to know if there are any other ways to pay down your debts you would like me to cover.

Using a Temporary Job For Extra Income and Savings

By: Green Panda | Date posted: May 26, 2010 (6:00 am)

It’s been a busy month this May. Besides working with my regular freelance work, I’ve been working on a temporary job. It’s a nice two week assignment (plus part time hours training earlier this month). The work is good and the office has a wonderful and friendly staff. It makes much easier.

I’ve worked other temporary jobs as needed, the most recent being several stints with the 2010 Census operations. This opportunity worked well as it as on an as needed basis. I’m happy I took it because we get to work on a few goals.

Goals for the Extra Paychecks

It’s nice to have 3 extra paychecks this month. We’re keeping on track with our monthly cash flow, so we can kind of spend this money as we please. Two goals we have for the extra money are:

I’m keeping simple with my two goals. I have a responsible side that wants to put some more money into our emergency fund for some peace of mind. My other side wants some cash just to have around for our trip so we can have a debt free vacation.

Finding Temporary or Part Time Work

Are you trying to pay down some debt, build some savings, or reach a financial goal? Does your current income make it hard to reach your goals? You may want to do some temporary/season work on the side or even have a part time job for a certain period of time.

  • Pizza Delivery: This is a popular choice with the Dave Ramsey crowd; mainly because of the flexible hours and the ability to some money with tips.
  • Hotel Reservations: This can be a low stress job depending on where you work.
  • Waiter/Waitress: This is another flexible job with tips available for pay.
  • UPS: Around the holidays, UPS hires a lot of temporary employees to help out with their increased workload.

You also need to ask around to see if some jobs pay as well as you think. I’ve heard that delivery drivers don’t make much moneyfrom tips, as some people are tipping low (if at all).

My only big warning is to count all the costs of the work, not just the pay. Will it affect your school schedule? Will it affect your performance at your main job? If you have a family, how will you juggle your responsibilities?

It may be hard to picture yourself working even more hours, so maybe having a specific goal or time frame for the extra income can help it become more manageable.

Your Thoughts on Extra Income

Have you taken another job to reach a financial goal? What was the hardest part of having two jobs? Was it worth it?

How Much Time Do You Take To Manage Your Personal Finance?

By: Mike | Date posted: May 25, 2010 (7:56 am)

Taking care of your personal finances, while rarely urgent, remains very important. The problem is that most folks don’t really like to manage their personal finance (or anything else that is important but not urgent). Call it procrastination, call it laziness or call it hiding from the cold hard truth; delaying the moment when you sit down and look at your financial situation can be very expensive.

In this article, I offer you a simple routine to review and adjust your personal finances on a regular basis. In order to avoid feeling overwhelmed, I suggest that you manage specific tasks according to given blocks of time. Therefore, you will be able to manage your personal finance in a more effective manner. So, I am sharing how I manage my personal finance on a daily, weekly, monthly and annual basis.

Manage your personal finance on a daily basis: quick overview

Each day when I arrive home from work, I take 5 minutes to look over my personal finance. Within this 5 minutes I:

  • Open the mail and email (review statements)
  • Login into my bank account to make sure that  my accounts, lines of credit are in order (no strange transactions)
  • Log my purchases for the day into my budget software

Since I just take 5 minutes, I do not pay any bills or scutinize the transactions one by one. I just make sure that everything is normal. When I have bills to pay, I put them in a separate basket to take care of later on.

Manage your personal finance once a week: quick actions

Now that my day-to-day finance is under control, I make sure to spend about 15 minutes per week to “clear” what’s on my desk. This is when I:

  • Pay the bills I received during the week
  • Make sure I have enough money for the upcoming bills
  • Take a brief look at the upcoming weeks to see if there are any one-off expenses

Manage your personal finance once a month: supervising the real stuff

Once a month (usually the first weekend of the month), I sit down and take a look at my personal finance for a good 30 minutes. During this time I:

  • Make sure I have followed my budget
  • Look at the upcoming month for unusual expenses
  • Look at my investments to make sure everything is on track
  • Calculate my net worth to see if I’m going forward or backward

Manage your personal finance once a year: planning the real stuff

This is probably the most important part of my personal finance management. This is when I look at what has been done over the past 12 months and plan for what is coming up. This is also where I set my priorities for the next 1, 2, 3 years:

  • Compare my net worth to last year
  • Review my financial goals and make sure I have reached them
  • Establish my new goals
  • Review my budget and look where I spent the most (I know it already; dining out!).
  • Determine the amount I give to charity
  • Review my retirement plan

As you can see, this step can take a few hours up to a full day to plan (especially when you do it for the first time). However, this is the day in your year where your time is definitely well invested!

Do you have any tricks to manage your personal finance?

I’d be curious to know what your tricks are when it comes down to managing your personal finance. Do you do it on a monthly basis? Yearly basis?

Green Panda; What is Cool Around the Web This Week

By: Mike | Date posted: May 21, 2010 (5:00 am)

Every Friday, I’ll pull out the 15 coolest personal finance article I found on the blogs I read weekly:

#1 Preet is giving away an Ipad @ Where Does All My money Go

#2 How to save on home maintenance @ Fiscal Geek

#3 Watch your credit card statement @ Budgets Are Sexy

#4 Financial advisors are investors too @ Dinks

#5 So are markets efficient? @ The Digerati Life

#6 10 Fun summer jobs @ PT Money

#7 Extra 7 hours a week @ Financial Samurai

#8 Saving money with an Iphone @ Canadian Finance Blog

#9 8 personal finance spring cleaning ninja moves @ 20 something finance

#10 3 little way to boos your emergency fund @ Money under 30

#11Your financial mindset determine your ability to handle your credit cards @ Enemy of debts

#12 Do you need mortgage life insurance @ Wealth Pilgrim

#13 Why your expensive luxury car doesn’t impress smart people @ Len Penzo

#14 Is it an investment or a home? @ Money Help for Christians

#15 One more refinance @ Joe Taxpayer

Carnival of Personal Finance EDITOR’S PICK!

Carnival of Money Hack

Friend or Foe: The Credit Card

By: Mike | Date posted: May 20, 2010 (8:22 am)


Personal finance is definitely a complex topic. In fact, financial answers are rarely  black and white. Everybody has their own opinion about how to manage one’s money and there is often more than one right answer. This is why I decided to create this Friend or Foe series. Over the upcoming weeks, I’ll take different financial tools and explain how it can be your friend or how it can be your foe.

Today, we start with one of the most debated financial innovations (or devil’s creation): The Credit Card: Friend or Foe?

Why your credit card is your worst enemy

All right, I’ll start with the easy stuff. It’s easy to hate credit cards and here are a few reasons why they can really be harmful to your personal financial health:

But I think that credit cards are your friend!

Huh? Say what? I just spilled all my venom on credit cards and now I will tell you that this is one of the most amazing personal finance tools ever created? I must be crazy ;-)

The problem is not the credit card, it is you!

Let’s be honest for a second. Stop reading, grab your car keys and jump in. Look at the speedometer. It probably says that the machine can go over 100 mph. Do you really drive at that speeds?

So if you sit back down in front of your computer, take your wallet out of your pocket and look at all your credit cards; do you really have to rack each of them up to their credit limits every month?

If you can control your credit cards, they can become your friend for many reasons:

  • It’s the easiest way to build a solid credit score as your actions are reported monthly. Pay it off completely each month and you will build a stellar credit report.
  • It’s also an easy way to gather rewards. I personally use my credit cards for all purchases. Therefore, I gather points on every bought. At the end of each month, I pay my credit card in full. I simply don’t have to avoid emotional purchases over the month and I have enough in my bank account to cover.
  • 0% APR balance transfer credit cards are also an easy way to get (temporarily) out of the mud. However, jumping from one credit card balance transfer to another is not a viable solution. Before you apply for a 0% Apr balance transfer credit card, make sure you have determined a plan to pay it off.
  • Credit cards allow you to use other people’s money to work for you for FREE.  I make all my regular monthly purchases the day after my statement is printed and have 6 weeks before the payment is due.  It is like an interest-free cash advance!
  • My credit card allows me to have additional insurance on all my purchases and coverage while traveling. This is how I save a lot of money on insurance and extended warranties!

In the end, I find that credit cards are more your friend than foe. However, it is a volatile friend that you need to be able to manage well in order to get along ;-) .

Are You Willing to Cut Back to Live Better?

By: Green Panda | Date posted: May 19, 2010 (5:13 am)

As you know, we’re going to Los Angeles next month for some fun and sun. It’ll be our first time there and we’re looking forward to going.

Dave Ramsey has a saying he’s fond of ” If you live like know one else, later you can live like no one else.” He has a point, if we’re willing to work harder towards a goal than most people, we’re probably going to succeed more than most people. Thinking on a much smaller scale, we want to scale back on our spending here for a bit so we have a bit of fun next month.

Money isn’t an infinite resource in our house, so we have to make the most of what we have. That starts with us anticipating some expenses for the trip.

Vacation Expenses

Some expenses we’re planning for the trip include:

  • Eating Out ($200)- We’re not going to eat out every meal, but I really would live to try out some local places while we’re there.
  • Car Rental ($200)- It seems like this would be a good option since we really want to explore the area.
  • Miscellaneous($100)-  I’m not big on buying a ton of souvenirs, but I’ll pick up something along the way.

We snagged our hotel at a great prices, but airline tickets even with a discount are expensive. To make sure we have some money to play around with, we’re cutting back on some expenses now.  Our hope is to have some more money in the vacation fund besides the food money we allocated.

How We’re Cutting Back and Building Savings

First on the chopping block is eating out. The good news is with the healthier eating habits we’ve been using, we’ve unconsciously cut back on eating out. The plan is to be very selective when we do go out and make sure we take advantage of deals and specials. We’re also inviting friends over or going to friends’ houses instead of just going out to eat.

We also have an other income stream this month with a temp job, so that money is going straight into savings. I had done extreme savings with temp jobs I’ve taken (saving 60-80%), so this is doable. The trick is to deposit and set up an automatic transfer ASAP.

Your Thoughts on Vacation Spending

We like to over estimate expenses rather than assume we’ll be completely frugal on the trip. How about you? How you do you financially prepare?

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