Archive for September, 2010

What’s Cool Around The Web

By: MD | Date posted: September 30, 2010 (11:44 pm)

Another week has gone by and it’s time to look at some of the top articles from around the blogosphere:

1. The Money Index– Your Source For Everything Finance.

2. Don’t Trade a Boss For Something Worse @ Financial Samurai.

3. You Always Have Options @ Debt Free Adventure.

4. Benefits of Costco Membership @ Couple Money.

5. The First Time Is Always The Worst @ The Financial Blogger.

6. Protect Yourself Against Mail Identity Theft @ 20-Something Finances.

7. Invest or Pay Off Mortgage? @ Do Not Wait.

8. Too Early For First Home Purchase? @ Budgets Are Sexy.

9. Why College Students Should Invest In a Roth IRA @ Studenomics.

10. Passive Income Tips For College Students @ PIN.

11. Building An Inexpensive Office Wardrobe @ Canadian Finance Blog.

12. Age Discrimination In The Workplace @ The Digerati Life.

13. Is It Just Me or Is It Too Good to Be True @ TDGB.

14. What’s Good Debt? @ Good Financial Cents.

15. Buying An Existing Business @ Wealth Pilgrim.

Four Reasons Why YOU Are Broke

By: MD | Date posted: September 30, 2010 (6:00 am)

It’s easy to pass the buck so to speak. We have become used to passing on blame to others for our problems. It’s easy to blame weight gain on the fact that there’s so many fast food joints around. It’s easy to blame poor financial habits on the abundance of  spending options available to us. Today we will not be playing the blame game. It’s now time that you take full accountability for your finances by understanding why you are broke:

Reason #1: You have no income.

Either you have no income or you simply don’t make enough money. This is usually the main reason most young people are broke. The obvious reason is that most college students claim to not have enough time to work. The quick solution to this is to start your own side business in college. If you don’t have the entrepreneurial spirit, you can always apply for a part-time job around campus. You won’t make a fortune, but at least you’ll have money coming in to prevent you from going broke. If all else fails you can check out online jobs for college students.

Reason #2: You spend more than you earn.

There’s just so much stuff out there that we want to buy. Every time I walk into a clothing store I feel like losing my mind because I fall in love with everything I see. Spending more than you earn can spell a financial disaster for you. At first it may only feel like you have a few dollars on your credit card. As you begin to spend more than you earn that few dollars can end up being a few thousand dollars. Add a few years to the mix and you’re in massive debt because you chose to spend more than you earn. I’m not here to preach to you guys. I just hope that this serves as a wake up call if you find yourself in this situation.

Reason #3: You follow every single trend.

Following trends can kill your finances. I would love to buy the new iPhone 4 but I know that it’s not in my budget at the moment. Many people go into credit card debt early in their working lives because it seems like so much fun to follow the newest trends when it comes to technology, clothing, and even eating habits. The trick is to practice delaying your purchases. I will get the newest iPhone. Just not right away. I will buy it when I have enough money in my checking account to cover this purchase.

Reason #4: You think personal finance is a waste of time.

Many young people simply can’t be bothered to worry about their finances. Some will argue that they will earn lots of money after college, so they can rack up debt now and pay it off later. Others simply don’t care. I’ve had buddies scoff at me for writing about personal finance. What’s their strategy? To make lots of money and not have to worry about managing it. I hate to break it to you but that’s not how it works in the real world when you have expenses to pay for.

If you don’t at least attempt to think about your finances, you’ll never get ahead and you’ll only find yourself broke. You don’t need to track every penny or live like a miser. You just need to understand where your money goes and why it goes there. That’s all.

This list could go on, but I feel that if you take care of the four reasons above, then you’ll be on the right track to managing your finances well now and into the future. Don’t worry next weeks topic will be much more fun. Just needed to cover this important concept guys.

(photo credit: nesster)

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Protecting Your Computer with Free Antivirus Software – A Good Deal ?

By: Green Panda | Date posted: September 29, 2010 (5:00 am)

If you’re like many college students today, you depend on your computer for your education. Papers are planned, researched , and written with it. Group project assignments are broken down and delegated online. Without a computer, you’d probably have a hard time getting things done efficiently.

Your computer is a valuable tool for your education. You want to make sure it’s protected, but you lack the budget to buy the fanciest antivirus software. Is it possible to protect your computer without going broke? Are there advantages to getting the paid versions of programs? How can you tell if you picked a program?

AntiVirus Software – What’s It Good For?

What exactly does antivirus software do? They protect you from malware that can harm your computer and files. It can also detect and remove spyware from your system as well.

Malware is a broad term and can include the following:

  • Viruses
  • Trojans
  • Worms
  • Spyware
  • Adware
  • Keyloggers

While no antivirus software can keep ahead of problems, the best ones can add valuable protection.

Top Free Options

While there are many free antivirus programs out there claiming to be free and safe to use, here are some proven ones.

Personally I’ve been using Avira AntiVir for my laptop and so far it’s been pretty good. Microsoft Security Essentials has a good reputation for offering good protection.

Are the Paid Versions Worth It?

The big question is, does the free software work as well? Should you fork over the money to buy the latest edition? I can’t give you a definitive answer, because you have to examine the quality of service you’re getting for a paid version to see if it’s really worth it.

I have relatives that benefit from having the paid service since they tend to call customer service a bit.

If you’re looking for some solid paid programs, you probably have to look no further than the trial versions that come with new computers. Some of the free antivirus software listed above also offer paid versions.  If you’re looking for software that is a bit more known, the 3 most popular ones right now are:

  • Norton
  • MacAfee
  • Kaspersky Anti-Virus

Check them out and see if they offer you any additional benefits. My family has used MacAfee and Kaspersky and has had great success with them.

Your Take – Antivirus Software

For now, using the free programs has worked well for me. If it changes, though, i’m more than willing to switch over to a paid service. How about you? Is getting the free version a frugal choice or is it being cheap? What’s been your experience with antivirus software?

The Power of Greed

By: Mike | Date posted: September 28, 2010 (9:29 am)

Last week, I wrote an article about the power of white lies in fake it until you prove it. In that last post, I was talking about how you can make your way up the ladder faster by “improving” your reality. The only thing is that you need to back up what you are saying at one point in time. BS will remain BS if you can’t back it up and people don’t like it ;-) . Today, I want to talk about another vice; greed. One of the famous 7 sins, greed is probably the most obvious vice in personal finance. Most of us want to make money, including me. The difference between each of us is the degree to which greed fuels our motivation. If we are barely motivated, the power of greed can be beneficial without having much bad side effects ;-) .

Greed as a motivation

I know, this can be very tricky. Usually greedy individuals all look like a bunch of old crooks gathering pennies and taking money from their friends & relatives. They don’t help anybody and sleep with the pot of gold in their arms. As I had mentioned before, a lower level of greed can give you a little push…

If you haven’t got this yet, you need to understand this; money brings power. I’m not talking about the power to control the world; I’m talking about the power of changing things in your life. You need to relax; money can bring you the power of taking vacations or going to the spa. You want to make your spouse happy; money can bring you the power of buying flowers, invite him/her to the restaurant or buying gifts. You want to retire young and happy; money brings you the power to do it and allows you to enjoy retirement without financial worries. As I said; money brings power.

So if you just want a little bit more money, if you just wake up the demon of greed inside of you without unleashing it; you can use this motivation for several things such as:

- doing the extra little things at work that will make you shine for your next promotion

- doing work on the after hours to start your own side line business

- getting a second job to achieve your financial goals

- creating a budget to give you order and follow a financial plan

Beware to tame your demon!

I think there is nothing bad about trying to earn more and get your finances under control. You can use a bit of love for money as a supplement to your inner motivation. However, getting greedy by letting the demon in your mind go as it wants: can do terrible damage. Controlling your expenses and making more money doesn’t mean that you can’t help others and you have to toss people in a corner in order to get a promotion. It’s like protein supplements; if you take a small portion, you will build up your muscles; if you take too much, you won’t be in a good shape later on!

How Was Your First Time?

By: Mike | Date posted: September 27, 2010 (5:00 am)

As part of a Money Mavens group project, we have decided to talk about our first time. The first time is always exciting. You are nervous; you don’t want to make any mistakes. This is why you try to take your time even though you are very excited. I have to say it; when it comes to your first time, you really feel like a man!

How was my first time?

The first time happened right after I had my first job. I was looking for a way to treat my girlfriend and earn extra money. The problem is that while I really wanted to try it, I didn’t have enough resources. This why I applied for a line of credit and start investing with this liquidity. What? You thought I was talking about something else? ;-)

I was working in an investment loan department where we used to lend millions of dollars to clients who wanted to borrow and invest in the markets. It was back in 2003, when everything was possible. This is when I decided to follow the trend and take my chance in the big world of stock trading.

Small trades at first

I didn’t want to push my luck too much and I didn’t know much about investing at that time. I discussed the strategy with my girlfriend and she told me she was ok if I traded about $3,000 to $4,000 from the line of credit. I bought my first shares of Power Corporation, the company we were making loans for. I bought one hundred shares and I was very happy to buy a solid company paying a 2% dividend yield ;-D

Then, on with the real stuff

I soon realized that the “buy and hold” strategy was pretty boring for an active young man like me. What is even more boring is logging onto your broker’s site to look at your only position in the stock market moving at 0.2% per year… BORING! I thought I needed more challenge and while I was getting “trading tips” from people in the industry; I started to borrow more from my line of credit.

Within the span of 3 months, I maxed my $20,000 line of credit and I was making some real good trades. While I wasn’t given any insider information, I know several people operating in the stock trading field. This combined with the fact that 2003 to 2006 were very good years on the stock market was enough to create some decent yield in my portfolio.

After my first year of trading, I was generating more than 20% return. I was such fun since it wasn’t even my money ;-D.

So my first experience was awesome, I want to do more!

I didn’t change much from my first time. The difference is that I am not investing on the stock market anymore but I am investing in my own company. The dividend yield is much higher and it is a challenge everyday ;-D. If I had to start all over again, I would borrow the 20K and risk it. In the end, when you are in your early 20s, 20K is not that much to risk!

Other Money Maven’s first time:

Canadian Finance Blog says “I should have bought ETF’s”

Monevator’s first time

Image credit

What’s Cool Around The Web

By: MD | Date posted: September 24, 2010 (11:22 am)

Let’s catch up with some of the top articles from around the internet:

1. Renters Should Pay More Taxes @ Financial Samurai.

2. Building An Emergency Fund @ Couple Money.

3. Break Out of Your Personal Finance Slump @ Debt Free Adventure.

4. The Cheapest Data Plan @ 20-Something Finances.

5. Don’t Go Shopping Drunk @ Budgets Are Sexy.

6. 3 Simple Ways to Invest $500 Online @ Money Smart Life.

7. Funding Options For Your Small Business @ The Financial Blogger.

8. Finding The Perfect Credit Card For College Students @ Studenomics.

9. Car Buying Websites For Online Car Shopping @ The Digerati Life.

10. The Non Latte Factor @ Good Financial Cents.

11. Banking Solutions For Travelers @ DINKs Finance.

12. Revenue Sharing Sites As Passive Income @ PIN.

13. What Happens When You Fall In Love With a Dividend Stock? @ TDGB.

14. Using a Lawyer For Debt Settlement @ Wealth Pilgrim.

15. Find Cheap Exercise @ Canadian Finance Blog.

Should You Start a Side Business In College?

By: MD | Date posted: September 23, 2010 (6:00 am)

Should you focus all of your energy on your studies or would it be a good idea to start a business in college?

This was a debate that I had the other day with a friend. He argued that he doesn’t know why I’m working on my online business because he thinks that my spare time should be spent on my studies. I do agree that taking your studies seriously is important to success during and after college. However, I feel that you should work on starting your own side business in college for the following reasons:

Time.

Ask anyone with a family or a full-time job if they could have one wish granted, what they would ask for? I’m willing to bet the shirt off my back that they would ask for more time. Everyone desires more time. Thankfully, as a college student you have plenty of time. Now I know that some of you will curse at me because your school schedule is so packed that you rarely ever get to sleep 8 hours a night. You guys are the exception, not the rule. Most college students have plenty of spare time. We just don’t utilize it properly. We spend our time checking updates on Facebook and sleeping ridiculous amounts of hours. Once you start making money doing something you enjoy, you’ll find time. Trust me. I’ve almost been smacked by friends because I’ve pulled out my Blackberry to work on an article idea during a social event. I just love to help others with money issue. You too have something that you love to do.

You need money.

Everything else aside, as a college student you simply need money. Whether you need money to pay for tuition, student debt, or for beers, it varies from situation to situation. The bottom line is that you should strive to earn as much money as possible. If a typical college student job doesn’t fit your schedule, you can always begin working on your own (even at 3AM when you can’t sleep). Starting a side business in college is the perfect chance to earn some extra cash doing something that you enjoy.

Networking opportunities.

Regardless of what small business you attempt to start, you’ll meet some interesting characters along the way. From the shady people that will try to rip you off to the really established business owners that will help you out. These are all learning experiences that are valuable to go through in college. Some of the people you encounter will help you become a better judge of character in the future. Some of the people you meet could even help you out in the future with your job hunt if you decide to work in the corporate world.

Your conditions are solid.

Let’s be honest here, your living conditions in college will likely never be matched. When you’re working a full-time job in the future or raising a family, you won’t be able to pull out your laptop to work on a graphic design at 4 in the morning after being out all evening. I truly believe that the college lifestyle is the ultimate opportunity to squeeze in time to work on your own side business. It could be something as simple as running a blog to something as complex as renting out properties to other college students. At the end of the day I feel that college students need to take advantage of this unique time.

Do you think that college students should strive to earn money on their own? If not, please share why you feel this way.

Img src: infusionsoft

Budgets and Spending Plans: Find What Works

By: Green Panda | Date posted: September 22, 2010 (5:00 am)

Last week, I was talking about some of the budget mistakes we all make. This week I want to share some budgeting systems that have worked for many people. Hopefully when you check them out, you’ll find something that works for you.

Budgets and Spending Plans

Budgets, spending plans, or whatever you prefer to call it, all have the same goal – directing your money to cover your necessary expenses, save some money for long term plans, and to give you some money for fun.

How you plan your spending should fit well with your personality if you want to have it be sustainable. There are several approaches to budgets, each with advantages and disadvantages.

Some people use a zero balance budget, where every single dollar is assigned to a bill, savings goal, charity, or for fun. Dave Ramsey is a huge believe in having a plan for every dollar.

If that’s too much planning and organizing for you then you might want to try out the balanced money formula. It’s basically allocating your net income in chunks. It’s dividing up your money in 3 broad categories.

35 -50% Needs

This include essential bills such as rent/mortgage, food, utilities, cars/transportation, etc. The simpler your lifestyle is, the lower the portion. Some suggestion would include looking into splitting expenses with a roommate, finding a more affordable apartment, or using public transportation.

20% Savings

Whatever budget method you use, it’s smart to set aside some money for your short and long term goals. They could be:

  • Retirement (IRA/401(k))
  • Emergency Fund (3 months or more)
  • House Down Payment
  • Savings for your Next Car

20-30% Wants

This includes some optional bills like cable television, Netflix, and cell phones. Vacations, concerts, shopping trips, and other personal activities are covered in Wants.

Using the Envelope System

The benefit of the envelope method is that it helps you visualize your budget. If you’re new to the envelope system, I would start small and use it for eating out or clothes. We’ll use eating out for our example.

  • Grab an envelope and label it “Eating Out”.
  • Fill it with the cash you have allocated for the pay period. (Eventually you want to get to a monthly basis, but start easy.)
  • As you spend the money, write a note the envelope how much, where, and when you spent the money.
  • When the money in the envelope is gone, it’s gone. You have to decline eating out until next pay check.

The envelope system is concrete and may open your eyes to how much money you’re spending on something. If you keep notes on your envelope you can review and see if it was worth the cost or not. It may motivate you to be more selective with your purchases.

Thoughts on Planning Your Spending

I’m curious to hear your ideas on having a budget. How do you control your spending? How did you develop a system that works for you?

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