Today’s guest post comes to us from Alban, the first guest-poster on My Personal Finance Journey. To read all of his articles, click on the following link – Alban’s previous guest posts.

Your home loan repayment may be scheduled into your budget every month, but it is much more than just another bill. 

Your mortgage is tied to one of the most important assets you will ever own, and to a home which is central to maintaining your family’s way of life. As a result, you probably have home and contents insurance for your property to cover any damages or repairs, but do you have home loan insurance?

As you read about the top five reasons to insure your home loan, can you still answer the question of why your loan is not insured?

Typically a home loan repayment will make up a third of your income – that is the ratio which most lenders use to make sure that you can afford the repayments while maintaining your lifestyle and covering your other bills. As a result a home loan is not just like another bill which you would be able to scrape together some spare funds to cover the costs if you lost your job or couldn’t work.

To cover the repayments of your home loan through your savings or by changing your lifestyle would be nearly impossible because of the amount required each and every month, but if your home loan was insured, you could keep your home easily. An additional option here for adding more security to your loan payoff is to get a loan cosigner.

As such you should set more store by protecting your home and your home loan repayments because losing your home would impact you and your family in every facet of your lives. The security of a safe home is the foundation for a happy life and whether you have four children or are a young couple, there are few places in the world we can feel as secure as we do at home, so make sure that feeling is justified.

People were losing their jobs before the Global Financial Crisis, but the shakeup has certainly made the event more prevalent and more devastating as savings, investments and interest rates mean less of a safety net for many families. Losing your job can come without warning and finding another can take some time. You also want to make sure you are choosing the right job in your search rather than snapping up something out of desperation. With home loan insurance you have the chance to assess the situation and decide whether it is time for a change of career or to pursue a passion and you can look at job loss as the opportunity it is, rather than the disaster it could be without insurance.

Illness or injury could strike you or a family member at any time and whether you are the one affected or you are the carer the household income can be quickly diverted or reduced to a dribble which is where you can benefit from the coverage of home loan insurance to continue to meet repayments. Illness and injury also often don’t come with a timeline and your family can be affected for an extended period. Even after recovery you may not be able to return to full time work or the same salary which is why you need home loan insurance protection.

In most cases you can claim the premiums you pay for home loan insurance at tax time so you can save on your income tax costs as well as protect your family and your home. With such easy and affordable options and so many good reasons to insure your home loan consider whether you and your family would be better off with home loan insurance.

Alban is a personal finance writer at Home Loan Finder. He helps people to compare home equity loans.

Get your articles in early for next week (Festival of Frugality #248). It will be hosted at Watson, Inc. Also, let Jim (the Festival organizer) know if you are interested in hosting as well. It’s a bit of work, but a great way to get your blog out there and meet new folks in the process!

Good Friday morning everyone! I hope you all have had a great week.

Shown below are the articles from My Personal Finance Journey that were selected to participate in blog carnivals throughout this past week.

Also, listed below are some of the articles throughout the blogosphere that I have read and/or commented on throughout this past week. Enjoy!

For a while now, the creation of a personal last will and testament has been on my “to-do” list. 

This was after reading several recommendations in the general personal finance books I frequently use as reference material (Personal Finance For Dummies by Eric Tyson and The Complete Idiot’s Guide to Personal Finance in Your 20’s and 30’s by Sarah Fisher).

Despite these recommendations to have a will, I had been putting off the exercise of will creation because I didn’t think I was adequately armed with the proper knowledge to know what to put in the document. Ideally, I was meaning to read The Complete Idiot’s Guide to Wills and Estates first).

However, several days ago, I came across the website below, which offered free templates for creating your own will. Needless to say, creating a will this way isn’t ideal, as it would be much better to have your will reviewed and prepared by an attorney. However, I figure that this is definitely better than nothing.

Note: The website above is also a great source for templates of other legal documents – ranging from real estate forms, rental contracts, patents, and franchise documents. Check it out by clicking on the link above!

So, I simply clicked on the website, chose the correct will template that suits my situation (not married with no kids), and filled out the required fields. It was fairly easy!

As I was filling out the fields on the will template, one of the sections caught my eye in particular – it was the section regarding what is known as bequests.

For the uninitiated, a bequest in a will is essentially a specific direction from you, the willer, for how/what a portion of your assets should be used for.

This bequest section reminded me of some gossip I heard while living in Philadelphia this year about a special bequest from Benjamin Franklin to demonstrate the power of compounding interest. After searching around on the internet, I found that Ben Franklin’s bequest, as described by the gossip, is indeed true, and is described well by Ben Franklin’s biography of Wikipedia.

An excerpt from the Wikipedia article is shown below.

Franklin bequeathed $55,000 in 2010 Dollars to each to the cities of Boston and Philadelphia, in trust to gather interest for 200 years. As of 1990, more than $2,000,000 had accumulated in Franklin’s Philadelphia trust, which had loaned the money to local residents. When the trust came due, Philadelphia decided to spend it on scholarships for local high school students. Franklin’s Boston trust fund accumulated almost $5,000,000 during that same time; at the end of its first 100 years a portion was allocated to help establish a trade school that became the Franklin Institute of Boston and the whole fund was later dedicated to supporting this institute.

Similarly, I found another example of an interesting bequest while scouring the internet. According to The Cross Roads Fund, in 1867, Benjamin Hicks left $20,000 to the American Society For the Prevention of Cruelty to Animals, with the stipulation that the interest could be used for the Society, and the principal remain intact.

As most of you know, I am planning to return to graduate school this fall to get my PhD in Engineering.

I am very lucky because in the field I have chosen to study, it is fairly standard for all full-time graduate students to… 

Recently, I began to ponder something – if we are receiving some employee benefits from the university, would it be possible for me to participate in the university’s 401k and pension benefits?

Now, let’s get real. Since my income is going to be 67% lower than what it was in my previous job, I will not be able to contribute much money in to a 401k account. This is especially true since it is more efficient to first contribute to an IRA up to the maximum limit, according to the account hierarchy as discussed previously.

After searching around online briefly, I could not really find any cases of people having found out that they could or could not participate in the university’s 401k program as a graduate assistant. 

I suppose I am probably the only one nerdy enough to think this far in to financial things. The main thing I found were people wondering whether or not they should tap in to the old employer’s 401k account to pay for the tuition of higher education. Fortunately, I do not have to worry about this dilemma.

After being turned down by my Google search, I sent an email to the person in charge of wages for engineering graduate students at my university, and her response was as shown below: 

So, the answer was a resounding “no.” But hey, it can never hurt to ask!

Recently, one of My Personal Finance Journey’s readers sent me a message to thank me for helping him to make the decision to sign up for a Roth IRA, as a result of reading the following previous posts about IRAs on this blog.

Upon asking him what his next steps were, he mentioned that now that he  had decided to open up a Roth IRA, he would go to talk to an investment professional that gives him guidance about what to do with his money at a local bank branch.

He would work out the exact details of investment instruments and the broker with which he would open his IRA with the investment professional.

The purpose of this site to is to circulate some ideas with you. Upon reading these ideas, they can then be researched further to find out if they fit your specific financial situation.

That’s our reader all-star showcase for this evening! Thanks for tuning in! 

Now that I’ve gotten the chance to settle in to my new condominium here in Virginia, I have been trying to get out to the mountains as much as possible to enjoy the scenery before graduate school starts.

Because of all of the rain we’ve had recently, it has created some pretty amazing pictures of waterfalls, like the one above I took this week of the tallest waterfall in the US east of the Mississippi river.

Below are the blog carnivals that the articles on My Personal Finance Journey were selected to participate in:

Also, below are some blog posts I read this week that I would highly recommend! Enjoy and let me know if you have any questions!

• Morningstar Admits Fund Expenses More Important Than Their Own Star Ratings When Analyzing Performance @ My Money Blog
• Funny Stock Symbols @ My Journey To Millions
• What I Learned From My Caffeine Free Month @ Squirrelers
• Change of Address.org – The ABC’s of Home Ownership

It is a widely accepted fact that owning a home changes your financial situation significantly.

Incorporated in with the smörgåsbord of financial changes is deciding how a person will change his/her monthly budget to accommodate for the pains and pleasures of homeownership.

The changes that I have made to my budget since buying a condo in late July of this year will be the subject of today’s post.

Listed below are the considerations and financial action steps that I have decided to take. Enjoy!

My Personal Finance Journey Homepage 

Previously on this blog, we have reviewed several topics relating to the joins and pains of pet ownership. We have reviewed the decision points around if you need to purchase pet insurance, helping out with dog fostering as a low cost alternative to pet ownership, and looked at the costs of different pet products.

Continuing on the topic of pet ownership is today’s guest posting from Alban. Alban is a personal finance writer at Home Loan Finder, where he helps people to compare home loans online.  Enjoy!

  The Real Cost of Owning a Pet 

Owning a pet can be a very rewarding experience, and it has been found that children who grow up with a cat or a dog have less chance of developing allergies, not to mention you can teach your children about the responsibility of caring for another creature.

Whether you couldn’t picture your life without a pet, or your kids are pestering you for a pet and you’re wondering what all the fuss is about, you need to be sure you are aware of the true cost of owning a pet before you take on what can be a significant financial responsibility.

Typical Costs of Pet Ownership 

The first year of pet ownership can be one of the most expensive as there can be a lot of accessories to buy and changes to be made to your home, and following are some typical yearly costs you should budget for when considering pet ownership – of course pets, just like us, can cost more in medical expenses for example as they get older.

As you budget for your new pet, don’t forget costs such as:

• The purchase. You may be lucky enough to be given a pet or pick one up from a shelter but for more unusual or specific pets you will have to buy them.
• Registration. Dogs and cats in particular must be registered with your local council, often from they are 12 months old, and the registration must be renewed each year.
• De-sexing. De-sexing your pets can get more expensive as they get older so it is best to organize this as soon as possible for their comfort, their health and the safety of other pets and animals in your area.
• Micro chipping. This is a security and safety measure you can follow for your peace of mind and is a one off cost to implant a microchip into your pet. If you pet is found, a vet can check for a microchip, which holds all of your contact information.
• A home or bedding. Depending on the type of pet you choose you’ll need either a cage, a kennel or some sort of bedding to give your pet a place to call their own. You may also need to furnish your pet’s home with toys and accessories.
• Vet bills. When you first buy a young pet, there will likely be a course of vaccinations required. You will then need to revisit the vet once a year for your pet’s regular shots. Vet bills may also include emergency costs if your pet is sick or injured.
• Food. Make sure you know about any special dietary requirements of your pet and budget for enough food for a growing young pet, and an increased cost as your pet is fully grown and even hungrier.
• Costs of medicines. Your pet may have special medical requirements or dietary requirements which need to be met, and you will also have to budget for the costs of regular worming and flea treatments for a furry pet.
• Pet boarding. If you and your family go on holiday and you can’t take your pet, you will need to pay for boarding or a house sitter to look after your pet.
• Pet insurance. To help you with all of these pet costs you can take out pet insurance which can pay a portion of each vet visit, cover emergency costs and even pay for some pet boarding each year.
• Your choice of home. it can often be harder to find a home if you have a pet, especially as very few rental properties will allow you to have a pet. Even if you own your own home, if you have a big outdoor pet, you need a big outdoor space. 

The Costs for Different Types of Pets 

The costs of pet ownership will differ vastly depending on your choice of pet, for example:

• To own some types of cats and reptiles you may need to buy an exotic pet license. However, check the rules relating to your area, as they differ from state to state.
• You may need to modify your yard to include a cat run to protect local wildlife, or upgrade fencing if you buy a large dog.
• If you choose a fish or other scaly pet, you may see increased power costs as you need to heat their tank or habitat.
• Your home maintenance needs can change if you own a pet and you may need to have your carpets cleaned more regularly to remove muddy paw prints, or pay for repairs to furniture or windows done by claws.
• Training is an important cost if you choose a dog as training your pup from a young age will ensure good behaviour for life, and avoid social issues down the track.
• Transporting your pet can mean the need for more accessories such as a cat cage or a dog harness. 

How to Minimize the Costs of Pet Ownership

While there can be significant initial and ongoing costs associated with pet ownership, you can plan for them. For example, now that you know the costs you can expect, calculate the cost of pet ownership for your choice of pet and put aside those costs for a year to save up. If you find you have the room in your budget, you then have a head start on some of the purchase and set up costs.

Also, consider the savings and the value of having a pet. A dog for example can save you on gym fees if you take him for regular walks, and save you on after school activities if your children take the dog to the park or the beach. Owning and caring for any sort of pet will teach your children responsibility and accountability more comprehensively than earning any Scouts badge could.

To save on some of the costs of pet ownership:

• Don’t buy the pet. Before you head to the pet shop, check out your local animal shelters, they often have a range of pets too, not just cats and dogs. Pets from an animal shelter often have all of their shots up to date and are already de-sexed and you can buy the animals much cheaper and they are sometimes free. Plus, the animals in a pet shop will be bought eventually, those in an animal shelter may not.
• Research the type of pet you choose. Knowing about their diet and common health problems can help you care for your pet correctly from the beginning and avoid some expensive health problems in the future.
• Know the animal’s lifespan. The cost of a pet is ongoing but different animals can keep costing you for longer than others. For example a guinea pig will live an average of four years but a cat can live up to 20 years. A parrot can live on average 50 years and in some cases up to 80 years so be prepared.