My Personal Finance Journey

All posts by Jacob A Irwin

Use Low Cost Spay/Neuter Programs to Fix Your New Pets

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Welcome to My Personal Finance Journey! If you are new here, please read the “About” or “First-Time Visitor” pages to find out more about us. If you would like to receive free updates on articles like this by email, then sign up here or you can subscribe to the RSS feed. Also, check us out on Twitter or Facebook. Thanks for visiting! Keep on learning!
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Click here to enter my free $51.95 giveaway for a chance to win 5% of My Personal Finance Journey blog income and give another 5% to a charity of your choosing! Deadline to enter is January 31st, 2013.

As I type this post, my girlfriend and I’s new golden retriever that we adopted (Crystal, 9 years old, shown in picture below!) in early January is having surgery to be spayed. For this procedure, we opted to have it done at a local low cost spay/neuter program instead of at our normal veterinarian’s office to save money.

Because of this, I wanted to share our experience with you all today so that you can determine if this money-saving strategy/option is right for you in the future: 

 

How Much Can You Save by Using a Low Cost Spay/Neuter Program?

Regardless of whether or not you are a believer in “fixing” your pets, it is significant to know that using one of these low cost spay/neuter programs over a normal vet can save you a lot of money.

How much money? Well, according to several sources I found online, spaying or neutering a pet at a normal vet office costs between $200-$300, and sometimes up to $1000, depending on the anesthesia being used.

On the other hand, the low-cost spay/neuter programs cost anywhere between $50-$100. If you fall in to the low to mid income qualification range, you can even get the cost reduced to close to $30.

What is the Quality of Vet Care Like?

This concern can be summed up in one sentence. The low cost programs are not cheap because they have low quality vet care; they are simply subsidized by charities, such as Petsmart Foundation, making the cost to the pet-owner less.

Where Are These Low Cost Programs Located?

Usually, these programs are run by local shelter, habitat, humane society, rescue, or SPCA pet groups. To find low cost programs in your area, click on any one of the link below to perform a quick search.

ASPCA – Low Cost Neuter/Spay Programs Search
SpayUSA.org – Search
Humane Society of the US – Low Cost Spay/Neuter Program Search 

I just did a quick search myself for all of the 3 areas I’ve lived during my life. For each location, there were at least 3 available programs within a 20 mile radius, so I imagine that there will be at least one in your area as well!

My Personal Experience

For our dog getting spayed today (Crystal), we used the local SPCA group since I have volunteered there in the past and am very familiar with them.

The cost to us is $55 for a dog under 64 pounds, or $75 for a dog over 64 pounds. I believe there is also a $10 fee for a wound-licking-prevention-collar, if that is needed. They will even spay/neuter cats and Pit Bulls/Bulldogs for free. Nice!

How about you all? Have you ever used a low-cost spay or neuter program to get your pets fixed? If so, how did it go and what was the cost?

Share your experiences by commenting below!

Blogging and Personal Goal Setting for the 2013 New Year

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Welcome to My Personal Finance Journey! If you are new here, please read the “About” or “First-Time Visitor” pages to find out more about us. If you would like to receive free updates on articles like this by email, then sign up here or you can subscribe to the RSS feed. Also, check us out on Twitter or Facebook. Thanks for visiting! Keep on learning!
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With this being a new year and all, I’ve decided to lay out some personal goals for my life in general and blogging goals for My Personal Finance Journey during 2013. I have also added a reminder on my Outlook calendar to track our progress pertaining to these goals each month (or as often as I have time for anyway!).

As I experienced in 2012, by tracking these goals each month, it provides us with more accountability and visibility to what we are doing and where we want to go with this community/blog and in my life.

As is the case with many things in life (including my 2013 financial goals which I laid out a couple days ago), a good portion of my blogging goals are long-term commitments requiring attention in each passing year. As such, you might see many similar goals that I was trying to or did achieve in 2012 listed for 2013. I am perfectly fine with having some of the same goals year-to-year, provided that I believe in the causes they represent (which I ponder each year, and all of the ones listed below definitely do meet that criteria!). Nevertheless, I’ve tried to call attention to completely new blogging/personal goals for 2013 by highlighting them in bold red text for easier reading.  

So, here goes! The blogging goals for 2013 are as follows:
  • Read and interact with (comment) 25 partner blogs per week.
  • Continue active participation as a proud Yakezie Personal Finance Blog Network member.
  • Publish 3-5 blog posts per week.
  • Obtain 600 unique visitors per day average by end of 2013.
  • Host all personal finance blog carnivals (Festival of Frugality, Best of Money, Tax Carnival, Carnival of Personal Finance, Totally Money, Carnival of Retirement, Carnival of Financial Planning, Carnival of Passive Investing, etc).
  • Continue organizing Carnival of Passive Investing in 2013. Offer hosting of the 12 editions for 2013 to guest hosts. If you’re interested in hosting, shoot me an email! You can view the schedule by clicking here. Also for the Carnival in 2013, my goals are to a) continue getting passive investing authors involved and b) start reaching out to financial journalists (maybe from Kiplinger’s or Money Magazine, etc) and/or financial reporters on TV.
  • Continue to spread word about benefits of passive investing over active investing. Get involved in BogleHeads forums as well.
  • Write 1 guest post for another blog per month to expand reach of my ideas.
  • Create an eBook on one of the following topics – a) Ways to be Frugal, b) Investing Strategy, c) Steps to Buying a Home, d) Getting out of Debt, or e) Financial Prioritization / Account Hierarchy. Once create book, market it afterwards.
  • Possibly transfer blog to WordPress hosting. First, migrate Carnival of Passive Investing for practice before do My Personal Finance Journey.
  • Create and publish monthly newsletter – “Intelligent Financiers Newsletter.”
  • Attend blogging, marketing, finance, or real estate classes at local community college or nearby conference locations. Particularly, I would like to take a class or two to learn more about Search Engine Optimization (SEO) and also how to publish a book in hard-copy.
  • Submit blog posts to blog carnivals every two weeks to expose my blog to new audiences and build links.
  • Successfully execute Tour de Personal Finance in July this year. For 2013, plan further ahead of time to gather more entries (max = 64) and get some sponsors involved. If get sponsors, donate 50% of the earnings of the event to a charity chosen by the yellow jersey winner of the event and also offer prizes for top place entries and jersey winners.
  • Do Easy Like Sunday Morning Roundup and Recap 1X per month minimum.
  • Continue social media presence on Twitter and Facebook. I would also like to try to incorporate some use of Pinterest as well.
  • Feature one Cheapskate Jake Frugal Ramblin’ per month.
  • Run 10% Blog Income Give Back Project each month. Continue teaming up with local charities to build relationships. Focus on visiting the charity personally after each give back concludes. Try to get other sites interested in doing something similar and also begin to look for sponsors for 1-2 of the giveaways.
  • Start and grow personal finance group speaking service. Generate ideas for speaking topics. Offer to local community first and build from there. Create page promoting service on My Personal Finance Journey. 
  • Continue to try to find other ways to help people with their finances away from the blogosphere. One thing I’ve applied to do is become a volunteer credit counselor with Credit Education.org. However, I have not heard back from them, even after submitting my application multiple times. Another option I could pursue is offering general advice on finances from a life coach perspective – lifestyle, frugality/money saving tips, life values and dreams, etc. You have to be very careful in making it clear to not offer advice on specific financial instruments since you must have the correct certifications for that (which I do not have). This might be hard for me to resist delving in to the specifics, but it could be fun! I would definitely need to learn more about the legal aspects first though.
  • Start building smaller sites – one about blogging tips, finance from a scientific perspective, running, and my family’s genealogy as time allows (this is a lower priority goal).
  • Network with other bloggers, with a particular focus on physically meeting them to build relationships. The bloggers I have met in person so far are really interesting people!
  • Incorporate affiliate resources in to posts where relevant.
  • Negotiate advertising deals for other sites.

In addition, my personal goals for 2013 that I set are as follows:

  • Get to bed at midnight or earlier.
  • Take 1 day off per week (Saturday or Sunday) completely from doing work on my blog or from my graduate research job to keep my mind feeling more “fresh.”
  • Become better at following the Getting Things Done email/work flow management system to focus my time and energy on high value projects first and avoid distractions. 
  • Hike or bike ride 1 time per week with a group.
  • Do a bike race if my Achilles starts to feel better.
  • Hike more with the Charlottesville Hiking Group.
  • Read one personal finance book per month.
  • Go backpacking one time per month in warmer months. 
  • Take a trip out of town 1 time per month. Visit sister’s new home in Raleigh. Visit one of the beaches in Virginia.
  • Learn how to build a group speaking business.

How about you all? What blogging/personal/professional goals have you set for yourself in 2013?  Share your experiences by commenting below!

    ***Photo courtesy of http://www.flickr.com/photos/aresauburnphotos/1121058121/sizes/l/in/photostream/

    Creating an Automated Zero-Based Budget to Strategically Manage Your Month-to-Month Finances

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    Welcome to My Personal Finance Journey! If you are new here, please read the “About” or “First-Time Visitor” pages to find out more about us. If you would like to receive free updates on articles like this by email, then sign up here or you can subscribe to the RSS feed. Also, check us out on Twitter or Facebook. Thanks for visiting! Keep on learning!
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    Click here to enter my free $51.95 giveaway for a chance to win 5% of My Personal Finance Journey blog income and give another 5% to a charity of your choosing! Deadline to enter is January 31st, 2013.

    As part of my blogging goals for 2012-2013, one of the ongoing projects I’ve been working on since Thanksgiving has been writing a book called, 31 Days to a Financial Revolution – Automate Your Finances To Achieve Financial Success. As I mentioned several days ago, the book details a series of 31 approachable steps over a one month period that people can take to optimize their finances. Along each step of the way, 2-minute automation action items are implemented to increase the likelihood of the financial planning steps being followed going forward.

    At first, my goal was to just write a short 20-30 page eBook on one specific topic. However, when I started looking at all of the material I had already covered on my site (now at 800+ posts total so far), I realized it was complete enough to tie together in to the form of a book. However, out of all the posts on my site, I realized there is one topic that had not been covered in a step-by-step manner (only piecemeal thus far) – creating the type of budget I use each month for my personal finances, a zero based budget.

    The purpose of this post will be to correct this annoying little discrepancy and cover an important step that I think should be taken in personal finance – creating a zero-based budget to manage your monthly finances!

    Creating an Automated Zero-Based Budget to Strategically Manage Your Month-to-Month Finances

    If you’re like me, by this time in your personal finance development, you’ve added quite a few financial accounts to your financial portfolio. Having gotten to this point, the goal then becomes to pull all of your financial commitments together in to a planning format that you can track on a monthly or bimonthly basis – something called a zero-based budget.

    Why a Zero-Based Budget?

    Simply put – a zero-based budget is a way of planning your finances so that every single dollar that you receive is immediately pre-reserved and subsequently transferred out of your primary checking/spending account at the beginning of the pay-period for all of your financial needs.

    As you can tell, this is clearly different than a normal budget, which dictates that you leave money in your primary spending account until the end of the pay period (at which time you then transfer the money to help achieve your financial goals).

    While the idea behind a normal budget is sound, I have found that in practice, it simply does not hold up. This is due to the fact that the unforeseen struggles of daily life get in the way, and the money that you have reserved in good faith to meet your financial goals (savings especially) at the end of the month gets spent prematurely.

    How to Create Your Zero-Based Budget 

    Creating a zero-based budget is fairly easy, and it is truly something that I enjoy and look forward to doing/maintaining each month.

    Why do I look forward to doing this? Because each time I do it means that I am moving towards strategically managing my money and ultimately, my financial goals.


    To create a zero-based budget for yourself, simply follow the steps outlined below:

    1.  For your zero-based budget, I recommend creating a new Google Docs Spreadsheet (www.docs.google.com). I prefer this to traditional spreadsheets because this way, your zero-based budget will be stored in the “cloud” and will be accessible from anywhere in the world and on any computer.
    2. Next, in the first row of the spreadsheet (starting with the second column), label columns with the dates of each of your pay periods for the next year.
    3. Then, in the first column of the spreadsheet, label each row according to ALL of your monthly financial commitments. The key here is to be very complete! They don’t call it a zero-based budget for nothing; the goal is to get your leftover money to zero after all! Make sure to include all of your normal monthly spending for energy, water/sewer/trash, TV/Internet, insurance (all types), Netflix, estimated tax savings, partying, homeowner’s association fees, student loans, credit cards, your mortgage, groceries/food, gas, child care, gym memberships, dog food, magazine subscriptions – everything. To make sure you haven’t missed any of your monthly spending, I recommend tracking every bit of your spending for 3 months to determine your patterns. In addition, you’ll also want to include any savings that you have for building an emergency fund, charity contributions, and life values/dreams.
    4.  Lastly, you’ll need to add additional rows for other important financial commitments, such as savings for future vacations and long-term retirement. To complete the budget list, I also like to include something called “comfort buffer” money. This is essentially the minimum amount of money that a person feels comfortable carrying in his or her checking account while still being able to sleep soundly at night. For me, this is around $600, but will vary for each person. For example, my girlfriend is comfortable having only $100 in her account. I would personally recommend keeping a minimum of $100-$200 in your spending account so that you don’t have to monitor it as closely, but to each their own! 
    5. Once you’ve listed all of your budget items, I recommend to “freeze” the 1st row and 1st column of the spreadsheet so that if you scroll down the page, you’ll still be able to see the date of each budget period and all of the budget items.
    6. Next, at the bottom of each column/budget period, sum the column to calculate the total money needed to meet your financial commitments. This total is important to monitor to make sure that you don’t financially overextend yourself by comparing it with your take-home pay each period. If the total is greater than your income, you will need to cut back. However, if it is less, you can scale up your debt payoff or retirement savings goals in accordance with the priority rules set forth the Account Hierarchy.

    Monitoring Your Zero-Based Budget Each Pay Period

    Having created your budget, it’s now time to actively monitor it at the beginning of each pay period to ensure you’re staying on track.

    In my experience, I’ve found that budget items always fall in to one of two categories – things that are automatically paid/deducted/transferred out of your spending account and ones that you need to manually execute.

    To help distinguish between the two, I like to color code the cells accordingly, using yellow for items that are executed automatically and green for items that I have to manually initiate each pay period. After an automatic transfer has been initiated for one of the automated items, I simply change the appropriate cell to yellow to indicate that it has occurred. For the manual items, immediately after I am paid in that period, I initiate a transfer from my checking account to the appropriate strategic location. After that, I mark the appropriate cell green and then insert a comment with the date that the transfer was initiated.


    For items such as gas and groceries that you purchase while running errands (i.e. physically when you are out and about), you can just leave the money earmarked for that in your spending account since you will naturally spend money for those things out of necessity.

    And just like that, you’ve now set up a great zero-based budgeting tool that will serve as the new cornerstone for managing your finances each month. In order to make sure the process continues without hitches, you’ll want to set up the following automation item.

     2-Minute Automation Action Item – Once you have set up your zero-based budget, place an automatic, recurring reminder on your Outlook or Gmail calendar to review and update your zero-based budget directly after you get paid each pay period, taking special care to ensure that you execute the manual items you identified above.

    How about you all? Do you use a budget to manage your monthly finances? Have you ever tried a zero-based budget? If so, how did it work out for you!? 

    Share your experiences by commenting below!

      ***Photo courtesy of http://www.flickr.com/photos/nourishingcook/5676133931/sizes/l/in/photostream/

      Happy 3 Year Birthday to My Personal Finance Journey!

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      Welcome to My Personal Finance Journey! If you are new here, please read the “About” or “First-Time Visitor” pages to find out more about us. If you would like to receive free updates on articles like this by email, then sign up here or you can subscribe to the RSS feed. Also, check us out on Twitter or Facebook. Thanks for visiting! Keep on learning!
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      Click here to enter my free $51.95 giveaway for a chance to win 5% of My Personal Finance Journey blog income and give another 5% to a charity of your choosing! Deadline to enter is January 31st, 2013.

      Happy Wednesday folks! Just a quick post here this morning to announce that today marks the official 3 year birthday of My Personal Finance Journey! Wooohooo! If my site was a child, he or she would be causing all sorts of mischief at this point! 🙂

      It all started 1095 (Wow! That sounds like a lot of days!) days ago with a simple little post about a $30 sign up bonus offer for the Chase Amazon Credit Card. Coincidentally, I still have that credit card and use it for all of my Amazon purchases. It provides a pretty nice cash back feature too, as I discussed the other day in my financial accounts and tools post!

      Since that first post on January 16th, 2010, here at My Personal Finance Journey, we’ve had about 300,000 visitors and 811 total posts (290 posts during 2012). It’s been a great ride, and I look forward to another successful year of learning and interacting with all of you.

      To celebrate reaching the 3 year mark on this site, I’m giving away ~$52 as part of the ongoing monthly 10% blog income give back project. Be sure to hop on over to that post to enter to win and help a charity all at the same time!

      Thanks again for all your support!

      Jacob

        ***Photo courtesy of http://www.flickr.com/photos/brettneilson/4962603428/sizes/l/in/photostream/

        Top Three Balance Transfer Credit Cards for Winter 2013

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        Welcome to My Personal Finance Journey! If you are new here, please read the “About” or “First-Time Visitor” pages to find out more about us. If you would like to receive free updates on articles like this by email, then sign up here or you can subscribe to the RSS feed. Also, check us out on Twitter or Facebook. Thanks for visiting! Keep on learning!
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        Click here to enter my free $51.95 giveaway for a chance to win 5% of My Personal Finance Journey blog income and give another 5% to a charity of your choosing! Deadline to enter is January 31st, 2013.

        This article was written by Logan Abbott. Enjoy! 

        If you’re like me, then you probably made some New Year’s resolutions a week and a half ago that you would like to make good on this year. Well, there’s no better time to get a jump on those New Year’s resolutions than the present.

        Many people carrying significant credit card debt promised themselves that this would be the year they paid that debt off. If you’re one of these people, you should consider moving that unwieldy credit card balance to another credit card by opening up a 0% Intro APR on balance transfers credit card.

        With a 0% balance transfer credit card, you can prevent the large dollar amount currently on your balance from getting any larger, since you will not have to pay interest on that balance anymore until the intro balance transfer period is over, which is typically 12 to 18 months on a great balance transfer credit card.

        Knowing which card to choose can be confusing. Worry not, however, as I have done the research for you, and present to you my top three picks for the best balance transfer credit cards currently available:
        1.      Discover It Card – The Discover it Card was just unveiled by Discover at the beginning of January. The Discover It line of credit cards looks to replace, and improve upon, the Discover More line of credit cards which Discover has recently discontinued. Putting the Discover it Card at the top of this list was really a no-brainer for me, as I cannot say enough about this card. In terms of balance transfer credit cards, the Discover it Card gives you a 0% Intro APR on balance transfers and purchases for the first 14 months that you have the card. If that wasn’t enough, the Discover it Card also grants 5% cash back on purchases in rotating categories, as well as 1% cash back on all other purchases. There is also no annual fee. So, all in all, the Discover it Card is a great balance transfer credit card and cash back credit card.
        2.      Citi Dividend Platinum Select Visa Card – The Citi Dividend Platinum Select Visa Card is the runner up on my list of the top three balance transfer credit cards of Winter 2013. With the Citi Dividend Platinum Select Visa Card, cardholders receive a 0% Intro APR on purchases and balance transfers for the first 12 months that they have the card. In addition, cardholders receive $100 cash back after they make $500 in purchases in the first 3 months that they have their credit card account. The Citi Dividend Platinum Select Visa Card also offers 5% cash back from Citi on certain purchases from Zappos.com, fitness clubs, and drugstores through the end of March, as well as 1% cash back on all other purchases, and no annual fee.
        3.      Citi ThankYou Card – The Citi ThankYou Card brings up the rear of my list. With the Citi ThankYou Card, cardholders receive a 0% Intro APR on balance transfers and purchases for 15 months. In addition, the Citi ThankYou Card rewards cardholders for 1 ThankYou Point for each dollar they spend on purchases, as well as an anniversary bonus each year on the amount of points they’ve already earned. Lastly, there is no annual fee to own the card.
        So what are you waiting for? If you are carrying a large credit card balance that you’re having trouble paying off, get your head above water by transferring that balance to a new credit card, and start to dig yourself out of that hole.

        How about you all? Have you ever used a 0% interest balance transfer to help pay off your debt?

         What is your favorite credit card?

         Share your experiences by commenting below!

        ***Photo courtesy of http://www.flickr.com/photos/brettlider/214337536/sizes/l/in/photostream/

        Financial Goal Setting for the 2013 New Year

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        Welcome to My Personal Finance Journey! If you are new here, please read the “About” or “First-Time Visitor” pages to find out more about us. If you would like to receive free updates on articles like this by email, then sign up here or you can subscribe to the RSS feed. Also, check us out on Twitter or Facebook. Thanks for visiting! Keep on learning!
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        Happy New Year Everyone! It is that time again. That’s right – time to set my financial goals for 2013. It’s hard to believe that 2013 is already upon us. Just two more years, and we’ll be to the year that they traveled to in the movie, Back to the Future II (one of my personal favorites!).

        I do this once every year as part of my goal to create what author David Bach calls a Purpose Focused Financial Plan. The goal of this system is to employ money in your life in a way that matches your life values and dreams. It is a very cool idea!

        You can read more about my journey to create this system at the following links – Creating a Purposed Focused Financial Plan and My Personal Finance Journey’s Investment Strategy.

        As is the case with many things in life, a good portion of financial goals are long-term commitments requiring attention in each passing year. As such, you might see many similar goals that I was trying to or did achieve in 2012 listed for 2013. I am perfectly fine with having some of the same goals year-to-year, provided that I believe in the causes they represent (which I ponder each year, and all of the ones listed below definitely do meet that criteria!). Nevertheless, I’ve tried to call attention to completely new financial goals for 2013 by highlighting them in bold red text for easier reading. 

        So, here goes, the unveiling of Jacob’s 2013 financial goals. Enjoy, and I look forward to reading any comments you all have!  

        Short Term (Less Than 1 Year) Goals
        • Contribute $5500 (or ~$458 per month) to my Roth IRA with Vanguard this year (maximum allowed, which increased $500 in 2013 compared to the $5000 maximum allowed in 2012!).
        • Reach short-term net worth target for this year (1.42X my current net worth).
        • Maintain target 6-9 months of expenses in cash reserve emergency fund in Dollar Savings Direct account.
        • Rebalance mutual fund portfolio to meet asset allocation target %’s (70% equity, 30% fixed income overall).
          • Put together a will and have it reviewed by a lawyer.
          • Continue to save money for trip to Grand Canyon or to see Niagara Falls.
          • Invest $500 in Microloans with Microplace.com to support Latin American micro entrepreneurship. This equates to $41.67 to invest per month.
          • Donate $1,150 to Multiple Sclerosis Foundation in 2013 (5% of take-home pay in my graduate school research assistantship job).
          • Fund raise $7500 for MS 150 bike event in June 2013.
          • Save 3% of take home pay each month (after taxes) for Dream Account.
          • $30 per month save for doing running races as part of health life values account.
          • $20 per month save for buying fresh vegetables as part of health life values account.
          • Save ~33% of (blogging income (if any) – amount of income deferred to Individual 401k with Vanguard + untaxed graduate fellowship income from my research job) in a high yield online savings account in preparation for 2013 taxes.
          • Apply for new graduate research fellowships since the one I have from the NSF will run out in 2014 (and need to apply for new ones about a year ahead of time).
          • $30 per month save for trips to visit friends/family in other states.
          • $10 per month save for purchasing food for backpacking trips in the Blue Ridge Mountains once a month.
          • Contribute at least 20% of blogging income to Individual 401(k) with Vanguard.
          • Execute any business tax deductions I can for 2012 taxes.
            • Use 1% home value home maintenance fund to fix various small things that are broken around my condo after 2.5 years of use. These things include a closet door off the hinges, the light-switch in the bathroom not working all the time, and some pipes under the sink that need to be re-caulked. Once I get these things repaired, I will then need to replenish the depleted funds in the home maintenance account. 
              • Execute 4 estimated tax payments for blogging + graduate research fellowship income on the following dates – 1) April 15, 2013, 2) June 17, 2013, 3) Sept. 16, 2013, and 4) Jan. 15, 2014.
                • Save $111 per month until have a total of $1600 for health expenses for dogs we adopted (for annual health checkup, Frontline/Interceptor, and miscellaneous health emergencies/treatments needed. I will have the $1600 total after March 2013.
                • Help friends become debt-free.
                • Continue investing in long-term content growth of blog. 

                    Mid-Term (3-5 years out) Goals:
                    • Continue contributing $5500 to Roth IRA and Individual 401k each year using dollar cost averaging.
                    • Reach intermediate net worth target (2.8X my current net worth).
                    • Own a rental property by 2018.

                    Long-Term (greater than 5 years out) Goals:
                    • Obtain a net worth of $1,000,000.

                    • Own a home free of mortgage payments.
                    • Own a vacation home in the mountains or a ski resort.
                    • Accumulate enough funds not have to work, but will probably anyways because I would get bored. 


                    How about you all? What goals have you laid out for yourself in 2013? What technique do you find is most effective in holding yourself accountable for your goals you set?  

                     Share your experiences by commenting below!

                      ***Photo courtesy of http://www.flickr.com/photos/gi/388322867/sizes/o/in/photostream/

                      How Have Attitudes Towards Debt Changed Since the 2008 Credit Crisis?

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                      Welcome to My Personal Finance Journey! If you are new here, please read the “About” or “First-Time Visitor” pages to find out more about us. If you would like to receive free updates on articles like this by email, then sign up here or you can subscribe to the RSS feed. Also, check us out on Twitter or Facebook. Thanks for visiting! Keep on learning!
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                      Click here to enter my free $51.95 giveaway for a chance to win 5% of My Personal Finance Journey blog income and give another 5% to a charity of your choosing! Deadline to enter is January 31st, 2013.

                      The following is a guest post. Enjoy! 

                      Since the global credit crisis in 2008, personal budgets and disposable incomes have been strained. Recent government austerity measures have been adopted by various nations attempting to balance returns to economic growth and their debt.

                      Attitudes of the Past

                       

                      Given these measures, have consumers been able to successfully manage their domestic budgets? The perception of personal debt pre-credit crisis is well publicized, with households adopting relaxed approaches to credit cards, personal overdrafts, etc. Recent studies have been performed with alarming outcomes showing that the average US citizen owes circa $8000 of unsecured debt, with around a third of that amount being in relation to credit cards.
                       
                      This attitude to debt is also leading to developments in lenders strategies as many consumers took debt pre credit crunch and have simply been managing this in the previous year’s, however have not been able to repay core debt. leading to many banks having to take further losses as back in the 2008 – 2009 financial periods.

                      Present Attitude Towards Debt

                       
                      From 2009, lenders have seen consumers micro manage their debt as opposed to repaying it as consumers perform their own research in the types and cost of their debt. For example, in the past, consumers were likely to focus on one method of debt to manage their monthly budgets (i.e. paying for day to day spending with credit cards). In actuality (assuming a monthly salary is paid), it would be cheaper to use an agreed overdraft limit with a lender (hence avoiding high monthly charges) to pay down the core debt on the credit card, which most likely is being charged at anything from 18-27% APR and manage their daily spend with an overdraft. This is very similar to the way a business manages its own cash flows (i.e. short term solutions for short term problems).
                       
                      Many businesses have awoken to the above movements in consumer behavior and noted the problems with households trying to reduce their core debt in agreement with its providers. Additionally, many debt solutions bodies can be found in the market to help consumers manage their budgets resulting in agreements with providers resulting in affordable solutions.                

                      How about you all? How do you think attitudes towards debt have changed in the years since the 2008 credit crisis?

                      Share your experiences by commenting below!

                      ***Photo courtesy of http://www.flickr.com/photos/pinksherbet/4257485778/sizes/l/in/photostream/

                      Tools, Accounts, and Books I Use in My Personal Finance Journey

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                      Welcome to My Personal Finance Journey! If you are new here, please read the “About” or “First-Time Visitor” pages to find out more about us. If you would like to receive free updates on articles like this by email, then sign up here or you can subscribe to the RSS feed. Also, check us out on Twitter or Facebook. Thanks for visiting! Keep on learning!
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                      Click here to enter my free $51.95 giveaway for a chance to win 5% of My Personal Finance Journey blog income and give another 5% to a charity of your choosing! Deadline to enter is January 31st, 2013.

                      Often times, I get asked about the various tools, accounts, and books that I personally use to organize and manage my personal finances/life (which often become very intertwined!) on a day-to-day basis.

                      In order to facilitate this sharing, I’ve decided to use this page as the central location for this information (also available via the Favorite PF Tools, Accounts, and Books tab at the top of my site). One thing I realized while putting this list together was that while I’ve discussed a lot of these topics on my site, I’ve never shared the specific companies that I use to make them happen in a central place (which I think may be of some value to people that are trying to figure these topics out in their own personal finances).

                      If there are any categories of things that you think I might be leaving out, definitely let me know! Let’s get started, shall we?!

                      CHECKING/SPENDING ACCOUNT

                      For my checking account, I use good ole’ Bank of America. Although Bank of America is not perfect and might not offer the best perks around, the main reason I’m still using Bank of America is that they are truly everywhere in the United States. They are in Arkansas where my parents live, they are on the East Coast where my sister and I live – they are everywhere. And, the fact that Bank of America is everywhere has made it very easy on me over the past few years since I have moved three times.

                      Often, I have considered moving my checking account to an online bank since they offer much better interest rates and other features. However, there is something to be said about having a physical bank if I need a certified cashier’s check (I just checked, and online banks such as ING Direct’s do not offer certified checks) to buy a house or pay a moving company. Additionally, I question the security of mailing a check through the Postal Service in order to make a deposit. On top of this, Bank of America has never charged me a monthly account maintenance fee since I have always met their required criteria. 

                      CREDIT CARDS

                      As far as credit cards go, I generally use only 3 credit cards on a regular basis (even though I have close to 15 of them which I rarely use and keep in an envelope. I only opened these to take advantage of the $50-$100 cash back bonus that came with opening the account. Some nice easy money!).

                      If you’re interested in learning more about these credit cards or opening an account for yourself, I’d encourage you to first compare your options at CreditCards.com to make sure they best suit your needs.

                      • For the majority of my purchases (except ones at gas stations and Amazon), I use the Chase Freedom Visa Credit Card. This card offers:
                        • No annual fee.
                        • $100 cash back bonus after you make $500 or more in credit card purchases within the first three months (not very hard to do if you use it for all purchases).
                        • 0% introductory APR for purchases and balance transfers for the first year. 
                        • 5% cash back on up to $1500 in purchases each quarter in rotating purchase general categories (examples are gas, groceries, restaurants, etc).
                        • Unlimited 1% cash back on all other purchases; rewards never expire.
                      • For all my gas purchases for my car, I use the Chase BP Visa Credit Card. 
                        • First, aside from the Gulf of Mexico oil spill fiasco (which may or may not have been BP’s fault), I believe that BP is a fairly “good” company as far as big oil goes. They have a very active renewable energy (wind, solar, etc) program compared to Exxon Mobil, and are also located nationwide in the event that I have to move around. 
                        • The card offers no annual fee, $0.15 per gallon rebates on every $100 spent at BP gas stations that can be redeemed in the form of discounts on gas purchases. This is sort of a confusing payout system, but if you sit down and do the calculations, I figured out that it equates to about 3% cash back. Not as good as the 5% cash back that it used to give, but still pretty competitive compared to the other cards available! 
                      • For all of my Amazon purchases (cheap used books and Christmas/birthday gifts), I use the Chase Amazon Visa Credit Card. This card offers:
                        • No annual fee. 
                        • $30 cash back bonus upon signing up for a card. 
                        • 3% cash back on all Amazon purchases. 

                      ROTH IRAS

                      Currently, I have two Roth IRAs – one with Vanguard that I contribute to on a regular basis (I HIGHLY recommend Vanguard. Read more below about Vanguard if you’re interested) and one with Capital One Sharebuilder that I opened back when I first started my investing “career” back in 2007. Sharebuilder has had quite a lifetime! First, it was an independent company, then it was purchased by ING Direct, which then got swallowed up by CapitalOne only recently.

                      In my opinion, I both love and hate Sharebuilder all at the same time.

                      • I love that they 1) have no required account minimums, 2) make it incredibly easy and affordable to invest new money in to stocks and ETFs through recurring automated investing plans (commissions of $4 or less per buy transaction, happens only once a week on Tuesday), and 3) often times offer $50 account opening bonuses. 
                      • However, I hate the fact that it costs $10 per trade to sell out of any shares or purchase new shares in a market order fashion. This high “share leaving cost” is one of the primary reasons why I have kept my Roth IRA with Sharebuilder all of these years. 
                      • So, the verdict on Sharebuilder essentially is that if you’re investing/buying for the long, long term, Sharebuilder is a good, simple alternative. However, if you’re looking to buy and sell more frequently, there are other cheaper discount brokerage options available out there (will discuss more below). 

                      ROLLOVER IRA, INDIVIDUAL 401K, AND TAXABLE MUTUAL FUND ACCOUNT

                      For my Rollover IRA (rolled over from my Fidelity 401k at my job before graduate school), Individual 401k, and taxable mutual fund accounts, I proudly and very loyally use Vanguard.

                      I really cannot recommend how good Vanguard is enough. They are the industry leaders in offering low-cost, passively managed, index mutual funds (often times lower than Fidelity), which is the type of investing instrument I use as part of my passive investing strategy. They have very good, responsive customer service, never charge transaction fees, and waive account maintenance fees for portfolios over $50,000 in value.

                      LIFE VALUES, DOGGIE EMERGENCY FUND, PROPERTY TAX, AND HOUSE MAINTENANCE SAVINGS ACCOUNTS

                      I store my cash funds earmarked for my life values, doggie emergency fund, condo property tax, and house maintenance savings purposes in an HSBC Advance Online Savings Account that I opened up back in 2007 or so.

                      Although the interest rate it pays (currently 0.20% APY as of 12-Jan-2013) is lower than some of the market leaders (it used to pay one of the highest rates around when I first opened the account in 2007) such as Ally Bank (0.95% APY) and EverBank (0.76% APY), HSBC does offer a nice user interface along with no monthly account maintenance fees or minimums and automatic savings transfers.

                      While there are now better options around in today’s market for online savings accounts (one of them being ING Direct, discussed below), HSBC is acceptable enough for me to stick with them for the time being for these accounts. Additionally, I figured I could invest my time in to more value-added activities than chasing returns, as recommended by Ramit in his book, I Will Teach You to Be Rich.

                      LIFE DREAMS SAVINGS ACCOUNT

                      The 3% of my take-home pay that I save for fulfilling my life dreams is stored in a high-yield online savings account with ING Direct (recently purchased by Capital One).

                      I am a very big fan of ING Direct (this and Ally Bank are my two favorite online savings options). They offer a very high, competitive interest rate of 0.75% APY, no fees, no minimums, automatic scheduled transfers, and a very simple yet elegant online user interface. Another good thing about ING Direct is that people seem to be more aware of this company as compared to the other online-only banks, which seem more obscure to people that aren’t plugged in to the online finance world as much.

                      EMERGENCY FUND AND INCOME AND SELF-EMPLOYED INCOME TAX SAVINGS ACCOUNT

                      My emergency fund and self-employed/income tax savings are stored in a ‘high yield’ online savings account with Dollar Savings Direct (part of Emigrant Bank).

                      As was the case with HSBC, I opened this account probably 5 years ago when Dollar Savings Direct was offering a very high interest rate compared to other online banks. However, in the present day, this is definitely not the case. They have more requirements ($1000 minimum) for accounts than Ally Bank or ING Direct, yet offer a lower interest rate (currently at 0.55% APY).

                      Nevertheless, since they don’t charge any monthly account fees and the account is FDIC insured, I’m OK keeping this account on-board for the time being. 

                      INTERNET PROVIDER

                      While I’m not happy about it, my Internet provider is Comcast. I use them only because they are the only Internet provider in my condo complex. I’ve written many times about how I don’t particularly like them and think their customer service is less than stellar/a headache.

                      However, their actual Internet service is not all that bad. Aside from that, they are always running promotion pricing deals which can be taken advantage of simply by calling every few months to see what is being offered. At the present, I am taking advantage of a promo deal for Blast Internet at the price of Economy. Not too shabby!!!

                      CABLE TV PROVIDER (OR LACK THEREOF IN MY CASE)

                      In general, I think that cable TV is a waste of money. Sure, it’s a nice thing to have, but is it required and worth the money? For me, it’s a significant expense that is not worth the money.

                      Instead, I use Netflix to rent DVDs for entertainment! For $12.59 per month, I can rent 2 – DVDs at a time among Netflix’s really good selection of both older movies and newer releases (just recently watched The Dark Knight Rises, a cool movie!). They even offer a free trial membership for new members if you’re interested in taking a look.

                      CHARITY THAT I CONTRIBUTE TO (AND SAVINGS ACCOUNT I USE TO SAVE MONEY FOR IT)

                      The charity that I choose to contribute 5% of my take-home salary to each year is the National Multiple Sclerosis Society Blue Ridge Virginia Chapter. 2013 will also be my 5th straight year of me participating in the MS150 Bike Ride Event here in Virginia in June each year. My goal for the 2013 event will be to raise $7500 for the cause!

                      I got/stay involved with this charity for several reasons: 1) MS is in the same general category of neurological diseases for which I do research in graduate school (Alzheimer’s disease), 2) there is a great team that I do the bike ride with here in Virginia each year, called Grateful Tread, 3) my girlfriend runs clinical research trials for MS, and 4) I’ve learned that MS is a disease that very greatly affects not only the patients, but also the caregivers which have to tend to the patients as their motor functions degrade. With everyone’s help, I sincerely hope we find a cure for this disease in my lifetime! 🙂

                      As mentioned above, I donate 5% of my income each year to the MS society. To do this, I execute automatic monthly withdrawals from my checking account to an online savings account with ING Direct(recently acquired by Capital One). As I stated previously, I am a big fan of ING Direct, and would highly recommend it to anyone reading this. I like it specifically for saving for charity purposes because it enables me to set up specific sub-accounts that I can name as I please in order to better organize my savings.

                      CONDO HOMEOWNER’S INSURANCE 

                      I have my comprehensive homeowner’s condo insurance policy through Erie Insurance. I purchased this through a local agent here in Virginia because the price difference was no different than if I purchased it directly from the company. I pay $36 per month for the coverage. The details of the policy are shown below:

                      • $150,000 of personal property insurance.
                      • $1 MM of personal liability insurance.
                      • $5,000 in medical payments to others (each person).
                      • Loss assessment.
                      • Earthquake coverage, but not flood insurance.
                      • Replacement cost personal property. 
                      • Enhancement endorsement. 
                      • Identity recovery coverage. 

                      PERSON-2-PERSON / MICROLOANS

                      As part of my quest to achieve my life values each year, I invest $500 per year in microloans to help Latin American countries. I invest in these through Microplace. I also have a small amount of money invested inLendingClub in order to try out their platform.

                      Overall, I am very satisfied with both LendingClub and Microplace. However, it is important to understand that they are VERY different! Microplace offers microloans primarily to help spur small business development and empowerment of poorer folks in 3rd world countries (which is why I use them to invest in causes in Latin America). On the other hand, LendingClub is geared at helping fund folks in the United States with repaying their credit card/automobile debt, build pools, and green projects.

                      From a pure investment-return perspective, you can likely get a higher rate of return at LendingClub (9% on some loans at LendingClub vs. 2-3% at Microplace). However, I like investing with Microplace because I believe my Dollars can make a big difference in these 3rd world countries. On top of that, I’ve never experienced a loan-default with Microplace, meaning that the investments are very safe/conservative. Microplace is also owned by Paypal, a company with which I have a lot of experience. 

                      INDEX-ETF INVESTMENTS

                      As you might have read previously on my site, index-ETFs have quite a few advantages (including about a 0.1% lower expense ratio) over indexed mutual funds. However, these advantages only hold true if you can trade the ETFs commission free (or with very cheap commissions), similar to the way you can trade the proprietary mutual funds with Vanguard or Fidelity.

                      Because of this consideration, the two places I use for ETF investing are Vanguard (primarily) andSogotrade (if for some reason there is an ETF I want to buy that is not a Vanguard ETF, such as the IAU gold ETF I invest in as part of my test run with Harry Browne’s Permanent Portfolio). Vanguard is great for ETF investing, offering 50 total ETFs tracking a wide variety of indices and sectors (although sector funds are generally not necessary for good diversification). The best of all is that if you buy and sell these funds in a Vanguard brokerage account, they trade commission free! Can’t beat that (Sogotrade.com will be discussed more in the next section).

                      “PLAY MONEY” INDIVIDUAL STOCK INVESTMENTS

                      As a passive investor, I personally do not think that people have any business investing in individual stocks (even if they are following the advice of a stockbroker or stock newsletter) with large amounts of their retirement assets. Having said that, I do like to “try my hand” at different stock investing strategies from time to time, but when I do, I make sure to only bet money that I can afford to lose 100% of. This type of money is called “play money.” I speculate with this play money in individual stocks in an online discount brokerage account.

                      In my mind, the two best discount online stock brokerages are Zecco (recently merged with and is now called TradeKing) and Sogotrade, with Sogotrade being slightly more favored by me since they offer cheaper commissions. Sogotrade offers unlimited stock and ETF trading for $3 commission per trade, along with no account maintenance fees or minimums. Tradeking also is very good, offering $4.95 commissions for each trade. 

                      HEALTH INSURANCE

                      Luckily, the cost of Aetna Student Health Insurance is fully covered through my graduate chemical engineering program. As I’ve posted about previously on this site, buying independent health insurance can be extremely expensive, so I’m very grateful that this coverage is provided through my work!

                      Being student health insurance, it’s not necessarily the most comprehensive, especially compared to the coverage I had with the company I worked with prior to coming to graduate school. For example, you pretty much HAVE to go visit the student health center on campus prior to seeing any other doctor or specialist. This isn’t too bad I suppose, but it is slightly restrictive. Even so, the coverage has satisfied my needs thus far while in graduate school.

                      LAPTOP COMPUTER

                      As you can imagine, all of the things related to my personal finances that I’ve discussed so far have been electronically based. Therefore, a good mobile laptop computer is required for me to ferry back and forth each day to the lab where I work in graduate school. The laptop computer I use is a Toshiba Satellite L555D-S7930.

                      I purchased the 17″ screen laptop over 3 years ago now, and it still works great! The only “finicky” thing about the computer is the charging step. What happens is that about 1 out of every 10 times I plug in the laptop, the battery doesn’t recognize that the cord has been inserted, and I have to plug and unplug it several times until it registers.


                      PRINTER / SCANNER / COPIER

                      Often times, in my personal finance endeavors, I’ll need to email scanned copies of forms carrying my signature for tax/financial account application purposes and print off numerous pages from the Internet in order to learn more about specific topics.

                      In order to accomplish all of these things with one device, I use the Brother All-in-One DCP7065DN Printer/Copier/Scanner. As the name suggests, it is a double-sided B/W laser printer that also includes scanner and copying purposes. At $150, it was fairly inexpensive for all of the capability that I get with the machine. Additionally, the fact that it is a laser printer drastically reduces my printing costs per page! I would highly recommend.   

                      CELL PHONE AND CAR

                      Ok, so we’re getting a little far out here, now describing what type of cell phone and car I use. However, I promised you above that I would be complete!

                      You might think that being a PF blogger, I would definitely have a high-tech smart-phone. However, I still rock out the old school Samsung flip-phone with no Internet capability. I can send text messages and make phone calls though! On top of that, I am also able to email myself notes throughout the day if I am somewhere without pen and paper. Additionally, I use a FREE transcription service through ifttt.com, which enables me to call a voicemail, leave a message, and then it will automatically convert it to text and email me the transcript and mp3 audio file. Not too shabby for being free, eh!?

                      For my car, I drive a 2009 Toyota Rav-4, recently upgraded from a 2004 Honda Accord DX. My family is a big fan of cheap, reliable Japanese automobiles, even though most Toyotas are actually made in US plants nowadays!

                      FINANCIAL ORGANIZATION SYSTEM

                      To organize all of the hardcopies of my financial documents, I use a self-created financial filing systemrecommended by David Bach in his excellent book, Smart Couples Finish Rich. You can read more about ithere.

                      EMAIL / CALENDAR MANAGEMENT

                      While I am definitely a big fan of Gmail, I choose to manage all of my email and meeting/appointment scheduling through Microsoft Outlook. Actually, I have a Gmail email address piped in to my Outlook account. It works very nicely because all of my emails and meeting details are automatically backed up and sync’d in the Gmail ‘cloud,’ while I get to enjoy the good folder organization system that Outlook offers. 
                      Within Outlook, I use the electronic filing ‘COTAP’ system recommended in the book, Hamster Revolution, along with the workflow system recommended by David Allen in his book, Getting Things Done.

                      TAX PREPARATION

                      For preparing my taxes each year, I use an actual accountant as opposed to an online service, such as H&R Block at Home or TurboTax (both of which are very good programs for the do-it-yourselfer!).

                      ZERO-BASED BUDGET AND NET WORTH TRACKING

                      In order to track my net worth each month and my zero-based budget, I use a simple, self-created Google Docs spreadsheet. I prefer to track these things manually in spreadsheet format because a lot of the accounts I have are not available in the automated personal finance software programs available, such as Mint (free), Manilla (free), SaveUp (free), Personal Capital (free), and Quicken Home ($). However, if you’re looking to make this process a lot quicker, these programs can be a great alternative! 


                      BOOKS I USED TO CREATE MY OVERALL PERSONAL FINANCE STRATEGY

                      Personal Finance for Dummies by Eric Tyson, MBA

                      Looking back on it all, I believe this was the first book I ever read prior to getting in to personal finance. In this book, Eric Tyson us with a very good, high-level look at pretty much every financial topic you could ever need to know about – investing for retirement, mutual funds, retirement accounts, educational funds for your children, insurance, life insurance, car loans, house loans, etc. This is one of those books that I like to keep around the house for the random questions that come up about topics that I forget about since they only come up every year or two (should I have term life insurance?, for example). Definitely worth the money to buy your own copy (used of course).

                      Smart Couples Finish Rich by David Bach

                      Perhaps one of the most memorable movie quotes (to me personally) was the quote by Morgan Freeman in “The Shawshank Redemption” when he said, “Get busy livin’, or get busy dyin’. That’s damn right.” I really like this quote because when you think about it, life is really too short to not live it to the fullest.
                      In David Bach’s book, “Smart Couples Finish Rich,” I found it very interesting to learn about the personal finance strategy that he adopts with the people he advises in his financial planning business. He calls his strategy a “Purpose Focused Financial Plan”.
                      Essentially, what the strategy is all about is that people/couples should plan for their specific values and life dreams, as opposed to planning what material possessions are needed for life (can be easily influenced by contemporary culture). I’d HIGHLY recommend anyone, even single people, to pick up a cheap used copy of this book and read it multiple times! 

                      BOOKS I USED TO CREATE MY INVESTING STRATEGY 


                      Stocks for the Long Run by Jeremy Siegel


                      In my opinion, this book is the best investment book ever written, and definitely deserves a place on any My Personal Finance Journey followers’ book shelf. This is essentially the closest thing to an “investment bible” on the market today.

                      In this book, Siegel analyzes everything – historical returns on bonds, stocks, mutual funds, the effectiveness of active money management, the performance of the stock market with Democrats vs. Republicans in the presidency, and methods for building an effective portfolio using Modern Portfolio Theory. It is also a great primer for explaining why individual stock selection (or active investing in general) simply does not work in the long term. 

                      What Wall Street Doesn’t Want You to Know by Larry E. Swedroe


                      This was another book that I very much enjoyed. From reading this, I really would break this book up in to two sections – the first 250 pages of talk about stock market history and essentially serve to build a case/show evidence for why active stock management is a loser’s game.  The second section (last 150 pages or so) was the most beneficial for me since I already knew a lot about stock market history and the pitfalls of active stock investing. In this section, Swedroe goes about telling how to build a portfolio that will achieve superior returns and lower risk. As was the case with Stocks for the Long Run and A Random Walk Down Wall Street, Swedroe repeatedly emphasizes the use of index mutual funds. The most useful lessons learned in the 2nd part of the book are described below.

                      1. The method to use for rebalancing a portfolio – using the 5% rule.

                      2. Describes allocation % targets between REITS, US large, small, and value stock funds, and international stock funds. There is a very handy table that I printed a copy of on page 307. Be sure to get a copy of the book and check out that page!

                      3. For higher returns, tilt more towards value and small cap stock funds (index funds of course)

                      4. The idea that a bond fund may indeed not be the best engine for the fixed income portion of your portfolio. Swedroe suggests that nowadays, it is so easy to invest in the actual fixed income security (e.g. t-bills), that it is more cost effective to just go ahead and buy it directly from the source instead of paying for the 0.1% management fee

                      A Random Walk Down Wall Street by Burton G. Malkiel

                      This is another gem that I would highly recommend for anyone who is a big believer in modern portfolio theory and the unlikelihood of beating the market long term by investing in individual stocks.

                      Like most books of it’s kind, the first part of the book is dedicated to proving that the market moves randomly, and that it is not possible to beat the market by buying and selling individual stocks or relying on active mutual fund management. One thing that I really like is how it takes the time to analyze the performance of both technical and fundamental analysis and how it compares to the performance of a mutual fund that matches the market indices.

                      The last 100 pages or so are where this book really makes itself worth the purchase. It describes in detail approximate target asset allocations for different age groups. For example, for mid-twenty year olds like myself, it recommends 5% cash, 20% bonds (5% of portfolio should be TIPS), 65% stocks (of this, 2/3 should be domestic, 1/3 should be international stocks with good exposure to emerging markets), and 10% real estate. As you can see, this goes in to a lot more detail about target asset allocations than the asset allocation calculators available on the Internet.

                      Another couple of key points that Malkiel discusses in part 2 of this book are 1) tax-managed funds for taxable accounts and 2) investing in the Wilshire index vs. the S&P 500.

                      1) Malkiel brings up the point that it is better to invest in Tax-managed mutual funds that fund houses offer if the account is taxable. This is a good idea for people that have more money at hand I believe. However, for myself, since my money is fairly limited, I do not have the $10,000 initial principal required to buy a tax managed mutual fund.

                      2) Malkiel also reinforces the important point that one should try to invest in the Wilshire 2000 index instead of the S&P500 index if you can only afford to have a limited number of funds in your account. The reason for this is simple: the Wilshire index represents a broader range of stocks, ranging from small cap to large cap, throughout the US markets. Therefore, this gives an investor more diversification than an S&P500 fund, since the 500 companies in the S&P are only very large cap stocks.

                      The Four Pillars of Investing by William Bernstein

                      This was one of the first books I read on asset allocation and index mutual fund investing several years ago. It really was what got me interested in learning more about how it all works.

                      One of the things that I like about this book is that it dedicates more time to explaining how to build a portfolio vs. spending half of the book explaining why to invest in index mutual funds instead of active management. It goes in to a lot of detail about the different specific options of mutual funds available to an investor in each asset size/class.

                      It even goes as far as to address how to best approach investing, starting with say $1000 (when you can’t afford to have 10 mutual funds). It then details how you build a portfolio piece by piece as you accumulate money over the years.

                      Highly recommended for a first book to read in learning to invest!

                      The Smartest Investment Book You’ll Ever Read by Daniel Solin


                      This is a great little book (170 pages and a very quick read at that!) that basically grazes over all of the topics in the books of Stocks for the Long Run and A Random Walk Down Wall Street. However, Solin keeps it to the high level view of things, and doesn’t delve in to the details that the others do. So, it’s good for getting a general message across, begin to set up your investing system with index mutual fund, find your correct asset allocation, and learn why stock brokers and active money management do not work!

                      The Intelligent Asset Allocator by William Bernstein

                      This is another great title from Mr. Berstein that addresses how to build and maintain a successful portfolio of index mutual funds. It has a nice section that addresses the importance of portfolio rebalancing as well. I especially also like the section of the book that describes in detail each of the recommended funds from the Vanguard fund family along with whether that fund should be held in a taxable or tax-shelter account.

                      Another very neat aspect of this book is the long list of investment resources at the end. Definitely worth taking a look at!

                      How about you all? What is your favorite personal finance account, tool, or book?

                       Share your experiences by commenting below!

                        ***Photo courtesy of http://www.flickr.com/photos/manitobamaps/3234259892/sizes/l/in/photostream/

                        How to Get a Grip on Your Gambling

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                        Welcome to My Personal Finance Journey! If you are new here, please read the “About” or “First-Time Visitor” pages to find out more about us. If you would like to receive free updates on articles like this by email, then sign up here or you can subscribe to the RSS feed. Also, check us out on Twitter or Facebook. Thanks for visiting! Keep on learning!
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                        Click here to enter my free $51.95 giveaway for a chance to win 5% of My Personal Finance Journey blog income and give another 5% to a charity of your choosing! Deadline to enter is January 31st, 2013.

                        The following is a guest post. Enjoy! 

                        While gambling is seen by many as a bit of fun or a way to spice up the dullest of sporting affairs, it can (if abused) also be a quick route to bankruptcy. As such, people need to be aware of its dangers.

                        Done well and with a good deal of prior knowledge, betting can be a potential way to get a few extra Dollars/quid in your back pocket. But if it is done badly (which is often what happens), or simply for the sake of it, then it can be a real drain on finances.

                        There are many different sorts of betting and now, in the modern age of apps, smart phones and in-play gambling, you can do so pretty much anywhere. While this may be a victory for convenience, it also has the effect of making a bet just a few clicks away and this, in turn, can lead to addiction and major financial problems further down the line. What’s more, the problem for many people seems to get worse when big sporting events are on the horizon, and there are definitely a fair few of them coming up in the next months.

                        Big events

                        The Super Bowl play-offs are due to take place at Wembley, which will have many people hurriedly laying down their hard-earned cash, while in football, many of the domestic European leagues are coming to a conclusion, and the Champions League will also approach its end.

                        It all adds up to a feast of sport, but it’s important to keep calm when betting and not get carried away.
                        Part of the reason that gambling is so dangerous is that remains addictive whether you are winning or losing. If you’ve just lost a hat-ful of cash, then you want to win that back, while if you are on a ‘lucky streak,’ then you want to keep that going. This adds up to a constant desire for gambling, and it’s something that should be kept well under control.

                        Simply enjoy sport for what it is and, while it’s OK to have the odd flutter, if you find yourself gambling on every single game or several markets within a game, then it may be time to move away from the in-play app.

                        Betting shrewdly

                        Of course, responsible betting is fine, and it shouldn’t necessarily be looked upon as a bad thing. If you do choose to put a small amount of money (which you can afford to lose, assuming the worst case scenario) on a game of football, then it’s wise to be clever about it. Ensure you look into the stats and figures before placing your stake and don’t feel as though you need to bet in any way.

                        If you feel a compulsion to put money on something when, in actual fact, you’re not too sure, then you could be suffering from addiction. If this is the case, then it’s wise to seek professional advice.

                        Know when you have a problem

                        This is one of the tell-tale signs of gambling addiction, and the important thing to remember is that burying your head in the sand won’t achieve anything. In fact, it will simply see you plunge into further debt, risking your financial security in the process. And, services such as Gamblers Anonymous are on hand to offer assistance and advice against using gambling as a debt solution.

                        Indeed, the issue of gambling is a hot topic at the present, with recent Guardian analysis finding the extent to which it is sucking money out of the UK’s poorest communities. The newspaper found that a total of £5 billion was gambled on high-speed, high-stakes gambling machines in cities across the north of England and London boroughs with high unemployment last year.

                        Around £90 million of this was gambled in the constituency of Lucy Powell, Labour MP for Manchester Central, and she said it came down to a question of morals. “There are mind-numbing numbers of betting shops in places like Moston in my constituency. I think it is a moral question to ask whether it is a good thing that betting companies are targeting the poor and whether government lets them,” she told the newspaper. “According to these figures, there’s more being spent on gambling than by the council in my constituency on services.”

                        Figures such as these showcase just how big a market the gambling sector is and demonstrates how important it is that people get a grip on their betting habits.

                        How about you all? Have you ever participated in any gambling? If so, did you lose or win money? Have you or anyone you know ever suffered from a gambling addiction? 

                        Share your experiences by commenting below!

                        ***Photo courtesy of http://www.flickr.com/photos/whappen/3159335780/sizes/l/in/photostream/

                        Don’t Let the Stigma of Debt Keep You From Getting Help

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                        The following post is by MPFJ staff writer Travis. Travis is a customer blogger for CareOne Debt Relief Services, and also appears weekly at Enemy of Debt.  Travis candidly shares his personal journey to pay off $109,000 of credit card debt and the tips he’s learned along the way. As a father and husband, he provides a unique perspective on balancing debt, finances, and family.
                        For thirteen years, I hid our mounting credit card debt from my wife.  I never denied that we had credit card debt, but I never told her just how much debt we had accumulated.  The truth is, I didn’t even know the exact number because I was afraid to add it up.  Whenever I tried, I just shook my head and stopped adding.  After the number got so big, it just didn’t seem to matter anymore what the exact number was.  It seemed so hopelessly out of control. 
                        Yet I didn’t do anything about my debt, besides continuing to increase it, until I absolutely had to. 
                        I’ve often wondered why I didn’t do something about my debt sooner.  I used to think it was simply because I was ashamed of my debt.  That’s certainly part of it, but I now think there’s more to it for me, as well as millions of other people struggling with debt:

                        Afraid to Admit Needing Help

                        Admitting that I need help is extremely difficult, and that doesn’t just apply to my debt situation.  Whether it’s being overloaded at work, unable to perform a home improvement project, or even doing tasks to keep the household running, asking for help feels like admitting I’m a failure (especially since our culture seems to prize individual success without any help!). 
                        Bankruptcy is considered by many as the last resort debt relief option, and nearly 1.8 million people filed for bankruptcy in 2011 (complete statistics could not be found yet for 2012).  That’s a lot of people waiting until they have absolutely no other option before getting help.

                        Not Aware of Options 

                        Speaking of bankruptcy, I had thought that was the only real option for debt relief.  Given the negative stigma attached to bankruptcy, people avoid it unless absolutely necessary.  I was surprised that there were other options such as debt management (the route we ultimately chose) and debt settlement.

                        Add Money To the Equation 

                        Try this:  Close your eyes and think about what you would consider a successful person.  If you are like many people, “Rich” is one of the first things that come to mind.
                        Whether we want to admit it or not, our society largely equates lots of money with being successful.  If you admit that you need help with debt, you admit that you have problems managing the most recognizable status symbol in western civilization.

                        Why It’s Better To Talk About It 

                        I could have never began my journey out of debt if I hadn’t swallowed my pride, raised my hand and said, “I need help.”  I would have never learned what my options were had I not opened my mouth and asked questions within the online community of my would-be debt relief provider.
                        For a very long time, I was afraid my friends and family would think less of me because I was in a debt relief program.  In all honesty, I still am not 100% comfortable with being completely open about my situation.  But, it does make it easier when I remember that everybody I know has a mortgage, a car payment, credit card payments, or even all three.
                        Am I really all that different from them?
                        Those that I have told have been nothing but completely supportive.  I’ve learned some of the most useful financial tips and techniques simply by talking with others about money.
                        It is true that I was forced to admit I needed help when I could no longer make my monthly payments.  Many people need something to give them that final “push” to enable them down the path of getting help.

                        Maybe you’re struggling with debt, and you’re looking for that push.

                        Talk about it with someone.  Reach out for help.  You’ll be glad you did.
                        How about you all? Did you have a hard time admitting you needed help with debt?  Do you talk to your friends and family about it?  How did they react?


                        Share your experiences by commenting below!

                          ***Photo courtesy of FreeDigitalPhotos.net

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