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What is Long Term Care Insurance?
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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 $76.18 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 May 31st, 2012.
The following is a guest post. Enjoy!
What Long Term Care Insurance Covers
Why Long Term Care Insurance Can Help
How about you all? Have you ever thought about getting or know anyone that has long term care insurance? Do you think this type of insurance is worth the money?
Share your experiences by commenting below!
***Photo courtesy of http://s0.geograph.org.uk/photos/24/68/246875_2523ec81.jpg
CarMax’s MaxCare Extended Service Plan Dissected and Other First-Hand Account CarMax Car-Buying Experiences
About a month or so ago, I went along with my girlfriend to help her purchase a car at our local CarMax.
While I could probably spend an entire post talking about the reasons for and against choosing CarMax to purchase a used car, overall, I have to say that the buying experience at CarMax was a rather positive one.
In particular, my girlfriend liked the ‘no-haggle’ pricing structure they have going on there and the fact that their cars are high-quality/not going to be ‘lemons.’ Perhaps the only drawback to buying a car from CarMax is that it is very difficult to find cars below $10,000 there. This is due in part to the fact that their cars are high quality, but in my opinion, also to the fact that because of their dependable reputation, CarMax knows people are going to be willing to pay a slight premium for cars purchased there.
Apart from the CarMax buying experience being overall very positive, there were two things that were mildly “pushed” on us to buy that I thought would be interesting to share with you all (described below):
- A 9.0% APR interest rate car loan.
- CarMax’s MaxCare Extended Service Plan for only $1,000.
CarMax’s Attempt to Push Car Loan Financing On Us
Because of some prior research I had done on the subject of car buying, I knew that while NEW car dealers were offering very low-interest rate loans in order to sell NEW cars, USED car dealers made a significant amount of money off of selling loans/financing options for used cars.
And, it turned out that the situation with CarMax was no different. My girlfriend was able to secure a loan from Bank of America for a pretty good rate of ~3.8% APR, while CarMax was willing to give her the same loan but at a 9% APR interest rate. Talk about some good mark up here! As you can imagine (since my girlfriend and I are still going out and have not broken up – haha), she ultimately chose the lower interest rate loan from Bank of America.
However, the strategy that the car salesman tried to entice us in to going with the CarMax in-house financing was rather interesting. What had happened was that the letter guaranteeing the loan from Bank of America needed to be confirmed over the phone by CarMax, but they were unable to make the call since the bank was closed for the weekend (and we needed to wait until Monday). When CarMax heard about this, they gave us an OFFER. They wanted us to walk out of the dealership with the car that night by simply using CarMax’s financing. Since CarMax is apparently nothing but our friend, they even were going to give us the option of coming back within 1 week and canceling the loan (if we decided to go with the Bank of America loan) with no fees or interest involved.
To us, this sounded like a whole lot of complication in exchange for simply getting the car 1.5 days earlier. So, we ultimately decided to simply stick with the Bank of America financing and wait until the bank opened on Monday to go back to finish the car purchase.
However, I was quite fascinated with CarMax’s willingness to swap us in and out of their financing with no fees or interest. It made me wonder if 1) are they just being nice? or 2) do they know from experience that X% of people that walk out with their financing won’t take the trouble to come back and change back to financing that they had secured from the bank?
CarMax’s Attempt to Push the MaxCare Extended Service Plan On Us
So, even though it took me a couple hundred words to explain what transpired with our refusal to take the CarMax in-house financing option for my girlfriend’s used car purchase, it really wasn’t too big of an issue at all. We simply said, “no,” to the nice salesman, and moved on with the paper(/electronic)work.
However, the CarMax MaxCare Extended Service Plan was pressured on us slightly more aggressively.
As a general rule of thumb, I operate on the belief that insurance and extended service add-ons to purchases (large or small) are generally NOT worth the money and are a better deal for the people selling the plan to you than for you the buyer. So, my girlfriend and I had done our homework on this MaxCare Extended Service Plan pumped by CarMax, and we were convinced that it was unnecessary.
Because we had done our homework about the extended service plan, we figured that when we sat down with the salesman at CarMax, it would be fairly simple to ‘just say no.’ Alas, this was not the case. During my girlfriend’s various initial talks with the salesman and subsequent discussions while we were finalizing the paperwork, I would say that the CarMax Extended Service Plan was mentioned no less than 5 times. By the end of it, I felt like we were almost made to seem like we would be IDIOTS for not taking the plan and that ALMOST EVERYONE who buys a car from CarMax gets the service plan. The salesman even threw in a story about one of his friends that is happily using the extended service plan when his car broke down! It was a nice touch! Was it true? Maybe.
When we finally got to the last screen where he could sign us up for the extended service plan and we still said ‘no,’ he actually asked us WHY we didn’t want to take advantage of such a great deal. In reply, I simply said, “NAME OF SALESMAN, let’s just proceed with the sale of the car,” because I didn’t want to give him the chance to bring up some doubts, regardless of how good his intentions were. And, he respectfully followed our wishes. So, overall, despite knowing that the MaxCare Extended Service Plan was not necessary for us, my girlfriend and I still felt very pressured in to buying it, and she felt rather guilty for not doing so at the end of the episode.
Now, this is not to say that CarMax is evil by any means. As I mentioned above, the overall result was quite positive, and I know it’s just part of the game of buying a car. But, it was interesting since I had never gone through the used car-buying process before.
Details of the MaxCare Extended Service Plan from CarMax
During the car buying process at CarMax, the Extended Service plan emerges as a very appealing option. On one hand, the initial cost of the plan is tacked on to the amount you are financing, making it so that you don’t necessarily consider the full cost since you will be paying it off over time. Second, many people coming to CarMax are looking for relief from an unreliable car that they had to make a lot of costly repairs on, so the Extended Service Plan very much catches their eye.
Especially in these slightly elevated pressure buying situations, it’s particularly good to know the facts about what you’re buying in to. So, I wanted to spend a little bit of time in this post discussing what exactly the CarMax MaxCare Extended Service Plan entails, and what it does not!
How Much Does the MaxCare Extended Service Plan Cost?
At a high level, the CarMax Extended Service Plan is a smaller, specialized insurance policy in a car service plan wrapper. The costs of the service plan are summarized below:
- You pay $1,000 at the time of purchase of the plan/your new car.
- Then, each time you need to bring in your car for a repair, you pay a pre-selected deductible, ranging from $100-$500 per visit.
How the MaxCare Extended Service Plan is Presented and What is and is Not Covered by the Plan
Essentially, what happens is that you are handed over this wonderfully crafted brochure “describing” all of the details of the plan. But, instead of this brochure listing the specific details that I expected such as price of the plan and different deductible levels, etc, it basically seems to be designed to overwhelm the car buyer in to thinking that it covers EVERY POSSIBLE REPAIR THAT COULD EVER HAPPEN WITH THE CAR. This is done by listing out about a thousand or more parts of a car that are covered by the plan, as shown in the picture below:
The catch is that if you read through the listing of parts covered by the plan and then compare it to the back side of the brochure where the plan exclusions are shown, it quickly becomes clear that 90% of the repairs that you will most likely incur on a reliable used car are NOT covered by the service plan (i.e. – they are all listed in the exclusions section).
I’ve highlighted several things not covered by the service plan below:
- Regular maintenance services described in your car’s manufacturer manual. This includes major 30k and 60k mile services and other major component replacements described in your owner’s manual.
- Engine spark plugs and ignition wires.
- Batteries, air conditioner refrigerant, engine coolant, drive belts.
- Brake pads and shoes.
- Suspension work, tires, wheels, catalytic converter, manual transmission work.
- Painting, bumpers, alignment of body parts.
- Repairs made to meet government emission standards.
I don’t know about you all, but looking at the list above on what is EXCLUDED from the plan pretty much encompasses every single costly repair I’ve ever had on my 2004 Honda Accord in the 8 years I have driven the vehicle.
You can view complete details about what is covered by the plan by clicking here and what is NOT covered in the plan by clicking here.
Conclusions
Because of the large amount of exclusions from the MaxCare Extended Warranty Plan, we ultimately decided that it was not the best move for us. And, by sticking to our guns, we were able to resist the pressure from CarMax to buy the service plan and their higher-interest rate in-house financing. And in the end, my girlfriend walked out of CarMax an altogether satisfied customer and is happy in her new, dependable car.
How about you all? Have you ever purchased a used car? If so, did you ever consider CarMax?
Did CarMax or the other used car dealer try to pressure you in to obtaining their financing options or their extended warranty/service plans? Do you think these extended service plans are a good deal?
Share your experiences by commenting below!
***Photo courtesy of https://upload.wikimedia.org/wikipedia/commons/thumb/b/bd/CarMax_Logo.svg/1000px-CarMax_Logo.svg.png
Best of Money Carnival #156 – May 21st, 2012 Edition
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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 $76.18 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 May 31st, 2012.
Welcome to the Best of Money Carnival (a weekly listing of the top 10 personal finance posts) – May 21st, 2012 Edition!
I hope you enjoy all of the posts I’ve selected for this week’s edition – and then come back to visit My Personal Finance Journey on my non-carnival days too.
For this edition, we had ~70 articles submitted. Below are my choices for the Top 10 Personal Finance posts of the last couple of weeks (that were submitted properly of course) in order from 1 to 10. A big congrats to all of this week’s winners!
1, Roshawn Watson presents 4 Ways To Reshape Your Views Regarding Money posted at Watson Inc. Perhaps one of the biggest ways to effect change financially speaking is to alter your belief system. Here are four ways to reshape your views regarding money.
2. FMF presents The Difference between Needs and Wants: Getting Spending Under Control posted at Free Money Finance. Achieving financial security is greatly dependent on our ability to make wise choices when it comes to spending money. Spending, not earning, is the key to financial security (though both are important, of course). And yet we live in a society where over-spending is almost the norm. The result for many people is a pile of debt and all the nasty struggles associated with it. It’s certainly not the pathway to financial security.
3. Harri Pierce presents Lessons from living below the line posted at TotallyMoney. A one week experiment to see how difficult it was to eat for less than £1 per day and how it can affect the rest of your life
4. Jason presents Should You Buy a Car Through CarMax? posted at Work Save Live, saying “Rust buckets, over-sized purses, methods of transportation, and a means of showing worth and status. Maybe it’s needless to say, but there isn’t a topic I detest more. When I hear the word ‘car’ all I can think about are over-priced machines that have gone from performing a function to being status symbols.”
5. Roger the Amateur Financier presents Advice for Students: What to Do With Your Summer posted at The Amateur Financier. A discussion directed towards students in high school and college, covering what they can spend their time doing in the summer in order to improve their finances and be in better shape economically.
6. Khaleef Crumbley presents 4 Reasons Why I Will Not File For Bankruptcy posted at Faithful With A Few. To file for bankruptcy is not an easy decision. Even though it has become more common, here are 4 reasons why KNS will never do it!
7. Ashley presents The Envelope System Works: Even on a 10 Year Old posted at Money Talks Coaching, saying “I’ve talked quite a bit about my frustration with my daughter and her lack of concern when it comes to money. She wouldn’t save money to save her life.”
8. Suba presents Should you buy Supplemental Unemployment Insurance posted at Broke Professionals. Unemployment is one of life’s setbacks that can seriously damage a person’s financial security. It can happen to anyone, even you.
9. YFS presents 10 Common Characteristics of Millionaires You Can Follow posted at Your Finances Simplified. Back in 2007, Forbes Magazine reported that all over the world there are a total of 946 billionaires, and according to Capegemini, a financial consultancy firm, in 2011 there are about 10 million millionaires. All of us probably have this dream of becoming millionaires ourselves, and sometimes we’re left wondering how these once ordinary people manage to make it big.
10. Hank presents How A Little Preparation And One Question Saved Me Over $1,000 posted at Money Q&A, saying “I hate buying a new car, but a little preparation and one simple question he me save money buying a new car this time with a little preparation.”
Well, that concludes this week’s Best of Money Edition. To all participants – it was a pleasure reading your articles this week!
Please submit your posts to the next edition of the Best of Money Carnival using the carnival submission form. The next carnival (#157) will be hosted by 20’s Finances and is scheduled for May 28th, 2012.
Also, If you’d like to host a future carnival, contact FMF asking for a slot.
$76.18 Giveaway – Community and Charity 10% Monthly Blog Income Give Back # 8 – May 2012 Edition
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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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The 10% give back giveaway fun rolls on for the month of May!
In case you missed the first seven editions of the 10% Blog Income Give Back, after doing some thinking at the beginning of October 2011 about what direction I want this blog to grow and evolve towards in the future, I decided that any income made from this blog would have more significance to me at a personal life values level if I knew that a portion were being given back to the following places:
- 1) The readers – Obviously, without you here to read my articles and interact with my ideas, there would be no blog in the first place (let alone blog income). As such, it is only fitting that you receive a portion of any blog income.
- 2) Charitable organizations – If you’ve read my blog before, you know that I’m a big believer in donating a portion of my money to charity. Each year, I donate between 5-10% of my income to the National Multiple Sclerosis Society as part of the Bike for MS fundraiser that I do. Beyond the good that is done by donating your money, getting used to contributing to charity is also a good practice to emulate the actions of affluent individuals (T. Harv Eker discusses this in his book, Secrets of the Millionaire Mind, which I would definitely recommend reading if you have a few hours).
Because of these considerations, I’ve decided that each month going forward, I’m going to give away 10% of my net (after-tax) blogging income/profit to My Personal Finance Journey readers (5%) and to charity (5%). Listed below is how the process will work:
- After each calendar month passes, I’ll tally up my net blog income and determine what Dollar value correlates to 10%.
- I’ll post the giveaway (similar to this post you’re reading now), and you’ll have approximately 2-3 weeks to enter.
- Once the giveaway is over, a grand prize winner will be announced, and then I’ll donate another 5% of my blog income to a charity. Once the giveaway entry window ends, I’ll send out the money to the blog reader winner(s) and personally drop off the charity donation.
- So far, I’ve been very happy with the success of the first 6 editions of the 10% income give back. Read on below for some of the details:
- In October, $205 total was given away, with $100 being donated to the charity, GreenPeace.
- In November, $201.40 total was given away, with $100 being donated to the charity, The Blue Ridge Area Food Bank. If you’re interested, you can view the details of me going to drop off the check at the Food Bank by clicking here.
- In December, $74.52 total was given away, with $38 given to Big Brothers Big Sisters of Central Blue Ridge. You can view the details of the donation drop by clicking here.
- In January, $196 total was given away, with $96 given to the Sexual Assault Resource Agency. You can view the details of the donation drop by clicking here.
- In February, $141.20 total was given away, with $70 given to the Blue Ridge Chapter of the National Multiple Sclerosis Society.
- In March, $64.51 total was given away, with $30 given to the Blue Ridge Chapter of the National Multiple Sclerosis Society.
- In April, $46.95 total was given away, with $25 given to the Blue Ridge Chapter of the National Multiple Sclerosis Society.
- $76.18 total blog income to give away – $38.18 to a My Personal Finance Journey reader and $38 to the National Multiple Sclerosis Society – Blue Ridge Chapter.
- $38.18 in the form of one prize available to one reader as follows –
- 1) Grand Prize = $38.18 Amazon Gift Card or $38.18 cash via PayPal.
- It’s been very fulfilling developing a relationship with the local chapter of the National Multiple Sclerosis Society through the MS150 fundraising bike ride I do each year. Click here to see the details for the 2012 edition of the ride I’ll be doing! I look forward to continuing to raise money for their efforts.
How to Enter the Giveaway – Deadline to Enter is Midnight, May 31st, 2012
Like last month, I’ve decided to use the RaffleCopter giveaway management tool to handle sign-up facilitation for the April giveaway, so simply go through the steps listed in the widget below to enter the running for the prize and accumulate entry points.
There is no limit to the amount of points you can earn. If you refer 10 subscribers – your name will have accumulated 170 entry points! Or, if you link to the giveaway more than once, you can accumulate those 7 entry points multiple times. You can also retweet the giveaway and/or share other My Personal Finance Journey articles via social media sites once per day. In the event of a tie, I will be using a random number generator to select the winner.
Important instructions: After you complete an entry method, make sure to click and fill out the “I Did This” or “Enter” button in the widget so that I have a record of your points.
a Rafflecopter giveaway
Remember, the deadline for entries will end at midnight on May 31st, 2012 (about 2 weeks from today – the start of the give back). Good luck to you all! Please contact me if you have any questions. After the deadline for entries passes, the winner (one with the most points accumulated) will be contacted via email to receive their prize.
Yakezie Blog Swap # 20 Roundup
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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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On Friday of this week (4-May-2012), My Personal Finance Journey participated in the 20th Yakezie Blog Swap (can you believe we’re already on the 20th edition!? Crazy!). In this event, members and challengers of the Yakezie Personal Finance Network paired up and exchanged posts on a common topic.
This month, the topic selected for us all to write about was as follows relating to wedding spending. According to the Huffington Post, the average wedding cost in 2011 was $27,021. Looking at this statistic, why do you think people spend so much on weddings? Do you think it’s worth the money? How do people afford weddings that cost $27k if the national savings rate is so bad? What are the long-term financial ramifications of an expensive wedding? What tips do you have to help people save money on weddings?
There were 10 bloggers who participated in the swap this time around. The various posts written are described below:
My Favorite Swapped Post
Emily from Evolving Personal Finance shares first-hand experiences from her wedding planning about why weddings cost so much, how people finance weddings, and also money saving tips on Edward Antrobus. I really liked how she placed on emphasis on the importance of prioritizing what is important to the bride and groom in the wedding in order to maximize value.
My Swap
I wrote about why people spend so much on weddings and possible ways to save some money on Frugal Portland.
The Rest
Nick from Step Away from the Mall writes a fascinating article about his first-hand experiences with inviting 350-400 people to his wedding and how it can easily cost a ton of money on Daily Money Shot.
Jana from Daily Money Shot wrote about the various ways she saved money on her wedding on Step Away from the Mall.
How about you all? Why do you think people spend so much money on weddings these days? Is it worth it? What tips do you know of that people have used to save some money?
Share your experiences by commenting below!
***Photo courtesy of http://www.public-domain-image.com/cache/people-public-domain-images-pictures/male-men-public-domain-images-pictures/man-reading-and-writing-at-table_w725_h544.jpg
Is a Wedding Worth the Down Payment on a House?
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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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Background
A Wedding is the Biggest Party of Your Life
Here’s the thing. Too many people focus on a wedding and not enough people focus on a marriage. I get it. Weddings are like birthday parties only bigger! More impressive! And, you get to be the center of attention much more than at a birthday. Everyone has a birthday every year, but, in an ideal world, each couple has just one wedding. And, the bride feels like going out of her way to make her party great.
Keeping up with the Kardashians
The average cost of a wedding is somewhere around $28,000. To put that in perspective, my 2005 Toyota Corolla is worth about $7,000. So, the average wedding costs four Corollas. And no, you cannot drive home a wedding. In fact, the things you get after you’ve had your big party are limited to kitchen toys, a marriage license, and 489 tea lights.
In a wedding, as in all things, you compare yourself against your peers. Whether you are the first in your age group to marry, or you’re like me, and have been to more than 20 weddings, it’s darn near impossible not to compare. Just look at the social cues: a picture of the ring is the universal sign for “I’m engaged!” because women want to see how your ring compares to theirs. They’re happy for you, sure, but they also want to know if you “did better” than they did.
More shockingly, the four-Corolla price tag for this mystical “average” wedding does not include the ring or the honeymoon. The dress is the first surprise. I haven’t purchased a formal gown since my senior prom, so inflation might have happened a bit, but if I could buy a prom dress for under $200 why on earth is a $2000 wedding dress considered a bargain?
All ranting aside (I don’t want this to become the ravings of an over 30, never been married bitter bridesmaid), it’s a bad idea to go into debt for your wedding. The success rate of marriage is so low, partly because two people spend x amount of time developing an intimate relationship and at least x amount of time planning a party. The wedding is the party, the marriage is forever. The more time you spend setting expectations and discussing what married life means to you, the less your color scheme matters.
Focus on a marriage and not a wedding. Your friends and family love you, and will have fun celebrating the beginning of the rest of your lives together. Don’t get caught up in the details. Have a blast. Love your spouse. Don’t marry someone until you’re absolutely, 100% sure you want to be old with them.
What tips do you have to save money for weddings?
Share your experiences by commenting below!
***Photo courtesy of http://farm4.static.flickr.com/3223/2760437873_13e50463fa.jpg
Bringing Down the Cost of Delivery
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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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The following is a sponsored guest post. Enjoy!
How about you all? Do you worry much about the transporting/shipping costs when you order online? Do a lot of items you’re considering purchasing require pick-up only? Have you ever used a delivery service for items that are pick-up only but are too far of a drive?
Share your experiences by commenting below!
***Photo courtesy of http://nopsa.hiit.fi/pmg/viewer/images/photo_5349064598_7cb8115bef_t.jpg
Carnival of Personal Finance #359 – Most Expensive Bottles of Wine – April 30th, 2012 Edition
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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 $46.95 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 April 30th, 2012 (today at midnight Eastern Time!).
The theme for this week’s carnival is a listing of 5 of the most expensive bottles of wine ever sold in the world! I hope you enjoy the posts and that you can stop by My Personal Finance Journey on my non-carnival days as well!
Listed below are this week’s top 5 editor’s picks. Congrats to the five winners! Some truly great articles here!
1. Our #1 pick of this week is by Darrow Kirkpatrick from Can I Retire Yet?, who presents Is the 4% Safe Withdrawal Rate Obsolete?, and says, “The era of the simple 4% Safe Withdrawal Rule in retirement may be drawing to a close. We are now hearing from some respected voices that it is rigid and simplistic — relying too much on historical data, and not enough on current financial conditions. Most alarmingly, we are being told that it might be too generous for these extreme economic times, that the actual safe withdrawal rate for today’s retirees could be less than half of the traditional 4% rate.”
Jacob’s Comments – In this article, Darrow expands on the ongoing analysis by others such as Rob Bennett, Todd Tressider, Robert Shiller, and Wade Pfau concerning whether and/or how long term market price valuations should be taken in to consideration to make investing decisions. In this case, Darrow examines whether or not a 4% withdrawal rate during retirement is applicable in today’s environment. This is truly a very important topic for everyone, and this article definitely warrants a thorough read!
2. The #2 pick of this week is by Sean from One Smart Dollar, who presents What is the Best Day to Buy Specific Items, and says, “Did you know that you can save money just be purchasing items on a specific day of the week? ”
Jacob’s Comments – This article examines the very interesting subject of price variations involved in purchases in the following categories across various days of the week: gas, hotel rooms, airfare, cars, clothing, and eating out. To me, the most surprising find was that Wednesday morning is the cheapest time to buy airline tickets.
3. Our #3 pick for this week’s Carnival is by
FamilyMoneyValues from Family Money Values, who presents Parents As Resources for Adult Children, and says, “Now that I am the parent of adult children, I am beginning to understand at least some of the reasons Mom and Dad offered what they did. Here are four things I wish I hadn’t been so stubborn about.”Jacob’s Comments – There are so many ways that parents can give their children a head start financially. However, the children have to be ready to accept that help. This article highlights several very interesting first hand experiences regarding this issue.
Jacob’s Comments – When I first started out investing, I too bought and sold individual stocks. I had some winners, but overall, did not make any money above the market return. After reading about investing more, I now follow a passive investing approach using index mutual funds and ETFs. Barb’s journey in this article is somewhat similar to mine, and was quite interested to read!
Jacob’s Comments – Dave Ramsey is a significant force in the personal finance community. I like his advice because it provides a simple guide and empowers people to take action quickly to get rid of debt. This article analyzes how much emergency fund a person needs. Personally, I think that most people need a larger emergency fund than the $1000 recommended by Dave, but $1000 is a good starting place for sure!
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And, listed below are the rest of this week’s great article submissions.
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Everything Finance from Everything Finance Blog presents Stay at Home Parents. . .Denied!, and says, “I recently read a US News Article about how the stay at home parent must ask the breadwinner for permission before opening a charge account. What??? Yes, even in the year 2012 this is true. The article sheds light on the Federal Reserve’s decision: No paycheck, no credit card.”
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Next week’s carnival (#360) will be hosted by Money Talks Coaching, and is scheduled to take place on May 7th, 2012. B
e sure to submit your articles for next week’s edition, using the following handy submission form.Also, if you’re interested in hosting a future edition of the Carnival of Personal Finance, you can apply using this form.
***Photo courtesy of http://nopsa.hiit.fi/pmg/viewer/images/photo_2857498721_0910907411_t.jpg
***Expensive wine bottle stats courtesy of http://www.huffingtonpost.com/2011/11/10/most-expensive-wine_n_1084988.html#s463410&title=1865_Chateau_Lafite
The Credit Card Dilemma: Prepaid or Not Prepaid?
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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 $46.95 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 April 30th, 2012.
The following is a guest post. Enjoy!
The Pros of Prepaid Credit Cards
The Cons
of Prepaid Credit Cards
Conclusion
How about you all? Have you ever used a prepaid credit or debit card? If so, did you incur a lot of expenses in order to use it?
If not, why have you steered clear of prepaid cards?
Share your experiences by commenting below!
***Photo courtesy of http://farm4.static.flickr.com/3050/2919245129_276a62a19d.jpg
What’s Your Magic Number?
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Recently, I was exposed to an interesting new online personal finance savings and life goals realization tool, called MagicNumber.com. And today, I wanted to share a my experiences in trying it out with you all.
What is Magic Number?
- Guides you through calculating the amount of money you need to make working optional at a specific target age and then allows you to set goals to reach this target.
- Facilitates execution of other general life goals that are important to you at a core values level.
How Does MagicNumber.com Work?
- Upon landing on the MagicNumber.com homepage, you enter 1) the age at which you want work to become optional, and 2) your email address.
- For me, I set this age as 50 years old.
- Next, you enter what values are important to you in life.
- For example, standard of living, career vs. family focused, active vs. relaxed lifestyle, social vs alone time.
- Then, you are taken through a total of 8 screens to help you figure out your Magic Number, or the amount of money you need to have saved up to live the lifestyle of your dreams by the age you entered on the homepage.
- The 8 screens that you are taken through are summarized below:
- Dream home price
- Dream transportation purchase price
- Amount of money you’ll spend per month for the lifestyle you dream of
- Amount you want to spend per month on hobbies
- Amount you want to spend per year on vacations
- Amount you want to donate per year to charity
- Amount you want to have leftover to will to others once you die
- Your current net worth
- Each screen features a simple slider toolbar to adjust the amount of money you think you’ll need for each category. An example of the lifestyle screen is shown below.
- The idea here is to get a very general/quick gauge of the amount of money that will be required for a certain lifestyle.
- The Magic Number that was generated for my inputs was that I needed to have ~$9 million by age 50.
- After generating your specific Magic Number, the system will display a screen similar to the one below, detailing the daily, monthly, and yearly savings goals that are needed in order to obtain your Magic Number amount by your set target age.
- Once the system generates these numbers, I’d then recommend doing a “reality check” to make sure that your savings goal is achievable given your current salary and financial condition.
- If these two things don’t align, you can then go back and re-evaluate your Magic Number if needed. This was the case for me, since as you can see below, the savings target of $11,000 per month is not possible given my current graduate school salary.
- Next, the Magic Number system will take you to a screen similar to the one shown below where you can enter other general life goals that you have based on your core life values. You’ll also specify target achievement dates for these goals.
- For me, this was fairly similar to the exercise I go through twice per year where I evaluate my life values and life dreams.
- After specifying each life goal, my favorite feature of the MagicNumber tool comes in to play. Important Note: Using this feature involves a fee. See below for more details.
- What I mean by this is that Magic Number then helps you break down an execution plan for your life goal by (after starting with your long term goal) first setting 3 year goals, then 1 year goals, then 90 day goals, then immediate actions you can take. You also specify achievement dates for these as well.
- An example of this feature’s online interface is shown below.
- For me, this is a very powerful feature since many times (even though I do a goals review twice a year), I sometimes forget during the “day-to-day hustle and bustle” about the interim steps I can be taking to achieve my long term life goals.
- After entering each interim goal and the target date for each respective action approaches, you’ll then also see alerts for these “upcoming actions” in your account dashboard interface.
How Much Does Magic Number Cost to Use?
Certain parts of MagicNumber.com are free to use, and other portions are not. For example, you can generate your Magic Number savings goal and enter your other general life goals in to the system for free.
However, in order to use the goal achievement breakdown and tracking tool shown in the last picture above, there is either a monthly or yearly fee, as described below:
- $95.67 per year
- Or, $9.97 per month
What’s the Bottom Line?
Overall, Magic Number is a fun and easy-to-use online tool (everything is a very visually intuitive) to help an individual 1) determine how much money will be needed to achieve the lifestyle of their dreams and 2) to realize other general core life values goals through continuous monitoring and tracking of interim action steps.
As such, Magic Number if well-suited for people that have specific goals they want to achieve, but often find that they arrive at the end of the year without having made significant progress since they got busy with everyday life.
How about you all? Have you ever heard of or tried out MagicNumber.com? If so, what did you think of it?
If not, how do you track your overall life goals and how frequently do you review your progress?
Share your experiences by commenting below!
Important Note: This review was sponsored by MagicNumber.com. However, the opinions and perspectives represent my honest review of the product. Thanks for reading – Jacob
***Photo courtesy of http://farm4.static.flickr.com/3032/2574833687_30cbd81acd.jpg