Stop, Think, and Be Thankful

The following is a post by MPFJ staff writer, Derek Sall. Derek is the owner of the blog, LifeAndMyFinances.com, where he teaches people how to get out of debt, save money, and become wealthy.

Do you ever stop to think about how much you really have? I sure hope so, because if you’re reading this post on your personal laptop or tablet right now, you have tons more than the average person in this world. On this day, I suggest that you stop, think, and be thankful.

We Are Wired to Want

Have you ever wanted something simply because someone else had it? I think we all have! It’s in our nature. Let’s take kids for instance. There might be a group of kids playing, each with their own toy, and then one kid decides to pull a different toy out of the closet, one that everyone knew about and didn’t grab. But, now that this kid has it, the other kids want it. We have all seen this before haven’t we? For whatever reason when someone else has something we are wired to want it.

Unfortunately, many of us do not grow out of this habit of wanting. When our friends and neighbors buy new cars, we suddenly get the itch to buy a new car as well. We know that it’s not a wise purchase (due to our lack of cash and the quick depreciation on the vehicle), but we begin to justify it. We suddenly start noticing that our current car “breaks down all the time” and “gets terrible gas mileage”, when in actuality the car is a perfectly fine automobile and might last another ten years if you just take care of it. The reason for buying the car is simple – we want it so we talk ourselves into buying it.

We Forget What We Have

As human beings, all we really need is a roof over our head, food in our bellies, and clothes on our back. If we shared a house with ten of our closest friends, what would all of that really cost us? Maybe $200 a month? But how much do we actually spend per month? For many of us, the monthly cost of keeping all of our stuff is well over $3,000 a month. Isn’t that just insane?!

And, with all of this spending, we are still left wanting more. Instead of a 2,000 square foot house, we think we need a 3,000 square foot house! Instead of a six-year-old domestic car, we would really like a brand new luxury car. And for what reason? Just because it looks cooler? Or maybe because we want others to envy us?

I don’t think I have ever quoted Oprah Winfrey before, but this saying is absolutely spot on:

“Be thankful for what you have; you’ll end up having more. If you concentrate on what you don’t have, you’ll never, ever have enough.” – Oprah Winfrey

Thankfulness and happiness really go hand in hand. If you are thankful for what you have and are happy with what you own, then you will likely be blessed with even more. But, if you constantly want what other people have, then you will just be wanting for your whole life, because there is no way that you can afford to buy everything. It is best to be thankful.

We Don’t Know What Others Don’t Have

While we are out wanting all day, many of us forget to consider the needs of others. Do you ever stop to think about how good you actually have it? There are millions of people out there that do not have access to clean water, and you can access it from your home by taking about 5 steps to your left and turning the faucet.

There are millions without the luxury of owning a car, but still walk 10 miles or more each day purely for their survival. You have a car that can drive you hundreds of miles, but you just want a shinier model.

The next time you want something, consider the life of the needy. How would they view your desires? Again, be thankful for what you have and you will only grow in your happiness in this life.

How about you all? What have you desired lately that is totally unnecessary? Will you be thankful instead?

Share your experiences by commenting below!

**Photo courtesy http://www.flickr.com/photos/hgaronfolo84/116858703

Increase Your Net Worth with Education

The following is a post by MPFJ staff writer, Derek Sall. Derek is the owner of the blog, LifeAndMyFinances.com, where he teaches people how to get out of debt, save money, and become wealthy.

Did you know that the more education you have, the higher you pay will likely be? I know it probably doesn’t shock you, but it’s absolutely true!

When I was in college for engineering, I was concerned that I would need to continue my education again and again in order to keep up with the changing dynamic of the engineering world. In fact, it was one of the reasons that I left engineering school.

Looking back, I was an idiot kid that didn’t realize that all occupations require continued learning. It’s expected that you continue to learn, grow, and improve in the working world. In fact, if done properly, it can actually be a great way to advance at your place of employment.

Feed Your Brain

So what is the best way to improve your knowledge and advance your career? As much as I hate to admit it, getting your Bachelor’s degree will probably provide you with the greatest degree of advancement. Just be sure not to spend too much on your degree. It might be easier to find a job coming out of an Ivy League college, but it will definitely cost you more money to receive that luxury (often two or three times more). Instead, look at going to an in-state university or a smaller college. The cost will be much lower, but your employer will likely still be impressed by the name of the school on your resume.

If you have your bachelor’s degree and work in an office setting, the next suitable degree would be a Masters. Again, focus on getting the education from the degree and don’t worry so much about the name of the school you are getting it from. Just having the degree will mean quite a lot to your employer.

Finally, if you are not interested in obtaining degrees then I would suggest being your own teacher. Take a hold of your own education and get yourself over to your local library. What are you interested in learning more about? Company financials? Leadership? Management? The library holds your answer to each of these topics and many more. Find out what you would like to learn, teach yourself through books and online courses, and then be sure to use your new-found knowledge in the workplace.

Prove Your Worth

Getting a degree is admirable, but if you apply none of your learning then you really don’t deserve to advance in the company. No matter where your education came from, if you expect to move up the career ladder to that next job, then you’ll certainly need to apply your learnings in your job.

A few years ago I sought out a mentor. This is the exact message he conveyed to me as well. Sure, a piece of paper from the University is nice, but it doesn’t do anything for the company if the education goes unused. Instead of just displaying my diploma in my cubical, he encouraged me to teach some of my knowledge to the rest of my department.

Within a couple of weeks, I discovered that many of my coworkers did not know how to use Microsoft Excel efficiently. Instead of using a function to transfer information from one file to another, they were copying and pasting information. To help them out (and to prove my worth to the company) I held a class for 14 people. I taught them how to use functions and I was immediately deemed “The Excel Guy”. It increased the company’s awareness of my skills (not just in Excel, but in teaching others) and it showed my increased value to the entire company. This simple action led to a promotion just four months later. If I hadn’t displayed my knowledge, I would likely be working that same menial job today.

Increased Knowledge Equals Increased Income

As you may have gathered, and improvement of knowledge will soon lead to an improvement in your income. As you learn and grow and display your skills to your employer, you will no-doubt be rewarded for the increased value you have brought to the company. Your knowledge will lead you to higher ranking jobs and will also increase your salary with each jump up the ladder. Education is almost certain to increase your salary, and therefore your net worth.

How about you all? Are you working to increase your knowledge? Are you displaying your new skills at work?

Share your experiences by commenting below!

**Photo courtesy http://www.flickr.com/photos/nottinghamtrentuni/14714286904

Can Public Transportation Replace A Car?

The following post is by MPFJ staff writer Travis.  Travis is a customer blogger for Care One 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.

I stop at the corner at the end of my block to talk to my neighbor almost every day at the conclusion of my morning run. It’s always at roughly the same time because I have to be home in time to make sure my kids get up for school, and my neighbor is waiting for the city bus to pick him up and take him to work.

For as long as I’ve known him, his family has owned a single car and his wife drove it to her job, requiring him to use alternate methods to get to work. I figured that they just prioritized other things financially over owning a second car. When the weather is nice, sometimes he rides his bike, most of the time he takes the city bus.

Recently they purchased a second car, but I still find him standing on the street corner at 6:00am waiting for the bus. I asked him why he still rides the bus, even though they now had two cars. He gave the following answers:

• Finding parking downtown is difficult and time consuming
• The cost of parking adds up quickly

Our conversation piqued my interested, and prompted me to do some investigation into using alternate means of transportation as well. My son is turning sixteen soon, and there may be times when he may want or need to drive to school. Neither he or I are in the position to buy another car right now, so we may be left with my wife, my son, and I all needing to drive, and only two cars.

Since my office is less than five miles away from my home I wondered how much it would cost for me to use an alternate method of transportation to get to and from work, and if it would work within my schedule to do so.

Bicycle:

Cost:

I used to have a bike, but it was stolen a decade ago. I’d incur a one time cost of a bike and a bike lock. I could spend $80 on a bike, or I could spend $1000 or more. I’d likely try to find something in the $300 price range.

Convenience:

With a bike, I would be free to come and go as I pleased. However, weather conditions could play a major detracting role in this as well. I would also have to get some kind of rack to transport my lunch and laptop. It would take me about 20 minutes to get to work, which isn’t that much longer than driving myself.

Analysis:

Using a bike to get to work would be much cheaper in the long run than buying another car, but there are times when the weather could be a factor in being able to get to and from work.

Public Transportation:

Cost:

I took a look at my city’s public transportation website and found the following pricing:

• $2 per ride
• $26 for a 20 ride ticket
• $48 for a monthly pass
• $480 for a yearly pass ($40 a month)

Convenience:

A bus line runs along the street at the end of my cul-de-sac, and as mentioned the bus actually stops at that intersection.   The bus comes every 30 minutes starting at 6am until 8:30am. It goes almost directly to my place of employment, the ride lasting 15 minutes. I can again use it to get home, with the bus picking up at my place of employment every 30 minutes starting at 3:45pm until 6:15pm.

Analysis:

As far as public transportation goes, having a bus stop 100 feet from your front door is about as convenient as it can get. The 15 minute ride is only slightly longer than it would take me to drive there myself.

Riding the bus isn’t as convenient as hopping in my car and leaving at any time I feel like it. But, it does give me some flexibility as to when I want to get to the office and definitely fits my usual workday schedule.

Advantages & Disadvantages:

The pros and cons of using a bicycle and/or public transportation to get to work breaks down like this:

Advantages:

• Cheaper than owning a third car (Cost of vehicle, gas, maintenance, insurance)
• Don’t have to worry about my car starting in winter
• Don’t have to worry about parking

Disadvantages:

• Inconvenience of waiting in or driving my bike in hot, cold, or rainy weather
• Takes longer to get to and from work
• Inconvenience of planning your work day around the bus schedule
• Lack of privacy when riding the bus

The best solution for me is to purchase a bicycle along with a 20 ride bus ticket. This gives me a bike that I can use not only to go to and from work on days I need an alternate method of transportation, but also for recreational purposes. The 20 ride bus ticket allows me to use the bus on those rare occasional that I need to ride the bus. It doesn’t expire, so I can use it as frequently or infrequently as needed. When it’s used up, I can just buy a new one.

We expect my son to get a part time job, save up his money, and eventually buy his own car. Until then we’ll have to make some sacrifices when it would be more convenient to allow him to drive to school due to after school activities, or if he has to work. The bicycle / city bus combination is the perfect low-cost solution to achieve this.

How about you all? Do you use public transportation? Have you ever investigated the cost and convenience of using public transportation in your area?

 Share your experiences by commenting below!

 **Image courtesy of nitnut at FreeDigitalPhotos.net

Practical Advice For Those Considering Law School

The following is a guest post by Nick from Millennial Finances. Enjoy! 

I graduated law school last May and wanted to pass along some practical advice to anyone considering law school.

Hopefully you read the news and know law school is not a safe route to a high-paying job. You should have significant concerns about about law school, and I’ll try to address them here:

Aren’t law schools producing more graduates than there are legal jobs?

Yes. Only 64.4% of recent law grads had jobs that actually required you to pass a bar exam. Median law graduate salaries (of those who reported their salaries) dropped to around $62,000, down from $72,000 in 2008.

The problem is law schools are cash cows – very inexpensive to run yet you can charge a lot of money thanks the ease of getting federal student loans. For-profit schools are especially predatory in leaving students with high debt, low bar passage rates, and even lower employment rates.

It’s crucial to scrutinize the data of the schools you want to attend. Where do their students end up employed? What are their areas of specialty? With how much debt, and at what salary? Many schools fight these important disclosures, or try skewing the numbers. Even prestigious schools magically increase their students existing GPAs to boost their employment numbers. Villanova’s dean resigned after a scandal involving doctored GPAs and LSAT scores.

So don’t just rely on whatever the law school tells you. Spend hours with Law School Transparency school reports. It’s a terrific resource that includes everything you should know your law school destination.

 

Will lawyers be as relevant in the future?

The legal industry is an arcane cartel doing its best to resist disruption. (It is illegal to practice law without being a member of the cartel, i.e. admitted to the bar.) The Supreme Court still refuses to allow its sessions to be videotaped. Laws and regulations are still bureaucratic mazes written by teams of lawyers that require even more lawyers to help others navigate them.

On the other hand, products like LegalZoom and FileRight and more are making inroads into the profession. Discovery work can be done more effectively by combining computers and outsourcing rather than having high-paid associates combing through paperwork.

I have no idea how rapidly things will change, but keep an eye on legal trends so you won’t be blindsided by them.

 

Is law school too expensive?

Absolutely. Paul Campos, a law professor at UC-Boulder, explains the skyrocketing tuition:

“Faculty salaries have doubled in real terms over the past 30 years. Administrative salaries have grown by much more, and the sheer number of administrative positions has exploded. Facilities are much nicer (this is known as the amenities race), and at law schools faculty-to-student ratios are much lower because of the pursuit of rankings. It’s just a crazy business model, all of which is enabled by no underwriting standards for student loans.”

The law school model is flawed, and even President Obama agrees three years is too long: “The third year [law students would] be better off clerking or practicing in a firm, even if they weren’t getting paid that much. [T]hat step alone would reduce the cost for the student.”

What can you do? Consider going only if you get a full or partial scholarship at a good law school. And look into graduating a semester early by taking on a busier course schedule.

I know that sounds extreme, but it’s also quite extreme to be out of the workforce for three years, then saddled with lots of debt, and not have a job. Take the time to read all the criticism of law schools. Everything Paul Campos has written on this issue, always backed up by reams of data, is good to know.

As for me, I went to a pretty good law school and passed my state’s bar exam. I was very fortunate to land a legal job in government as a third year student.

If you’re ready to apply, here is what I think every applicant should know about the admissions process:

Concentrate on your LSAT score and essays. Law schools care about their rankings, and LSATs play a big role. Most admissions committees won’t care if it took you two or three tries to get a high score, so consider sitting for multiple LSATs. 2nd time LSAT test takers score highest on average (mean improvement is 2.8 points). LSAT courses can be a great investment if your higher score gets you an extra $20,000 in scholarship money.

Customizing your essays are also critical to show the admissions committee you care about their law school and are a perfect fit. You can’t change your undergrad GPA, but you can still get a full scholarship with a great LSAT score and essay.

Study LawSchoolNumbers.com methodically. On this site, applicants self-report their data (GPA, LSAT score, demographic info, etc.) and show what schools accepted or rejected them. You get a rough idea of how likely you are to get into different schools, and more importantly, how much scholarship aid you can expect to receive.

Apply as early as possible. As you’ll see on LawSchoolNumbers, much more scholarship money is offered earlier compared to those applying near the deadline. Applying early can be difficult if you’re still waiting for better LSAT results, so try to take your LSAT well in advance of applying to law school.

Read the fine print of any scholarship. The classic scam is the unsavory law schools that gives 50% of the incoming class full rides, but rescind scholarships from those that don’t stay in the top 20% of the class. The ideal scholarship has no strings attached.

A legal career can be very rewarding if are able to avoid the ugliness of high debt and pervasive underemployment. I hope this has been helpful, and I’m happy to answer any questions in the comment section!

***Photo courtesy of http://commons.wikimedia.org/wiki/File:University_of_Notre_Dame_Law_Library.JPG

Important Financial Moves You Can Make in 2015

This following is a post by MPFJ staff writer, Jeff. Jeff writes about sustainable living and finances at his website, Sustainable Life Blog. Jeff really enjoys traveling with his wife as much as he can, to wherever he can.

It’s a new year again, and it’s time to prepare yourself financially and get the rest of your life in order. While many have their goals figured out and are midway through the point where they’ll eventually fail, you can make your financial goals different this year.  When you look back on 2015 in December, you can be happy with your progress.

Here are a few things you should do to make the most (financially) out of your 2015:

Increase your retirement contribution by at 10% or more

Last year, I wasn’t sure if I would be able to max out my Roth IRA account, but I knew I wanted to contribute more than I had in 2013. After talking it over with my dad, he suggested increasing my contribution by 10%. The amount doesn’t seem like much, but it made a big difference.  That small monthly increase led to another 10% increase midway through the year, and things just kept rolling.

I was given some money for Christmas, and I used that to max out my Roth for 2014 – the first time in a few years I had been able to do that, since I had been paying off some debt previously.

So, for those of you looking to increase contributions to your retirement accounts (401k, IRAs or 457’s/403b’s) but are not bumping up against the government maximum for the year, consider increasing your contribution by at least 10-15% per paycheck.

Typically, it does not amount to much more than skipping one meal out per week, but the benefits at the end of the year are substantial.

Lower Your Monthly Nut

Lowering your monthly expenses is critical to increasing your cash flow and your savings. I spent most of 2013 working on lowering my monthly nut, and it allowed me to do some things that I probably wouldn’t have been able to do otherwise (like absorb a 1500+/mo cash hit).

In late 2013, I spent a day gathering all of the monthly bills for the family, and then spent the next 3 weeks researching how to lower each and every bill. I started with the big ones like home and car insurance, then moved on to smaller ones, such as cable TV, internet, and cell phones.

Even though you may only be saving $10-$25 per month on some of this stuff, it can really add up over the course of a year. We were able to reduce our monthly expenses from above $2200 to below $1500, just by making a few phone calls.

So in 2015, take a look at your bills and figure out how to lower them – even if it’s just by $10 per month. You’ll save yourself $120/year, and be happy you did.

Pro tip: If you want to lower your phone bill, look into Ting or Republic Wireless. If you want to tackle cable TV or internet, here’s a script to use when you call.

Establish a New Money Routine

This is what I’ll be focusing on primarily in 2015 – changing my money habits.

After looking at the data, it seems as though I can go Monday to Friday without spending a dime, then I’ll spend $100-$200 on the weekends. Of course, some of this is groceries so it’s not all bad, but it seems as though I’ve gone into a pattern where I save all my “pent up” spending for the weekend.

So, in an effort to lower that number, I’m going to do two things:

1. Set a budget of $500 per month for all non monthly nut related things (for me, that includes gas and groceries), and;
2. Extend my “no spend weekdays” by 1 day, and make Saturday a day where I don’t spend any money.

I’m hoping this will lower my total spending for the month, and help kick start me to a better habit.

What about you all? What money moves are you planning on making in 2015? Do you have other money-saving tips you found successful and would like to share with us?

Feel free to leave your comments below!

**Photo courtesy http://www.flickr.com/photos/cooperweb/8363160192/

How Will Insurance Impact Your Early Retirement?

The following is a post by MPFJ staff writer, Derek Sall. Derek is the owner of the blog, LifeAndMyFinances.com, where he teaches people how to get out of debt, save money, and become wealthy.

Have you ever thought about retiring early? With the proper savings and build-up of passive income, it is entirely possible! But, what about benefits like health insurance? What about the company 401k contributions? Is it realistic to walk away from these benefits and still retire early?

These are questions that I have been asking myself lately, and if you have ever thought about early retirement I bet that these questions have you curious as well. Let’s dive in and see what the impact might be of an early leave from your job.

My Extreme Early Retirement

My plan for financial independence started a couple of years ago. I first decided that I would get rid of all of my debts including my home mortgage, and then start to build up some passive income in real estate. At this point, I am 100% debt free and am ready to try out my luck with land lording.

I originally had a plan to purchase one or two rental houses per year with cash. By following this plan I could accumulate about 8 rental houses by the time I reach the age of 34. After factoring vacancies and general expenses, I figure my before tax earnings would be about $70,000 per year. If I could achieve this income per year, I would actually be making more money than my current salary! Surely I would be able to retire from my day job with an increase in salary, right? Unfortunately, the math isn’t quite that simple.

There are a few issues with my plan though. I did not factor in how much it would cost to insure myself, and I also didn’t figure how much I would lose in company 401k contributions. How much would it cost to buy my own health insurance? And how much money am I leaving on the table by forgoing those 401k payments?

The Cost of Medical Insurance

In my current company, medical insurance is pretty cheap. For just myself, I pay $54 a month for some pretty decent high-deductible coverage ($1,500 deductible). Based on the research I have done, my cheapest insurance option would be $148 a month for a $5,950 deductible. In other words, I am paying three times the cost for some pretty crappy coverage.

Realistically, in five years I probably won’t be single. I plan on being married and will probably have a child. In this case, my total cost of insurance through work would be $156 per month vs. $450 on the exchange (again, for a crappy deductible of $5,950). Plus, by leaving work I am forgoing $1,000 of HSA money from the company.

With the HSA contribution, my total yearly insurance cost within the company is $872/year. If I decided to retire early, my insurance costs would be $5,100 each year, and would certainly increase with age. This is a massive difference! So what about the 401k contribution?

The Cost of the 401k Contribution

My company currently matches 401k contributions up to 3% and also contribute an additional 7% for our benefit. For me, this totals about $6,000 per year. If I retired 30 years early, I would be throwing away all of those contributions. With interest, these $6,000 deposits would total $734,000! Yikes! That’s quite a lot of money to give away!

The New Total for Early Retirement

Instead of earning my current salary with my passive income, I figure that if I still want to retire early I will need to earn much more.

If we consider only the increased cost of medical insurance, one should earn about $10,000 more than their current salary in order to fund a respective medical insurance plan, and that’s if you’re young and healthy! If you are older and have health issues, then early retirement might not be in your best interest.

It is a sad realization, but one must factor in all of the increased costs that come with early retirement.

How about you all? Do you think you’ll retire early? Have you considered the increased costs of insurance?

Share your experiences by commenting below!

 **Photo courtesy http://www.flickr.com/photos/120360673@N04/13856188134

The Best Ways to Ask Your Boss For a Raise

The following is a post by MPFJ staff writer, Kevin Mercadante, who is a freelance professional personal finance blogger for hire, and the owner of his own personal finance blog, OutOfYourRut.com. He has backgrounds in both accounting and the mortgage industry.

For a lot of people, one of the most difficult work related tasks is having to ask your boss for a raise. Though it should be something easy to do if you feel that you absolutely deserve one, it’s usually a tense situation. In no small part, this is due to the fact that there is a built-in reluctance on the part of employers to give raises. After all, the more an employer pays a staff member, the less profit that will be available in the budget.

One of the best ways to ask your boss for a raise is be prepared in advance. Doing so can stack the deck in your favor, and make it less difficult to pull off. Before you ask for a raise, try some of the following steps.

Research Your Market Value

Unless your job classification is very unique, the job market largely determines how much your employer is paying you, and how much they may be willing to increase your pay. This is all about defining your market value as an employee, and that’s all about determining how much you make in relation to other people in similar positions.

There are various web based information sources on salary levels, but the most comprehensive is the Bureau of Labor Statistics (BLS) Occupational Employment Statistics website. The BLS is an agency of the US Government, and not only does the site provide salary ranges for nearly every job classification in existence, but it also provides specific regional salary statistics. This is important because for example, an accountant is likely to earn more in New York City than in Nashville.

If you are on the lower end of the salary range for your job classification in your geographic location, you’ll have more room to ask for a raise. But if you are at the higher end of the range, you need to tread lightly. Your employer has access to the same information, and could use your request for a raise as an opportunity to remind you that you’re at the top of the salary scale.

The BLS site also provides ten-year growth projections for each career classification. This information is not to be underestimated. The greater the future demand for your job, the more flexibility you will have in asking for a raise.

Figure Your Employer’s Financial Position Into the Mix

You also need to consider what your employer’s financial position is at time you’re asking for a raise. If the company is losing money and cutting staff, asking for a raise may be a difficult proposition at best.
If you are on the lower end of the pay range for your job classification, you may still be able to get a raise even if your employer is not prospering. But here’s where you will need to do some careful analysis. As yourself the following questions:

• How important is your position to your employer’s overall operation?
• How well are you performing on your job? Can you objectively rate yourself as a high performer, a medium level performer – or something less?
• How difficult or desirable would it be for your employer to replace you?
• Would your getting a raise put your employer in a difficult position with other employees?
• How much do you like working for your current employer, and would you be willing to make a move if you don’t get a raise?

If you are a key employee at your company, you are a top performer, and you are well below the top range for your career in your location, you can still ask for a raise. But if your answers to a few of the questions above are generally negative, you’ll want to use caution.

Document Your Accomplishments

It’s unfortunate that many employers do a much better job in documenting your mistakes and blunders than your accomplishments. And that’s why you need to be prepared to step in and fill the void.

Seriously, this is a step you cannot leave to chance. Asking for a raise is very much a negotiation process. While you’re asking for the raise, your employer is pushing back and trying to justify why you shouldn’t be given one, or given one that’s less than what you’re asking for. You’ll need to be fully “armed” for that outcome.

You should literally have a file that includes positive past job reviews, commendation letters, and any other examples of outstanding work. If you are in either a production position or have budget authority, you should be fully prepared with hard numbers that document your statistical improvements.

You don’t need to pull these out early in the negotiations, but rather to have them available just in case things don’t go your way. If your employer resists giving you’re a raise, citing your performance as an issue, you’ll be ready with evidence that tells a better story.

Remember That It’s Business, not Personal

It’s very difficult not to get emotional when asking for a raise. After all, you’re asking your employer for an improvement in your compensation, and that’s a true “gut issue”. Be that as it may, you have to do your best to keep your emotions out of the picture. No matter how personal it truly is, it really is a business negotiation.

It’s best to be as cordial and respectful as possible in approaching your boss about a raise. You should always want to stick to the facts – as provided based on the research you have done in the steps above – and to avoid emotional generalities.

You should also fully expect some form of resistance. If you don’t get any, great! But if you do, you’ll be prepared. As noted above, your employer will have their own reasons for wanting to limit your income. Your job will be to prove – based on the facts – that their conclusion is incorrect. But in the process, keep in mind that you are merely asking for an increase in pay, and not attempting to justify your existence on the payroll. That means do your best to reasonably promote yourself, but avoid getting defensive at all costs.

You want to make sure that your request proceeds as a friendly negotiation, and doesn’t spill over into the realm of conflict. Make it clear that you are both on the same side, that the raise will help you to do your job better and to increase your performance.

Also be fully prepared to be flexible. If you’re asking for a 10% raise, and your employer counters with 5%, be ready to meet in the middle. This isn’t about winning, but about getting yourself a better compensation package.

Have a Strategy Just in Case the Outcome is Negative

Despite your best efforts, your request may still be denied. At that point you’ll need to determine whether you will be able to continue on with the employer knowing that your pay will not be increased. And that will depend on whether or not there are better alternatives with other employers.

The strength of your negotiations will rest largely on you knowing that information beforehand. If your career field is in strong demand, in you’re at the lower end of the pay scale, you’ll have the confidence of knowing that you have other alternatives going into the meeting with your boss. That confidence will likely come through, and could win the day for you. But if it doesn’t, you will have to be prepared to go elsewhere.

Should you decide instead to stay on with your employer and make a request at a later date, you will have to be certain that the denied raise doesn’t negatively affect your attitude. No matter what, continue to do your best work! This will be important on two fronts:

1. Continuing strong performance will put you in a better position to ask for a raise again at a later date, and
2. It will make it easier for you to find a position with another employer, since your performance will likely get you a favorable reference from your current employer.

There are risks to asking for a raise. If you should carefully consider those risks, and prepare for them in advance, not only will you have a better chance of getting the raise that you want, but you’ll be able to do it with more confidence.

How about you all? Do you struggle at the thought of asking for a raise? Have you tried asking for a raise in the past?

Share your experiences by commenting below!

**Photo courtesy of https://www.flickr.com/photos/usdagov/14605147054/sizes/n/

The Novice’s Guide to Improving Your Finances in 2015

The following post is by MPFJ staff writer, Melissa Batai.  Melissa is a freelance writer who covers topics ranging from personal finance to business to organics to food.  She blogs at Mom’s Plans where she shares her family’s journey to healthier living and paying down debt.

Once again, a new year is upon us, and with it, the promise of a fresh start. Each year, we find ourselves on a precipice, leaping from one year to the next. If we choose, we can also leap from one lifestyle to another.

A new year seems more powerful than any other time. Why not harness that power and momentum and make this year the year you get your financial house in order?

If you decide to take on the challenge, don’t try to improve every aspect of your finances immediately. Instead, take it day by day, month by month. In fact, I recommend that you make one change every month or two. By the end of the 2015, you’ll be in much better financial shape than you are right now.

Take Advantage of Your Employer’s Match

Does your employer offer a match on your retirement savings? If so, your job for this month is to set aside as much money as you can to take advantage of your employer’s match. If your employer matches up to 6% of your salary, try to put away 6% every month. Make this easy on yourself by having your retirement savings automatically deposited. Now, instead of saving just 6%, you’re saving 12% in retirement thanks to your employer’s match.

If you can’t put aside as much money as the employer will match, put aside as much as you can.

Pay Yourself First

Too often, people pay all their bills and are left with the remaining money. They think, I’ll save some money if I have any left over this month. Guess what? They usually don’t have money left over. The trick is to pay yourself first.

If your budget is extremely tight, maybe you’ll only be able to set aside $20 or $50 a month. That’s okay. Don’t make the mistake of thinking saving isn’t worthwhile for such a small amount. If you save $50 every month, you’ll have $600 set aside at the end of the year. That is much better than having nothing saved. Of course, if you can save more, do.

The best way to make sure savings happens is to have the money automatically withdrawn from your paycheck and deposited in your bank account. After a while, you won’t even miss the money from your paycheck, and it will continue to accrue in your bank account.

Learn to Budget

If you’ve read several finance books, you know that there are many different ways to budget. The important thing is to find a way to budget that works for you.

If you typically overspend each month, you might benefit from being on a cash-based budget and only paying in cash for a few months until you learn to not overspend.

Search budgets online, and you will find many different tools and strategies. I’ve found America’s Cheapest Family’s budgeting strategy works best for me, but there are many more to choose from.

Don’t forget to consider using software to help you. There are plenty of great software tools out there like Mint.com, You Need a Budget, and Pear Budget. Many offer a free trial period. Don’t be afraid to try a few until you find the right match.

Finally, remember that it may take 3 to 6 months to get to the point where your budget actually matches what you do with your money. Don’t be discouraged if your budget doesn’t work out the first month or two. There is a learning curve to budgeting, especially since most of us are used to spending fairly freely.

Pay Off Debt

If you’re in debt, make this the year you really focus on not adding any new debt and paying off what you have. If you’re married, sit down with your spouse and decide how much debt you want to pay off this year and how you’ll do it. Maybe one of you will take an extra job, or maybe you’ll put your tax refund on your debt.

Once you calculate exactly how much you owe and make a plan for paying it off, you’re much more likely to see your debt load decrease.

Learn about Investing

Even people who have a fairly good handle on their money can find investing intimidating and confusing, but it doesn’t have to be this way. There are plenty of good resources that can help you learn more about investing.

If you search online, you’ll find courses you have to pay for to learn about investing, but there are also plenty of free resources. Fidelity offers a free learning center covering topics like mutual funds, ETFs, and options. Morningstar offers 172 different courses on stocks, funds, bonds, and portfolio building and monitoring. You can even take a free online class from Stanford University about making smart investment choices.

There are so many resources, there is no reason why 2015 can’t be the year you learn more about investing.

Give Your Extra Money a Job

Each of us receives extra money every year. Most of us just absorb that money into our regular budget, but if you instead give it a purpose, you’ll make it work much harder for you.

For instance, my husband and I wanted to make some cosmetic repairs to our home like getting a new kitchen faucet and putting in a garden. The problem? We didn’t have extra money to buy the supplies. So, one day I decided that whenever I got a one-time writing job, I’d put that money in a home improvement fund. After all, these one-time jobs gave me money I wasn’t expecting any way. Within 6 weeks, we had enough money for both the new faucet and the supplies to build a raised garden bed.

Don’t believe you have enough money coming in every year to make a difference? Please reconsider. Julie from The Family CEO has earned $43,082 in “found” or extra money over the last two years and has used it for everything from helping her daughter pay cash for college to bulking up her emergency fund.

Give your extra money a job. You’ll be surprised how much more money you have coming in than you thought.

Save for Your Children’s College

I’m putting this last because saving for your own retirement and getting out of debt are far more important. If, after doing those two things, you have extra money, consider saving for your child’s education.

Of course, the earlier you start investing the better, thanks to compound interest. You could even start with a small amount like $10 or $20 a month because every bit will help.

However, if you’re like we are and have a 10 year old child but very little college savings, you can take a different approach. For every dollar that our son saves for college, we match his contribution. So far, in the last four months, he’s saved $50, so he has $100 in his college fund. Seeing us essentially double his money has made him more excited to save, and it also helps make him take an interest in finances and saving for the future. For us, we are still saving for his college education, but we don’t have the financial pressure of saving more than we can comfortably afford to.

How about you all? What financial moves do you want to make this year? What financial goals are most important to you?

Share your experiences by commenting below!

**Photo courtesy of http://commons.wikimedia.org/wiki/File:Analyzing_Financial_Data_%285099605109%29.jpg

How to Stay in Shape This Winter

The following is a post by MPFJ staff writer, Derek Sall. Derek is the owner of the blog, LifeAndMyFinances.com, where he teaches people how to get out of debt, save money, and become wealthy.

Do you have plans to shed a few pounds this winter? Or maybe you’re already in shape and would like to continue to stay active this winter. If you had absolutely no plans to get your heart rate up this winter, I think you should really reconsider. Did you know that exercising could keep your wallet a little fatter in the upcoming years?

By taking some time now and etching out some time to work out, you could avoid some serious medical complications in the future. Or, at the very least, you could extend your lifespan by a couple more years.

Set Simple, Yet Effective Goals

Goals are incredibly important in all areas of life, whether it be a financial, fitness, or a relationship goal. If you do not have a goal the odds are already overwhelmingly against you. For, with no goal, one will quickly forget the aspirations of yesterday and will simply blow along with the wind of today.

So how does one set an effective goal?

Well, by definition a goal is a future ambition to be accomplished on a set date. Without a date, a goal is simply a dream. So, what you must first do is set a goal for yourself, and then set a reasonable date to accomplish the goal.

In regards to exercise, your goal might be to lose 10 pounds. In order to do so healthily, I would suggest setting this goal two months in the future. If you decide on this goal on January 20^th, plan to lose those 10 pounds by March 19^th. Then, almost more importantly than the overall goal, set little goals along the way to keep yourself on track. Continuing with our example, on February 1^st you might set a goal for yourself to lose your first three pounds.

If you achieve this goal, reward yourself with a new pair of sneakers or a Fitbit watch (or whatever it is that you fancy). In order to stay on pace with your overall goal, be sure to set those small goals to keep you on target.

Find Activities That You Enjoy

Personally, I enjoy being active, but running on a treadmill or riding a stationary bike is torture! If I had to get in shape by only doing these two things I would probably gain 20 pounds instead of losing weight! Stationary running just isn’t my idea of fun.

For me, I stay in shape by running outside, riding my bicycle outside, and swimming. I also enjoy playing basketball and tennis when the weather is nice outside. If it’s snowy, then I’ll resort to cross country skiing or snowboarding. These are the things I enjoy doing. They keep me active and it hardly feels like exercise.

What are the activities that you enjoy doing? If they keep you in shape and fit within your financial budget, consider doing them more often to get yourself into shape and stay trim. You will have fun and your future self will thank you for the reduced medical bills, and therefore reduced costs.

Partner Up or Join a Activity Group

Unfortunately, even “fun” activities still aren’t all that fun by yourself. Instead of going for a solo bike ride or a solo jog, it is often much better to have a running partner or sign up for a group ride once a week. Joining conversation to exercise makes it feel much less like exercise and more like a social event. Plus, by joining a group you will likely feel that you are held more accountable. Miss a week and you might just receive a phone call from one of your activity group friends.

In the name of exercise, it’s good to have a nudge to get your heart rate up on a consistent basis don’t you think?

How about you all? Do you exercise on a regular basis? Do you have a new fitness goal that you are trying to achieve? Share your experiences by commenting below!

**Photo courtesy of http://commons.wikimedia.org/wiki/File:Pas-de-patin.jpg

Five Promising Career Fields – No Matter What the Economy Does

The following is a post by MPFJ staff writer, Kevin Mercadante, who is a freelance professional personal finance blogger for hire, and the owner of his own personal finance blog, OutOfYourRut.com. He has backgrounds in both accounting and the mortgage industry.

As the economy moves forward it destroys certain career fields, but creates entirely new ones. Those new careers are certainly promising since they’re on the cutting edge. But there’s no way to predict the longevity of brand-new career fields. If you are looking for a promising career field, there are five that have withstood the test of time, and are likely to prosper no matter what the economy does.

Those include healthcare, computers, sales, education, and financial services, particularly those related to retirement. For statistics we’ll be relying on the Bureau of Labor Statistics Occupational Outlook Handbook.

Healthcare

When we think of healthcare, we immediately think of doctors and dentists and a variety of high level specialists. In truth, the healthcare field is strong almost across the board.

Registered Nurse is an obvious choice. Median pay is $65,470, and the field is expected to add 526,800 jobs, or a 19% increase in employment. That’s well above the rate of growth for the job market in general (about 12%). Just as important, RN’s can work in a wide variety of environments, including hospitals, nursing facilities, clinics, schools and private practices.

Some other healthcare careers to consider:

• Dental Hygienist:
  Median income: $70,200
  Number of new jobs expected through 2022: 64,200
  Percent increase: 33%

• Pharmacists:
  Median income: $116,670
  Number of new jobs expected through 2022: 41,400
  Percent increase: 14%

• Physical Therapists:
  Median income: $79,860
  Number of new jobs expected through 2022: 73,500
  Percent increase: 36%

• Occupational Therapists:
  Median income: $75,400
  Number of new jobs expected through 2022: 32,800
  Percent increase: 29%

Almost any field in healthcare offers not only strong earnings, but also a very secure future as the number of jobs increase to meet the demand of an aging population.

Computers

This is another field that’s much more diverse than it seems to the average person. Computer Programmers, perhaps the most visible computer specialists, have a median income of $74,280. But somewhat surprisingly, the field is expected to add just 28,400 jobs by 2022, an increase of only 8% which is below the rate of growth for the overall US job market.

Other niches in the computer field are expected to fair much better. For example:

• Database Administrators:
  Median income: $77,080
  Number of new jobs expected through 2022: 17,900
  Percent increase: 15%

• Computer Network Architects:
  Median income: $91,000
  Number of new jobs expected through 2022: 20,900
  Percent increase: 15%

• Computer Systems Analysts:
  Median income: $79,680
  Number of new jobs expected through 2022: 127,700
  Percent increase: 25%

• Information Security Analysts:
  Median income: $86,170
  Number of new jobs expected through 2022: 27,400
  Percent increase: 37%

• Software Developers:
  Median income: $93,350
  Number of new jobs expected through 2022: 222,600
  Percent increase: 22%

Even though prospects have slowed for Computer Programmers, the rest of the computer field looks very promising.

Sales

Sales is something of a career mixed bag. There is a sales category connected with just about any and every industry in the country. According to the BLS, most sales fields will grow no faster than the general job market, and some will grow even slower. Incomes meanwhile are all over the map. Travel agents earn a median income of $34,600 per year, while sales engineers earn a median of $91,830.

But when it comes to sales, median income levels and future job prospects vary widely. In fact, generally speaking, the success or failure of a given sales position depends mostly upon the skills, ability, knowledge, and dedication of the salesperson. A good salesperson can easily make six figures in just about any industry niche. Underperforming salespeople can end up doing little better than minimum wage.

But the reason that sales is a promising career field is based on pure necessity. Virtually every business that exists to sell a product or service needs skilled salespeople to keep their income flowing. If you are good at sales, you’ll not only have an above average income, but you’ll also have an almost unlimited future. Many companies promote successful salespeople to top management positions, such as sales director, and even chief operating officer.

If you are naturally good at sales, there are few other career fields where you can earn as much money and enjoy the level of career stability.

Education

Education doesn’t pay as well as health care, the computer field, or even certain sales positions. And as a rule, job growth is expected to be at or below the rate for the entire job market. So why include education as a promising career field? Not only are there literally millions of jobs in education, but the career stability tends to be higher than average. Not only are people who work in the field less likely to lose their jobs in a bad economy, but they typically also enjoy better employee benefits as a result of being part of the public system.

Here are some of the more typical career fields in education:

• Career and Technical Education Teachers:
  Median income: $51,910
  Number of new jobs expected through 2022: 21,400
  Percent increase: 9%

• Adult Literacy and High School Equivalency Teachers:
  Median income: $48,590
  Number of new jobs expected through 2022: 6,700
  Percent increase: 9%

• Kindergarten and Elementary School Teachers:
  Median income: $53,090
  Number of new jobs expected through 2022: 188,400
  Percent increase: 12%

• High School Teachers:
  Median income: $55,050
  Number of new jobs expected through 2022: 52,900
  Percent increase: 6%

• Instructional Coordinators:
  Median income: $60,050
  Number of new jobs expected through 2022: 18,500
  Percent increase: 12%

• Middle School Teachers:
  Median income: $53,430
  Number of new jobs expected through 2022: 76,000
  Percent increase: 12%

• Librarian:
  Median income: $55,370
  Number of new jobs expected through 2022: 11,000
  Percent increase: 7%

• Post-Secondary Teachers (Includes College Professors who can earn upwards of $100,000 per year):
  Median income: $68,970
  Number of new jobs expected through 2022: 236,400
  Percent increase: 19%

• Special Education Teachers:
  Median income: $55,060
  Number of new jobs expected through 2022: 26,600
  Percent increase: 6%

Financial Services – Especially Retirement Planning

Financial services, like sales, encompasses a wide range of career fields, from accountants to real estate appraisers, to insurance underwriters. Future prospects income levels for all of the careers within the field vary incredibly. But one area that’s growing rapidly are personal financial advisors, especially those involving retirement planning.

According to the BLS, the median pay for personal financial advisors is $67,520 per year. But the field is expected to add 60,300 positions by 2012, an increase of 27% over the current level.

The reason for this growth is simple: there is an aging population with a greater need for financial planning services. There are not only more people in or approaching retirement than ever before, but they are expected to live a lot longer than in the past. There is a huge need for financial planners who work specifically in the retirement area.

We should expect this trend to continue for the next two or three decades, making this one of the more promising career fields available, no matter what the economy does in that time.

If you’re planning your future career – or contemplating a career change – any of these fields hold a lot of promise, no matter what the economy does.

How about you all? Are you planning a new career or career change? Are you in or moving into a career that has promise regardless of what the economy does that was not listed above?

Share your experiences by commenting below!

**Photo courtesy of https://www.flickr.com/photos/tulanesally/6881550355/sizes/n/