Category Archives for Saving Money & Frugal Living

Different Types Of Loans

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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 guest post. Enjoy!

How about you all? What types of loans have you taken out in the past? Have you used any of the types of loans mentioned above? Share your experiences by commenting below!

Jacob’s Thoughts – Listed below are my random thoughts as I was reading this article.

• @ Unsecured loans – 
• It’s important to note that since unsecured loans expose the banks to a significant amount of risk, they must be compensated for this increased risk/return ratio by demanding a higher interest rate. 
• This is the exact reason why the interest rate on credit cards is higher than many types of secured loans. It’s all about that risk/return ratio!
• @ Using secured loans to build credit – 
• In a previous post, I’ve discussed how I (and you as well!) can successfully use a secured personal loan in order to start building a credit history. This especially works well if you are younger and don’t have established credit already.
• In my case, I secured the personal loan with a CD that I took out from the same bank with which I took out the loan. This enabled me to keep the interest rate low on the personal loan.

***Photo courtesy of http://farm4.static.flickr.com/3082/4557765121_17d83c918f.jpg

Money-Saving Travel and Flight Apps

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Click here to enter my free $201.40 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 November 30th, 2011.


The following is a guest post. Enjoy!

Regardless of where you like to take your vacations or the kind of activities that you like to take part in while away, it is fair to say that most people have something in common when booking their holiday –  a want to save some money. Listed below are some great tips to help you save some money on your next holiday:

Language:

Remembering just a few simple phrases can easily help you save some money. You may be able to negotiate a taxi fare, a price in a shop, or even the room rate at a hotel. At the very least, knowing a few phrases will probably curry some favour with the locals and help you to get fantastic service when dining out or using facilities.

There are lots of fantastic mobile phone applications and websites available that can help with languages when abroad. For example, Bussu.com offers seven different language applications that allow you to learn some of the most common European languages (to a basic standard) completely free and in the minimal amount of time possible.

Eating:

When you are in a strange place, it can be difficult to locate an eatery that is suited to what you want to eat at that time. But, there are lots of fantastic mobile phone applications that can help with this. ‘Urbanspoon’ is the main one that springs to mind, as it allows you to choose your eatery by price, location, and even food type, so you can be sure to find something that is suitable for your requirements before you even head out to the streets to locate a place.

Currency:

If your home is the United Kingdom and you are looking for a fantastic way to work out how much something costs in Sterling while on vacation out of the UK, then why not download the ‘currencyapp,’ which will allow you to see, at a glance, how much something works out from over 100 different currencies back in to your home currency. You do not need internet access, once downloaded, to use this application, so it is a fantastic way to check how much you are going to be spending even while away from an internet connection.

Money:

If you are looking for a way to keep track of the money that you have spent while abroad, then why not consider downloading ‘Expensify’ or one of the other similar applications available on the market at present. This will allow you to document the items that on which you have been spending, like flights, hotels, and eating out and their cost. It is a fantastic way to see, at a glance, how much you have currently spent and therefore work out how much remaining from your budget you have.

Communicate:

While you are away, you may want to keep in touch with people back home. One such way to do this is to use a web based voice service, such as Skype. This allows you to talk to people, anywhere in the world, free of charge, via webcam and microphone. This is a fantastic way to check in with people and you can even add some credit to your account that allows you to send text messages and call mobile phones and landlines rather than computers for a very reasonable fee.

Conclusion

There are literally thousands of applications available on mobile phones that will allow you to budget your money, find locations to visit on holiday, and do numerous other things that will help you stay organized and hopefully, save a fortune while on holiday!

How about you all? What mobile phone apps do you currently use that help streamline/simplify your traveling or even save you money? Did you have to pay for these, or were they free? 


Share your experiences by commenting below!

Jacob’s Thoughts – Listed below are my random thoughts as I was reading this article.

• Interesting post here! Thanks for sharing, as I’m always interested to find out about new technological tools that people can use to save money and streamline their finances! 
• Personally, I don’t yet have an Apple iPhone or other type of smart phone, so I’m not able to access all of these sophisticated apps. But, they sound like they could be quite useful when a person is on the road. 
• One potential problem I do see is that when people are traveling, they often have limited access to Internet hotspots or cell phone/3G service in general. So, there may be a case for people making sure they don’t rely too heavily on the apps from their smartphones while on vacation. 
• @ Knowing the local language helping you to save money on vacations – 
• It’s definitely also been my experience that if you know at least a little bit (or try to speak a little bit) of the local language of the country/place you’re visiting, you’ll be shown much more respect by the people you’re paying to buy things or to provide you with a particular service. 
• This is especially true since the price of so many services and goods are indeed quite negotiable.
• And, if you at least attempt to speak some of the local language it shows the person that you’re trading with that you respect them and their culture. And, in my experience, this almost always is helpful in making sure you don’t get charged too much.
• After all, would you not feel the same way if you were in their shoes?
• @ Finding affordable restaurants while traveling abroad – 
• So far, when I’ve traveled on vacations, I generally use hard copy versions of travel guidebooks to find appropriately-priced restaurant options. 
• However, I could imagine that referencing a smartphone app would provide slightly more up-to-date information about the local flavor.
• @ How I handle calculating the approximate cost of items using currency conversions –
• Typically, when I am traveling abroad, I don’t worry about my spending down to minute penny amounts.
• Instead, what I do is develop a general easy-to-remember mental formula for equating the price of items in the foreign country to my home currency (US Dollars) by dropping some of the zeros from the exchange rate. 
• For example, the last foreign country my family and I visited was Chile in January 2011. Currently, the exchange rate between the Chilean Peso and the US Dollar is ~500 Chilean Pesos = 1 US Dollar.
• So, if a bottle of Chilean red wine was 3,500 Chilean Pesos (a fairly common amount for a moderate bottle of wine), I would drop the zeros, and divide 35 by 5 to find out that the bottle of wine was about $7 US Dollars. Pretty easy, right?!
• @ Question about spending tracking apps – 
• Unfortunately, I’m not very familiar with the spending tracking smartphone apps available on the market today.
• As such, I actually had a question for the readers out there – do these spending tracking apps hook directly up to your bank account or credit card transaction reports and update automatically? I would imagine that would streamline things a lot!

***Photo courtesy of http://farm3.static.flickr.com/2731/4416977499_4a9f255bb7.jpg

What Does a Passive Retirement Look Like?

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The following is a guest post from Corey at Passive Income to Retire, where he is keeping track of his progress to retire early. Corey is one of my close personal blogging friends from the Yakezie group and is doing a very good job building his blog(s) and helping others with their finances. I know you’ll enjoy the post!

If I were to tell you that I am 24 years old and I plan to retire in 2-3 years from passive income, I am sure that you would wondering, “What’s the catch?”

I recently started my second blog ‘Passive Income to Retire‘ in order to document my progress towards reaching a goal to retire early. To sum up my goal, I hope to build up passive income streams that will provide me with enough money to replace my mediocre salary from my day job.

I want to think long term, so my plan will eventually integrate long term income streams as well (real estate and dividend investing). Here’s the catch – earning income online is not passive at all and as a result, my plan to maintain these income streams really isn’t retirement – not in the traditional sense at least. Before you think my goal is completely ridiculous, let me explain.

Online Income Isn’t Always Passive

My new goal in life is to earn enough money from blogging (and a few other online business ideas) so that I can quit my day job. Six months ago, I didn’t even know that you could make money from blogging. Now, I not only know it is possible, but I am doing it! I don’t want to just stop with mediocre success. I want to shoot for the stars. My earnings have increased rapidly, and that is the reason for my new goal. I enjoy it so much that I have invested a lot of time to build up my first blog.

The only problem with this goal is that making money online isn’t passive. Some people claim that it is semi-passive, but to be honest, it takes a lot of work. When my (non-blogging) friends hear how much I am beginning to make from my blog, they want to know how they can do the same thing. The fact is that I earned very little money my first and second month even though I probably put in 100 hours for each of those first months. Usually it takes 6-9 months to make any money, if not longer. (It is also important to point out that the Yakezie Network has been a huge help as I am learning the ropes).

The idea of replacing my income from my day job to start another full-time job didn’t make any sense. Why would I forfeit many of the benefits that come with working for an employer just to be able to work in my pajamas? Even though it is a lot of hard work, I hope to create systems that will let me manage an online business (or “empire” as it is often coined). Managing these blogs and online businesses will take time. This is why I recognize that I will have to work about 3 days a week to keep everything running smoothly. I know this won’t happen overnight, but I hope in 2-3 years, everything should be in place that this should be manageable.

Working 3 Days a Week Isn’t Retirement

Because I know that online income isn’t entirely passive, I knew I couldn’t just expect to do nothing for the rest of my life. Plus, I enjoy this stuff. Why would I want to stop? I didn’t want to become a coach potato at the age of 27, but I also didn’t want to become a workaholic like some bloggers that I know. Like I said, why just swap jobs? Why not try to do something completely radical at the same time? Lots of people make a living from blogging, but how many people do it in 3 days a week?

This retirement goal is about so much more than not working. I no longer see retirement as not working. Where’s the fun in that? It is instead, about being free to follow my dreams (without working too much), experiencing life, and giving back to the community that I am apart of. The best way that I can see how to do this is to work part-time. This would give me the freedom to be able to participate in important causes and also get me out of the 9-to-5 job. A great part about this is that I don’t have to work for 40 years to begin my life.

Ultimately, the question I keep coming back to is what I could do with those extra two days every week. The potential to make a huge difference in this world with that time means a lot more than getting out of the rat race.

So, here’s my question for you- What would you do if you only had to work 3 days a week? If there is something else you would rather do, why aren’t you working towards that goal?

Jacob’s Thoughts – Listed below are my random thoughts as I was reading this article.

• Great post here Corey! It’s definitely good to see someone come to the realization of what they want to accomplish in life, and then initiate the process of making that dream a reality. 
• I definitely agree with you about blogging not being the best source of passive income, as I have probably put in several thousand hours to writing content and building the community of my blog over the past 2 years or so. But, because I really enjoy the blogging process, I don’t mind at all. I will, however, be very interested to follow your progress and learn ways that you find to make it more passive. 
• However, I am a believer that blogging can be a nice source of leveraged income in the sense that you can put together an article (or collection of articles), and that information can be referenced by anyone the world over for possibly years to come. 
• In other words, there is a possibility that you can provide value to others while you sleep. 
• In this way, blogging is a leveraged source of revenue, but maybe not directly passive in the strict sense of the word.
• Like you, I also think that retirement is not necessarily a time when I would just be relaxing/doing nothing all day. Instead, it would be about being free to choose things that I would want to do, irregardless of if they were associated with a job. 
• I definitely hope and expect to develop passive income from real estate investing and online ventures as a hobby/side-business. However, I intend to keep my primary career as developing and commercializing pharmaceuticals, as I feel very strongly in a commitment to delivering these medicines and improving the health of the world as a whole. As such, I would be perfectly fine and completely fulfilled doing this job 5 days a week. 
• In general, I think that if people do a little soul-searching and determine that there is something (or multiple things) that they want to contribute during their life, but are not able to do so in their current job, it would be beneficial for them to begin taking small, actionable steps towards this goal. After all, life is short!

***Photo courtesy of http://farm5.static.flickr.com/4134/4791395291_552f7b8978.jpg

Vacation Budgeting, Saving, and Execution + An Example of This Process in Action From My Recent Trip to New York City

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Click here to enter my free $201.40 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 November 30th, 2011.

Setting the Stage for Vacation Planning – Personal Reflections on New York City from a Recent Trip

To me, New York City is truly a source of amazement and wonder for several reasons.

First, from an infrastructure perspective (yes – the nerdy engineer in me always appreciates the structural aspect of things), it’s fascinating to see a place where SO MANY enormous buildings are built on such a small area of land, yet all of the transportation (subways, roads, and trains) and utility (water, sewer, gas, and electricity) needs of millions of people can still be served by this land at the same time. Second, New York City is fascinating from a social dynamics perspective because it is a place where millions of people from severely diverse backgrounds live and work together in a very small land mass. Yes – New York City is quite a gem and is a very cool place to visit for a vacation!

However, from a personal finance perspective, in my opinion, New York City is a financial disaster as a place to call home. Now, I’m not trying to say that the city or companies located in New York City run their finances poorly. Far from it actually, as I commend the companies that operate there because it is a good, accessible location in which to do business. What I mean is that for the average middle-class American Joe/Jill, because of how expensive it is to live there, New York City just might be the worst thing ever for a person’s personal finance, retirement, debt-payoff, and savings goals.

In fact, in doing a brief investigation on Google, I found a Forbes study reporting that the savings’ rate of not only New York City, but of all 10 of the highest populated metro areas in the US, did not rank in the top 50 highest-saving cities in the country. Clearly, there seems to be a trend that if you want to save money, these big cities might not be the best place to reach your goal (unless of course, you have a high paying job in one of these cities that cannot be located elsewhere).

Budgeting for a Vacation

So, needless to say, in July of this year, when I began planning an early-November trip to New York City to watch my girlfriend compete in the New York City marathon, I knew it would be quite essential to budget for the trip conservatively, save accordingly, and then stick to executing the plan once we were on the trip in order to prevent the scenario of having to pay for things on my credit card that I don’t actually have the money for.

Now, if you’ve read my blog before, you probably know that I am not the biggest fan of budgets in the traditional sense of planning your monthly spending and then saving whatever is left over at the end of the month. What I’ve found is that if people do this, they tend to not have any money left over at all. Instead, I endorse the strategy of saving pre-determined amounts at the beginning of each month.

However, since in the case of vacations, you are only planning your SPENDING needs, budgeting is an appropriate and intelligent exercise.

Listed below are the various categories I like to budget/plan for when preparing for a vacation. It’s worthwhile to note, that for the most part, these are the same general categories that one considers in planning his or her regular monthly expenditures as well (with the exception of Investing and Charitable donations savings). To get you started, I’ve also listed some of the specific cost items that normally fall in to these categories.

Vacation Spending Categories to Consider in Putting Together a Vacation Budget

• Entertainment (shows, museums, games, club entry fees, tours, activities/excursions)
• Lodging (hotels, motels, B&B’s, resorts, or anywhere where you spend the night)
• Transportation (gas, plane ticket, car rental, tolls, parking fees)
• Food (breakfast, lunch, and dinner). I like to use $10, $15, and $20 per person for each of these meals, respectively, to plan conservatively and then multiply by the number of days of the trip (see note below for expensive destinations).
• Miscellaneous (a “cushion” amount to allow for random spending)

How about you all? What favorite techniques do you use to either budget, save, or make sure you stick to your planned spending during a vacation? 


What are the biggest hurdles you encounter during a vacation that cause you to go outside your budget (the people you go with, finding out about new activities, etc?)?


Share your experiences by commenting below!

Stop Being Cheap and Invest In Yourself

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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 guest post was written by Aloysa from My Broken Coin as part of a “Yakezie blog swap” where members of the Yakezie Personal Finance Blogging Network pair up and exchange guest postings on a common topic. The topic of this blog swap was to discuss a certain thing or category of things that we absolutely refuse to go cheap on in our lives. Hope you enjoy! You can view my guest post over at My Broken Coin today as well! My Broken Coin is a personal finance blog of a big spender and a shopping addict who is trying to save, budget, set up goals and still have fun along the way.

I am a spender. But even big spenders like me have their limits. Sometimes, I decide to make an effort to be frugal and save money. I start looking for bargains. I have to admit that my biggest mistakes were caused by me trying to save a buck or two on things that should not be settled for because of the price. Believe me or not, sometimes expensive means quality, style, and comfort and cheap means….crap. In the end, my attempts to save money cost me more.

I am not telling you to follow my excessive shopping habits and go shed unreasonable amounts of money on stuff. Think for yourself and be smart about your spending. But, I would advise to not look for bargains when it comes to the following:

Hair Stylists

My hair defines me. It gives me style and a distinct look. I never let anyone cut my hair using a razor, but for some unexplainable reason, hairstylists in cheap parlors are obsessed with razors. Maybe scissors are too expensive. Maybe they like to slice and dice people’s hair. I don’t care! I ran away from them a long time ago and never looked back. I settle for expensive salons for one reason only: I get what I pay for. In the end, I am not paying twice: once for a cheap color and cut, and later, for an expensive salon hairstylist who desperately tries to fix my mullet like, razor shaped haircut. I save money by choosing to pay more.

Shoes

Shoes are not all about the looks. I am a shoe snob who doesn’t believe in striking a balance between comfort, quality, and affordability with cheap footwear. Every time I go for a low price and breathtaking looks, I end up in pain, misery, and with a health issue. I walk a lot during the day, and if I don’t get the appropriate support, my feet and back hurt. I don’t want to be in pain every day. Do you? I consider shoes one of the best investments we can make. Good quality shoes won’t bring you any monetary gain. However, they will definitely benefit your health. Is there a better investment other than investing in your health?

Bed

I love to sleep. I love to rest. Preferably in the comfort of my big bed. Most of our waking hours are spent either flying above the pavement in our expensive and comfortable shoes (see above) or sleeping in our beds. I always ask myself how much is a good night’s rest worth to me. Believe me, it is worth a lot!  In fact, a good night’s sleep is priceless.

Work Clothes

This is very simple. If you work in a professional environment, do not settle for bargains and sales when choosing a suit for the following reasons:


 – You will look cheap in substandard quality fabric.
 – You won’t look professional.
 – You won’t look sophisticated.

Remember a saying “Dress to impress?” It applies in the office, especially if you want to move up the ladder one day. Invest in your professional looks. It will pay off, trust me.

How about you all? In what areas of your personal finances/life do you draw the line at being cheap? Why do you feel this way about these areas?  


Share your experiences by commenting below!

Jacob’s Thoughts – Listed below are my random thoughts as I was reading this article.

• Very good post here, Aloysa, and thanks for being my blog swap partner! You bring up some very interesting points and some good areas for where NOT to be cheap. 
• Personally, I would classify myself as a “saver,” so it’s interesting to read a “spender’s” take on the issue of where we draw the line of being cheap.
• @ Cheap sometimes meaning low quality – 
• It really resonated with me in particular when you mentioned above that some of your biggest money mistakes involved you buying something cheap, only to find out that quality of the product was very low.
• As someone who is VERY frugal myself, I frequently am tempted by cheap products and have fallen in to this trap as well. 
• What will happen with me is that I’ll find out that I need to buy something new, and upon investigating the full retail price of my “first choice” product, I’ll find out that the item is quite pricey. Being a very frugal person, I then start to look for ways to obtain the same sort of product at a cheaper price. Often, this has resulted in me buying stuff from eBay, Amazon, or other various discount-priced outlets that HAS been cheaper, but has also been of much lower quality. 
• Since the product is of lower quality, I will often have to either buy another one immediately to upgrade (wasting time and money), or the cheap product will break and will need to be replaced.
• I’ve decided to devote an upcoming post to this topic since there is only so much room in this comments section. However, listed below are some of the various “cheaper-version” products I’ve purchased over the years that have probably cost me more money in the long run than simply buying the more expensive version from the start:
• Hiking poles
• Road bike
• Laptop battery (the one I purchased on Amazon didn’t interface correctly with my Toshiba laptop and would switch my computer’s power on and off unexpectedly!)
• Heart rate monitors
• Sunglasses
• @ Investing in your self – 
• I am a big believer in not being cheap when it comes to investing in your self growth. 
• Each month, I set aside a small portion of my income to save to be used for one of the following ways to invest in myself: 1) continuing education classes at a local community college, 2) books, 3) seminars, and 4) conferences.
• @ Why hair salons use electric razors vs. scissors –
• I’ve also noticed the trend in recent years that hair salons have started to almost stubbornly use the electric razor to cut as much of your hair as possible. This is especially true at many of the discount hair cutting operations that you see in Wal-Marts and shopping malls.
• I’m pretty certain that the reason that this shift is occurring is because using the electric razor is 1) quicker, 2) easier, and 3) less awkward (they don’t have to grab your hair and cut it with scissors).
• Since my hair is VERY easy to cut, I actually started noticing back in 2009 that the hair salons were starting to only use the electric razor (on one length setting no less) to cut my hair. This simplicity prompted me to buy an electric razor kit at Wal-Mart and use it to cut my own hair, which I have done since and couldn’t be happier with! I’ve calculated that this has saved me $300-$400 so far!
• As a whole, I think that probably the majority of guys (at least the ones with fairly simple hairstyles) could in fact cut their hair at home using an electric razor. On the other hand, women have more complex hairstyles, and therefore, I think it still makes sense for them to visit a hair professional.
• @ Dress with high cost clothes
• I have to respectfully say that I somewhat disagree with the idea that you have to spend big money on fancy dress clothes for work. 
• Thus far in my working life, I’ve worked in multiple settings (casual manufacturing plant and semi-formal corporate headquarters) in multiple locations (big city and small farming community), and not once, was I ever looked down upon for not having fancy designer dress clothes. All of my dress clothes were either bought from Wal-Mart, JC Penney’s, or Target. 
• In fact, I often got compliments of how well/nicely I dressed for someone of my young-ish age in the workplace.
• Of course, I suppose that this attitude towards “level of style” all depends on the nature of your job. 
• All of the roles I’ve had involved working with other scientists, pharmacists, or engineers (even at the corporate level). And, as a whole, I’d posit that these people place less importance on style, provided that someone looks presentable to some degree. 
• If you worked somewhere such as a fashion firm or as an investment banker, it might be different.

***Photo courtesy of http://www.flickr.com/photos/katerha/4354618648/sizes/l/in/photostream/

10 Tips to Save Energy and Money This Winter

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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 $205 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 October 31st, 2011.

The following is a guest post. Enjoy!

Let’s get right to it, shall we? Saving money is arguably the most talked about subject at the water cooler, over dinner, and in the grocery store lines. You name the subject, and people are talking about it everywhere.

Where to find the cheapest gas and electricity is always a conversation starter. Mention to a friend you found cheap gas and someone you don’t even know will chime in on your conversation. What once would have been considered rude is now acceptable. Eavesdropping on a stranger’s conversation at the table next to yours in a diner would have been unheard of several years ago. However, with the price at the pump and the cost of heating oil rising, etiquette seems to have gone by the wayside. Sometimes, a little less etiquette and a little more sharing is not a bad thing. Learning where you can get the best deal and other money saving tips for lowering winter heating bills is highly valued knowledge these days!

Shown below are ten tips on how you can save both your wallet and the planet on energy consumption this winter:

1. Develop an energy plan for your house – Make a list of the energy hogging appliances you can eliminate or replace in the coming months.

2. Evaluate your electric bill – Ask for detailed information from your energy supplier. Figure out when your energy is peaking. Look for ways to decrease usage.

3. Turn televisions off or unplug them if they will not be used for extended periods of time.

4. Turn computers off when not in use; this includes printers and monitors.

5. Use lower wattage bulbs whenever possible, replacing burned out bulbs with newer long life energy efficient (sometimes called CFL – Compact Fluorescent Light) bulbs. Although more costly for the initial purchase, they last substantially longer and use less energy while providing the same level of illumination.

6. Insulate your water heater and put it on a timer – Organize your family so everyone is taking showers at the same time of day. Maintaining instant access, hot water 24 hours per day can be expensive. If the family plans on showering in the morning, set the water heater to turn on 1-2 hours before the first person will shower. Run the dishwasher when no one is home, using the last of the hot water from that morning’s heating cycle to run the dishwasher before the timer turns the water heater off for the day.

7. Wash all clothes in cold water – Although hot water may be needed for some bedding items, most clothes will not only be just as clean, but will last longer if washed consistently in cold water.

8. Use hand sanitizer instead of water for post bathroom clean-up – Not only do you save on the water bill, but you also won’t place a demand on the water heater for quick hand washing.

9. Use a heating blanket to combat chilly nights in the fall and spring – Taking the edge off cold sheets with a heating blanket is often more than enough to avoid firing up your heating system for a chilly evening.

10. Open southerly and westerly curtains on sunny days – Even on the chilliest of winter afternoons, the sun’s rays will provide added warmth to rooms without increasing the thermostat temperature settings.

How about you all? What strategies do you use to save money on heating/energy usage during the winter months? Have you tried any of the techniques on this list? 


Share your experiences by commenting below!

Jacob’s Thoughts – Listed below are my random thoughts as I was reading this article.

• @ Putting your water heater on a timer – This is actually a VERY good idea! I’ve never really looked at my water heater in great detail, let alone evaluate whether or not it had timer ability on it. But, it’s very true that you really don’t need hot water AT ALL HOURS of the day. As such, this item is going on my lists of things to evaluate! 
• @ Washing clothes in cold vs. hot water – 
• Personally, I’ve never understood why people bother washing clothes in hot water. Along with costing more as far as water heating purposes go, if you use hot water, you also have to be vigilant in separating your white clothes from your colored clothes. As a guy in my mid-20’s, this is too much work for me! haha I ALWAYS use cold water to wash.
• Even if some of my clothes call for washing them in hot water, I figure that my clothes are inexpensive enough that if they last 10% shorter (as a result of me using the wrong temperature water while washing them), replacing them wouldn’t be that big of a deal. 
• Nevertheless, whenever I enter the laundry room at ANY of the apartment complexes I’ve lived in, the washing machine is ALWAYS set on hot water from the previous user. I really just cannot figure out why this is. 
• I could understand using hot water to wash clothes if your clothes have been soiled by one of your animals or what-not. However, this is somewhat of a rarity.
• How about you all out there? Can anyone educate me on why so many people wash their clothes with warm or hot water?!

***Photo courtesy of http://farm4.static.flickr.com/3038/2724803437_030a4f42d0.jpg

How You Can Obtain Long-Term Electricity Savings

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With the prices of nearly everything rising, it is important for consumers to find the best utility rates available. Though many utility companies offer websites to allow for rate comparisons, there are a few things that every consumer can do to make sure that they are receiving the best possible long-term electricity prices.

Finding a Provider

The first step in saving money on utility bills is finding the best rates available. Many companies have websites that allow potential customers to compare their current rates with rates offered by that company. Some companies may even guarantee rates for a specific amount of time, thereby reducing the amount of time consumers spend searching for the best rates and switching providers. Before changing providers, however, it is important to check if the current provider charges a cancellation fee to terminate a contract.

How about you all? How much do you currently pay per month in electricity? Is it more or less than what you would term as your “tolerance limit?”


What steps do you actively take each month to save money on electricity? Have you tried any of the steps shared above? 


Share your experiences by commenting below!

Jacob’s Thoughts – Listed below are my random thoughts as I was reading this article.

• Posts discussing methods to reduce electricity or utility bills are always very interesting. I think this stems from the fact that almost everyone does have to pay these types of bills in one form or another, so everyone can relate and share their thoughts.
• I also like posts such as the one above that discuss how the electricity “system” works in other countries (this one applies to the UK especially).
• My personal spending on electricity bills for my 781 sq. ft. two-bedroom condo (built in 1966 with a probably 30 year old A/C unit) over the past 5 months is shown below:
• September 2011 – $67
• August 2011 – $97
• July 2011 – $74
• June 2011 – $54
• May 2011 – $40
• As you can clearly see by these numbers, there is a sharp peak in the electricity usage during the hottest month of the year here in Virginia (August), with the totals decreasing on either side of this month. Quite interesting stuff!
• @ Finding or switching electricity suppliers in the US vs. the UK –
• One thing that is quite different here in the US compared to the UK (as is described by this post) is that an energy supplier in a certain area has a “necessary monopoly.” This means that this supplier will most likely be the sole source of electricity for a particular town/city/area. 
• Because of this “necessary monopoly,” it is actually difficult/impossible to do any price bargaining with a supplier or threaten to switch to a competitor. This is simply because there are no competitors (unfortunately). 
• Maybe, one day, this will change. But, this is the reality we’re stuck with right now.
• @ Home improvements to reduce electricity costs and usage – 
• First, I must admit that I do not always have the best habits when it comes to saving money by reducing my energy consumption.
• What I mean by this is that while I do the best I can to reduce my environmental impact, I refuse to have to work at my home in the 80 degree F heat during the summer. Instead, I have no shame in turning on the A/C to a comfortable temperature, at least while I am home.
• Having mentioned that I am by no means perfect, listed below are the things that I do do in order to save money on electricity usage:
• Have opaque curtains that stay closed during the day-time to block UV light and heat.
• Turn off the A/C or heat while I am gone at work during the day or out of town for the weekend.
• Turn off electronic appliances (stereos, VCR (do people besides me even have these these days?! haha), DVD players, TV’s, etc) when they are not in use.
• As I mentioned above, my A/C blower unit is MANY years old. In fact, I think that the home inspector for my condo mentioned to me that it was close to 30 years old. As such, I believe that it is not nearly as efficient as a newer unit. Therefore, replacing this will be on my radar if I stay in the condo for more than 5 years.
• For more sustainable living tips, I would recommend visiting Sustainable Personal Finance. They’re the real pros at this stuff!
• @ Replacing your energy meter with a “smart” one
• This is actually a great idea! I would love to have something I could analyze online that showed a breakdown of my energy use by appliance and/or room in my house. 
• However, my initial guess is that again, due to the way in which the electricity infrastructure is set up in the US, the energy companies would not allow you to change the meter from the one that they provide for reading the electricity from your house, since it is technically their property anyway.
• This is just my gut feeling. If someone knows more about this issue, please let me know or comment below to share. I’ve made a note to look in to this in more detail in a future post!
• Reading about the sorts of information that these “smart” meters provide sparked my curiosity to see what types of information my current energy supplier/meter (Dominion) provide me in my online account interface.
• What I found that was provided in the online interface is shown below:
• Monthly and daily overall usage in kilo-Watt-hours. A graph is also provided that enables me to compare my current month’s energy usage with previous years.
• Dominion also has a tool in their online system that claims that you’re able to “analyze your energy usage.” However, this tool was not working when I just logged in to check it, so I’ll have to check back at a later date to see what it offers.
• And, that’s about it…So, there was really nothing on the site (at the current time) that told me anything super-beneficial for how to better save energy.
• In addition, Dominion did offer several “green” energy programs. One was a Smart Cooling Rewards program, where you allow Dominion to cycle on and off your A/C during the hottest summer months to help them meet the energy demands. In exchange for this, they’ll give you $40 per summer. Some other cool programs they have are offering free in-home energy reduction assessments to low-income families and providing discounts at select retailers for customers buying energy-efficient light fixtures.
• Unfortunately, none of these programs facilitate the analysis of my current energy usage, but every initiative helps!

***Photo courtesy of http://farm4.static.flickr.com/3655/3338776771_22e2442958.jpg

I’m Staying With Bank of America…"Are You Crazy?"

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Recently, I mentioned to my girlfriend that I was going to stay put with using Bank of America for my checking account, despite their recent BRILLIANT, customer satisfaction-driven (yeah right!) decision to start charging $5 per month for the use of a Bank of America debit card.

To my brilliant statement mentioned in the title of this post, she then asked if I had a screw loose. Truthfully, her comment has merit because man, oh man, have Bank of America and Netflix made some moves recently that have upset their customers beyond belief, or what?!

As such, the goal of today’s post is to explore the various factors that went in to my decision to stay with Bank of America (for now at least). And, by doing so, I hope that it will help you to make your decision as well, if you are one of their customers.

Drivers for the $5 Fee

As much as I hate to say this, I understand why Bank of America is going to start charging this fee. It all comes down to the finances, as you might imagine.

To get a grasp for their motivations, we must first dig in to the inner-workings of how debit card transactions are processed after you “swipe” the debit card at the store. For example, let’s say that you’re at a grocery store buying a $3 bottle of wine for a dinner party on Friday night (since you’re a My Personal Finance Journey reader, and that’s how we roll with $3 bottles of wine). You approach the cash register and take out your Bank of America Visa debit card to swipe. After swiping, the card machine then asks you whether you’d like to process it as “debit” or “credit.”

Choosing between these two options has huge financial ramifications for the store from which you’re purchasing the wine.

• If you choose “credit,” the store will be charged 2-3% of the purchase cost in credit card fees to be paid to Bank of America (payday for them!) and Visa (for providing the infrastructure). 
• If you choose “debit,” the store will only be charged a few cents.

If you are Bank of America, let’s think about it – which one would you prefer? Would you (as Bank of America) prefer paying the infrastructure fees to Visa, or would you like the merchant to send those to you along with some extra for a profit?! Obviously, this is a no brainer!

Details of the $5 Fee

So, as we saw in the previous section, even though I may not like Bank of America’s decision to start charging fees, I do understand it.

Furthermore, it is important to understand (my girlfriend was slightly confused about this) that the $5 per month debit card fee will not be charged for simply having a debit card. Rather, you must actually use it to buy something at a store in order to be charged this fee. ATM usage remains free (thank goodness!).

Why I’m Sticking with Bank of America

Now that we’ve gotten the important background information out of the way, we can now explore my reasoning for why I’m committed currently to staying with Bank of America (despite these debit card fees), and YOU can determine for yourself if you think I’m crazy/out of line!

These considerations are listed below:

• I only use my debit card for ATM purposes.
• The only time I ever use my debit card is to deposit cash or checks or make withdrawals at the ATM. Therefore, I won’t be charged the $5 monthly fee.
• For my finances, using a debit card makes zero sense because I get 1-3% cash back when I make purchases on my Chase Freedom Visa credit card. I am very attentive to paying off my credit card once a week so that I don’t accumulate a month-to-month balance.
• I haven’t found any banks yet that can match what Bank of America offers for my needs. 
• One of the only reasons that I’m still using Bank of America is that they are truly everywhere in the United States. They are in Arkansas where my parents live, they are on the East Coast where my sister and I live – they are everywhere. 
• And, the fact that Bank of America is everywhere has made it very easy on me over the past few years since I have moved three times.
• Often, I have considered moving my checking account to an online bank since they offer much better interest rates and other features. 
• However, there is something to be said about having a physical bank if I need a certified cashier’s check (I just checked, and online banks such as ING Direct’s does not offer certified checks) to buy a house or pay a moving company. Additionally, I question the security of mailing a check through the Postal Service in order to make a deposit…

How about you all? Do you think I’m crazy for staying with Bank of America? If you are a Bank of America customer, are you currently looking to leave due to the debit card fee change? Why or why not? 


Can you provide any suggestions on a good bank that would be suitable for me if I were to change from Bank of America? Should I go with a local or national chain? Regular bank or credit union?


Share your experiences by commenting below!

***Photo courtesy of http://www.flickr.com/photos/moneyblognewz/5264722308/sizes/m/in/photostream/

Personal Finance Issues and Concerns Faced by Scientists and Engineers – Interview Today at Smart Family Finances

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Welcome to My Personal Finance Journey! If you are new here, please read the “About” or “First-Time Visitor” pages to find out more about us. If you would like to receive free updates on articles like this by email, then sign up here or you can subscribe to the RSS feed. Also, check us out on Twitter or Facebook. Thanks for visiting! Keep on learning!
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Happy Saturday everyone! It’s a beautiful day here in Virginia, where the clouds that have lingered over the East Coast of the US have finally lifted, and we have sunshine and 70 degree F weather!

I wanted to let everyone know of an interview I did that was published today by our friend, Shaun, over at Smart Family Finance. Just click on the link below to view the interview.

Interview at Smart Family Finances.com – Personal Finance Issues and Concerns Faced by Engineers and Scientists


As the title of the interview mentions, the questions discussed and answered relate to the specific debt accumulation and money saving financial issues encountered by scientists (especially scientists just beginning their careers). Overall, these problems are caused by the ability of scientists and engineers to earn MUCH HIGHER than average starting salaries at a very young age, often before they are financially mature.

The specific questions that are answered are listed below. Be sure to head on over and check it out!

I hope you all enjoy the interview. Please let me know if you have any questions!

***Photo courtesy of http://www.flickr.com/photos/rocknroll_guitar/3841235072/sizes/l/in/photostream/

How Checking Your Credit Report Can Stop Identity Theft

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The following is a guest post. Enjoy! 

Identity theft costs American consumers and businesses almost 50 billion Dollars annually. In 2009, more than 11 million people were victims of identity theft and lost an average of almost $5000 per person. This type of crime is growing at a rapid pace due to the sophistication of hacking groups and the ability of thieves to sell private information on the internet. As more personal information moves online with social media and technology like “the cloud”, identity theft may even become an even bigger problem. With regular monitoring of your financial data, it is possible to catch the theft in progress and stop it before serious damage is done. So, how can you spot it?

Checking Your Credit Report

Keeping close tabs on your credit report is important if you’re going to notice any activity that seems abnormal. Your credit report shows your entire credit history, and you should be able to spot anything fraudulent.

The best place to check all 3 of your credit reports (from the three biggest credit reporting agencies – Equifax, Transunion, or Experian) is Annualcreditreport.com. The Fair Credit Reporting Act (which was recently amended in 2010) allows all people to have free access to their credit information (report), one time per year. You can check all three reports free of charge and search for activity that looks suspicious. Your good credit score can be seriously damaged by fraudulent activity, so keeping a close watch on it is important. However, viewing your credit score is not included in the one time per year free credit report viewing.

How to Spot Identity Theft

Your credit report shows all open and closed credit accounts, all the way back to when you opened your first credit card or paid your first utility bill. If you see anything that you don’t recognize, it may be the result of identity theft. The FTC recommends that consumers check their credit at least once per year to make sure it doesn’t contain any fraudulent activity.

Other signs of identity theft may include:

– Phone calls or mail saying you have been approved for credit cards or loans that you did not apply for.
– Missing financial mail like bank or credit card statements.
– Bills and/or credit card charges for items you did not purchase.

What to Do if You Notice Fraud

If you do notice suspicious activity on your credit file, you can have a fraud alert placed on your report. This alert will help stop any unauthorized use of your credit. There are 2 types of fraud alerts, an “initial alert” and an “extended alert”.

An initial alert is put on your credit file for around 90 days. This is a step you might take if you believe your personal information may have been stolen and could be used fraudulently. If you know you are a victim of identity theft already, you may need to file an extended alert which will stay on your credit file for 7 years. This means that creditors must contact you before issuing any new credit in your name.

You will also need to close any accounts that were opened in your name. You can contact the fraud department of the company that issued the account and explain your situation. Keep a record of all correspondence with the company. It may be important to have proof of any agreements that you have made about your case.

You also may want to file a complaint with the FTC and the police. This can help law enforcement find the perpetrators of the theft and prevent any further illegal activity with your credit.

Credit Monitoring Services

Credit monitoring is a service which can be purchased through a credit bureau like Equifax, Transunion, or Experian. This service will alert you any time new accounts are opened or suspicious activity occurs on your credit file. This would include the application for new credit cards, loans or mortgages, or the opening of an account with a mobile phone provider. Some companies that provide credit monitoring will also insure you for losses that result from identity theft. The amount you will be covered for varies with each company and monitoring plan.

Conclusions

Identity theft is a serious problem that can be very expensive and time consuming to deal with. There are measures you can take before a theft happens to lessen the chance that you will be a victim. Regular monitoring of your credit report and financial information will help you notice illegal activity before it turns into something more serious.

How about you all? Have you ever been a victim of identity theft? If so, what steps did you take to correct it? Have you ever noticed any unauthorized charges on your credit cards? 


What steps do you take to protect yourself from identity theft? How often do you check your credit report?  


Share your experiences by commenting below!

Jacob’s Thoughts – Listed below are my random thoughts as I was reading this article.

• Personally, I’ve been lucky enough to not have been a victim of identity theft so far in life. As far as bad luck goes, I think having your identity stolen would be one of the worst things that could happen since it can affect your purchasing and borrowing ability as well as your credibility as a person for years to come.
• How I protect myself from identity theft
• There are several steps I take to stop identity theft from happening to me, the majority of which are covered in a previous post I wrote which can be assessed at the following link – How To Protect Yourself Against Identity Theft. 
• The main steps I take include the following – 1) place a free 3 month fraud alert on my credit report at all three of the main credit agencies (this must be renewed every 3 months), 2) monitor my credit report once a year using the free site mentioned above in this post, and 3) reduce the amount of junk mail I get by “opting out” of these lists at a site called Opt Out Pre-Screen (reducing the amount of junk mail decreases the amount of documents floating around the trash and mail system with my personal details on it).
• Several additional steps that have been added to my “identity theft prevention regimen” lately are to never click links in scam emails and always make sure I see that an Internet website is secured before entering my payment details.
• @ Does insurance cover identity theft?
• As I was reading this post, I began to think that it would be nice (since identity theft is becoming more and more common these days) for some type of insurance policy an individual would already be carrying would protect him or her against damages done by identity theft. 
• According to the Insurance Information Institute (III), insurance companies are now offering identity theft coverage either as add-ons to home insurance policies or as separate policies. 
• As mentioned above, another increasingly popular service that provides identity theft coverage is credit monitoring services.
• So, since identity theft coverage is not currently included in regular insurance, the question becomes whether or not this type of coverage is worth the extra $25-$50 per year. 
• An investigation in to answering this question would be a good topic for a future post. However, my instinct tells me that it probably is not worth the money for the current risk level. Additionally, much of the service offered by credit monitoring agencies can actually be performed by you manually using the steps described above (setting up fraud alerts, etc). 
• But, we may see this changing in the coming years as identity theft becomes more prevalent.
• @ How identity theft happens –
• One of my more computer-savvy friends recently told me, much to my surprise, that the majority of identity theft incidents happen simply by random occurrence rather than specifically targeting a certain individual. 
• What he said would happen is that a hacker runs a computer script that scans through millions of account numbers, applying number and letter codes in order to discover a person’s password. If a password is “cracked,” it is more the result of random chance than targeting a specific person for personal reasons.
• Furthermore, he told that the majority of identity theft incidents occur through non-technological means. What he meant by this was that more identity theft cases occur simply by someone eaves-dropping on a nearby conversation when a person mentions his or her Social Security number out loud or when someone finds credit card information written on a piece of paper in the trash than when someone uses high-tech computer software to hack an account.
• I found this interesting!
• @ How often you should check your credit report for fraud – 
• Because identity theft seems to be turning in to a more significant problem, it begs the question of whether or not checking your credit report once per year (the free route) is sufficient.
• In thinking about this, my thought is that checking your credit score twice per year is probably both a reasonable and safer plan.
• @ I wonder what percentage of identity thieves are actually caught or apprehended?
• When I had finished reading through this article, I felt slightly disheartened because it seems to me that identity theft is almost too easy for fraudsters to get away with. 
• After all, if you are a victim of identity theft, it’s not like you can report it to the local police to look in to since the person who took your identity could be in a different country or state. So, just who goes after these people?! And furthermore, how do they prioritize which cases to investigate?
• Because of this, I was curious to find out what percentage of identity thieves are actually caught.
• According to a study I found on Privacy Rights.org, only about 1 in 700 identity thieves are caught. This is truly amazing! That’s a 0.14% chance!
• Just as a point of reference, the probability that you will become a victim of identity theft is 1 in 200. Wild stuff!

***Photo courtesy of http://farm3.static.flickr.com/2285/1594411528_1512b1aad5.jpg