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If you have taken out loans to go to school, you most likely have Federal Stafford loans from at least one bank.  If you ended up with more than one bank, you have to make two sets of payments every month for those loans.

I have two sets of loans, and in about 7 months they will come due.  When that happens, I will probably find a consolidation loan.  There are a few important things to know about consolidation loans if you are planning to consolidate.

First, do not get the impression that a consolidation loan will save you money.  Federal Stafford loans, the most popular type of student loans, are fixed at 6.8% by the government.  If you have two loans with minimum payments of $100 each and you consolidate, you will just have one payment of $200.

If you do not get the same kind of loan when you consolidate, the process can actually cost you more money.  Make sure that if you have student loans to consolidate you continue with a Federally backed loan with the same fixed interest rate.

Consolidation can also impact your credit score.  The impact should not be big depending on when you got the first loan.  When you consolidate, you close two loans with history and replace them with one brand new loan.  This lowers your average account age and can impact your credit.

It has been a while since I gave you all an update on my credit score and why things have been moving.  There is no mystery to why my score has gone down and back up.

As you can see, my score went down from about 770 to 747.  Over those months, one of my banks closed my credit card accounts that I never used and I opened up a new credit card account to use as my primary card.  The combination of events decreased my average account age significantly.

The only way to raise your score after something like that is to be patient and keep paying everything on time.  I have, and my score finally took a jump up early this month.  I am now sitting at a cool 757.  It is just a step on the road to 800.

So, until further notice, you will see this credit score on the right side of the blog:

I have taken Ramit Sethi’s thoughts on making an extra $1,000 per month to heart.  I am not there yet, and would like to figure out a better way to keep things balanced, but I have found a fun, income producing hobby that I want to share with you.

Last month, I was accepted as a writer at Demand Studios.  I went through an online application processwhere I was asked for a resume and two writing samples.  I heard back about two days later with an approval e-mail.  Demand Studios is held under the same parent company as popular sites like eHow, Livestrong.com, and Cracked.com.  The parent company is called Demand Media.

Demand Studios hires people on as freelance writers.  Your earnings are paid by PayPal and are reported to the IRS, so you do have to pay income taxes on the income.  Writers are paid on Wednesday and Friday for articles written before a specific cutoff time.

The earning structure is fairly straight forward.  There are articles with a set rate (most commonly $7.00 or $15.00) and there are articles under a revenue sharing program.  Those articles accumulate earnings over time and pay once they reach $10.00.

I have earned $240.20 so far, with two articles awaiting review (another $30) and $45.00 as my expected next payment.  Click to enlarge the summary below:

So, if you are interested in writing, this is a great opportunity to get paid for it.  I make a heck of a lot more at $15 per 400-500 word article than I do writing on this blog.  It is less rewarding, but a better financial gain.  I have found that writing an article or two while watching TV in an evening is easy and quick.

Have any of you given Demand Studios a try?  Have you had similar experiences?  Let us know in the comments.

Are there any closet freelancers in Narrow Bridge reader land?  If so, I have a question for you.  I got a form from my accountant last week asking about any direct costs I have associated with freelance writing I do online.  I made about $650 last year from writing projects.

The question is, how do I figure out what percent of Internet costs were associated with the writing?  How about other utilities and rent?  I did the work from home, and could not have done it anywhere else.  I needed power, Internet, and space to do the writing.  What part of all of that is a business expense?

Have any of you done this before?  How did you figure it out?  Please give your ideas in the comments.

[Also, a quick thanks goes out to Evan for including Narrow Bridge in this week's Carnival of Personal Finance.]

I have been a member of Upromise for nearly a year, and I am thinking it might be time to pull the plug.  I tried the toolbar and registering my cards to the account.  I think I ended up with two transactions that paid me anything.  I will let the picture speak for itself:

Fifty two cents!  That’s it.  Far from the average savings of $458 that Upromise suggests.  Here is what I have decided about the site:

1. Unless you get their credit card, you are not going to make all that much anyway.  The credit card is a way for them to make a lot of money and pass a small amount of it to you.  This works like any other credit card rewards program, but pays for college instead of other rewards.  Not such a great deal if you ask me.

2. Unless you make a crazy effort to go to Upromise restaurants and online stores, you won’t make much else.  That is where I got my fifty two cents.  One trip to a restaurant (not on purpose) that is supported by their program and a website domain renewal, which I would have done anyway.  So, it takes spending money to really earn anything back from Upromise.

Overall, I would not recommend this program.  I try to only endorse sites I really like myself, and this one did not earn the Eric seal of approval.

I made a bad stock trade this morning.  There, I said it.

Given that, I still made a bunch of money, but had I not let emotions get involved I would have made more money.  Here is the story:

I bought BRK.B about a month ago for $3,404 per share.  Over the last month is dipped down below $3,300 and slowly came back.  I bought it because I knew it was going to split 50:1 in the near future, and I wanted to capitalize on the price increase I (correctly) expect would happen.

Yesterday the split was announced.  The stock was way, way up.  This morning it split.  It went up more.  The market opened, it went up more.  I put in a stop order, it touched it for a second and went up more.  So, I locked in a profit of over $200, but it could have been more.

I traded on emotion.  I was so excited that I was right, I had to lock in my profit shortly after the market opened.  That was around 9:45am Eastern, 15 minutes after the market opened.  Had I been patient and set things up correctly, I could have made an extra $100.

But then it went back down.  I ended up buying it back for .80 less than I bought it for.  Good deal right?  I did it again.  I got impatient and sold it for a modest gain.  Had I been patient, and let emotion take a back seat, I would be up an extra .50 per share right now.  That is a lot with 50 shares.

So, I made about $220 after trading fees.  Not a bad day.  If I could do that every day, I would be in pretty good shape.  But I did learn a valuable lesson.  Be calculated and leave emotion at the door when you are buying and selling stocks.

This is a re-visit to my old Intro To Investing post from October, 2008.  If you like this post, be sure to read the old one that inspired it.

Imagine the life of Mr. Buffet.  He lives like money is not really a concern, which it isn’t.  He is frugal.  He relaxes.  He is happy.

Who am I describing?  Who is the proverbial Mr. Buffet?  It is two Mr. Buffets actually.  Those are Warren and Jimmy.

Warren Buffet is the closest thing I have to a modern day hero.  Buffet is smart and calculated and made a lot of money over the years.  He is the world’s best investor.  Warren Buffet took his “value investing” education to turn an investment in an old textile company called Berkshire Hathaway into one of the most famous holding companies in the world.  With an insurance powerhouse and investment arm under its control, Berkshire Hathaway has produced consistent investor return for half a century.

When you picture paradise, you probably imagine clean beaches, tropical weather, and cold drinks.  Chances are, Jimmy Buffet is there waiting for you.  I imagine Jimmy’s life as the ultimate in relaxation.  While sipping away in Margaritaville and enjoying the Cheeseburger in Paradise (hold the cheese on mine), Jimmy Buffet is the American symbol for relaxing.  His ‘parrotheads’ often travel south, as inspired by his song “Changes in Lattitudes, Changes in Attitudes.”

So, while these icons appear to share little more than a last name, they represent something more to me.  I have to remember to be serious and dedicated in my professional life, but I have to remember to head south every once in a while, or just relax regularly.  Finding the balance between the Buffet’s is the key to my dream.

I hope to be able to combine those lifestyles more as time goes on.  I want to remove the tether of my office and be able to work wherever I want and whenever I want.  I hope to have the financial security to tell any boss how I really feel at any given time and not worry about the consequences.  (I like my boss today, in case you were wondering)

I dream of a freedom from financial worry and a freedom to pickup and go.  I want to enjoy paradise, and the ride to get there.  That is my dream.

I have been doing some research on a stock for the University of Denver endowment fund, as I am enrolled in a course where we make investment decisions for a $500,000 equity fund.  I made a good find and thought I would share it with all of you.  I plan to purchase this stock in my personal portfolio and to recommend a 1,000 share purchase for the fund.

The stock is World Wrestling Entertainment.  Don’t laugh, this company is very serious and is doing very well.  So well, in fact, that they are paying a 9% dividend.  I am in the camp that dividends should be reinvested until retirement.  In that case, your reinvested return in tax free until you sell it.

How can they pay so well?  WWE is a diversified entertainment company.  The main product, of course, is wrestling.  However, that business has launched an empire of products creating revenues and profits.  From cable and pay-per-view revenue, ticket sales, video game licenses, book publishing, a record studio, a movie production company, merchandise sales, web revenues, and toy licenses, WWE is is earning $500 million per year, of which about $50 million is profit.

I don’t mean to sound like an advertiser, but I am bullish on the stock.  The weak economy means less vacations and more TV.  More TV is a good thing for the WWE.  Stay-cations (vacation time spent at home) also helps the wrestling business, because people are both watching the shows and going to the reguar live events around the United States and Canada, which are not limited to the weekly Raw, SmackDown!, and ECW programs.

The risk with this stock is that revenues would decrease, spurred by a number of causes.  If a major wrestler, such a John Cena, were to be injured, many fans may stop watching.  However, the company has managed to succeed despite the departure of Hulk Hogan, Stone Cold Steve Austin, and The Rock.  In addition, new personalities such as Kofi Kingston prove that the WWE farm system (similar to AAA minor league baseball) is continuing to produce top level talent.

My analysis gives a target price of $23 per share.  For a stock trading at $16 with a 9% dividend, I call it a buy…  If ya smell, what Eric, is cooking…

Also, a quick thanks to FrugalTrader for including Narrow Bridge in this week’s carnival of personal finance, hosted at Million Dollar Journey.

Update 1/21/2010: I bought the stock this morning at $15.80 per share.  Here we go!

I will never forget the image of Tyler Durden telling the mystery hero in Fight Club that, “The things you own end up owning you.”  That line still rings true with many of us, and one blogger came up with a system to actually quantify how much your things own you.

Matt at Steadfast Finances had this to say about his stuff to work ratio:

Just to show that all personal finance bloggers aren’t a pristine model of financial responsibility all of their lives, the graphic below represents how my personal finances looked using what I call the “How your stuff owns you calendar?” method when I was fresh out of grad school, making ~$60,000 a year, and leveraged up to my eyeballs.

He then gives a very blunt look at where his money goes, and it is eye opening at the very least:

If you want to figure out how to make your own “The Things You Own End Up Owning You” calendar, head over to Matt’s post and follow the great tutorial.

If you want to lose weight, there are two important parts of the puzzle: eat better and exercise.  Those two areas combine to have a big impact, but one is much more important.  It is easier to skip the burger than swim laps for two hours to burn it off.  To make a big difference, you need to control the input, not the output.

The same logic can be applied to finance.  Budgeting, the exercise of personal finance, can make a big difference.  Going from no budget to watching your expenses can save you a lot of money.  However, as some financial bloggers point out, it is important to go for the big kills rather than a nickel here and a dime there.  Cutting your rent, insurance, and cable/Internet bills can save big over the course of a year.  Even more important, though, is income.

If you can save $10 per month by asking your cable company to lower your bill, that is $120 per year, not too shabby.  But if you can get a raise of $100 per month, that is $1200 per year, which is a bigger impact.

What we see here is that controlling your income can have a bigger impact than controlling your expenses.  Easier said than done, right?  WRONG.  There are two major methods to increasing your income.  1. You get a raise or increase income from what you are doing already.  2. You create a new source of income.

I have created new sources of income from a few places over the last year.  The most successful has been eHow, where I have made over $1,000 in the last 18 month.  If I did more there or added another supplement, I can have that grow by more.  It only took a few hours to get started on making that $1,000, why can’t you do it.

Getting a raise is also possible, even in today’s economy.  If you are worth it, your company will pay you more to stick around.  I got a raise of nearly 20% in the same time period my group laid off about 15 people.  If I can do it, you can do it.  Just work hard and be the best at your job.  Sometimes that takes time and careful negotiation, but it is possible.

Ramit over at I Will Teach You to Be Rich is kicking off a series on earning more income, and it is worth a read.  I know there are silent readers out there, please come out of the shadows and let us know if you have secondary income streams in the comments.  Any residual income?  If not, tell us in the comments too.  As a community, I am sure we can come up with some good ideas.