I just finished reading Julie Clow’s new book ‘The Work Revolution.’ Like the title implies, it has a range of ideas that can revolutionize the way an organization treats its employees and how employees look at work.
Money Tips for New Grads
May 14, 2012 by
This weekend, I had the pleasure of watching my sister graduate Summa Cum Lade from the University of Arkansas. While in Fayetteville, I watched thousands of students receive their degrees, but I realized that most did not get a financial education on par with their newly minted degrees.
Here are some top tips for new graduates around the world.
Ask The Readers – Pareto Principle
April 24, 2012 by
The Pareto Principle, also known as the 80-20 rule, is a powerful concept that we can all use to improve our own lives.
Why I Hate People Who Give Bad Tips
April 16, 2012 by
I recently read a post with an interesting theory on tipping. I like and respect the author of the post, Len Penzo, though I disagree with his opinion this time around. However, it was when I read the comments I wanted to scream and start punching people. Here is what you really need to understand about tipping and the service industry. [Warning, angry rant ahead]
What Recession? The Economy is Awesome
February 22, 2012 by
If you follow the Republican presidential campaign, you have undoubtedly noticed that the candidates are trying to sell you a story about how horrible the economy is and why you need to elect them to fix it. I think they are dead wrong, the economy is great. Here’s why.
Track Your Job Application Status
February 6, 2012 by
You all know that I am a big fan of aggregating everything into one, simple to use location. Whether I am watching my finances at Mint.com or Adaptu or tracking an upcoming trip with TripIt, looking up a recent purchase on Slice, or tracking insurance claims on Simplee, I am always trying to make my life simpler. If you are looking for a new job, I found a great tool for you. StartWire will pull in all of your job applications to one, simple platform.
Fixing Your Own Economy
October 21, 2011 by
If you read the news today or listen to talk radio, you will most likely hear some mention of unemployment and how bad the economy is. I disagree, the economy is in great shape. You just need to look after yourself to ensure your personal economy stays on top.
Education
Education is the core to most people’s financial success. If you look at top CEOs today, almost every single one has a college degree. Many of them have master’s degrees. Most of them went to business school or have an MBA. This is not a coincidence.
If you want to keep your economy stable, you need an education and a degree that will lead to the future you want. I am thrilled that so many people want to be social workers, but a $60,000 master’s in social work from a private university will likely make you $25,000 per year. Is that warm fuzzy feeling worth it?
The same university offers an MBA for the same cost. That degree will leave you making double what a social work degree will make you.
History degrees, art degrees, English degrees, and other liberal arts do not have a bright future today. Unless you want to be a teacher or go to grad school, these degrees will help you land a job with good benefits at Starbucks. Make sure you know what you are getting into when you pick a major.
If you don’t believe me, this graph from the Department of Labor breaks down the numbers.
Interview: Jason at Live Real Now
August 10, 2011 by
Welcome to the newest installment of the Yakezie interview series. Today, we have questions answered by Jason at Live Real Now. Jason has been making major strides cutting his debt and has chronicled the journey at his site.
How did you get started in personal finance blogging? What was your inspiration?
In April 2009, my wife and I were on the verge of bankruptcy. We weren’t behind on anything, but we were in over our heads. While researching bankruptcy attorneys, I discovered Dave Ramsey and decided to give that a shot, first. For the next 6 months, I wouldn’t shut up about money and decided I should share my journey with the world and stop annoying my friends and family with it.
What changed in your financial life after you were married and had kids that was a surprise? If you could instill one financial value in your children, what would it be and why?
I was shocked by how much nickel and dime crap there was to pay for with our house. Everything from getting the sewer main snaked to replacing the screen in the window to buying gas for the snowblower to having to own a snowblower. It all costs money and adds up, but nobody ever thinks about that before they get a house. The one financial value I am trying to drill into my kids is a pure loathing for debt, specifically interest payments. Kids, don’t carry debt. If you can’t control yourself, don’t get credit cards!
On your site, you mentioned that you are trying to change your lifestyle. You are trying to get in shape and downsize your stuff. Have those efforts made a financial impact in your life? If you could start those efforts again today, what would you do differently?
I managed to cut my finances down pretty severely before I picked up my other projects, so I don’t think weight loss or downsizing has had much of an impact financially. The one thing I would do differently is to remind myself not to cheat. I can’t cheat just a little. Guaranteed, if I eat one cookie, there will be 3 more following it. I need to follow a strict set of rules, or I will definitely fail.
What is the biggest personal finance lesson you learned the hard way?
This one’s tough. I’ve always had a compulsion to learn every possible lesson the hard way. The biggest? Get your husband/wife/partner/lover/
Outside of blogging, what has been the biggest change you made to your financial life that made a difference? (i.e. making more money, frugal changes, budgeting, investing)
Credit. Rather the shunning of. Over the past 27 months, we’ve paid down $40,000 of debt. We couldn’t have done that if we were still charging our lives away. This spring, we got surprise with a $4000 bill for my son’s vision therapy and managed to pay it off without paying a cent of interest on it. That would have been impossible with our old spending habits. Our money is doing what we want it to do now, instead of demanding it be spent on garbage like a new TV we didn’t need and couldn’t afford 3 years ago.
Blogger Interview: Marie at Family Money Values
July 20, 2011 by
Today we have the pleasure of an interview with Marie at Family Money Values, a site with an eerily appropriate name. Be sure to stop by and read about how personal finances impact a family and how, even if you have kids, you can still focus on your family’s wealth.
1) How did you get started in personal finance blogging? What was your inspiration?
I had (and have) a message I felt was important – money brings it’s own problems. I didn’t feel that message was being conveyed anywhere and that a certain segment of our population would need to hear and be interested in hearing all about it.
2) What changed in your financial life as your family grew that was a surprise? If you can instill one financial value in your children in the future, what would it be?
What changed and was a surprise: Kids raised in the same household, by the same parents learned very different financial lessons.
One financial value: Money is just a tool – the work you do to earn it is the real reward - providing you with honor, respect and the self-satisfaction of making a contribution to society.
3) You discuss the possible downsides of wealth for families. What is the biggest downside and the best way to negate that problem?
I think the biggest downside differs depending on where you are in life and what you want out of life. In general though, I believe that being unprepared for the effects of wealth affects most people at some point in their wealth cycle. I’m hoping that FamilyMoneyValues can help educate and inform folks that they do need to prepare, as well as, on how to get prepared.
4) What is the biggest personal finance lesson you learned the hard way?
Bailing someone out of their financial mistakes by throwing money at them is not the way to solve the problem. If you really want to help, you somehow have to effect behavior changes. Sometimes that means letting the someone fail miserably.
5) Outside of blogging, what has been the biggest change you made to your financial life that made a difference? (i.e. making more money, frugal changes, budgeting, investing)
In our case, the biggest change happened when I chose a new career and worked hard to succeed in it. It immediately helped our bottom line. It provided bonuses, stock options and other opportunities for added income and it provided our children with a great example of a lucrative career path (which they both chose on their own to pursue).
My First Jobs: Camp and Retail
July 7, 2011 by
You all know that I have worked in banking and finance, but I have not told you very much about my more humble beginnings. Long before my MBA, years before my BSBA, I worked at a Boy Scout camp and a Target Store.
Boy Scout Camp
I spent seven summers on staff at the local Denver area Boy Scout camp. I started when I was 15 as a Counselor in Training (CIT) getting paid a whopping $5 per week. The $50 I made over the entire summer was not enough to pay for the uniform. Over the following summers, I had a range of jobs. I was (in order) a Program Counselor, First Year Camper Director, Assistant Director of Dining and Equipment, Camp Store (we had 3) Director, Order of the Arrow Director, and Assistant Business Manager.
What I Learned
You don’t have to make a lot of money to love your job. My favorite summers were early on when I made far less than $100 per week. During those summers I made great friends and had wonderful experiences. I did not always like giving up summers in Denver to be away working, but living in a tent, sleeping under the stars, and helping thousands of scouts learn and play made it worth it.
The Real Benefit
Aside from the networking aspect, I was part of a scholarship program for camp management. My entire undergraduate college experience (four years at the University of Colorado) was paid for by the Boy Scouts with matches by CU and another company.
Target
I started at Target as a sales floor associate. I was one of those people that made sure shelves looked nice throughout the day, helped customers find things, answer questions, stock products that were running low, and “other duties as assigned.” I was a sort of jack of all trades.
The schedule did not work well for me as a high school student, so I moved over to the cashier side of the store. I spent most of my two years at Target on the registers. I was also occasionally assigned to run the snack bar (.25 per hour pay differential!) or help the cart guy on a busy day.
What I Learned
When you have a boss, you have to do what they say. However, if you are a hard worker, do a good job, and perform well, they are willing to work with you on your needs. It is a two way street. Do your part and you will be treated well and respected regardless of your age.
The Real Benefit
I had to pay for car insurance, so I was there for the money. I also got a $1,000 Target Employee Scholarship for my first year in college.
You Are Not Too Good For Any Job
The most humbling part of working in a retail store and a camp is that you start at the bottom. I cleaned bathrooms and latrines, I scrubbed kitchens and offices, I built tents, I cleaned up from a virus outbreak, I taught archery, I was a trained lifeguard, I taught kids to swim, I carried heavy boxes to cars for old ladies. I did it all.
In today’s economy, people are often not willing to take a job that is “not good enough” for them. It is only not good enough if you are too good for money. Suck it up.
Your First Job?
What was your first job? What did you learn? How did it help you moving forward in life? Please share in the comments.
Photo by kevindooley.
Interview: Jacob at My Personal Finance Journey
June 24, 2011 by
This is an interview with fellow Yakezie member Jacob. He is the author of My Personal Finance Journey, a source great personal finance information with Jacob’s unique twist. If you like what you read here, be sure to give him a visit.
1) How did you get started in personal finance blogging? What was your inspiration?
From the age of 18, I have always been fascinated with the idea of starting and growing new businesses. Through my undergraduate college days, I started and successfully operated 1) an eBay selling business and 2) a pet waste removal service. I also attempted several network marketing gigs, but failed miserably in all of them. I most likely won’t be trying those again anytime soon!
At the same time that I was starting these different ventures, I also began reading any personal finance book that I could get my hands on. Several of the books that inspired me in my early days to learn more were David Bach’s “Automatic Millionaire” and Jeremy Siegel’s “Stocks for the Long Run.” I used the knowledge I gained from these books to begin investing my own money that I received from internships throughout college. By the time I finished school, I had been fully funding my Roth IRA for 2 years.
On a cold January day in 2010, I was reading a book about different businesses that could be started with little or no capital investment. Among the listing of businesses was the idea of starting your own blog. I knew the second that I read this page that writing a personal finance blog would be a perfect fit for me . Not only could I tie together two of my passions in life (personal finance and starting businesses), but it would also be contained in an omnipresent, searchable internet location that could make the information accessible to anyone in the world. Shortly after that day in January, I had my first several posts generated, and My Personal Finance Journey was born.
2) On your site, you mention that you hope to “Unravel some of the myths around investing and personal finance that are ever-present in today’s society”. What is the biggest myth you have found since you started blogging? What is the real deal behind the myth?
The biggest myth that I’ve encountered since I started blogging is that people think/are told that active management (individual stock selection by “experts”) in the investing world will produce superior long-term returns. I consistently hear of investors throwing money at individual stocks touted by stock newsletters, bought through “hot” actively managed mutual funds, or simply by the financial advisor at their local Merrill Lynch or Edward Jones office. However, the truth is that these “experts” are often little more than salespeople trying to make money. The majority of investing books and research studies I have read have found that 70-80% of actively managed money (so money invested in individual stocks) fails to beat the return of the overall market.
Because of all of this misinformation, I attempt to unravel this myth by researching and posting about the benefits of low-cost, passively managed index mutual funds. Examples of the posts I’ve written can be found at the link below.
Why I Sold Out of My Actively Managed Mutual Fund
Vanguard vs. Fidelity – Which Funds Are Better?
Index ETFs vs. Index Mutual Funds – Which Are Better?
3) If you wish you knew one personal finance tip when you were 18, what would it be?
This one is easy! The one tip I wish I knew was to open a Roth IRA investing account at an early age. You can open a Roth IRA as soon as you have earned income, even if it is for side-jobs you have during the summer.
By opening up a Roth IRA at age 18 with $2000 and assuming you earn the long term market return of 10% until retirement at age 65, the $2000 alone would be worth ~$176,000 at retirement. It’s brilliant how powerful compounding interest is!
4) What is the biggest personal finance lesson you learned the hard way?
The biggest personal finance lesson that I learned the hard way was to be cautious about how I issue payments to parties I do business with on the Internet. While this may seem obvious, it sure cost me some money!
Several years ago (prior to my blogging days), I was very involved with running an eBay wholesale selling business. One day back in 2005-2006, I received an unsolicited email from a seemingly nice man representing a supplier that sold Canon CCD cameras to people with wholesale licenses (state sales tax IDs). His back-story, company description, and website all seemed to check out as being legit, so I began working through the details of a potential deal for him to sell me several CCD cameras that I would resell on eBay.
My contact was very responsive to any and all questions I had during the negotiations of price, delivery, etc, and we finally decided on the price of $1500 per camera. The only suspicion that I had during the negotiation was that he insisted on payment being made through Western Union, instead of using PayPal or a credit card like I would have preferred. He mentioned some technicality about how their company receives payment that I believed at the time (but looking back on it, I obviously shouldn’t have gone for it). Anyhow, I agreed to send him the money for one camera via Western Union in advance of receiving the product. I went to the grocery store that afternoon to make the transfer, and it went through with no problems. I then rushed home to tell my contact to confirm receipt of the money.
Well, he received it all right! So much so that he felt that he never had to talk to me again! He disconnected the phone number I was using to reach him, didn’t answer any emails, and I never heard from him again. Now, granted that I was a little less Internet savvy back then than I am now, but I really didn’t do much to try to track him down. I remember thinking that I didn’t believe there was anything I could do. I looked around at Western Union’s website, and couldn’t see any refund policies like the ones that credit cards or PayPal has. And, ultimately, I never saw that money (or the camera) again.
5) Outside of blogging, what has been the biggest change you made to your financial life that made a difference? (i.e. making more money, frugal changes, budgeting, investing)
Outside of blogging, there have been two changes I have made to my financial life that I believe had the most significant impact on my net worth and ability to manage money.
The first change is that whenever I move to a new location, I track my spending for one month to determine how my expenses have changed compared to where I lived previously. Doing this allows me to 1) put together a budget for the various categories of spending (entertainment, transportation, housing, etc) and more importantly, 2) know how much money should be left over at the end of the month that I can set aside for cash reserves or retirement account savings.
The second change that I’ve made is that I now track my net worth and asset allocation percentages once per month. This tracking exercise forces me to be objective in maintaining my asset allocation percentage targets (within a +/- 5% band) through rebalancing, regardless of what movements the markets has made. For example, if the world equity markets have gone up significantly, rebalancing forces me to sell some of my holdings and buy fixed income shares to maintain alignment with my targets.
Why Layoffs Are Good For the Economy
June 16, 2011 by
Unemployment rates are one of the top economic measures used to measure the economy. The general mindset is that low unemployment is good and high unemployment is bad. While there are many truths to that statement, most people ignore the good parts of a high unemployment rate.
Good for Businesses
Companies generally try to avoid layoffs to keep their workers employed and producing. Large, widespread layoffs are bad press and bad for the individual workers. Companies usually lay people off for one of two reasons: cost cutting or efficiency increases.
If a company cuts costs, it increases profits. Increased profits mean that the company has more free cash flow to invest in expanding the business or will return a higher profit to investors. Either way, no one can argue that increased capital investment and profitability is bad for the economy.
Investors and politicians are hung up on employment data, but they are ignoring that many companies are posting major profits. In many cases, companies are posting record profits or have returned to pre-recession levels.
Encourages Education
While some may argue that education is not good intrinsically, I argue that it is. Coming from a family of educators, I think furthering your education is one of the best decisions anyone can make.
While the cause for the motivation is not great, any motivation to increase your job skills and educate yourself should be welcome. The unemployment rate for people with business and engineering degrees is lower than other areas and the unemployment rate for people with advanced degrees is much lower than people with less education.
A lot of people are going back to school during their unemployment. Those skills will ultimately raise the standard of living of those going through the programs and will increase their productivity when they re-enter the work force.
Mixed Bag
I know that this is the optimist look at a bad situation, but it is important to focus on the major benefits to companies after layoffs. As long as the quality and quantity of work is not compromised, there is no reason to keep the extra expense.
Image by Ryan Q.
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