Life is Not Short – Life is Long So Make Good Money Decisions

October 03, 2011

You’ve heard the saying, “Life is short so don’t waste time worrying” or “Life is short so enjoy every minute of it.”  When I was listening to Frank Abignale, Jr., the convicted felon turned distinguished FBI agent (I wrote about him last week) and the subject of the movie, Catch Me if You Can, give the keynote address at the Financial Planning Association conference, I heard him say the opposite.  He said, “Life is long.”  Then he went on to say, “Life is long so make good decisions.”  Continue reading “Life is Not Short – Life is Long So Make Good Money Decisions”

Identity Theft Prevention Tips from a Convicted Felon

September 26, 2011

I’d never really thought about living in an unethical country before, until I heard Frank Abagnale speak.  Frank is the subject of the film “Catch Me if You Can,” who went from being the FBI’s most wanted forger, stealing millions of dollars and flying all over the world posing as a Pan Am Pilot, to a well respected 35 year veteran FBI agent, and expert on forgery, embezzlement and secure documents.  He declared, “We live in an unethical country” during the keynote address at the Financial Planning Association’s annual conference in San Diego last week. Continue reading “Identity Theft Prevention Tips from a Convicted Felon”

How to Optimize and Simplify Your Daily Finances

September 08, 2011

In my last few blog posts, I wrote about how  we can manage our spending to save enough to reach our financial goals.  Ideally, you’d pay yourself first by having your savings set aside before you can even spend the money.  If you have retirement plan contributions deducted from your paycheck, you’re already doing this.  But you can do the same thing with your other savings too.  At Financial Finesse, we have the option to have a percentage of our paycheck diverted into a separate bank account.  See if your company offers something similar, or have the savings transferred automatically from your checking account. Continue reading “How to Optimize and Simplify Your Daily Finances”

GUEST BLOG POST: Back to School

September 01, 2011

Clipping coupons and watching out for store sales and promotions will be important, but elementary strategies, for keeping back-to-school spending in line. This year, however, parents of college-age kids may need some higher grade ideas for keeping their back-to-school expenses affordable.

  • For college kids with 529 plans, be aware of a potentially expensive pitfall as a result of 2011 tax legislation. Formerly, withdrawals for computers, electronics and internet services were considered as qualified educational expenses, and were therefore tax-free. Now, however, a 10% penalty may be imposed if money from the 529 plan is used for these purchases, unless they are required by the college, university or technical school. Be sure to check with your child’s school on their policy on this. If their college or university does not have a policy requiring computer equipment, it is best for you to purchase those outside your 529 plan.
  • Also, going forward, you may want to require your child use summer earnings to purchase any new technology needed for college or to fund other college expenses. Since college students will be responsible for their expenses after college, it’s a good strategy to start giving them some responsibility for expenses before they graduate to make the transition into the real world a little easier. Budgeting and saving are the most important financial skills for young adults, so any opportunity you can give your child to practice budgeting and saving will pay off in the long run. Some of the most financially responsible and successful people I’ve met had to pay for at least a portion of their college expenses out of money they earned themselves.
  • If your child has a custodial UGMA or UTMA account, and has not yet reached your state’s age of majority, it’s okay for parents who are custodians on these accounts to use the funds for college expenses, including computers and equipment.
  • Get educated on the rules for taking educational deductions and credits on your tax return for your child’s college expenses. Talk to a financial planner with tax expertise for a planning strategy to coordinate and maximize these tax benefits now, so that you don’t discover you missed opportunities when you file your tax return.

Why Adults Need Allowances Too

September 01, 2011

In previous blog posts, I covered each of the “fixed” expenses and how you can cut back on them to save more for your goals.  This leaves discretionary expenses like food, entertainment, and shopping that you have more control over on a day-to-day basis.  The problem here is that because the amount we spend on these items tends to change so much from month to month, they can actually be harder to manage.

There are lots of tips out there for how you can save money in these areas.   Continue reading “Why Adults Need Allowances Too”

You Don’t Need to Spend a Million Bucks to Look Like It

August 29, 2011

The other day I was getting my nails done at the salon down the street, and a very nice classy looking lady walked in and asked a question to the owner.  Why was I listening?  Well, you need to know that when you are getting your nails done, there isn’t anything to do.  They’re usually playing a soap opera on TV, or some random program that you have no interest in.  There are magazines to read, but think about how difficult it is to do because you have to put the slippery magazine in your lap making it difficult to turn the pages.  Remember why you are there also; you have to keep changing hands while the manicurist works on you.  So the best way to pass the time is to people watch.  That is what I was doing when I overheard the conversation between the classy patron and the salon owner. Continue reading “You Don’t Need to Spend a Million Bucks to Look Like It”

How to Lower Your Bills

August 25, 2011

One of the great things about your 401(k) is that it allows you to put away a small amount of money each month and end up saving quite a bit of money over time. The “fixed” expenses I’ll write about in this post work the same way, except in reverse. While they individually aren’t as big an expense in most people’s budgets as the housing and transportation costs discussed earlier, these relatively small costs can still add up to a lot of lost savings each month: Continue reading “How to Lower Your Bills”

An Unconventional Q&A Session with a Financial Planner

August 19, 2011

If you have read more than two of my blogs, you probably already know that while I take your financial lives pretty seriously, I don’t take myself seriously.  At all.  So, in the spirit of having a little bit of fun with this (it’s summer after all), and answering some REAL questions that I’ve been asked over the last few years, here’s a little “unconventional financial education” Q&A session: Continue reading “An Unconventional Q&A Session with a Financial Planner”

Pimp Your Bank Account, Not Your Ride

August 18, 2011

There’s a show on MTV called Pimp My Ride, in which people would get extreme makeovers for their cars. But this post will be about a different kind of extreme makeover for what is probably your largest monthly expense, after your home. After all, getting from point A to point B can be expensive. It’s not just the sticker price on your car. It’s also the interest on the car loan, insurance, gas, maintenance, and repairs that go with it. An employee in one of my webcasts said she spends $400 a month on gas alone.  To make it worse, unlike owning a home, a car is usually a depreciating asset.

Here are a few keys (no pun intended) to minimizing this cost: Continue reading “Pimp Your Bank Account, Not Your Ride”

GUEST BLOG POST: Back to School – Saving on Supplies

August 17, 2011

School-aged children have a long list of supplies for the classroom, many of which remain unused. Keep abreast of sales on school supplies and forgo the expensive flashy versions in favor of basic notepads, folders and pencils. Here are some tips to keep your shopping to the minimum. Continue reading “GUEST BLOG POST: Back to School – Saving on Supplies”

GUEST BLOG POST: Back to school

August 10, 2011

The countdown begins. American retailers are doing a happy dance, while American kids are doing a sad shuffle. It’s time to go back to school.

Parents and providers are counting, too, not just the days, but the money they’ll need to get their students ready. As a nation, we will spend approximately $23 billion to equip and clothe our kids for grades K to 12. When our college-bound children are considered, that adds another $46 billion to the price tag. This anticipated surge in consumer spending is second only to the money we will spend for the holidays at the end of the year.

Continue reading “GUEST BLOG POST: Back to school”

Ways to Save a Little Here and There

August 03, 2011

If I were to ask you how much energy you consumed today, chances are you haven’t thought a whole lot about it.  The truth is, most of us have no idea how much energy we use each day, but whether you use gas, electric, or both, finding ways to use less, translates into more money in your pocket. Continue reading “Ways to Save a Little Here and There”

So You’re Having a Baby? Six Ideas to Get Ready Financially

August 01, 2011

I just heard the news that my niece is pregnant with a little girl!  I am doubly excited for her since as a mother of three boys (and one girl), I am still “underweighted” in girls.  Bring on the pink.  What I’m about to say may come as a shock to you, and I feel I have license to say it because of personal experience with pregnancy (even though it has been over twenty years): When women are pregnant, they tend to act differently (read c-r-a-z-y).  (Any husbands want to second that?)  I can promise you that at some point in your life, you will have a pregnant woman say, or do something, that will leave you scratching your head.  Whether it’s eating pickles and peanut butter together (yuck!), eating entire boxes of frozen spinach (guilty), crying uncontrollably for seemingly no reason, having an uncanny sense of smell and being able to tell what people had for lunch or forgetting how to do things they’ve done a thousand times before, it will happen. Continue reading “So You’re Having a Baby? Six Ideas to Get Ready Financially”

7 Steps to Make Credit Card Debt Work FOR You

July 28, 2011

NOTE FROM LIZ DAVIDSON, FOUNDER AND CEO OF FINANCIAL FINESSE, ABOUT THIS POST:  The strategy Erik discusses below has huge risks if you are not extremely financially disciplined.  Most of us aren’t.  Erik Carter happens to be the most financially disciplined person I’ve ever met in my life, so I can see how he was able to use this strategy without over-extending himself and getting into serious debt problems.  If you are one of the few who is like Erik, this is a great strategy.  Otherwise, it has the potential to lure you deeper into debt and you need to be very careful to implement it the right way and avoid the temptation to spend money you don’t have.

With that, here’s the post– hope you enjoy it: Continue reading “7 Steps to Make Credit Card Debt Work FOR You”

Ways to Save a Little Here and There

July 27, 2011

According to the Consumer Expenditure Survey of 2009, American households spent an average of $3,753 on food at home.  This equates to a little over $300 a month, and between you and me, that sounds a little low.  Regardless, some have suggested that we waste as much as 40% of our food in the U.S., and that’s a lot of dough (pardon the pun).  We obviously need to eat, and for many this is one of the largest expenses (behind rent or mortgage) in the budget.  We know couponing is one way to cut down on the food bill, and if you would like to know more about how to save money in groceries using this strategy, check out these blogs written by my colleagues. Continue reading “Ways to Save a Little Here and There”

How I Got Road Rage From a Radio Ad

July 25, 2011

Driving to Lake Tahoe last weekend, I heard a radio ad from a mortgage company going on and on about how we should call them immediately to refinance our fixed rate mortgages since the variable rates are dirt cheap right now.  It said, “You can save thousands of dollars in interest by switching to a variable rate loan,” and intimated that the bank was ripping you off by charging such high interest on fixed rate loans.  I did something very uncharacteristic of me and started yelling at the radio.  At first my husband thought I had a strange case of radio road rage, and I guess he is right. Continue reading “How I Got Road Rage From a Radio Ad”

Ways to Save a Little Here and There

July 20, 2011

If there is anything good that has come out of the recession, it’s that Americans seem to be more self conscious of their spending habits.  I hear from people everyday who espouse the virtues of living below their means, but despite the increase in desire to live a financially fit lifestyle, there are still households that are living paycheck to paycheck, and even after cutting out entertainment, dining out, and other non-essential expenses, are finding it hard to make ends meet.  Unusually high unemployment and expected increases in the cost of food, gas, and healthcare will only exacerbate the problem these households face.  For many, their lifestyles are about as frugal as they can possibly be, so what we need to do is think outside the proverbial box.  Here are some less popular, but potentially valuable, money saving tips you might want to consider: Continue reading “Ways to Save a Little Here and There”

Cash Management: The Price of Our “Toys” is High

July 18, 2011

I was talking to my 23 year old son, Brian, last night and had to smile when he told me of his latest financial mistakes.  I say smile because this young man really has his act together – he is happily married to a sweet young lady, just graduated top of his class from the nuclear program with the United States Navy in South Carolina, and they are keeping him on to teach for two years.  This guy is no slouch.  Earlier this year, when the federal government hadn’t passed a budget and threatened to withhold pay from the military until it was passed, he called to let me know he was fine and had 4 months of emergency savings.  The rest of his buddies were scrambling. Continue reading “Cash Management: The Price of Our “Toys” is High”

Save Money by Teaching Your Kids Home Economics

July 13, 2011

Whatever happened to Home Economics?  I remember taking this class in the seventh grade, and I don’t even think it was an elective—we all had to take it.  I remember learning how to measure ingredients and follow cooking instructions so we could bake cookies, cakes, and bread.  I remember learning how to load a washing machine, and how to iron clothes when they came out of the dryer.  I remember learning how to thread a sewing machine so we could sew holes in our jeans, make clothes, and create stuffed animals to play with.  (I made a stuffed frog out of camouflage and named him Camo-frog.)  I enjoyed that class very much.  Not only did it teach me things I would need to know in the real world, but it also taught me how to follow instructions, how to respect my work space and keep it clean, and how to work with others—you never bake alone.  What I didn’t realize is how much money it would save me over the course of my life. Continue reading “Save Money by Teaching Your Kids Home Economics”