* Money Saving Tips – “Tip Jar”

A friend of mine sent me this information.
Apparently, there’s a new trend called “crowdsourcing” that Kim Komando defines as sites that “rely on the wisdom of the community to provide useful information.”

Google Moderator is one such application.  One of the implementations of Google’s Moderator tool is a “Tip Jar” site that accepts money-saving tips from users, which other users then rank.  You can view this site at: http://budurl.com/eh27.

A few of the recent tips include:
“Utilize online bill pay with your bank. It keeps you in much closer contact with your money, as you can keep a very close eye on your balance and be in much less danger of overdrafting. It saves you money on stamps and paper checks.”

“Record every purchase. A few years ago I decided to do this for one month, but I saved so much money that I stuck with it. No more impulse gum, coffee or magazine purchases, and it allowed me to both create and stick to an annual budget.”

“Never pay checking account fees. And if the bank happens to charge you one, ask them to reverse the fee or take your business to another bank.”

“Pass on extended warranties. A $129 two year extension on a $300 product is just not worth it. Warranties are insurance, and we rarely need to insure such a small amount.”

“Set up automatic withdrawal to your savings account. This is the simplest and most effective technique of all. If you set up $100/month to your savings account, you will save $100/month.”

“Make your monthly credit card payment on time. The $30-35 you save by not being charged a late fee each month on one card would save you most of the money you need for $500 in emergency savings”

“Get organized and avoid missed payments. Get organized and avoid those late payment penalties. If you do miss a payment, call your creditor and ask to have the penalty removed. They’ll usually accommodate the request, at least the first time.”

“Use credit cards that provide cash-back or other benefits, but ALWAYS pay them off each month to avoid finance charges.”

“Request a reduction in the interest rate on your credit cards. As with home equity loans, credit card companies sometimes are willing to reduce the interest rate. It can’t hurt to ask.”

* A Lesson in Not Judging Too Quickly

It seems that almost everyone has seen this video, but in case you haven’t, I strongly suggest that you take a couple of minutes to watch.

I found it very inspirational.

Susan Boyle, a modest and not-flashy amateur singer from a small town in Scotland, has taken the world by storm after her performance on “Britain’s Got Talent.”

Watch this and be reminded that it is not a good idea to judge too quickly.

* A Conversation With Daniel Gilbert The Smiling Professor

April 22, 2008

By CLAUDIA DREIFUS

At Harvard, the social psychologist Daniel Gilbert is known as Professor Happiness.

That is because the 50-year-old researcher directs a laboratory studying the nature of human happiness. Dr. Gilbert’s “Stumbling on Happiness” was a New York Times paperback best seller for 23 weeks and won the 2007 Royal Society Prize for Science Books.

Q. HOW DID YOU STUMBLE ONTO YOUR AREA OF STUDY?

A. It was something that happened to me roughly 13 years ago. I spent the first decade of my career studying what psychologists call “the fundamental attribution error,” which is about how people have the tendency to ignore the power of external situations to determine human behavior. Why do many people, for instance, believe the uneducated are stupid? I’d have been content to work on this for many more years, but some things happened in my own life. Within a short period of time, my mentor passed away, my mother died, my marriage fell apart and my teenage son developed problems in school. What I soon found was that as bad as my situation was, it wasn’t devastating. I went on. One day, I had lunch with a friend who was also going through difficult times. I told him: “If you’d have asked me a year ago how I’d deal with all this, I’d have predicted that I couldn’t get out of bed in the morning.” He nodded and added, “Are we the only people who could be so wrong in predicting how we’d respond to extreme stress?” That got me thinking. I wondered: How accurately do people predict their emotional reactions to future events?

Q. HOW DOES THAT RELATE TO UNDERSTANDING HAPPINESS?

A. Because if we can’t predict how we’d react in the future, we can’t set realistic goals for ourselves or figure out how to reach to them. What we’ve been seeing in my lab, over and over again, is that people have an inability to predict what will make us happy — or unhappy. If you can’t tell which futures are better than others, it’s hard to find happiness. The truth is, bad things don’t affect us as profoundly as we expect them to. That’s true of good things, too. We adapt very quickly to either. So the good news is that going blind is not going to make you as unhappy as you think it will. The bad news is that winning the lottery will not make you as happy as you expect.

Q. ARE YOU SAYING THAT PEOPLE ARE HAPPY WITH WHATEVER CARDS ARE DEALT TO THEM?

A. As a species, we tend to be moderately happy with whatever we get. If you take a scale that goes from zero to 100, people, generally, report their happiness at about 75. We keep trying to get to 100. Sometimes, we get there. But we don’t stay long. We certainly fear the things that would get us down to 20 or 10 — the death of a loved one, the end of a relationship, a serious challenge to our health. But when those things happen, most of us will return to our emotional baselines more quickly than we’d predict. Humans are wildly resilient.

Q. DO MOST OF US HARBOR UNREASONABLE NOTIONS OF WHAT HAPPINESS IS?

A. Inaccurate, flawed ideas. Few of us can accurately gauge how we will feel tomorrow or next week. That’s why when you go to the supermarket on an empty stomach, you’ll buy too much, and if you shop after a big meal, you’ll buy too little. Another factor that makes it difficult to forecast our future happiness is that most of us are rationalizers. We expect to feel devastated if our spouse leaves us or if we get passed over for a big promotion at work. But when things like that do happen, it’s soon, “She never was right for me,” or “I actually need more free time for my family.” People have remarkable talent for finding ways to soften the impact of negative events. Thus they mistakenly expect such blows to be much more devastating than they turn out to be.

Q. SO, IF WE DIDN’T HAVE THESE MECHANISMS, WOULD WE BE TOO DEPRESSED TO GO ON?

A. There may be something to that. People who are clinically depressed often seem to lack the ability to reframe events. That suggests that if the rest of us didn’t have this, we might be depressed as well.

Q. AS THE AUTHOR OF A BEST SELLER ABOUT HAPPINESS, DO YOU HAVE ANY ADVICE ON HOW PEOPLE CAN ACHIEVE IT?

A. I’m not Dr. Phil. We know that the best predictor of human happiness is human relationships and the amount of time that people spend with family and friends. We know that it’s significantly more important than money and somewhat more important than health. That’s what the data shows. The interesting thing is that people will sacrifice social relationships to get other things that won’t make them as happy — money. That’s what I mean when I say people should do “wise shopping” for happiness. Another thing we know from studies is that people tend to take more pleasure in experiences than in things. So if you have “x” amount of dollars to spend on a vacation or a good meal or movies, it will get you more happiness than a durable good or an object. One reason for this is that experiences tend to be shared with other people and objects usually aren’t.

Q. HAVE YOU JUST EXPRESSED A VERY ANTI-AMERICAN IDEA?

A. Oh, you can spend lots of money on experiences. People think a car will last and that’s why it will bring you happiness. But it doesn’t. It gets old and decays. But experiences don’t. You’ll “always have Paris” — and that’s exactly what Bogart meant when he said it to Ingrid Bergman. But will you always have a washing machine? No. Today, I’m going to Dallas to meet my wife and I’m flying first class, which is ridiculously expensive. But the experience will be far more delightful than a new suit. Another way I follow what I’ve learned from data is that I don’t chase dollars now that I have enough of them, because I know that it will take a very large amount of money to increase my happiness by a small amount. You couldn’t pay me $100,000 to miss a play date with my granddaughters. And that’s not because I’m rich. That’s because I know that a hundred grand won’t make me as happy as nurturing my relationship with my granddaughters will.

Q. SO YOU HOLD WITH THE NOTION THAT “MONEY CAN’T BUY YOU HAPPINESS”?

A. I wouldn’t say that. The data says that with the poor, a little money can buy a lot of happiness. If you’re rich, a lot of money can buy you a little more happiness. But in both cases, money does it.

Q. ARE YOU, DAN GILBERT, HAPPY?

A. I am. I think good things are happening to me and will continue. I am not optimistic about the rest of the species, but I’m so blessed, it’s almost scary. I’m sorry to disappoint you, but I have a wildly sunny disposition. I love to laugh. My book is full of jokes.

Original website:  http://budurl.com/ydr4

* 50 Things Every 18-Year-Old Should Know

1) “If you are buying something that you will use often and for a long time, never go cheap. You’ll end up replacing it sooner or paying more in maintenance costs than if you had spent more on good quality in the beginning. Plus, you’ll enjoy the nicer product throughout its lifetime, rather than cringing every time you use something that is falling apart.” — bretts

2) Don’t spend money on a credit card that you can’t afford to pay back. The interest and late payments can put you in a hole that can take you years to pay back.

3) Compound interest is your friend. Saving even a relatively small percentage of your income each year, starting at 18, can leave you in much better shape by the time you’re ready to retire.

4) If you’re working with someone who can be bargained down on a price, it seldom hurts to try. The exceptions may be someone of exceptional talent, someone you’re going to have to work with on a regular basis, or someone whose help you’re going to need in a timely manner.

5) Try to keep enough cash to pay your bills for at least six months in reserve. It will make your life immeasurably easier if your car breaks down, you have a surprise medical expense, or you get an opportunity to get a fantastic bargain.

6) Dogs are fantastic animals. They deserve to be called man’s best friend. But, if you are under the impression that you just need to buy a collar and a bag of dry dog food every month and you’re set, you’re in for a rude awakening. Dogs tend to be much more expensive and time consuming than you’d think.

7) “Don’t have any children or get married until you can support and love yourself first.” — D-Vega

8) “Don’t trade your vehicle in on a new one just a couple of years after buying it. Pay it off and ride it until (the wheels fall off), all while putting that car payment in the bank.” — The_Muck_Man

9) College is a lot more work than high school and your job will be a lot more work than college was.

10) Start looking for a new job BEFORE you quit your old job.

11) Don’t take any job that only pays commission unless you’re either an expert salesman or ready to spend months working without pay to gain the skills you need to become an expert salesman.

12) Ideally, you should choose something you love to do so much that you’d do it for free and find a way to make it into a career.

13) When asking for a salary, always have a figure you want in mind — and then ask for significantly more than that number. That way, you may get more than what you want and even if you don’t, you have a better chance of getting the amount you had in mind than if you had blurted it out right off the bat.

14) There’s no shame in taking any honest job.

15) Getting fired or laid off isn’t the end of the world. To the contrary, a lot of people, myself included, have moved on to bigger and better things after being laid off or fired.

16) If you’re not happy with the job market, the government, or the schools in your area, remember that you can always move to another city or another state. Lots of Americans do just that every year.

17) “I wish that I had known to check the oil in my vehicles and to have changed it regularly. It would have saved a lot of money that I spent on repairs — directly due to my lack of changing the oil per the mechanic.” — Ann H.

18) Lefty loosey, righty tighty. Turn it to the left to loosen it and to the right to tighten it.

19) Don’t ever open a hot radiator cap or you can get seriously burned.

20) Here are 3 keys to keeping a reasonably clean house: don’t leave any dishes in the sink overnight; every time you have a full load of clothes, wash ’em, and take out the trash every time the can is full. You do those things, wipe up your messes, and vacuum when the floor gets filthy, and you’ll keep things reasonably neat.

21) If you use a computer even semi-regularly, it’s worth your time to take a typing class.

22) It’s not enough to buy a gun and stick it in a drawer like a lucky talisman. You need to learn to use the gun.

23) When you move, sell, throw away, and give away as much as possible or you’ll just end up moving boxes from one closet, where they have been sitting for five years, to another closet, where they’ll be sitting for the next five years.

24) Don’t ever loan your friends money if you want to keep them as friends. After all, if they were good with money and were likely to pay you back in a timely manner, they probably wouldn’t need the loan in the first place. If they really need the money, you want to help them, and you can afford it — just give it to them.

25) Women should never allow a boyfriend to take naked pictures. If it’s on film, you shouldn’t be surprised if it goes public in one form or fashion after a break-up.

26) When men have a problem and they tell you about it, they want to know how to fix it. When women have a problem and they tell you about it, they just want you to listen.

27) If you ever get arrested, don’t say anything until you talk to a lawyer.

28) If you don’t know the agenda of the people you’re getting your news from, then you don’t have the information you need to know if what they’re telling you is true.

29) Government is a necessary evil. It’s best to keep its tentacles out of your life and out of our society as much as possible.

30) “When you’re 18, you worry about what everybody is thinking of you; when you’re 40, you don’t give a darn what anybody thinks of you; when you’re 60, you realize nobody’s been thinking about you at all.” — Daniel Amen

31) Trust your instincts. They’re usually right.

32) If you think a doctor’s wrong, don’t hesitate to ask for a second opinion. Your health is vitally important and doctors make mistakes just as often as anyone else.

33) Don’t ever say anything that may offend someone who is going to be serving you food. You never know what they may stick in it when you’re not looking.

34) If you get into a business deal with someone who goes to unusual lengths to convince you of how honest or Christian they are, watch your wallet and make sure you have an iron clad contract. They “doth protest too much.”

35) “You are the average of the five people you spend the most time with.” – Jim Rohn

36) If you want to do something exceptional, don’t expect anyone to believe you can do it until you’ve done it. Unless you’re already perceived as exceptional, most people won’t believe in you. That’s doubly true for the people who know you best and have therefore seen you at your most mediocre, like your parents, family, and friends.

37) If you don’t feel like you’re being treated fairly by a company, don’t hesitate to ask for a manager. Oftentimes, a manager has gotten to where he is in a company because he is good at pleasing customers like you in the first place.

38) “You are not invulnerable and you are not going to live forever. You can (make) mistakes at 18 that you will have to live with for the rest of your life.” — Don_cos

39) Nobody owes you a living.

40) You are not a victim.

41) If you just assume that every conspiracy theory is wrong without even examining it, you will be right 99.99% of the time.

42) “It’s likely that whatever challenges you have faced in your life currently could have been avoided but some better decisions upstream.” — Anonymous

43) At a minimum, keep a basic “to do” list, a schedule, and a budget.

44) “Excellence is the gradual result of always striving to do better.” — Pat Riley

45) “If you want your life to have impact, focus it! Stop dabbling. Stop trying to do it all. Do less. Prune away even good activities and do only that which matters most. Never confuse activity with productivity. You can be busy without a purpose, but what’s the point?” — Rick Warren

46) Ironically, successful people tend to fail a lot more than unsuccessful people. They also tend to ask a lot more questions.

47) When you consider Christianity, keep in mind this classic quotation from C.S. Lewis, “If I, being what I am, can consider that I am in some sense a Christian, why should the different vices of those people in the next pew prove that their religion is mere hypocrisy and convention?”

48) You beat 50% of the people by just showing up. You beat another 40% by working hard. The last 10% is a dogfight in the free enterprise system.

49) There are at least six key areas of your life: health, career, romantic, social, money, and religion. If you neglect any one of those areas, it will harm you in the other areas and keep you from being as happy as you can be otherwise.

50) When trying to decide between two closely matched alternatives, always have a bias towards action. In the long run, it’ll lead to your having a lot more experience, great stories, and a richer, fuller life.

Original source:  http://budurl.com/9re5

#5 – Secrets to Personal Financial Success: Have Adequate Emergency Funds

Your Emergency Fund: Why, How Much, and Where?

Adequate emergency funds are essential to your personal financial success.  This article talks about why you need to have an emergency fund and how to go about creating one.

Why Save for Emergencies?

There are many situations in life that you simply do not have control over. Because, many of these require immediate cash flow, it is essential to have emergency savings to cover them. If you have a personal investing account or retirement account you could pull funds from these, but for a number of reasons (including bad market timing, early withdrawal penalties, or a delay in the liquidity of actually selling your investment and receiving your funds), this is the last thing you want to do.

Financial emergencies can come in many forms:  a job loss, significant medical expenses, home or auto repairs or something you’ve never dreamed of. The last thing you want to do is be forced to rely on credit cards or a loan which could simply compound the problem.

Having money set aside for emergencies not only prevents this from happening, but also gives you the peace of mind that comes from knowing that if something unfortunate was to happen that you will have a financial cushion to ride it out.

I’m sure that you have needed fast cash for a number of situations in your life, or seen situations where others have. Insurance may cover many of these scenarios for you, but there is always a chance that it won’t cover fully what you will need. Here are a few examples:

  • lost job or layoff
  • began a new job that required you to expense a geographic move
  • auto accident, auto retirement, or major repair
  • major home expense such as a broken water line, tree falling on your roof, fire, natural disaster effects, etc.
  • pet health care
  • unexpected taxes owed to IRS
  • death in family that required you to help pay for funeral and other expenses
  • unexpected medical expenses not fully covered by insurance


How Much do you Need in Emergency Savings?

For most people, I recommend that you keep emergency funds in two different accounts:

The first, which would be equal to 10% of your annual income, is kept in an account where you can get to the money within days and there would be no penalty for accessing it.

The second emergency fund is equal to 20% of you annual income, and should be kept in a tax-deferred account such as an IRA, 401k, etc.  The reason that you can keep this emergency fund in tax-advantaged accounts is that, if you are doing good financial planning,  you are highly unlikely to need it and if you do need it, it is most likely that it will be because you have lost your job.  In that case, your income will be lower and you will probably be in a lower tax bracket.  In that case, the penalties you have to pay to get access to that money will be less than the taxes you saved when you put it into that account.

If you are anticipating a major life changing event, increase your emergency fund or start another savings account. You do not want to be pulling from emergency funds to pay off anticipated expenses.


Where Should you Put your Emergency Savings?

For your first emergency fund (10% of annual income), you should be earning interest from your emergency funds, otherwise, you are losing value due to the effects of inflation. Place your emergency fund in a high interest savings account, checking account, or money market account (MMA). Stay away from certificates of deposit because if you pull your money out prior to the CD expiring, you will lose interest in the form of a penalty.

Go with a bank that offers quick and easy access to your fund and a competitive rate. Bankrate has a good rate comparison list. Use this as a starting point to see what the current going rate is before committing.  Check back periodically to see if you’re getting the best going rate. If you’re not, don’t be afraid to switch. If you haven’t already, start building your emergency savings. It will help you sleep better at night.

It is important to keep this emergency fund in a place that will fairly liquid so that you can get to the money quickly in the event of an emergency. You also don’t want to have this money tied into stocks or mutual funds because the volatility of the market could cause you to lose money over the short-term.

The second level emergency fund (20% of annual income) should be invested in interest-earning accounts.  Many 401k plans offer “Stable Value” Funds, which re an excellent option for your emergency funds.

Start Small

If you currently don’t have an emergency fund or find it difficult to save money the key is to start small. You have to realize that accumulating one month’s worth of expenses will take some time, let alone three to six months. If you set your immediate goals to be small and manageable you will have a better chance in reaching them.

The best way to get started would probably be through your bank. Open up a new savings account if you currently don’t have one and begin to save with this first. The next step is to get into the habit of making regular deposits into this account. Whether it is weekly, bi-weekly or monthly, create a schedule and stick to it. Once you make savings automatic you won’t even have to think about it.

If you feel it is difficult to begin saving simply start with a small amount. Maybe you begin with $10 a week initially. While this won’t amount add up all that quickly the important thing is to start putting something away and to make it a habit. After a few weeks you won’t even notice that $10 missing so you can bump it up to $15 or $20 after a month or so. You will begin to get used to that money not being there and can slightly increase it again.