Headline roundup on credit card changes
Here’s a few more weekend headlines on the credit card law changes that take effect Monday:
- MonroeNews – Credit card confusion and Key terms of new card law
- CNN – Banks nervously await new credit card law
- Michelle Singletary / The Color of Money – Beware of loopholes in new credit card law
Continue reading Headline roundup on credit card changes …
From Monroe on a Budget.
Making banking easier for those on tight budgets
If you think you don’t have enough cash flow to justify opening a bank or credit union account, it’s time take another look at what your options are.
I’ve found several options for free or low-cost accounts for my local readers in Monroe, Mich., and now here’s a national article on the topic. CNNMoney has this report: Banks and consumer groups target consumer savings.
A snippet:
16 major banks have recently lowered minimum balances on savings accounts, making it easier for people to save without having to worry about getting socked with low balance fees. US Bank has no minimum savings account balance, while Regions has a $5 balance and Bank of America has a $25 minimum balance.
Continue reading Making banking easier for those on tight budgets …
From Monroe on a Budget.
Personal Finance 101: Getting Started with Banking
We all did it at the beginning of our financial lives. We grew up. We moved out. We opened accounts at a bank on our own, quite often a different bank than the one used by our parents.
And we had to figure it out. How should we pick a bank? How do we move the money over? What should we put in our checking account? Our savings account? What are these CD things?
Michael writes in:
I’m a student, just trying to firm up my financial situation after having read your blog. For the last several years, I’ve used Washington Mutual largely because my parents had an account there but since being taken over by Chase, customer service has gone downhill, and the interest rate on my savings account is ridiculously low.
I’m looking at having an interest-bearing checking account and a savings account at different banks, to maximize my savings. However, how easy is it to transfer money from an account at one bank to one at another? Also, I’ve seen money market accounts, savings accounts, and no penalty CDs? What’s the difference, and how would you allocate money between them?
My first comment would be that I would value customer service strongly at the bank where I held my checking account, but view it as more of a secondary factor at the bank where I held my savings account. The bank with the checking account will handle the vast majority of your transactions for you, while the savings account bank will just handle a small number. So, when you evaluate your checking account bank, ask around and Google for information on their customer service.
Transferring Money Between Accounts
How does transferring money between accounts at different banks work? If a bank features online banking, it’s usually just as easy as logging on and requesting such a transfer. Most likely, if you’re seeking a high-interest savings account, you’ll be getting an account that’s managed primarily online, as most of the best interest rates are offered by online banks such as ING Direct, HSBC Direct, and so on.
In those cases, the online account is often “linked” to your checking account. That means you record the information about your checking account (the account number and the bank’s routing number, which you can get from them upon request or often simply from their website or from Google. Once that’s set up, you will be able to initiate transactions either way – both from checking to savings and from savings to checking – with just a few mouse clicks.
Such transactions are done electronically and usually take around two business days to complete.
Choices for Savings
Michael also wondered about several different options for saving his money. Let’s look at them.
Savings accounts are the default choice. Savings accounts allow you to deposit money as you please and withdraw money up to six times a month. Savings accounts usually have a fixed rate of return that doesn’t change all that often. Usually, high interest savings accounts change their rates whenever the Federal Reserve changes rates, so if you hear about Ben Bernanke on the news, pay attention to your rates.
Money market accounts sometimes offer a higher rate of return than straight savings accounts, but the rate of return on a money market account is variable and is quite often not as high as the online offerings. It changes based on the state of the money market – to put it simply, the money you put into that account is invested by the bank in highly secure government investments. Those investments change rates regularly (based on what the government is offering at a given time, which is usually related to the demand of the market) and thus the rates you get in the account go up and down. On (extremely) rare occasions, money markets will return nothing at all or just a tiny, tiny fraction of a percent – at other times, they’ll blow savings accounts away. Most of the positive legacy of money market accounts comes from the early 1980s, when they returned money hand over fist because treasuries had absurdly high rates of return.
CDs are much like savings accounts, except they have a higher rate of return. The big difference is that you can’t actually touch the money you’re saving during the life of the CD. So, if you picked up a one year CD with a sweet interest rate that’s much higher than your savings or money market options, you wouldn’t be able to touch that money for a year without a stiff penalty. The “no fee” part you mention is something that’s offered by a lot of banks today – the days of charging fees to buy a CD are rolling into the past.
Splitting Up the Money
So what should Michael do?
In my experience, money market accounts and online savings accounts are usually very comparable. If anything, I’ve consistently seen online savings accounts offer a slightly larger return over the years I’ve been following them, but money market accounts at your local bank will likely trounce their savings account rates.
When compared rates between maoney market accounts and online savings accounts are close (say, within half a percent or so), I generally stick with banks that have a good customer service reputation, but I don’t view it as being as important as it is with my primary bank that holds my checking account and handles most of my transactions. Rate-hopping (or rate arbitrage, as some call it) isn’t worth the effort, in my opinion, unless you’re moving around high five-figure or six-figure amounts, in which case I wouldn’t have a large portion of that in a savings account.
What about CDs? CDs can be a really great way to tack on a bit more return for your savings, but it’s often easy to get caught up in CDs and put more of your savings into it than you should. I would make sure that I had a healthy emergency fund in my cash savings (a savings account or a money market account). If you’re single, this would probably be about two months’ worth of living expenses. The ability to just grab cash when you need it to deal with an emergency is vital.
The big question I’d ask myself is why I would want to put money in CDs. This goes beyond just earning a higher rate of return – if you just want that, put the money in a CD that will mature within a year and keep recycling it (unless you have a year or more worth of living expenses in your savings account, then you can shoot for longer ones). Are you saving for a particular goal? When do you expect that goal to come to fruition? If you have a goal in mind, buy the highest rate CD that matures before that goal.
Of course, if you’re finding that you want to get more aggressive with saving for goals, you can begin to look into index funds… but that’s another story entirely.
Good luck, Michael.
Continue reading Personal Finance 101: Getting Started with Banking …
From The Simple Dollar.
Personal Finance 101: Getting Started with Banking
We all did it at the beginning of our financial lives. We grew up. We moved out. We opened accounts at a bank on our own, quite often a different bank than the one used by our parents.
And we had to figure it out. How should we pick a bank? How do we move the money over? What should we put in our checking account? Our savings account? What are these CD things?
Michael writes in:
I’m a student, just trying to firm up my financial situation after having read your blog. For the last several years, I’ve used Washington Mutual largely because my parents had an account there but since being taken over by Chase, customer service has gone downhill, and the interest rate on my savings account is ridiculously low.
I’m looking at having an interest-bearing checking account and a savings account at different banks, to maximize my savings. However, how easy is it to transfer money from an account at one bank to one at another? Also, I’ve seen money market accounts, savings accounts, and no penalty CDs? What’s the difference, and how would you allocate money between them?
My first comment would be that I would value customer service strongly at the bank where I held my checking account, but view it as more of a secondary factor at the bank where I held my savings account. The bank with the checking account will handle the vast majority of your transactions for you, while the savings account bank will just handle a small number. So, when you evaluate your checking account bank, ask around and Google for information on their customer service.
Transferring Money Between Accounts
How does transferring money between accounts at different banks work? If a bank features online banking, it’s usually just as easy as logging on and requesting such a transfer. Most likely, if you’re seeking a high-interest savings account, you’ll be getting an account that’s managed primarily online, as most of the best interest rates are offered by online banks such as ING Direct, HSBC Direct, and so on.
In those cases, the online account is often “linked” to your checking account. That means you record the information about your checking account (the account number and the bank’s routing number, which you can get from them upon request or often simply from their website or from Google. Once that’s set up, you will be able to initiate transactions either way – both from checking to savings and from savings to checking – with just a few mouse clicks.
Such transactions are done electronically and usually take around two business days to complete.
Choices for Savings
Michael also wondered about several different options for saving his money. Let’s look at them.
Savings accounts are the default choice. Savings accounts allow you to deposit money as you please and withdraw money up to six times a month. Savings accounts usually have a fixed rate of return that doesn’t change all that often. Usually, high interest savings accounts change their rates whenever the Federal Reserve changes rates, so if you hear about Ben Bernanke on the news, pay attention to your rates.
Money market accounts sometimes offer a higher rate of return than straight savings accounts, but the rate of return on a money market account is variable and is quite often not as high as the online offerings. It changes based on the state of the money market – to put it simply, the money you put into that account is invested by the bank in highly secure government investments. Those investments change rates regularly (based on what the government is offering at a given time, which is usually related to the demand of the market) and thus the rates you get in the account go up and down. On (extremely) rare occasions, money markets will return nothing at all or just a tiny, tiny fraction of a percent – at other times, they’ll blow savings accounts away. Most of the positive legacy of money market accounts comes from the early 1980s, when they returned money hand over fist because treasuries had absurdly high rates of return.
CDs are much like savings accounts, except they have a higher rate of return. The big difference is that you can’t actually touch the money you’re saving during the life of the CD. So, if you picked up a one year CD with a sweet interest rate that’s much higher than your savings or money market options, you wouldn’t be able to touch that money for a year without a stiff penalty. The “no fee” part you mention is something that’s offered by a lot of banks today – the days of charging fees to buy a CD are rolling into the past.
Splitting Up the Money
So what should Michael do?
In my experience, money market accounts and online savings accounts are usually very comparable. If anything, I’ve consistently seen online savings accounts offer a slightly larger return over the years I’ve been following them, but money market accounts at your local bank will likely trounce their savings account rates.
When compared rates between maoney market accounts and online savings accounts are close (say, within half a percent or so), I generally stick with banks that have a good customer service reputation, but I don’t view it as being as important as it is with my primary bank that holds my checking account and handles most of my transactions. Rate-hopping (or rate arbitrage, as some call it) isn’t worth the effort, in my opinion, unless you’re moving around high five-figure or six-figure amounts, in which case I wouldn’t have a large portion of that in a savings account.
What about CDs? CDs can be a really great way to tack on a bit more return for your savings, but it’s often easy to get caught up in CDs and put more of your savings into it than you should. I would make sure that I had a healthy emergency fund in my cash savings (a savings account or a money market account). If you’re single, this would probably be about two months’ worth of living expenses. The ability to just grab cash when you need it to deal with an emergency is vital.
The big question I’d ask myself is why I would want to put money in CDs. This goes beyond just earning a higher rate of return – if you just want that, put the money in a CD that will mature within a year and keep recycling it (unless you have a year or more worth of living expenses in your savings account, then you can shoot for longer ones). Are you saving for a particular goal? When do you expect that goal to come to fruition? If you have a goal in mind, buy the highest rate CD that matures before that goal.
Of course, if you’re finding that you want to get more aggressive with saving for goals, you can begin to look into index funds… but that’s another story entirely.
Good luck, Michael.
Continue reading Personal Finance 101: Getting Started with Banking …
From The Simple Dollar.
Merge Left
Charlene writes in:
I’m getting married in March. My future husband and I are talking about when and how to merge our finances and we’ve had some difficulty coming up with a plan. What did you and your wife do? What would you suggest for other couples on the cusp of marriage?
First of all, I’ll point out that when my wife and I were first married, neither one of us had any clue about how to manage our money. We basically left all of our accounts the same, keeping accounts and direct deposits at separate banks and without any sort of shared savings or checking accounts. This worked for us for a while, but it had serious disadvantages, chief among them the fact that it was hard for either one of us to really get a grip on what our true financial situation was.
I would not recommend doing that unless you have a very good, clear reason for doing so. It’s very clear in that wonderful 20/20 hindsight that the disadvantages of such a split far outweigh the advantages.
Instead, I would fold your accounts together at whichever bank the two of you already use that offers the best customer service. Don’t worry about things like savings rates and such for your primary accounts – if you want to seek out a great savings rate, seek that out separately and use a second bank for your savings purposes. The most important factors on your primary checking account and bank services are the customer service provided to you and the lack of fees on the account for various things (keeping the account open, ATM use, and so on).
I would not do this until you’re married, but I would follow through with the plan pretty quickly after you’re married. Before you’re married, you’re basically opening yourself up to the potential for a very sticky situation without any real benefit other than just a bit of short term convenience.
Instead, invest your time coming up with a detailed plan before the wedding so that you can just quickly execute it after the marriage, getting your affairs in order as quickly as possible.
You may also want to consider a prenupital agreement. You may be deeply in love right now, but people can and do change. A prenupital agreement makes any divorce process that may happen much simpler and less fraught witn anger and emotion, both of which you can surely live without in such a situation. If you find agreeing on a prenupital agrangement is difficult, you may want to step back and have some discussions about why this is – and what that might mean for your relationship.
Another thing worth considering is life insurance. Now that you’re merging your financial lives, you may find yourself investing in things that you may not be able to afford individually, like a home, more expensive cars, or children. A term life insurance policy can ensure that your partner is not stuck in an incredibly difficult financial situation should you pass away unexpectedly. Even if you don’t have such expenses now, term life insurance is still worth considering because the cost of a policy is much lower when you’re young than when you’re older (or have pre-existing conditions that may be discovered later on).
It might seem strange at first glance to suggest this as financial advice, but I would strongly encourage you to have discussions about such issues as having children now rather than after you’re married. If you have differing feelings on such key issues and haven’t come to an understanding about them (and trust me, quite often one side thinks there’s an “understanding” and the other side does not), they can fester within a marriage, turning a loving situation into something painful and often quite financially costly for everyone involved (well, except for the lawyers – they clean up). Talk things through – items such as future career plans, dreams, ambitions, children, and so on should be discussed and understood and both partners should at least understand each other’s positions, even if they’re not fully on the same page.
Marriage isn’t something that benefits from being entered into lightly. Merging your accounts is just the first step – you’re often merging lives in ways you never even considered before. Take the time now to at least consider these changes – and talk about them – before you take the plunge.
Continue reading Merge Left …
From The Simple Dollar.
Most of Us Have Never Experienced a True Economic Meltdown
My grandfather and grandmother came of age during the Great Depression. They both passed away when I was a young child (not all that much older than my own son now), but many of my memories of them revolved around their extreme frugality. They would buy bottles of the most inexpensive wine they could buy, drink it slowly, then fill it with water to get those last drops of flavor. They hand-painted their car with house paint and a brush (seriously).
One of the most vivid memories, though, is that they kept their money in tin cans in their home, hidden in different places. To put it simply, they did not trust the banks to keep their money for them.
They grew up in the 1930s, where banks failed by the hundreds. The only difference between now and then is that they didn’t have FDIC insurance. If their bank failed, their money was gone.
Their coming-of-age experience was filled with inherent distrust of financial institutions and a well-ingrained idea that they had to protect what they had. This usually meant living as inexpensively as possible – making modest choices again and again throughout their lives.
Since then, three generations have passed. Most of us living today in the United States have never experienced a true economic meltdown. Losing some of your retirement money in your 401(k) one year and then gaining most of it back the next year is not a meltdown. Losing your job and finding a new one – partially supported by unemployment along the way – is not a meltdown.
Without this kind of life-altering experience, it’s unsurprising that later generations are unable to match the frugality of my grandparents’ generation. The idea that a third of the nation can be unemployed, that the bank where you keep your money can just take that money and run, and that if you don’t have a job you don’t get any benefits or support from the government seems completely alien to how we live our lives today.
We inherently rely on these institutions and they allow us to live less frugally and carefully than we otherwise would have.
Yet they had the things that mattered. They had people to love – and people who loved them. They had food on the table. They had the entertainment that they needed. They had a roof over their heads.
In the end, what else do we really need? Whenever we go beyond that, we’re simply chasing more of the same – and risking the security of everything we hold dear to do so.
Lately, I’ve been looking at a picture of my grandfather quite often. He’s sitting on the couch in his home with an old banjo in his hand and a big grin on his face. He didn’t have much spit and polish to him, but he was surrounded with what really mattered to him – his home, comfortable clothes, friends and family, a fishing net on the wall behind him, a musical instrument in his hands. He was happy and he didn’t need much to get there.
He knew what was important. He knew what made him happy. He also knew how easily it can be lost – something that’s very difficult for us to see most of the time. So, he made choices that might seem outrageous to others. So what?
Grandpa, almost twenty five years after you left this earth, you’re still inspiring your grandson.
Continue reading Most of Us Have Never Experienced a True Economic Meltdown …
From The Simple Dollar.
The Simple Dollar Weekly Roundup: Next Project Edition
Now that my book is finished, I’ve decided to embark on another big time-consuming project, but this one is a little different.
I’m a big fan of online banks. I think they’re an incredibly powerful tool for helping you with your personal savings. For a long time, I’ve wanted to talk about a slew of online banks, just to review all of the different options out there.
There’s been a problem with this, though. I don’t like to talk about products that I don’t actually use myself. I won’t review a book unless I’ve read it and thought about it. I won’t review a financial tool unless I’ve used it extensively myself. And I won’t talk about a bank unless I’ve used it myself.
I use ING Direct as my primary bank. I talk about it often. But I don’t mention other banks for the reason above, and I want that to change. There is a huge diversity in online banks, offering different features, different interest rates, different offerings, and different tools for managing your money.
Here’s my solution. Over the next several months, I’m going to open accounts at a bevy of online banks. I’m going to try them out, see in detail what services they offer, transfer some money in out, test their customer service, and close the accounts (if I don’t intend to replace an account I’m already using).
Then, once a week, I’m going to post a detailed review of that bank in an effort to outline clearly what distinguishes it from other banks. What do they do differently? Who is this bank most appropriate for?
So I’m going to open this up to you a little bit. What would you like to see in a review of an online bank? What features really matter to you and would cause you to make the move to switch to a new bank?
While you chew on that, here are some interesting personal finance articles that might interest you.
“Natural Inclinations…Are Hardly Ever Altered or Overcome.” Over the last few days, I’ve been enormously inspired by this little quote. (@ the happiness project)
Do you do your most important work first? I used to have a very organized morning routine, where I would do most of my “routine” tasks before starting the day. What I found is that I got my “routine” tasks done, but most of the real meat of my work – the creative tasks – didn’t go nearly as well. (@ unclutterer)
How to Change Your Motor Oil Changing one’s own motor oil is a tremendous way to save money – when you pay someone else to do it, you’re essentially paying someone $20 so you can sit in a waiting room while some guy unscrews a nut, collects some oil in a bucket, screws the nut back in place, then dumps some clean oil in the top. Why not do that at home where you can do something worthwhile while the oil drains and save yourself $20? (@ art of manliness)
What To Do With A Financial Windfall This is a great step-by-step guide to handling a windfall. If you don’t have a plan, windfalls can actually be a large negative disruption in your life, as we talked about a bit last week. (@ moolanomy)
Results of a Week Without Spending Can you go an entire week without spending any money? As an experiment, this family attempted to have a week without any spending and managed to get by only spending $3. Fairly insightful stuff. (@ pt money)
Continue reading The Simple Dollar Weekly Roundup: Next Project Edition …
From The Simple Dollar.
Free Ebook: Get A Car When Banks Aren’t Lending
Free Ebook: Get A Car When Banks Aren’t Lending
Learn alternative ways you can get a car loan, when the banks won’t lend to you.
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Continue reading Free Ebook: Get A Car When Banks Aren’t Lending …
From Frugal Simplicity.
Reader Mailbag #86
Each Monday, The Simple Dollar opens up the reader mailbags and answers ten to twenty simple questions offered up by the readers on personal finance topics and many other things. Got a question? Ask it in the comments. You might also enjoy the archive of earlier reader mailbags.
Can you tell me a little more about how banks like ING work? If they don’t have a physical branch how do I get my money? Do I need to keep my current bank and just transfer the money around? I generally have several different saving account that I use for saving for specific purchases or vacations. Once I meet my savings goal I simply switch to whatever I’d like to save for next. My current problem is this: my bank has recently switched from a $100 minimum for penalty to $250. This means I now need to save $250 over my goal or close my account each time I reach a goal to avoid a service fee. I feel like I never actually have all of my money. I’m under the impression that online banks such as ING have much smaller fees. Any advice?
- Dana
ING Direct – and other such online banks – basically provide all of the services of a typical bank without a brick-and-mortar location. Typically, at least some of that savings is passed back to the user in the form of better service in other areas and high interest rates.
So how do you bank with them? Most of the interaction with such banks is done online. They all have a very full featured online bill pay service, for starters. Many online banks issue paper checks (not all – ING’s Electric Orange doesn’t) and if they do not, they allow you to fill out a check online and have it sent to a business for free.
When you’re out and about, most such banks have an enormous ATM network that allows you to get at your money without a fee at many, many ATMs.
I found that, for me, I was happy enough with ING’s service that I switched to using it as my primary bank, even without a teller window available to me. We did eventually decide to open a free checking account at a local bank for emergency reasons and so we would have access to a paper checkbook, which made it easier to do things like order a magazine subscription from the neighbor’s kid for a school sale.
would you consider making another blog or on occasion posting a few short stories? I enjoy reading short stories a lot and I’m sure many of your readers would be interested in reading a few of them.
- Alexandra
I’ve been debating whether or not to post some of these stories online or not – I’m actually fairly torn on it. If I did, I would put them on my personal blog.
Why am I torn? A big part of me would like to succeed as a fiction writer on my own merits, without the success of The Simple Dollar influencing it. I feel as though I might be able to “get away” with substandard fiction if publishers believe I can bring a built-in audience to the table.
On the other hand, I know that sharing what I write here on The Simple Dollar has led to a lot of great feedback – both negative and positive – and it’d be great to open up my fiction writing.
I still haven’t made up my mind, to tell the truth.
Can’t Laurenly also build her credit score by having an apartment lease, utilities, internet, etc. in her name? Does paying for those things not factor into a person’s credit score as much as a credit card?
- Chelsea
Sometimes they will, sometimes they won’t.
Different utilities and rental companies have different practices on how often and how much information they provide to reporting agencies. Many of them – perhaps most of them – only report delinquent accounts and don’t report positive payment. Others do full file reporting, which means they report everything, good or bad.
You can ask your utilities which method they use and they may or may not tell you. Either way, though, I wouldn’t expect a utility payment to be the source of financial recovery.
I know the local library is one of your favorite resources — it’s one of mine, too! However, I live in Philadelphia, where, if the economic situation doesn’t get better *fast*, the libraries and recreation centers will all be closed as of the beginning of October, which means we’ll lose all the great free resources the libraries ofer, as well as the free or cheap resources offered by the rec centers.
Short of personally balancing the state and city budgets (I’m no economist), what can the people in Philadelphia (and any other city or town in this situation) do in the absence of these resources until they re-open (assuming they do!)?
- Laura
Utilize used book stores. Trade the books they have with their neighbors. Use services like PaperBackSwap.
People who want to read can usually find a low cost way of doing just that. A library is a tremendous service, but lack of a library is only a small obstacle in the face of a focused and resourceful reader.
For other community services, just get together with your neighbors that miss those services and co-op them. Start your own basketball league and enroll people in the neighborhood to coach and referee. You don’t need a bureaucracy to make this happen – it’s not like they’re ripping up the basketball courts.
I vaguely remember you answering this question elsewhere, if so, please remind me. If not, will you please tell me the pros and cons and differences between copper, stainless steel, and non-stick cookware? I am at the point where my first purchased pots (purchased in one of those large sets that you abhore) are starting to crack on the handles. Over the past year I have become relatively proficient in the kitchen and want to upgrade some of my cookware as it breaks or needs replacing. I’d like to replace it with something high quality, but is the mark up on copper really worth it?
- Gwen
Most lower-cost nonstick cookware is covered with a nonstick coating – Teflon is a common one. This coating usually lasts for a few years, but begins to peel – and when it begins to peel, you shouldn’t use the pan any more, as Teflon isn’t something you want in your food.
Alternately, high-cost nonstick items are covered in a baked enamel or porcelain finish. These are usually quite expensive, but they won’t peel and can last for a very, very long time if cared for.
Now, about copper versus stainless steel. Copper has much better heat conduction and heats more evenly, which means that things will cook a bit faster with it and the stuff cooked inside will heat evenly. However, stainless steel is cheaper and looks pretty – it’s all shiny! Many pots and pans can be found that are made of copper with a stainless steel lining, which kind of gives the best of both worlds. Some cooking mavens will grumble about tin-iined pans, but they’re hard to clean and they occasionally have to be re-tinned, which is a real pain.
The best thing you could get, in my opinion, is copper with a stainless steel lining – but these can be breathtakingly expensive. From there, you can kind of go down the scale. I’m not sure what you’re looking to spend, but that’s my thumbnail guide.
Also, if you’re used to cooking with nonstick, cooking on stainless steel is very different – you have to heat it first with nothing in it, then add the oil and other ingredients.
What percentage of your readers are from outside U.S? When you write a blog, have you ever stopped to consider whether certain US centric references that you make may not be familiar for readers outside US?
- Prasanth
My readership is roughly 85% within the United States.
I typically don’t worry too much about focusing on issues that are strictly within the United States. I believe I talk about universal concerns often enough that when I do dig into U.S.-specific issues, it’s appropriate for my audience.
To put it simply, I really don’t worry about it too much. I just focus on being me.
I have a firm grasp on my finances and would like to start helping other people get their finances in order. Do you have any suggestions on how to get a personal finance consulting gig going?
- Austin
If you actually want to get into a career of financial planning, be very, very careful. Such industries are incredibly highly regulated and you should have proper certifications and such before embarking in it.
Sometimes people think, “Well, he can do this website, so why can’t I throw out my shingle and consult?” Well, on every single page of The Simple Dollar, I make it clear that this site is for entertainment purposes only and any information or suggestions taken should be followed up with one’s own research. On top of that, this is a free website – I’m not charging for services as a consultant would be.
If the idea of being a planner interests you, look into proper education for it. Start off by digging deep into what it means to be a certified financial planner.
Is it worthwhile to invest in art?
- Shanya
If you’re investing in art because you believe it will return aesthetic appeal and enjoyment to you over a long period of time, by all means, invest.
If you’re investing in art for a financial return, don’t waste your time unless you’re treating it as tantamount to gambling. The art world is fickle – and an art purchase for investment assumes that someone will want to buy the art in the future, which is far, far from guaranteed.
Yes, by all means, if you have art that appeals to you and you can easily afford it, buy it. It will add true enrichment to your life.
But if you’re looking to turn a buck, stay away from the art world unless you’re working for Sotheby’s.
You mentioned attending SXSW recently. I also know you’re really into playing board games with your family and friends. Have you ever gone to GenCon? It’s not that far from Iowa.
- Ron
I confess – I am strongly considering a trip to GenCon in 2010. My wife is planning a short trip next spring or summer to visit her sisters, leaving me with the kids – and also with a ticket to have my own fun solo trip. GenCon is likely that destination.
I have several friends in the area that are considering going, so I will likely pool up with them at least for the trip.
If I do decide to go, I’ll let people know on The Simple Dollar so we can meet up if readers wish to.
How do you discover the personal finance books and other books you write about?
- Gil
I usually carefully follow the new releases and sales rankings on Amazon to see what’s new in the genres I follow.
If a major release is coming down the line, I’ll try to request it at my library. if that doesn’t work, I’ll attempt to request a review copy, but I don’t particularly like doing that as I feel slightly obligated to give a positive review.
I also listen carefully to reader recommendations. Sometimes – more than once, actually – I’ve suspected that an author of a book is posing as a reader and trying to pitch me on reviewing their book. If I get that vibe, I’ll usually blacklist it. I don’t like those games.
Got any questions? Ask them in the comments and I’ll use them in future mailbags.
Continue reading Reader Mailbag #86 …
From The Simple Dollar.
The Money Jar Trap
Hundreds of thousands of people place their extra change into a jar or bank every night when they return home thinking that they are saving money. In reality, the dynamics of saving coins has changed over the last 10 years so that by placing your extra coins in a jar, you may actually be losing money. This is the new money jar trap.
The money jar has been a classic way for people to save money for generations. The concept was easy. After coming home for the day, you simply empty out your pockets and put the coins into a jar. When the jar was full, you take it to your local bank, have the coins counted and place the money into your savings account. While this sounds simple enough, the savings generated in the coin jar may not be worth their face value depending on how you redeem the coins.