Tag Archives: News

Saturday Sneak-Peak: PimpYourFinances.com

Welcome to this weeks edition of Saturday Sneak-Peak! Every week I explore a personal finance blog and give a brief review of the site. My major intent of the adventure is to expose everyone to new and/or obscure blogs. Up this week is PimpYourFinances.com. David has commented on the site a few times and I greatly appreciate his input. This blog would be nothing without you readers!

David is a twenty-something college grad who is just trying to get his financial house in order. He is tired of his debt and wants to rapidly decrease it while increasing his savings. David has a very unique writing style and I think that is what has given him a lot of success over the past few months (he has only been blogging since October of 2008). Here are a few of my favorite posts:

Are Savers Dooming the Economy? NO!!

What Would Bilbo Do? 14 Money Lessons from “The Hobbit” (Featured on MSN SmartMoney)

12 Easy Ways to Sabotage Your Financial Life In College

The Escalator Not Taken

I also asked David a few questions to help you get to know him. Here they are:

YMR: What inspired you to start a PF blog?

David: When I started making money at a real job, I had no idea what to do with it. So I started look around PF sites, and was disappointed that there wasn’t more stuff aimed at young people.

I started thinking that if I was desperate for information, there were probably a lot of people in a similar position.

YMR: You have had some pretty rapid success getting your name out there over the past few months. How do you explain that?

David: Thanks! It’s very flattering to think that my name is getting out and others consider me a success!

I think there are a few reasons.

First, I just try to be myself. I don’t try to write that same articles that other people are writing. I write articles that I’d want to read, especially if no one else is writing about them. That also means that I try to keep a very strong sense of humor and sarcasm.

It also means that I’m brutally honest about myself. I’ll admit the mistakes I’m making. I’ll tell people exactly how much debt I have, and the things I know I should be doing, but I’m not. I think people can relate with that, and hopefully use it to avoid similar mistakes. I’ll never pretend that I’m doing everything right.

Another big reason for what I’ve accomplished is that I teamed up with someone else when I started the site. I handle all the writing, and he does all the technical stuff. It’s allowed me to focus on writing and content – things I enjoy (and that take up most of my free time). It’s allowed him to focus on coding, layout, presentation, etc… stuff he enjoys, and is very good at.

By focusing on our strengths, we’ve done a lot more than we could have done by ourselves.

I’ve also tried to build strong relationships with other bloggers. I link heavily to the sites I like to read, especially ones that are similarly sized to mine. I need to be better about commenting on other sites though.

And one thing I definitely can’t leave out is Tip’d. It’s a social media site for personal finance. They’ve embraced bloggers, so it’s given me a way to publicize my site that didn’t exist a few months ago.

YMR: Which article has been your favorite so far?

David: The most fun I’ve had is with a post on What Would Bilbo Do? 14 Money Lessons from “The Hobbit”.

The reason I enjoyed it so much is that it came naturally. I love J.R.R. Tolkien, and have read the Hobbit / Lord of the Rings trilogy constantly.  At least 10-15 times each by now.

One day, I saw some financial undertones, and started taking notes. It came together by itself. I even ended up with 14 lessons – the same number that Gandalf intended – without trying. So it was fun and easy to put together. Plus I got to embrace my inner nerd.

And more than anything I’ve written, it struck a chord with the masses.  Get Rich Slowly linked to it.  Then MSN money did, and so did Mental Floss Magazine.  It was huge!

It was never a marketing ploy. I just wrote about something I was passionate about, and others picked up on it. It was a very cool feeling.

YMR: Do you think we will ever have too many PF Blogs?

David: Never! I think we all compliment each other. It’s great to having multiple opinions, and multiple points of view.

Even if we run out of unique ideas, you can always learn from the experiences of others.

Also, no one knows The right answers. We can all share our thoughts, but no one has it exactly right. By reading a variety of opinions, hopefully we’re all getting closer to the Truth.

It’s like good music or food. You can never have too many options. Each has their own audience, and even if they’re not normally your thing, there are some times when it hits the spot perfectly.

That’s it! I wanted to thank David again for taking time out of his busy schedule to do this interview. Head over to his site today and poke around! You will find many great things there, trust me.

Have a great weekend!

12 Questions With Deena Katz – Top Financial Planner

While attending Graduate school at Texas Tech, I had to opportunity to learn from one of the top financial planners in the country, Deena Katz. Deena has been in the business for many years and is recognized as one of the best CERTIFIED FINANCIAL PLANNERâ„¢ Professionals. She was recently named one of Financial Planning Magazine’s “5 Most Influential People in the Planning Business”. She is also the author or co-author of nine books on financial planning.

I appreciate the time that Deena took out of her extremely busy schedule to answer our questions. Here is the list of questions that I asked her. These questions include some of my own as well as some from readers. Deena has some great insight in her answers and I hope you appreciate her input!


YMR: What drew you to financial planning and how does it enhance your life?

Deena: My mother was a minister and a social worker, but when my father died at 39, it became clear that she was unprepared for the financial burden.  She taught me early on to be able to take care of myself, because there is a high likelihood that I would be taking care of myself at some point in my life.  That led me to the planning profession.  My first company was working with women in transition.  It is extremely fulfilling to see people learning to take financial responsibility and accomplishing their goals.  I’m passionate about it.

YMR: Why do you think many individuals are scared about the thought of using a financial planner? What can the industry do to fix this problem?

Deena: There have been some very bad incidents in past years (Madoff and Standford most recently) which have shaken the trust and confidence that people had in advisors.   This is a two-sided problem.  Many people do not have the education to recognize if something is not right, some are looking for investment opportunities that are just too good to be true.  A little greed and a little vice make a big mess.  I always tell people “Never let anyone care more about your money than you do.”  On the other side of that, I believe people should work with CFPs, who are bound to standards of ethics that are quite rigorous.  I also believe that advisors should act as fiduciaries (in the best interest of the client.)  When looking for a planner, ask how they work, how they are paid and if they are a fiduciary.   Then you can begin to develop trust.

YMR: How have you been calming down your clients over the past year? Did you have them well prepared for an event like this?

Deena: No one is really prepared for an event like this.  It’s a 6th standard deviation event.  But, if we are able to manage client expectations from the first minute they work with us, we have a better chance to keep them from jumping ship when things are rocky.  As advisors, we can never promise market returns, we should be exploring the downside of investments with them.  We should be able to “stress test” their plan, to demonstrate how bad things really have to get, before their plan is unworkable.  We need to keep them informed of what is happening in the markets, in congress, and in the economy so we can give them “our take” on it and how it affects them personally.

YMR: Do you think this economic climate will finally get people to realize that debt is bad and retirement saving should be a priority?

Deena: No.  I don’t think many folks really understand.  I am hoping that congress will start to help us focus on financial literacy so that young children get this education to prepare them for life, rather than stumbling through it, making grave mistakes, then trying to “right” everything before they retire. I think people are paying more attention, but I am not sure they have been taught successfully yet.

YMR Reader: Do you think budgets are a sexy thing right now?

Deena: I have always felt that budgets are a four-letter word…but “sexy” is not the word I think of.  The nature of many human beings is not to feel the constraints of budget, because you fight against them, the same way you fight against your parents when you are 15.  I believe in  “trade-off” spending.   The first thing you need to know is how much does it cost you to live-basics, like rent, utilities, etc.  Then you look at the variables-eating out vs. eating in, for example.   Then you can say, “I’d like to buy a new car, so if I eat in and shave off some other expenses, I can us that money to buy the car.”   With budgets you are managing money, but with trade off spending you are managing goals.

YMR Reader: The buy and hold strategy has been around for decades. Do you feel that same strategy applies to the Gen X and Y generation?

Deena: I do not believe that modern portfolio theory is dead.  I further believe that you can’t  make market returns unless you are in the market.  Look what has happened in the last two weeks— If you missed one day, you missed a 6 ½ % run up.  Right now, I have no reason to change my investment philosophy.

YMR: Speaking of generations, do you think the baby boomer generation is prepared for retirement? Why or why not?

Deena: Baby Boomers are not prepared, but they don’t really want to retire either. Further, if all of us did retire, we would not have a big enough work force to carry on.  Boomers may not stay with their current jobs, but may work at something they love, for less money.  They will postpone retirement because they have to, even though they will not admit that’s the reason.

YMR Reader: Asset allocation has been preached extensively after the dot.com bubble, yet even diversified balanced portfolios took a significant hit with the recent economic meltdown. How do you address that to those concerned?

Deena: See #6 above.

YMR Reader: Speaking of asset allocation, what do you recommend people do with their retirement accounts? I would like an answer for new hires, mid-range employees and close to retirement employees.

Deena: First, the younger you are, the more time you have to let your portfolio grow.  I suggest a low-cost S&P 500 index.  Leave it alone.  As you continue to add money, eventually you should buy small cap and international-all index.  Mid range employees, you may want to add some fixed income, probably around 20% max.  As you get closer to retirement, you may have 60% equities, depending upon when you will need to start withdrawing from them. You want low-cost selections, because the fund expenses come right off the return.

YMR Reader: The economy has my wife feeling a bit insecure even though we’ve got a sizable emergency fund built up, and we have no debt. The question is, once we’ve completed our emergency fund, what path should we take? Should we start investing in the stock market like it’s on clearance, save in a high yield savings account, or should we be paying extra on our mortgage? Or a combination of those things?

Deena: Some leverage is good, so I would not start paying down the mortgage unless your interest rate is so high that you cannot beat it by investing your money elsewhere.  If your mortgage interest is low, invest in the market, because it is on sale.  I would suggest that you in invest index mutual funds because they are cheaper (less expenses).  Try Vanguard’s S&P Index fund for starters.

YMR Reader: My wife and I are in the market to buy a new home. We’ve saved up a sizable amount and we are selling our current co-op to use mostly as a down payment on a new place. Our credit is also impeccable. Still…how can we tell if we can truly afford it? Is there a metric/guide we can go by?

Deena: Bankrate.com has a calculator that can help you get your arms around that.  I don’t like “rules of thumb” because they are made for average situations and I believe you deserve solutions that are unique to you.

YMR: Now a fun question! How are you liking semi-retirement in Texas?

I am not semi-retired!  I am working 24/7, but loving it.  I love Lubbock, it’s just the right size community for me.  I love the school, my fellow faculty and most of the students.  I can’t imagine doing anything else. In fact, we’ve opened up a branch office of Evensky & Katz here in Lubbock and we are in for the long haul.

Many thanks to Deena for allowing me to interview her!

Weekly Roundup – March 29th

Welcome to this weeks roundup! There were plenty of great articles this week around the PF Blogosphere. Last week I posted infrequently and I apologize for that. I hope to get a full week of articles done today and you can expect to see my Q&A with Deena Katz (the top financial planner) on Wednesday. She has responded to my questions and I am excited for you all to read it. Anyway, enjoy these great reads!

Great Reads

Ben at Trees Full of Money witnessed a credit card fiasco at a Target checkout counter. Needless to say, this article really made me angry for some reason. You can see my response in the comments of his post.

Trent at The Simple Dollar thinks that most time management is rubbish. Head over there to see the ten things that work best for him.

Pinyo at Moolanomy has some extra income ideas for college students and recent graduates. I especially like the one on selling class notes. I wish I would have thought of that when I was in school!

Pete at Bible Money Matters wants to know if you are emotionally invested in your credit card.

Frugal Dad talks about the new Discover card for teens that creates bad habits.

I hope you enjoyed these great posts! I look forward to your comments this week!

Saturday Sneak-Peak: StretchyDollar.com

Welcome to the first edition of Saturday Sneak-Peak! Every Saturday, I will be exploring a personal finance blog and giving a brief review. My major intent of this new adventure is to expose everyone to new and/or obscure blogs. Up this week is StretchyDollar.com. Jeff has been a frequent commenter on YMR and I greatly appreciate it.

Jeff is a twenty-something blogger who started StretchyDollar as an outlet for his ideas and as a place to interact with other people in similar situations. Although Jeff has only been blogging for three months, there are plenty of great articles over there to check out. Here are a few of my favorites:

10 Financial Commandments for Your 20s

Get (Real) Rewards for Searching the Internet

I also asked Jeff a few questions to help you get to know him. Here they are:

What have you liked most about blogging so far?

I enjoy blogging for two main reasons:

1. Meeting and networking with awesome people who have interests similar to you who can teach you a lot. It’s fun to connect with people and share a part of you with them.
2. To learn through ‘teaching’. I enjoy researching and learning something, and then trying to present it in an interesting and understandable way.

What have you disliked most about blogging so far?

It’s not a dislike, per say, but the hardest thing for me so far has been coming up with a great idea for a post and then seeing it executed better somewhere else. I’ve had a couple ideas that I thought would be cool, and then I see someone else do a great job writing about that topic and I feel like I shouldn’t do it because I wouldn’t do it justice, or they would just think I was copying them. It’s difficult sometimes to come up with ideas that I think people would be interested in actually reading.

What has been your worst financial decision so far and how did you learn from it?

Due to a landlord problem, my wife and I were backed into a corner and due to a lack of time had to rent an apartment we couldn’t really afford. We made it work for a couple of months off of gifts from our reception (it was right after we got married) and extra money that my wife had, but in the end we had to move. It wrecked us financially, and we were on the ropes for a bit, using credit card advances just to get by. It took us months to really fully recover from it, and we missed out on some great financial opportunities because the money wasn’t there. It was really the thing that got me interested in learning about personal finance. The main concept that I learned from that experience was to plan ahead and do my research, and to live well within my means. Just because I think I can afford something doesn’t mean I really can.

Which of your posts did you have the most fun writing?

That’s a tough question – I’ve enjoyed writing each post for different reasons. I’d have to say the most fun was maybe one of the first I posted on StretchyDollar.com – ‘The Value of a Vision.’ It talks about having an overall plan/dream about what you want your finances to be, and then working towards it. Most people really don’t want to be financially strong, because they aren’t willing to put in the hard work and make the sacrifices to make it happen. If you can decide, have a goal, and works towards it, anything is possible.

I want to send out a big thanks to Jeff for letting me interview him. Head over there today and be sure to check out his posts and comment on ones that connect with you.

Do you know of a blog that you would like to see on Saturday Sneak-Peak? Head over to my contact page and submit the name/URL of the blog. You can submit your own blog if you like.

Buying a New Car? Cash Rebate vs 0% Financing Spreadsheet

I think the toughest part about buying a new car is selecting a model. When I searched for my most recent car, it took me months to figure out which one I wanted. I even feel like I settled on my Chevy Malibu because I was just tired of shopping. Whatever car you end up selecting, there comes a time when you have to choose between the cash rebate and the super low financing rate (typically 0%).

Do you find yourself searching for topics such as this every day? By subscribing to this site, you can get FREE updates in your inbox daily. Why not give it a try? You can unsubscribe at any time and it’s FREE. You can subscribe via RSS or you can subscribe via email.

Cash Rebates

Cash rebates are exactly what they sound like. Many automotive companies offer cash back when you purchase one of their new cars. If you see a commercial for a new car that offers $2,000 cash back, you can expect at least $2,000 off the MSRP. There are several types of rebates so make sure you know about all of them. You can get rebates for being a recent graduate, being in the military, etc. Make sure you negotiate the lowest price before mentioning any rebates. This will ensure you receive the best deal possible. You can find a list of current rebates at this site.

Special Financing

Many companies also offer the chance to get great financing rates through their company. Many companies, especially right now, offer 0% financing for a couple of years. Even if they do not offer 0% rates, they usually still offer rates lower than you can get through traditional banks.

Which Offer to Choose

Now comes the part where you need to figure out which one to choose. Here are the options which you will need to pick from:

1. Pay Cash for the Whole Car

In this case you should obviously take the cash rebates. You should also be proud of the fact that you will own the car free and clear. Congratulations!

2. Take the Cash Rebate and Finance the Car at an Outside Bank

With this option, you need to figure out if the amount of the rebate will be greater than the amount of the interest expense of the outside loan. For example, let’s say you need to borrow $15,000 for the new car and you can get a 60 month loan at your credit union at 5%. Over the term of the loan you will pay $1,984 in interest. So for this example, if the rebates are greater than $1,984 you should take the rebate and finance it at the outside bank. You can search for auto loan rates in your area at Bankrate.com. Also consider joining a credit union. They always seem to have great rates. You can use the spreadsheet at the end of this post to calculate the interest expense. It will also tell you which option to choose.

3. Pass on the Cash Rebate and Finance the Car at the Special 0% Rate

If the rebates are smaller than the interest expense you calculated for #2 (using the spreadsheet at the end of this post), you should use the 0% financing (assuming you qualify).

I should note that many companies are offering cash rebates PLUS 0% financing right now due to the economy. If that is the case, you should obviously take both.

Spreadsheet to Help You Choose

Use the following spreadsheet to help you choose the best option for you. Be sure to read the comments in the spreadsheet so you get all of the numbers in the right spot. Enjoy!

Weekly Roundup – March 22nd

It’s been a few weeks since my last roundup. What can I say, I’ve been pretty busy!

Keep an eye out for a new feature this coming week. I will be posting a “Saturday Sneak-Peak” each week where I will be visiting a new/upcoming blog on personal finance. I will give you a brief overview of what I found on the site and you will be introduced to the author with a few answers to my questions. You can then visit the site and make your own conclusion. Be sure to check it out this Saturday! Anyway, off to the roundup!

Last Week’s Great Posts

Trent at The Simple Dollar lets us know the hows and whys of his Prius purchase.

JD at Get Rich Slowly has received some really bad customer service at Smart Money. Does that sound familiar?

David at Pimp Your Finances is paying it forward, every day. Man did he have a day! I love doing great things for people but I’m not that good around drunk people. I give him props!

Frugal Dad shares with us seven ways to fund college without a college savings fund.

Pete at Bible Money Matters lets us know that when renting a car, save money by not paying for the extras.

Michael at Wealth Uncomplicated has a unique way of paying his kid’s allowance. I really like this idea and will definitely keep it in mind.

Free Money Finance fought the law and the law (mostly) won.

Have a great week and enjoy this weeks posts!