Tools for Investing

I know this site is more about saving than investing, but Ask the Advisor has a nice "toolset" article listing 57 web resources for investing. The sections are:

• Learning Tools - check out Morningstar classroom, with nearly 200 courses.
  
• Investment Blogs
• Fantasy Investment Sites
• Investment News Sites
• Research Tools
• Investment Brokers
• Investment Message Boards
• Free Trading Sites - check out Zecco, which gives you 10 free stock trades per day, and Bank of America, which gives you up to 30 free trades per month.
• Free Advice
• Everything Else - just a round up of some sites that don't fit the above categories.
   

The article doesn't mention many web2.0 applications, but the Advisor archives has a number of other articles worth checking out, including a list of 25 web2.0 apps for money, finance and investment. There are a couple of applications in that list that look great for money management. One of the standouts is Wesabe, which not only let's you managing your finances but you can actually pay bills online by attaching bank accounts.

What'd be really nice to see is similar tools from some of the financial institutions that offer online savings accounts. Obviously, people like convenience. I'd really like to have a single website access point for my bank accounts, mutual funds, online savings accounts, bill payments, and investing. Or maybe that's a security risk?

Turning The Tables On Credit Card Companies

Credit card companies are currently fighting amongst each other to get your debt. That's because personal debt in North America is at an all time high. The result is loads of 0% APR credit card offers applicable to balance transfers. So, if you have debt elsewhere, they want it. That way, when your 0% offer runs out, you'll be paying them interest, not someone else.

But if you have very little or no credit card debt and good credit, you can use it to your advantage with a technique called balance transfer arbitrage. Balance transfer arbitrage is the act of using all those 0% APR credit card offers to earn money. The basic principle is to deposit each balance transfer check issued to you into a relatively high-interest online savings account or other liquid investment, such as a CD (Certificate of Deposit).

For example, say you received a credit card offer for 0% APR, 12 months, $10,000 limit. You have the card activated and receive a balance transfer check for the full amount. You then deposit the check into something like the Emigrant Direct American Dream Savings Account, which is currently at 5.05% APY.

That's roughly $500 in interest earned on $10,000 over 12 months. (Though you don't want to cut things that close. Only deposit for 11 months so that you don't miss the deadline to pay back your credit.) You could also get a CD, which usually earns at a higher rate. You just have to be able to cash out your investment before the credit line comes due.

You can read more about the ten golden rules of balance transfers at Your Credit Advisor.

Bootstrapping Your Business

Growing a young business is obviously a critical step to success. If you have a business or are starting one, you probably know the statistics. Something like 80-90% of all new businesses fail in the first year. (I might be making that up, but it really is very high.) And of those that remain, a huge percentage fail in the 2nd year. Get past that, you'll probably do fine.

The primary reason for failure? Well, I'm guessing it's one of two things:

1. Poor planning.
2. Rapid growth.

Can You Live On $12,000 Per Year? 20 Tips Towards Frugality

Time was when you could actually work a minimum wage job full-time and get by. Two jobs, and you could raise a family. Nowadays, it's nearly impossible, but some people seem to be making an attempt at living under the median line. The movie The Pursuit of Happyness is an example of what persistence can do to move you from having nearly nothing towards being such a success that someone makes a film about you.

I'm not sure if someone will make a movie about Donna Freedman, but people are writing about her decision to intentionally live on $12,000 per year. She seems to be not only coping but in control. Is it really possible? As someone who did it on about $10,000 a few years ago, for about 3 years, I'd say it was possible then, and still might be so today, but only in some cities. You'd have to give up anything that wasn't absolutely essential. It's not necessarily enjoyable, to be honest, but if you eat properly, you can at least maintain your health.

Here are some tips, if you find yourself in a similar position or just want to save money for a trip or investment or what have you.

Five Tips To Better Stock Investing

Just around the turn of the decade, I was questioning my many years of computer progamming and analysis and the growing difficulty of finding contracts and even salaried work. I entertained the notion of writing my broker's exam and even did a great deal of studying, as a supplement to developing some trading models I'd been working on since 1991.

I used the models to predict three of four market turns in 2000 but decided that being a stockbroker wasn't really what I wanted. I did learn a great deal about stock investing in the past decade: mostly that paper trades are often meaningless theory, and only by performing actual trades can you learn anything. And learn I did, from making some big mistakes. But it's best to get your failures out of the way early in your investment "career". Here are a few tips for better stock investing.

More Tips On Saving And Finance

It's probably about time that I started posting here again, though while I get around to it, I thought I'd point out another monster list of savings and finance tips. Your Credit Advisor has a piece called 102 Personal Finance Tips Your Professor Never Taught You. Why "professor"? That's what I wondered, though there is an explanation, but it could've been anyone, I suppose. This list catches a lot of things I missed in Who else wants to save money? 88 tips, tricks, tutorials. There are a lot of great tips in this 102 list that are far more practical. Definitely worth a read.

Who Else Wants To Save Money? 88 Tips, Tricks, Tutorials

If my previous posts about saving money weren't enough for you, I've compiled a list of 88 ways to save money. Sure, some of these might seem obvious, but it doesn't hurt to be reminded once in a while.

The items are in no particular order of importance, but might be grouped by themes. (Apologies for any possible duplicate or similar items. I did my best to edit.) I've linked some items to other websites, including pfblogs (personal finance blogs). By doing so, understand that I am not necessarily endorsing them , nor have I necessarily tried out the linked-to services or products. I have, however, read most of the articles linked to.

Upon reading the first few items, you might think that I have a vegetarian agenda. Not true. I am a former vegetarian (because of personal health reasons). But food costs can often be the type that goes out of control in the monthly budget, since many others are usually the same each month. As well, eating properly means preserving your health, which in turn means avoiding expensive medical and health bills in the future.

(1) Look for jobs online.
Instead of buying a newspaper.

(2) Take advantage of credit card promos.
This includes cash back and free iPods. American Express. Discover Card - 5% cash back. $100 cash back or gift card, Bank of America iPod, AmeriTrade iPod [My Money Blog]. For general info about credit cards, see Credit Card Lowdown or Your Credit Advisor.

(3) Manage your credit card debt.
Pay off your credit cards with the highest interest rates first; pay your monthly balance off in time; pay off more than the minimum  monthly amount. All of these will save you something in terms of interest. Otherwise you end up desperate for credit [MSN Money] and should just bend over.

(4) Ditch your credit card and pay with cash.
Spend only that money which you actually have. What a radical idea.

(5) Buy and sell stocks less often.
Save on transaction fees.

(6) Don't buy a TV.
Instead, get a large computer screen and a TV capture box (PVR - personal video recorder) so that you can watch on your computer. You'll also save on electricity by not having both TV and computer turned on at the same time. If you record shows on your computer to watch later, you can often watch at a slightly faster speed, to save total viewing time. (Depends on your viewing software.)

(7) Don't buy a TV, part 2.
There are dozens of free video streaming sites online. There are even a few broadcast networks releasing TV shows free online, including NBC and CBS (United States). In some cases, you have to live within a certain geographical area to access content, but not always. You may have to watch commercials as part of the deal. If you're just looking for video content, a good place to start is by visiting YouTube. Or if you prefer to download video and watch it later, get the free Democracy Player. You can also find info about IPTV (Internet Protocol TV) at ItsMyTelevision.

(8) Get a voltage regulator.
If you have a lot of AC-based consumer electronics, use a voltage regulator to even out the amount of peak power you use at any time.

(9) Get a free iPod, MP3 player, or laptop.
There are legitimate programs online, but they do require you to get friends to sign up for the same programs. So this isn't for everyone. In some cases, you also have to spend a bit of money to sign up for certain promos, as will your friends.

(10) Download legitimate MP3 files.
Many official websites of musicians make a few songs per album available online. Download MP3 files from several of your faves, then burn your own mix CD using free music player software such as iTunes or Windows Media Player.

Personal Finance Advice - Sat Sep 9/06

Fine Tuning Your Ing Direct Online Savings Account
Do you have an ING Direct online savings account? Did you know that you can actually set up "sub-accounts" to organize your money? Consumerism Commentary gives you the lowdown on how to set up ING Direct sub-accounts. These sub-accounts allow you to organize your funds. By the way, here's how to setup an online savings account, in case you don't have one. They're a great way to earn more than a half percent on your savings.

Tracking Your Monthly Expenses
Having trouble figuring out why your expenses are increasing? Doing an itemized monthly breakdown of expenses goes a long way to show you where the extra money is going, especially if you plot a chart for each item, by month. Consumerism Commentary has a couple of screen captures ofa financial balance spreadsheet: simple and complex. Madame X, at My Open Wallet, also talks about using spreadsheet software to track expenses, as well as a couple of accounting methods.

Accumulating (Almost) Free Money
Jonathan at My Money Blog talks about how he scores an extra $1500-300 in a year in sign-up bonuses (banks, credit cards), etc. While you probably can't do this every year, he talks about how, if you managed to find an extra $2000 each year and saved it, what it would add up to over 30 years. There are a few examples on his post as well. And in my experience, it's the person who has developed a frugal mindset who tends to notice these opportunities when they cross your path. People who are not in a savings frame of mind just don't pay attention.

How To Find Money For Your Projects Or Business Ideas

One of the reasons for saving money, for some people, is that they plan to launch a business or some other project that will hopefully produce an even greater return in the future. If you have done this, or attempted to, you know how hard it is to get money from a bank when you actually need it. What's your alternative? One possibility is approaching family and friends.

How many friends do you have that you can approach for capital? Entreprenuer Magazine says it might be more than you think, and finding investors for a new venture may be made easier by making a list. Here are two articles from their website which might help you: Friends With Money, published Aug 2006, and Accepting Money From Friends & Family, published May 2002.

Should You Rent Or Buy A Home?

Recently, I pondered the idea of whether people with mortgages were better at managing finances than those without. In that article, I put forth the notion that while not everyone is suited to have a mortgage, saving money as if you plan on one could give you some needed financial discipline. Well, if you're thinking of having a mortgage anyway, there's a free e-book (PDF) called Take Cover: Compare Renting vs Owning, available from a site called Moving Average Inc. [found via I Will Teach You To Be Rich]

If you are considering purchasing a home and taking one the enormous, long-term debt of a mortgage, keep in mind all of the hidden costs that you don't feel first-hand when you rent. This is often what trips people up, from what I've seen of friends and family. As I've said previously, the stress of a mortgage or double-mortgage can ruin a family.

If you're not sure that you have the financial/ savings discipline for owning a home, but really want one anyway, I still stand by my hypothesis (as discussed in the article linked to above) that acting as if you are saving for one,will help you develop that discipline. Go for an investment vehicle that affords liquidity, such as short-term certificates or online savings accounts.

What Is Tithing And Why Does Giving Money Away Bring More?

Many years ago, I came across the books of Catherine Ponder, a minister of the non-denominational Unity faith. She wrote many wonderful books about the positive relationship that people can have with money. I bought as many of her books that I could find. They were hard to find, but I collected several, and now she has a section on the Prosperity Network where her books are available. Her books have helped me in the past, to get out of credit card debt, and to general solve many financial problems. But like many books of this sort, it's easy to forget what you learn in them, and easy to stop practicing. Re-reading such books always helps.

One of the concepts she discusses is an ancient practice called tithing, where a person willingly gives up, usually, 10% of their income for a good cause. The money has to be released willingly, and without any expectation of return. What is believed, in many cultures, is that tithing results in a ten-fold return. It has to be 10%, for each tithe you give - some cultures expect their adherents to give up to three separate tithes of 10% to three different purposes. There's something magic about the number ten. While this may seem rather metaphysical and "Eastern", tithing is also written about in the Christian bible and many other holy books all over the world.

Consumers With Mortgages Better At Managing Finances?

According to an American study by Experian Consumer Direct, the average credit score of someone with a mortgage is better than that of someone without. People with second mortgages have an even higher score. [via Payments News]

I don't see this as suprising information. My parents managed multiple mortgages - including second mortgages - over a period of time and it's simply necessity to be disciplined. If you take on so much debt that you need a second mortgage in the first place, then if you're not disciplined with your finances, you're going to lose your property.

What would be interesting to study is how many people who have gone through bankruptcy had second mortgages. I think such information would show that not everyone can handle either a mortgage or a second mortgage. Sad but true. So only the most disciplined people keep their property long enough to be part of a study in the first place.

10 Money Saving Tips

This post is an aggregate of money-saving tips that I've written at this website and elsewhere over time. For reading convenience, I'm summarizing tips that have worked for me in the past.

The amount of money you can save can be life-changing. If you're in debt, and want to erase it, then you either have to earn more money or spend less of what you make. Here are some suggestions for how to spend less/ save more.

Saving Advice: Save 10% In Hard Cash?

Bryan Fleming has an interesting suggestion for disciplining yourself to save money. I was a bit taken a back at first, but after he gave his rationale, it actually made a lot of sense, and I realized I've done it in the past without realizing its effectiveness.

Basically, he says - this is my interpretation of his post, plus my own interwoven commentary - that the key to learning to save money is actually saving money. Hard currency. And somewhere you can see it.

He's not saying that you should keep all of your money in a sock. Rather, he's saying that if start keeping, say, 10% of what you earn in actual currency, in a place where you can see it each day, it'll have a positive effect on you. When the money starts to build up to a sizeable amount, you can move it to a bank account.

Saving Money While Treating Yourself

People in a saving-money mode often think they cannot treat themselves to a nice meal in a restaurant once in a while. Someone once told me that if you're on a diet, it's less stress on your body to eat, in moderation, something you're craving, rather than force yourself to resist. The same thing goes for budgets.

Don't stress yourself out. A little treat once in a while is a good idea and less stressful than the alternative. In fact, it's a great reward for having the discipline to save in the first place, and motivation to continue the practice.

In that regard, might I suggest Vietnamese cuisine? When I've queried culinarily adventurous friends in the past, they didn't know much about Vietnamese food. Of those who had tried it, most fell in love with it, although a few said they found it boring - which I find incredibly surprising, having worked at a Vietnamese restaurant and sampled many different dishes. Of course, many who like the cuisine also love the inexpensive meals.

Finance Tips: Saving Through Carpooling

Personality clashes, smokers, stinkers, halitosis, catching colds, and getting up at ridiculous hours are the things you can look forward to if you carpool. On the positive side, you can also look forward to the occasional worry-free commute, getting to work faster through carpool lanes, meeting new friends, and best of all, saving a lot of money. How about you? Do you carpool?

I've only ever carpooled for one period in my life, but the amount of money I saved was amazing. I was fortunate, too, because my ride was a heck of a nice guy (and never smelled bad). In fact, he was a pleasure to commute with.

This was back when gas was less than half of what it is now. If I remember correctly, he only charged me a couple of dollars a day, at the end of each week. I didn't have a car until a bit later, and the increased cost of the car was pronounced, compared to car pooling.

Finance Tips: Investing A Windfall

Lately, I've been exploring all the great pfbloggers (personal finance bloggers) that are out there on the Internet. When I come across one I like, I add it immediately to my Bloglines subscription list. I have 40 pfblog sites in my list, and it's hard to keep up with all of them on a regular basis.

But since I make the attempt to read them all regularly anyway, I thought I'd spend a few days linking to a variety of articles by other pfbloggers. These should give you some different perspectives on finance, wealth and opportunities. I'll of course be adding in my own comments and advice.

By "pfblogs" I'm also including websites that talk about wealth and business opportunities, not just saving or investing or personal finances in general. They're all kind of loosely tied with the same end goal: increasing your net worth. So without further adieu....

Teach Your Children Well... About Money and Savings

On a CNBC TV video segment tonight, they profiled about Paul Rodrigues. Senior and Junior. PR Sr is a comedian. PR Jr is a skateboarder who barely looks 16 or 17. Yet he has endorsement deals with Nike and others that bring him over a million per year - more than dad makes. While that's great for Paul Jr and other talented youngsters like him, it's not realistic for his young fans to think that this WILL happen to them, too. (But it's certainly good if they're motivated.)

Money is such a difficult topic for some couples to discuss, let alone an entire family, but it should be done. An episode of the comedy Reba tonight, in its own humorous way, talked about some of the conflicts that arise from not discussing money.

How To Save For Your Own House - A Few Tips

Buying a house should be considered a project, if not a "family business" investment. It's undoubtedly one of the most important investments you will ever make in your life, and if you don't plan every aspect of your life that surrounds this purchase, it could turn out to be the worst investment of your life. Or it could be your best investment, becoming your sanctum sanctorum.

Your decision will affect every member of the family, whether you realize it now or not. Plan loosely long before buying, or the financial stress afterwards can cause family rifts. I've seen it happen. Take some time beforehand to do some relatively easy planning, and every member of your family could eventually learn something valuable about personal finance. (Once they're old enough to appreciate what you teach them.)

Secrets To Spending Money

My last post was about some secrets to saving money. This one is about spending money wisely, so that you either save, or make an investment that pays off later. Here's an example, albeit an extreme one.

One secret about acquiring wealth is to not think linearly. Just because you make "this much" does not mean that you cannot enjoy luxuries. It's question of whether you can learn to wait on your purchases. It's not a matter of frugality per se, but of figuring out ways to "multiply your talents" and your money.

Secrets To Saving Money

Here's a secret about saving money that I learned a long time ago but which took me many years to actually implement: it doesn't matter how much you make, just how much you save.

If you read any of the other personal finance sites, you'll see that a lot of people are saying that right now. It's a pretty well-known "secret". But knowing something and making use of that information are distinctly different. Are you making use of your financial knowledge? Or are you keeping it a secret from yourself?

Does Anyone Stick To Their Budget?

Budgets are an emotional drain for some people, and just a chore for others. Devising a budget is bad enough. Balancing them is even less fun. But managing the finances of a family is really not that different than managing the finances of a business. It's not easy, but it's a necessity.

While some people prefer good old paper and pencil, I like to use a Microsoft Excel spreadsheet. It's easy to track past expenses, as well as chart changes in total or specific expenses. And the more income and/or family members there are, the more likely you are going to want to track changes in expenditures.