Personal Finance Tip – Floss Your Teeth

Cost – A few minutes of time a day + dental floss.

Savings – Hundreds or Thousands over your Lifetime.

An article at CNNMoney talks about the high cost of dental care and six ways you can save money on your teeth.

“According to a dental industry report, every dollar you spend on preventive care can save you anywhere from $4 to $50 in restorative care.”

Photo by Jackie Hutch

Written by Ben · Filed Under Health, Personal Finance >Comments (1) 

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The High Price of Job Security

“This is so convoluted, no one is ever going to be able to figure it out!” said one cube dweller to another. The other smiled and said, “I know, job security baby!”

I’ve worked in my current software job for 7 years and suppose I could be considered a “key” employee for our product. I know how most of the system works, who to call when something breaks, and where a lot of the bodies are buried.

Does this scenario sound familiar to you? Sure it’s good for job security

BUT

You’re tired of what you do.
You don’t look forward to going to work.
The grass is greener everywhere else.

YET

You go every day because the job is secure.
You spent too much on your house & car and need the money.

What’s the Cost?
Stress
When you’ve been around for a while the same problems keep popping up. Working on the same issues time and again is frustrating. It is stressful, hard on your body and your psyche.

Knowledge Depreciation
If you’ve been doing the same thing for 5 years chances are your industry is moving on without you. You may now be a commodity in a cash cow product instead of an innovator in a Skunk Works. Your “skills that pay the bills” may no longer fetch the same salary in the market.

Responsibility
When you’ve been in the same place for a long time you often accrue more responsibility whether it’s through promotion or by default through attrition. You’re the one they call when something breaks in the middle of the night or a deadline has to be met by tomorrow. Responsibility = less sleep.

Family Time
While you’re spending hours stressing and being responsible at work, you’re not spending time with your family. News flash, your wife and kids miss you!

Money isn’t Everything
In an effort to build our net worth, job security is a major contributing factor. However, in our quest to enjoy life, job security can be a major pain in the butt! I try to remember some words of advice from an co-worker of mine that’s been around the block a few times, “Work to Live, don’t Live to Work”! How do you balance performing at your job with enjoying life?

Written by Ben · Filed Under Career, Personal Finance >Comments (4) 

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Clean Out Your Closets, Sell Unwanted Christmas Gifts. Hurry, Deal Ends Saturday!

eBay is running a promotion for new users that waives the insertion fee for the first three items you list. If you’ve never used eBay before, this is a good chance to give it a go for free. If you have anything valuable sitting unused in your closets or an unwanted gift that’s worth some money try and sell it on eBay.

“New eBay sellers who create up to three Auction-style or Fixed Price listings will not be charged insertion and Gallery upgrade fees for those listings. In order to qualify for the special offer, the eBay member must not have sold on eBay before, and must list their first three items during the promotional period (January 9-13, 2007).”

See the promotion for full details.

Worth a Shot
One thing to keep in mind is that many people won’t purchase from a seller unless they’ve already earned some feedback. This means you many not get any bids on your item but you never know. It is free to list with the promotion so it doesn’t hurt to try.

Building Feedback
How can you earn feedback if no one will buy from you without feedback? When I first started on eBay, I built up a little feedback by buying shipping materials. Once I had 10 positive comments I started selling things.

Future Sales
Even if no one buys anything from you the first go round, you could build some feedback and bide your time. eBay periodically holds promotions where they feature a 10 or 20 cent listing fee and you could try your luck again at turning trash into cash.

Written by Ben · Filed Under eBay >Comments (0) 

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Flexible Spending Account Reimbursements Simplified

Thanks to changes made by the Internal Revenue Service, many of us are able to make claims against our 2006 Flexible Spending Account balance for health care expenses incurred up through March 15, 2007. If only we could find a way to simplify the process.

Receipt Overload
With a new baby the number of receipts for co-pays, prescriptions, and over the counter medicines multiplies pretty quickly. If your FSA account administrator is anything like mine, the process of submitting these receipts is quite a hassle.

Cutting Through the Red Tape
Recently I had 18 receipts to submit for reimbursement but the form only had room for 5 claims. I called up the administrator and asked if there was any way I could submit all the receipts at once without having to fill out and mail in 4 different forms.

The first answer was no, please submit 4 different forms. Irritated by what a waste of time that was I pressed harder. Finally, after arguing my case the representative acknowledged that I could just put all the receipts in one spreadsheet that contained the same fields as the paper form and mail them all in together.

Electronic Records
One current trend in health care information is to digitize health records. I figured; why not follow the trend with our family’s FSA records? I like the spreadsheet approach because it saves time filling out and mailing in multiple forms. Entering the information is simplified, just cut and paste a previous entry and change the appropriate details instead of filling out forms for each one.

In addition, the spreadsheet keeps a running tally so I know how much I should have been reimbursed for the year and it makes it easy to search for a specific claim. Many FSA administrators offer web access to your account. Once a claim has been submitted and/or paid it will show up online. You can double check your spreadsheet against their records to make sure you were reimbursed appropriately.

Flexible Spending Account Debit Card
When my plan administrator first offered a debit card that we could use to pay for health care items I signed up right away thinking it would simplify the process. However, many of the items that I paid for with the card were flagged by the administrator as requiring substantiation. For each claim that was flagged I had to fill out and mail in a separate substantiation form.

After several cases of this I decided to see what would happen if I didn’t mail in the form. Several weeks later, my FSA debit card was locked. For me, it was more of a hassle to keep up and fight with separate substantiations for claims than it was worth. I decided to abandon the debit card and stick with the spreadsheet method described earlier. This approach has worked out quite nicely.

Use It Or Lose It
Whichever system you use, if you still have money left over from your 2006 FSA contributions make sure you use it by March 15, 2007 or that money will go to your employer instead of in your pocket!

Written by Ben · Filed Under Health, Personal Finance, Taxes >Comments (5) 

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Phone Bills Too High? A Tax Refund Will Help Ease The Pain.

This is the one time that a big phone bill may work out to your advantage. The IRS is granting a tax refund to give back money collected for federal excise taxes on long-distance phone calls since 2003. It allows a standard refund you can claim on your tax return. According to an article in the Arizona Republic the standard amounts are based on the number of exemptions you take, listed below:

1 exemption – $30 refund
2 exemptions – $40 refund
3 exemptions – $50 refund
4+ exemptions – $60 refund

However, the federal excise tax is charged as a percentage of your phone bill. So if you run up high bills every month, you may be better off filing a refund for the amount of the tax you actually paid between Feb. 28, 2003, and Aug. 1, 2006.

Of course this means that you have to go through all those long-distance phone bills and add up the total; but the higher your bills the wiser it may be. One thing to note is that you have to file Form 8913 with the IRS if you calculate your actual taxes paid instead of taking the standard refund. See the IRS website for more information.

Written by Ben · Filed Under Taxes >Comments (2) 

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FinanceSpirations – Working Hard and Spending Very Little

In the first submission for the contest, Iram shares her financial habits. Sounds like ING can be credited with motivating her to start saving. A variety of blogs have inspired her to avoid credit card debt.

Her story is below, I’ve highlighted some parts that caught my eye. Iram, thanks for setting a good example for the rest of us with your financially healthy habits, keep up the good work!

I have always paid attention to my finances. At age 25 I have a 4 flat investment property and a condo that I share with my boyfriend. We are both very frugal but I got my start when I learned about ING savings plan. I did not have rich parents, I paid my own way through college by working hard and spending very little. Needless to say, I didnt have the college life I would have liked to but at least I got out of college with 0 credit card debt. Reading different blogs on fiscal awareness and fitness, I have been able to maintain my 0 credit card debt by paying off my balance each month. I do energy audits on my own house, clip coupons, watch sales and generally try to lead an average life including saving more than I spend. I currently make about $50K at my job.

Iram

Vote for Iram to win the financial consultation by leaving her a comment about her story and check out the other entries here.

Written by Ben · Filed Under FinanceSpiration >Comments (2) 

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The 10 Worst Credit Card Mistakes College Students Make

Blueprint for Financial Prosperity had an article the other day about college students establishing credit by signing up for one of his favorite student cards. I’m glad I had a credit card in college, it helped me build up my credit score. However, in my time at school I saw many mistakes being made with credit cards, here are 10 of the worst in no particular order:

1) Opening a Credit Card for Free Stuff
Whether it’s on the beach over spring break or in the student lounge, booths giving away a free a hat or T-shirt in return for opening a credit card are bad news. Even if you never use the card it shows up on your credit report. After opening several cards for a few freebies your credit score probably won’t look so pretty.

2) Open Door Policy
The dorms were a great place to hang out when I was in school, you could drift in and out of rooms down the hall just shooting the breeze, playing video games, or watching Sports Center. Most people left their doors open and if they didn’t you knew their lock combinations. There usually wasn’t much of value in a college student’s room, except credit cards that is. There were several instances where someone’s credit card was “borrowed” for a spending spree or used to pay for adult phone conversations.

3) Speculating on Credit
I have to admit, I love playing poker. Unfortunately the recent proliferation of online gambling sites has made it way too easy to blow tons of money playing online. When you have an hour to kill between classes, it’s tempting to sit in the library computer lab and test your fortunes. What’s worse than losing all your money in poker? Losing money borrowed at over 15% interest!

4) Taking the Card out for Night on the Town
Friday night was a great time in college. The weekend was full of potential as you hit the town with a date or a group of friends. Unfortunately, the money often ran out long before you were ready for the good times to end. If you had the credit card along, you could always rely on it to keep the party going. Just remember, the only thing worse than a hangover is a credit card hangover!

5) Carrying a Balance
I have friends in their 30’s still paying off student loans with pretty low interest rates. With today’s credit card rates of at least 15%, if you carry a credit card balance as a student you will be paying off those debts for a loooong time.

6) Opening Store Credit Cards for Discounts
It seems every time you buy something at Best Buy, the Gap, or any other retailer they always ask if you’d like to save X% today by opening a store card. When you’re a broke college student the idea of saving money sounds great! However, if you open a card at every store you shop at it will hurt your credit score. Plus if you have all those cards, you’re probably more likely to spend more money.

7) Overspending, then Reporting Your Card Stolen
I knew of several cases in college where someone charged hundreds of dollars they didn’t have over Spring Break, then called up the credit card company claiming their card had been stolen and that the charges weren’t theirs. Not much to say about this one other than it’s breaking the law and don’t do it.

Buying an Engagement Ring
It’s senior year and you’ve found “the one”. The only problem is she wants a big rock and you’re a poor college student with no money. Of course you love her and want to make her happy, and you don’t want to hear comments about how small the diamond is for the next 20 years. Many people turn to credit cards happily offered by Zales, Helzberg, or whatever the store may be.

My question for you, do you really want to start your marriage off with thousands of dollars of debt just for a piece of compressed carbon? I know, I know that argument probably won’t fly with the Missus. If you don’t have the money for the ring she wants be creative. Find a way to talk her into downsizing, borrow from your parents, or do something other than going into debt for diamonds!

9) Paying For Friends
The great thing about college life is the people you go through it with. Countless midnight pizza runs, poker late into the night, and road trips all build memories that last a lifetime. When you’re headed out for one of these adventures you don’t want anyone to be left behind because they don’t have the cash. It’s so easy to say, “I’ll put it on my card” or “the next round’s on me”. I’m not saying don’t help out your friends. Just make sure you have the money to pay the bill and that you’re not doing it all the time.

10) Forgetting to Pay the Bill
College is full of classes, sports, homework, parties, dating, and just learning to be on your own for the first time. Who has time to remember to pay the credit card bill? Plus if your dorm room is as messy as mine was you probably couldn’t find it even if you remembered! The unfortunate part is that missing your payment will not only cost you a $30 late fee you don’t have the money for but even worse it will put a mark on your credit history that will follow you around for years once you’re out of college.

Credit Card Cum Laude
If you can avoid making these mistakes you should graudate not only with a college degree but a good credit report and lots more money in your pocket!

Written by Ben · Filed Under Credit Cards, Personal Finance >Comments (19) 

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Lessons We Can Learn from Donald Trump’s, The Apprentice

I’ve been a devoted watcher of “The Apprentice” since the first season. Every week I learn something new from the trials and tribulations of the competitors about personal interaction, decision making, business strategy, taking risks, trusting others, interviewing, negotiation, marketing, and many other important skills.

I know we only see the clips that the producers want us to but I still think it’s a great overview of how to stay true to yourself and your beliefs while striving for success in a competitive environment.

I ran across this site by Alain Burrese that lists various success and business principles we can glean from the Apprentice. It’s a good summary of the lessons the show has provided so far. If you haven’t had a chance to catch the show, I’d tune in tonight. The season premier of The Apprentice Season 6 begins at 8:30 PM CST.

Written by Ben · Filed Under Entrepreneur >Comments (0) 

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Win Free Financial Advice – Share Your FinanceSpirations!

Who inspired you financially in 2006? The blogosphere is full of financial wisdom and inspiration. Where did you find your most helpful tip or most inspiring article in 2006?

I challenge you to let everyone know which site or article made a difference in your personal finances last year. Let’s highlight your successes and the people that helped make them possible! One lucky submission will win a free 1 hour consultation with a certified financial planner.

Kristine McKinley is a CFP and CPA from Beacon Financial Advisors whom some of you may recognize from her contributions to various finance carnivals. The winner of the challenge will get a mini-version of her Right Start Financial Checkup. The prize is one hour of phone consultation with Kristine on your investment or tax issues.

So how do you participate? It’s easy, here are the rules:

1) Write about how a personal finance blogger inspired you financially in 2006.
Submit your stories via my Contact page or by email and I’ll post them on this site under the category of FinanceSpiration. If you have a site of your own, post your entry there and link back to this contest.

2) Voting
Everyone’s favorite story will be chosen for the people by the people! Get out and read the submissions, then vote for your favorite success stories by leaving a comment on their post. Of course you can vote for more than one.

The entries submitted directly to me can be found under the FinanceSpiration category. Any story written on another site linking back to this contest can be found in the comments/pingbacks section at the bottom of this contest.

3) Winner
Whichever submission has the most comments by the end of the day January 22nd wins! At the end of the contest, I’ll write a summary post and announce the winner.

Kristine will contact the winner to schedule the meeting and determine the personal finance questions to be covered in the consultation.

Contest Updates
I’ll be giving updates on the contest over the next two weeks so subscribe to my feed to stay in the loop.
Good luck!

Written by Ben · Filed Under FinanceSpiration >Comments (7) 

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The Problem with Annual Pay Increases

How much extra pay did your efforts at work earn you last year ?

What Incentive?
I’m not sure how the 3.5% annual merit increase I received yesterday is supposed to motivate me to work hard in 2007. Don’t get me wrong, I’m grateful to have a steady job and that my pay is increasing at all. However, I don’t think our system of annual merit increases offers much in terms of incentives for me to be a better worker.

Scarcity Mentality
At the end of the year each department gets a shared pool of money to allocate to its employees for the merit increase, so all of us in my group are competing for the same fixed amount. The amount of the pool is a certain percentage of the current combined salary of the group; the percentage is based on how well the company did financially during the year.

So if Human Resources decides our group pool is 2.5% of our current salaries, then the baseline merit increase for each person is 2.5%. If someone did a really good job that year you can increase their percentage but that means you have to take away from the amount you give someone else.

Is the Work Worth the Money?
What usually happens is that most people get right around the baseline increase, the poor performers get maybe .5 – 1% less, and the top performers get .5 – 1% more. That means I could work my butt off all year and earn just $300 – $600 more than the guy next to me that had a horrible year. Taken over the course of a year, this breaks down to a few extra dollars a workday.

With the exception of some time off for the holidays, I’ve been working long hours the last few weeks to make sure our projects are a success. It doesn’t seem to me that a few extra dollars a day is worth the time away from my family and the stress I’ve been under.

The Alternative
One thought I’ve had repeatedly is that I should put in the bare minimum at work and concentrate my efforts on earning alternate income from home. It would be a difficult thing for me; I always like to perform the best in all that I do. However, working hard just to keep my salary up with inflation doesn’t seem to lend itself well to enjoying life and building wealth. If I’m going to be slaving away, mine as well be working for myself.

Written by Ben · Filed Under Career >Comments (9) 

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