Personal Finance Review – Featuring Joe Money & Bob Cash

Today the weekly roundup will be run by two special hosts, please welcome Joe Money and Bob Cash.  Joe and Bob have been close friends since they were little but have different outlooks on money so I thought it’d be interesting to hear their take on the personal finance articles this week.

Joe: Hey Bob, you’re almost broke; you should be looking to save a bundle of money.

Bob: Come on Joe, I’m trying to win a Wii here, don’t bring up money please.

Joe: If you had lost all your money last night I wouldn’t be bugging you.  Didn’t you pickup any money lessons from your poker game?

Bob: Hey man, give me a break, I just figured out the cheapest ways to exercise so I can save money on my gym membership.

Joe: Well, you wouldn’t be so poor if you hadn’t up and resigned from your job yesterday.

Bob: I told you already, my life is not my job! My quality of life is way more important to me than money.  I bet you’d feel better if you weren’t counting your money and measuring your investment’s performance all the time.

Joe: Hey, I’m being money smart!  I’ll be able to retire way earlier than you. What you need is a framework for personal finance to get you on track. Plus how are you going to pay your half of the rent?

Bob: Don’t sweat it Joe, I signed up for the a rewards card, I have some bonus cash coming my way.  Plus I’m going to start an online business and make tons of money.  I don’t know why you spend so much time researching your investments; all you really need to do is check out the Kiplinger’s Best List.

Joe: I’ve guess I’ve just been thinking a lot about money lately. When I think back through my best & worst financial decisions I realize I’ve many more bad decisions than good ones but at least I’m learning from mine.  I bet you haven’t even started saving for college yet.

Bob: Hey, I do things to save money, like making good use of old magazines and buying cheap olive oil.

Joe: I guess that’s a start but things like that will never make you wealthy, you really need to focus on getting out of debt and building your net worth.

Bob: Yeah, I guess you’re right.  I’m broke as a joke, think you could buy me some dinner…..

Thanks to Joe & Bob for stopping by and entertaining us!  Of course they’re not actually real people but if you’d like to see them come to life check out the movie, You, Me, & Dupree.

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Health Insurance Blame Game – Stuck Between Insurance Company and Doctor’s Office

Do you ever feel like navigating the health insurance claim process is like walking through a maze blindfolded?  Our most recent experience leaves me wondering how many people get stuck paying hundreds of dollars for claims that should have been covered.

During a recent visit to the pediatrician the receptionist informed my wife we had a balance of over $300 outstanding. Luckily she only paid the co-pay and got the phone number of the billing department so I could call and investigate.

Doctor’s Office Perspective
When I spoke with billing the next day, they informed me that the claim they had filed with our insurance company for a visit from December of last year had never been processed.  They started off by sending an electronic claim and after receiving no response they sent a follow up by either mail or fax.  When no response was received the doctor’s office then billed us directly.

Insurance Company’s Perspective
Having heard the pediatrician’s side of the story, I then called the insurance company to see what went wrong with the claim.  According to little miss phone rep the doctor’s office hadn’t submitted the necessary paperwork until April of this year, past the 90 day window stated in the contract between the doctor’s office and the insurance company.  According to the contract, since the pediatrician had waited too long to submit the claim, the insurance company was not liable for the charges and had sent the doctor’s office a letter informing them of this.

Patient’s Perspective
I pay my health insurance premiums monthly and a fork over a co-pay at every doctor’s visit; I’ve upheld my end of the contract.  I expect the insurance company and the doctor’s office to run their business correctly. I shouldn’t have to be stuck in the middle of the two parties trying to negotiate an agreement.

When the doctor’s office joins the insurance company network, they agree to follow certain procedures and the insurance company takes on the obligation to process claims effectively and efficiently.  It sounds as though the claims process is not perfect and could use some revising.  If the system is broken, they should do something to fix it, not leave the customer stuck with a bill.

Stuck in the Middle
When I spoke with the women in the pediatrician’s billing department she said this type of thing happens all the time.  In my conversation with little miss phone rep from the insurance company she informed me this type of thing is rare.  Obviously the two answers don’t match up.

The insurance company advised me to ask if the doctor’s office had any proof that they had sent the claim within the 90 day window.  If not I should tell the pediatrician I wasn’t liable for the payment and if they gave me grief to let the insurance company know. 

The only positive in the experience is that my wife didn’t pay the over $300 bill when she was at the doctor. I’m sure if she had we would never have seen the money again.  However, I’m not looking forward to the nasty arbitration I imagine I’ll have to direct to resolve the issue.  Does it really have to be this difficult?

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Free Trial Subscription – Investors Business Daily Case Study

Investors Business Daily Free Trial

Are free trials a selling tactic, a useful tool for consumers, or both?  I received a lot of comments and emails on the Free Trial Offer post the other day and decided to dig into this one a little more by looking at a free trial offer from Investors Business Daily.

Investing Research
The story actually begins 8 years ago. When I graduated from college and started my first job I went from making no money at all to earning $40K a year.  Suddenly I had all this money coming in and decided I wanted to invest some of it but didn’t know where.  I signed up for the Investors Business Daily  to learn more about investing and would pour through it every day during my lunch break and after work.  Soon I began working insanely long hours, with no time to read the paper so I canceled the service and dumped all my money into a mutual fund.

Service Referral
Fast forward to the present. I was visiting with a co-worker yesterday who subscribes to Investors Business Daily and always raves about the investing news and tools they provide.  He encouraged me to give it try but I balked since I’m used to reading all my financial information online.  When he mentioned they have an online digital edition as well and that I could sign up for a 4 week trial period I decided to check it out.

Free Trials
After researching the offer a little I realized this was a perfect example of how free trials are both sales tactics and good consumer screening tools. I would never sign up for a service that charged a monthly fee without knowing more about what value it would offer me in return for my money.  A referral is what began the process but my interest would never have made it past that initial conversation without the free trial.

So the sales tactic worked, it convinced me to sign up for a service I would not have otherwise.  Of course, this was a type of service I had already been interested in and had been considering so it benefits me as well.  The free trial allows me to see if I can put the financial information in Investors Business Daily to good use without costing me any cash.

Protecting My Paycheck
Since signing up for the free trial requires you to put your credit card on file, I was sure to check out the terms of the offer and the cancellation policy before signing up.

“For free trial access to eIBD and the IBD Investing Tools on investors.com, please enter your credit card information and billing address. You may cancel any time during the four-week free trial period. If you opt to cancel, you will not be billed. Otherwise, after your free trial period, we will bill you for your subscription automatically, at the current monthly rate of $28.95 (US). Thereafter, your eIBD subscription will renew automatically on a monthly basis, and we will charge the credit card we have on file.”

After calling the 1–800 number they provide to make sure I could easily cancel if I decided against the subscription I felt like I had covered my bases.

Trying It Out

After signing up for the free trial I was taken to an upsell page where I was given a long list of trial offers for other financial services and products. I opted against any of those and was taken to the confirmation page, one free trial at a time is enough to keep track of. The free offer was an effective selling tactic, now I just have to take advantage of the trial period and decide whether the service is for me or not.

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Can Losing Your Job Mean Finding Happiness?

What goes through your head when your boss stops by your cube and asks, “Do you have a minute?” As you follow them into the conference room a little voice in the back of your head wonders if the impromptu meeting will end with you being escorted out of the front door without a job.

I remember when we had a “Reduction in Forces” a while back; if you were pulled into a conference room it meant the end of the road.  People were led out of the office with their personal items in a box and tears on their cheeks.

Being Fired Stinks
I’m sorry to say Lazy Man had a rough day yesterday. I don’t know how it went down but I picture a somewhat similar scene.  I’ve never been delivered the bad news myself and I never want to be in that situation.  Although I’m a bit disenchanted with corporate America and often times fed up with my job I’d prefer to leave when I’m ready, rather than an abrupt flush down the toilet.  You work so hard to get ahead it really takes you by surprise when the company says thanks for playing, there’s the door.

Do Secure Jobs Exist?
In today’s society many “secure jobs” are only one bad earnings report away from an unemployment check.  Since at-will employment works both ways you never know what tomorrow will bring. I have a cartoon tacked to my cube wall where a younger boss says to an older man, “You’re the best there is at something we don’t need done anymore”.  The myriad of reasons a company might let you go can be a little nerve-wracking to think about.  Of course, it’s good to wrack those nerves so that you can be prepared in the event you do lose a primary source of income.

After Losing Your Job
Now that we’ve covered the negative, lets talk about the positive.  After the shock of being let go wears off, you automatically start to think about what’s next.  You look at life from a different perspective since certain assumptions and obligations no longer exist. As Lazy Man said:

“I’m a lot happier than I thought I’d be.  In fact I’ve never felt so free. This could fade or get old, but right now, it’s new and exciting.”

I have a good friend that lost his job unexpectedly several years ago and in hindsight it was a pretty good career move.  He went onto bigger and better things and found the job he really wanted. Of course it doesn’t happen like that for everyone.  It may be that you love your job and your life’s a mess after you’re fired.  It’s for times like those that we should try and be financially prepared for a layoff.

On the other hand sometimes we just can’t make ourselves let go of a “secure” job even though we’d really like to and losing it actually turns out to be a good thing.  Other times, we’re not wanting to leave but a layoff turns into new opportunities or a new direction in life.  If your job vanished into thin air tomorrow, what would you do?  Would losing your job help you find happiness?

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Are the Rich Necessary – A Non Book Review

Do you ever drive through a neighborhood with million dollar homes and wonder what the people that own them do for a living?  Do you ever look at Berkshire Hathaway stock and think to yourself “how in the world did Warren Buffet make all that money”? 

Rich people are a bit of a mystery to many of us.  I’ve never viewed the world from their perspective and sometimes find myself begrudging them for their success and vast resources.  I mean come on, who isn’t jealous of rich people now and then?  But without them, how would our economy survive?  Despite our occasionally envy of them, are they necessary to make the financial world go round?

Hunter Lewis recently released a book that discusses the question Are the Rich Necessary? I was given an advance copy of the book by the publisher to read and review but simply ran out of time.  There is an interesting review of the book by Thomas Kostigen on MarketWatch and another by Lisa Von Ahn from Reuters.

If you’re interested in reading the book, I’m giving away my copy.  Leave a comment on whether you think the rich are necessary or not. I’ll randomly select one commenter and send them my copy.  You might check out the articles first for some food for thought. Rich people shouldn’t leave comments, they can afford to buy their own copy : ) Just kidding of course, I’d like to hear perspectives from all sides.  Maybe we can get the rich Millionaire Mommy Next Door to lend her thoughts.

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Do You Fall for Free Trial Offers – Sales Tactics #7

Come on, sign up and give it a try.  The first 30 days are free, if you don’t like it just bring it back.

Sound familiar? How many times have you been talked into signing up for a service or buying a subscription because they offer a free trial?

“I’ll just see what it’s like”, you tell yourself.  “If I decide I don’t want it, I’ll just cancel.” The trial period goes by quickly, life gets busy, and suddenly the time to cancel has passed and you’ve been billed for the first month.  You call back to cancel when you see the charge come through on your card.  Sometimes they’ll give you a pro-rated refund other times they won’t give back a dime.

The free trial is an effective technique for sellers.  Their ideal scenario is that you will fall in love with their product or service and decide you must have it.  Another common situation is one where you aren’t really using their service but forget you signed up and the recurring payments on your credit card stay under your radar for a while before you cancel.

Of course a free trial can be a valuable offer to you as a consumer if there is a product or service you’d really like to try out before committing to it.  Just be aware that companies can use the free trial offer to entice you into closing the deal.

Warning Signs
• First 30 Days Free  • Absolutely No Obligation 
• Risk Free Trial        • First Issue Free
 

Tactic In Action
When I bought my last cell phone several years ago Sprint PCS was offering a 30 day trial of their Vision service that allowed you to browse their online content with your phone.  The salesperson convinced me to try the service when I activated my phone and sure enough the trial period came and went and I didn’t cancel. 

Not only did I get charged after the 30 days were over, Sprint also billed me for my “free trial”, they “forgot” to give it to me for free. The half hour I had to spend on the phone convincing customer service they had billed me incorrectly for something that was suppose to be free was definitely not worth the few minutes of time I surfed around the web on my phone.

Protect Your Paycheck
Trial Period Reminder – As soon as you sign up for a trial period, mark on your calendar two days before it ends to remind yourself to cancel.

Beware the Asterisk – Many free trial ads are followed by an asterisk that give the fine print of the offer.  Make sure you know the rules before giving anyone your credit card number.

Just Say No – Often times the process of canceling a free trial is more hassle than it’s worth.  Unless you’re actively looking to review and buy a product or service, just say no to free trials.

Sales Tactics
Free Trial Offer is the 7^th sales trick in the Sales Tactics Revealed series. Be sure to check out the first six if you haven’t already: Don’t Miss Out, You’ll Be Sorry, Buy Now, Pay Later, Rebate Ransom, Sales Events, and Preferred Customer.

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What Would You Do With a Million Dollars?

What would you do if you woke up tomorrow and had a million dollars?  Do you think your answers to that hypothetical question might change if you actually won a million dollars?

As I mentioned on QuickCents recently, Problogger had a cash giveaway where you were entered to win a variety of cash prizes by simply finishing the sentence, If I had a million dollars…. I didn’t read through all 742 answers but below is a paraphrased list of some of the responses:

• Give money to charity
• Fund a 529 Plan
• Research cancer
• Retire early
• Travel
• Pay off mortgage
• Tithe to church
• Pay down student loans
• Quit my job
• Spoil my family
• Pay off credit card
• Buy a house
• Invest in my business
• Buy a car
• Invest the money
• Buy a computer
• Go back to school
• Buy an island
• Go on vacation
• Buy parents a house
• Ski everyday
• Buy stuff
• Take care of my family
• Hire a maid
• Become a writer
• Buy a boat

There were many recurring themes such as get out of debt, charitable giving, helping family members, investing, and travel but my favorite answer was:

“If I had a million dollars… I don’t have an idea what would I do.”

It’s hard to say exactly what you’d do with that much money. Making your own million dollar list is a good exercise because it can highlight what things may be holding you back in life (debt) and also what you’d really like to do with your life (travel/philanthropy/etc).  But I wonder once you actually had the cold hard cash in hand, minus taxes of course, would your plans change? 

Despite inflation and the falling dollar, $1 million is still a lot of money; the kind of money that can really change your life.  Is it possible to say now what you’d actually do if you had that big lump of money sitting in your bank account?

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Personal Finance Review – Installing a Patio Edition

I don’t remember the last time I was this sore! We spent all weekend putting in a Pavestone patio with the help of my wife’s parents (thanks guys!).

We hit a few roadblocks along the way but managed to overcome them and now have a new back patio!  We still have one more step left to take but we’ll wait a while until our tired muscles and backs recover.  Not only did it cost less to do it ourselves, we picked up a few cool new tools and learned how to install a patio.  Needless to say I didn’t have much time for reading about personal finance but here are some articles I noticed.

–Stop Worrying About How You Got Into Debt and Start Focusing On How To Get Out @ The Digerati Life

–Baby Bonds or Lazy Man’s Trust Fund @ Lazy Man & Money

–Did You Miss the Rally? @ Suns Financial Diary

–Looking At Life From A Stock Market Perspective @ Money, Matter, & More

–October 1-7 is Financial Planning Week @ Generation X Finance

–The Christian Perspective on Debt @ Free Money Finance

–What To Do During A Recession @ Blueprint for Financial Prosperity

–Credit Bureaus to Offer Credit Freezes to Customers Nationwide @ Five Cent Nickel

–Save Money with a Roth IRA @ No Credit Needed

–How to List an eBay Auction for Maximum Profit @ Get Rich Slowly

–Money Lesson: Investment Vehicles @ Moolanomy

–Tips On How To Cancel A Credit Card… Profitably! @ My Money Blog

–Ten Steps To Financial Success For A Minimum Wage Earner @ The Simple Dollar

The unfortunate Dividend Guy lost his feedbuner feed, anyone who was a reader can get the new feed here. Thanks to My Retirement Blog for hosting last week’s Carnival of Personal Finance!

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How Do You Thank Your Coworkers Without Breaking the Bank?

Every quarter things get really busy at my job and everyone works like mad to get things done on time.  Teams stay all night and work weekends, it really sucks for the people involved.

Since the majority of people are salaried employees, there is no incentive for staying late and working insane hours.  As a team lead, saying “thanks a lot, I really appreciate your help” tends to ring hollow quarter after quarter.

Of course the nice thing to do is treat them to a dinner or lunch or buy them a gift card.  But if you figure you have 10 people to thank @ $10 for a meal or gift card, that’s $100. Multiply that by 4 times a year and you’re looking at spending $400 a year.

Why do I struggle with this? We all just worked a lot of overtime without pay to ensure the company earns more money, why are we the ones paying each other for recognition? The current company recognition program will earn anyone submitted a crappy metal pin.  Frankly, I’m almost insulted every time I get one.  So my evenings and weekends away from my family are worth a tacky pin?

Is there any way to show your co-workers and team members you appreciate their hard work without shelling out money from your own pocket or is that the only way to make a genuine gesture?  What non-cheesy techniques do you use to express gratitude to people at your job?

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Why Selling on eBay is a Great Way to Make Extra Money

Get a free tutorial on how you can start your own Easy eBay Business

Anytime someone is looking for an easy way to earn some extra money, I recommend eBay since it shows quick results, is simple to get started, and has a low cost of entry.

Quick Results
One problem many people run into when trying to earn extra money is that they start out eager to generate extra income on the web but lose steam when their hard work doesn’t immediately turn into profits. In my experience, eBay is a great way to overcome this roadblock since you can start seeing the results of adding extra income in a relatively short period of time.

Simple Startup
In addition to the motivation issues I mention above, another obstacle to creating a side income is not knowing how to get started.  Since the eBay website provides an abundance of resources on how to sell on eBay, the beginning steps to selling online are pretty much laid out for you.  If you already shop online, selling online isn’t that much more difficult with eBay.

Low Cost of Entry
Another reason eBay is a good place to earn extra income is the low cost of doing business there.  Your selling fees are the largest cost of doing business and are proportionate to the amount of items you list and sell.  You don’t need a lot of money to get started just selling a few items.

Gateway Income
One thing that’s a little intimidating about earning extra money is that you often have to spend/invest cash in order to make more.  It’s easy to avoid taking the initial risk since we don’t want to lose the money we already have.  Once you figure out how to sell on eBay, you discover a tried and true way to make extra money. 

At that point you’re a little more open to re-investing that money, you know if you lose it you can always make more.  That’s why I think of eBay earnings as a sort of gateway income. Money you can use to expand your earning potential, either through additional business on eBay or other methods you’re interested in.

eBay Training
If you couldn’t tell from this post, I’m a big fan of eBay : )  I’m working on a guide to selling on eBay if you’re interested in learning more check out the free tutorial for an Easy eBay Business.

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