Personal Finance for Sports Fans – Ignore the Analysts & the Hype
Which would you rather do, watch sports or learn about personal finances? What if I told you that you could do both! There are good personal finance lessons to be found in the many exciting games of the upcoming NCAA Men’s basketball tournament. This is the first in a series of posts that will cover some of these lessons.
Ignore the Analysts
As selection Sunday approached, everyone had their opinion about who would make it into the big dance and who would miss out. Any coach would tell you the only way to guarantee a spot in the tournament is to keep winning. They tell their players to ignore the noise and focus on their game.
There are always going to be analysts who speculate about interest rates, oil prices, foreign wars, and unemployment. They debate whether it will be a bear market or a bull market, an up year or a down year. The basic principles of personal finance tell us to block out this noise and stick to the basics. The only way to guarantee long-term financial success is to spend less than you earn, start saving & investing early, and insure your health and assets.
Ignore the Hype
When you’re a low seed squaring off against a high seed you tend to be pretty nervous. Your opponent has been built up in the media all year long; there is a ton of hype surrounding the team’s players, coach, history, record, etc. The best way to lose the game is to listen to the media and buy into the hype. If the lower seed can block out the noise, stick to the basics, and play their heart out they may have a chance of coming out on top.
In the world of finance there’s always some revolutionary new company or new product that the media falls in love with. The CEO will be on the cover of Business Week, the company’s IPO will rocket out of the gate, and everyone will be sure they’re going to make a killing off of the stock.
The best thing you can do is ignore the hype about the company and stick with regular investments into a diversified portfolio. If the media hype is convincing and you decide you have to buy into the company, do it as part of your overall portfolio. I’m one of the people that just bought on hype in the dot com bubble and I won’t make that mistake again. I encourage you to avoid it as well.
Ten Ways to Ask for a Lower Price or a Better Deal
Have you ever been quoted a base price then blindsided with additional fees? Just the other day, I was shipping some recent eBay sales at the UPS store and they charged me a $4.50 “Rural Surcharge Fee” on a package whose base shipping price was $9.
I’ve seen this fee pop up before on shipments costing $15 or $20 but this was too much. The fees raised the cost of shipping by 50% so I brought it up with the guy and he ended up waiving the fee for me. This experience reminded me that sometimes all you have to do to get a better price is ask. Here are ten different ways to go about it.
Be Diplomatic
“I know your policy says you have to charge everyone this fee but I do all my business here because I like the service you provide and even refer my friends to you. Wouldn’t it make sense to waive the fee for a valuable customer like me?”
Loose Your Cool
Throw your receipt and pen in the air, kick a box or smack the counter, and yell, “I can’t take all these extra fees anymore! Give the base price or I’m walking away! Well, what do you say?!”
Mention the Competition
“Wow, that’s a lot more than FedEx. I guess I’ll be going there next time unless you guys can give me a better deal.”
Make it Personal
Scowl at the salesperson. “Every time I come in here, you charge me this extra fee. I don’t see you making anyone else pay it!”
Question Blitzkrieg
Overwhelm them with questions. “What’s the fee for? How far do you have to live from city limits for it to kick in? How much do you charge per mile? Is it charged in all cities? How come it wasn’t on the shipping calculator? How often will I have to pay this? Does FedEx charge this fee? Is this a new policy?” Fire away until they’re flustered then demand a better deal.
Broke as a Joke
“Uh oh. I didn’t know anything about this fee. I didn’t bring enough to pay this extra amount and I have to get this shipped out today. Can’t you waive the fee for me?”
Be Flirtatious
Obviously this won’t work for everyone but if you’ve got charm, now’s the time to turn it on. Work your magic to drop the price or waive the fee.
Promise Future Business
“My company mails 30 packages a week and I’m looking for a new shipping company. Low shipping costs are vital to my business. I’d like to start bringing all of my packages here if we could work something out about these prices.”
Best Buds
Treat the salesperson like your best friend. Make them like you and they’ll feel bad not getting you the lowest price. This one is pre-emptive, be nice from the second you walk into the store or they’ll smell a phony.
Simply Ask for a Better Deal
They’re in business to make money and won’t give you a lower price unless you ask. Ask them straight up, “What can I do to get a lower price?” I saved this one for last because some variation of this question should be used as a closer no matter which tactic you choose. You can’t get a better deal if you don’t ask.
Corporate Cubicle Politics – Why Size Matters in the Office
Would you turn down a bigger office or bigger cubicle if your boss offered it you? I did and now I’m questioning my decision.
The Cubicle Decision
My boss stopped by last week to ask if I wanted to move into a large cube recently vacated when another team leader on our floor moved groups. I quickly answered no way and he proceeded to offer the cube to someone else.
Why I Said No
I opted out of the larger cube for several reasons:
- A bigger cube is just more space to mess up.
- Moving cubes would be a pain. I have enough work to do; I don’t want to lose part of a day moving.
- I didn’t want to give my team the impression I was “more important” than them by moving into a larger cube.
Second Guessing My Decision
During a team meeting later in the day my boss announced the replacement team lead and mentioned he would be moving into the big cube. When visiting with someone after the meeting they mentioned they were sorry I didn’t get the big cube. I then realized that in everyone else’s eyes, I had been passed up in favor of the incoming team lead.
Why Size Matters
Every other team lead on the floor has a big cube. The mental association with progress in the corporate world is that you graduate cubes or offices as you advance. When someone sees you have a larger working space than others they automatically assume you have additional authority, competency, salary, and knowledge. This may result in them giving you preferential treatment.
Right or wrong, this often seems to be the impression the status symbol of an office or cube size indicates. In passing up an opportunity to upgrade, I had also been passing up on this social capital.
Was it a Mistake?
The reasons I listed for turning down the larger cube still apply, but in making this move I’m not playing by the “corporate rules”. Is my goal in life to get a bigger cube or office? No way! However, my goal is to earn more money for my family. Did my cubicle decision lose me social capital that could slow my rise up the corporate ladder?
Flexible Spending Account Deadlines Approaching
Use it or lose it! The deadline to spend your flexible spending account balance for your 2006 contributions is March 15th. So fill your prescriptions, make your doctor’s visits, or buy over the counter cold medicine next week if you haven’t spent your balance yet.
The deadline for submitting your receipts for 2006 purchases is at the end of this month, March 31. I frequently procrastinate and send my receipts in at the last minute. The deadline always seems to creep up on me but not this year. I’ll be submitting my information on Monday, make sure you get yours in as well.
Personal Finance Week in Review
Jim does a summary of his Devil’s Advocate series to date and asks readers for more topics.
Looking for fast and easy ways to save some money? You’re in luck! The Simple Dollar has started a series called Five Minute Finances that covers simple things you can do save some money. The latest is Make a Sandwich (or Something Else).
Henry causes an uproar in Arkansas when he points out that there may be a reason why the cost of living is lower in some cities. Maybe they’re just boring?
I was dismayed to check out the Sun’s article on Morningstar’s best and worst 529 plans and discovered mine was in the bottom 5. Go see how yours stacks up
Ever wonder what those rich celebrities do with all their money. Lazyman talks about some celebrities attitudes towards money.
Jeremy started a great series this week called 24 Signs That You Could be in Financial Trouble. He’s already given the first 4, go check out the list.
How many days have you come home from work swearing you’ll never go back to that #*@% job again! The Silicon Valley Blogger gives us a how-to guide with A Job Quitter’s Primer: 25 Reasons To Leave Your Job and A Quitters Primer – 15 Ways to Resign
Ever have questions about your credit history? Take a look at a comprehensive article by Golbguru about credit scores.
JD at Get Rich Slowly shares a list of his favorite personal finance books.
Festival of Under 30 Finances – Money & Love Edition
Welcome to the Festival of Love, otherwise known as the Festival of Under 30 Finances. We had some interesting questions to this week’s question, “What is the worst money move you’ve made either because of or in spite of LOVE?”
Wanda, “I spent $550 on cell phone bills over a span of 2 months. I was in a long-distance relationship at that time, and when my parents found out they were quite displeased. I paid the bills and didn’t feel really sorry. But now that I think about it, it’s ALOT of money. Still, it’s water under the bridge now, and I think I’ve learned my lession: LDRs are expensive.”
Nina, “Lessons learned: always have a financial exit strategy in relationships.”
Aridni, “I bought my first property with my husband out of love for him… now I’m addicted.”
Living Almost Large, “My best and worse money moves were predicated for love”
ISPF, “I turned down a very lucrative job offer so that the better half and I could stay close by. Financially, it was a bad move. Emotionally and relationship wise, the best one! Money, just cant compete with love (boy, that sounds cheesy even to me, but it had to be said 🙂 ”
Wenchypoo, “Worst money move: letting my new husband drive my 1967 Camaro in the snow – he wrapped it around a guard rail and that was the end of an asset that is probably worth $25k today. That’s what happens when you get married, are all giddy in love and hormones, and find out later that neither one of you are capable of balancing the checkbook…except on your nose! We rode the bus for awhile until we saved up to buy another car at auction – we also went to an all-cash lifestyle. GEICO would probably thank me for losing the Camaro, gaining a cash-paid Buick, and paying the annual insurance in advance.”
English Major, “I managed the process of moving in with my boyfriend from across the country. It was kind of unavoidable (his existing lease would run out just as I was getting back to New York from school), but it still meant that I didn’t always have the most up-to-date information or hands-on control of the financial process. Because of some vagaries of the apartment-hunting process, he still owes me about $1,000 that’s (still) tied up in his last apartment’s deposit.”
There were a wide variety of entries in the Festival, here they are listed by categories: Love & Money, Investing, Taxes, Saving Money, Credit Cards, Real Estate, & Other
Love & Money
Nina Smith presents Sleeping with Money: Safeguard Finances Before The Break-Up posted at Queercents
living almost large presents My Best and Worse Money Moves posted at Living Almost Large
John presents Sleeping with Money: Lessons Not Learned from Sex and the City posted at Queercents
InvestingWilson Ng presents Profits Straight to the Bottom Line posted at Reflections of a BizDrivenLife, saying, “Understanding the financial cost structure of the company, in optimizing the profit bottom line.”
H.S. Ayoub presents Sirius Buys XM Radio: What Should Investors Do Now? posted at SciTech Investor.
Larry Russell presents The Solution – ONLY follow financial strategies that are scientific, passive, diversified, savings focused, risk controlled, low cost, and tax efficient posted at THE SKILLED INVESTOR Blog, saying, “In general, individuals will benefit greatly, if they decide ONLY to follow financial and investment strategies that are: a) scientifically grounded, b) completely passive, c) thoroughly diversified, d) savings focused, e) risk adjusted, f) cost effective, and g) tax efficient.”
Ybother presents Top 10 Reasons Wall Street Gives for the Stock Market Correction posted at TodaysTen.com: Daily Top Ten List to jumpstart your knowledge, saying, “Why did the stock market fall so suddenly and by so much? Wall street tries to explain”
John1212 presents Hedge fund investing guide 101 posted at OhCash.com.
Wanda presents 401(k) choices: Vanguard vs. T. Rowe Price? posted at Wanda, saying, “I spent $550 on cell phone bills over a span of 2 months. I was in a long-distance relationship at that time, and when my parents found out they were quite displeased. I paid the bills and didn’t feel really sorry. But now that I think about it, it’s ALOT of money. Still, it’s water under the bridge now, and I think I’ve learned my lession: LDRs are expensive.”
English Major presents Ouch: Experiencing Volatility posted at An English Major’s Money
TaxesBill presents Saving On Taxes posted at Ask Uncle Bill, saying, “It’s not brain surgery.”
Bill presents Taxes and the Three Martini Lunch posted at Ask Uncle Bill, saying, “it’s that time of year.”
Saving MoneyMatthew Paulson presents 25 Realistic Ways to Spend Less and Save Money in College. posted at Getting Green.
Ybother presents Top 10 Money Tips For Almost Everyone posted at TodaysTen.com: Daily Top Ten List to jumpstart your knowledge, saying, “10 tips for almost anyone. Motivates you to get interested in your money!”
Silicon Valley Blogger presents Are Mail-In Rebates Worth The Hassle? posted at The Digerati Life.
Credit CardsSagar Satapathy presents Little Known Facts about Credit Cards posted at Credit Card Lowdown.Mr Credit Card presents Joint or Seperate Credit Card Account? posted at Ask Mr Credit Card’s Blog
Real EstateAlex at The RE Forum presents Refuting “Facts” at RealtyTimes.com posted at The RE Forum, saying, “Real estate myth-busters, real estate news and trends for first-time home buyers and first-time home sellers, financial incentives”
Super Saver presents Is It Time To Buy Real Estate? posted at My Wealth Builder
Michael Cook presents How to Find the Right Mortgage posted at Suite101: Buying/Selling a Home articles.
Michelle presents How to purchase a rental property posted at Aridni
OtherWenchypoo presents How I Create (and Re-Create) My Own Kitchen Convenience posted at Wisdom From Wenchypoo’s Mental Wastebasket
FrugalTrader presents Reader Comment: Newborn Baby Expenses! posted at Million Dollar Journey.
Nenad Ristic presents Money Conciousness » What is Money? posted at Money Conciousness.
Thanks for reading, be sure to check out the next edition of the festival over at Money Crashers. Have a great weekenend!
Selective Self Control Can Lead to a Thick Wallet but an Even Thicker Waist
Have you ever been accused of having a selective memory? Only remembering the things that you want to? Well I think I have something even worse, selective self-control.
Using Money Responsibly
I like to think of myself as the Stonewall Jackson of frugality, no offer or ad can get past my staunch defense. I hate spending money and I thoroughly enjoy accumulating and growing it. Thanks to my parents’ upbringing, I have a talent that many people in our country do not. I can spend less than I make without breaking a sweat. Credit cards balances, home equity loans, 90-day same as cash, and tech gadgets galore stand no chance against my will to grow our net worth. Unfortunately, this iron-clad self control doesn’t exhibit itself in all areas of my life.
Eating in Moderation
My teens and early twenties were a smorgasbord of eating. Thanks to regular exercise and healthy food choices, I could eat, and eat, and eat while maintaining a trim figure. My friends still give me a hard time for a legendary seafood buffet experience in Fort Lauderdale. I epitomize the ad that says, you can’t have just one. Unfortunately for me I think the party is over. Career circumstances and the arrival of a new baby have led to a drastic reduction in exercise and a surprising increase in garbage food intake.
Practicing What I Preach
Self-control, consistency, and patience have been the secret to my success thus far with personal finance. Anyone could follow the same formula; it’s mostly a matter of willing your way to constant growth. However, I ask myself, how can I expect my readers to follow suit financially, when I am practicing selective self-control? If I can’t throttle back on the eat-o-meter, why should I expect them to scale down the spend-o-meter and up the save-o-meter?
My Commitment
I’ll keep on writing about smart personal finances as long as I can maintain smart personal health. If my health habits slide, I’ll stop writing until they bounce back. I very much enjoy maintaining this site so that should be good motivation for me to strive to be both healthy and wealthy. As far as being wise, I’ll have to leave that for another day.
Entrepreneurship Week Wrap Up
Thanks to everyone for putting up with my entrepreneur kick over the last week. As you might have gathered from some of my posts, having or finding an entrepreneurial spirit is important to me. I think that even though it may be hard work, the ability to earn money for yourself can give you a little more freedom in life.
Entrepreneur Interviews
My favorite part of the last week was interacting with and learning from a variety of different entrepreneurs. I’ve actually only published two of the interviews so far, Generation X Finance and John T Unger so stay tuned as I continue to roll them out.
Resources & Guest Articles
I pointed you towards some resources for starting a business with in Do You Have What it Takes to Start a Business and 10 Steps to Starting a Business and featured a guest article about how college students can get started, Great Small Business Ideas for College Students.
My Thoughts on Being an Entrepreneur
I highlighted some pros, Ten Reasons Why You Should Become an Entrepreneur Today, and cons, Ten Reasons Why It’s Tough to be an Entrepreneur, of entrepreneurship and finished it up with a discussion of being a Full Time vs. Part Time entrepreneur.
I learned a lot this past week and hope you picked something up as well. I have some new ideas as a result of some of my research and am excited to share them with you in the future!
Payback Time for Payday Loans – Contest Winner
Thanks to everyone that participated in the Payday Loan Payback contest! I’ve listed the two stories that were submitted below and have bolded some key points.
Charles Rady
I’ve used one in Florida…..right after hurricane “Charley” came through and wrecked my house. I needed the fast cash to do some immediate repairs, but ended up in a cycle due to the high interest and payed them over and over again until I could catch up a year later. The interest was just below 25% and you had to pay on time or you stood a chance of not getting another one or paying more.
Emm
I am currently trying to pay off a payday loan. It started in October 06 when I went to visit my mom down south. I ended up going out with my brother and his family to more places than originally planned (more $), went to the mall and bought some clothes because it was too hot to wear the ones I brought down with me, my mom needed a couple of things repaired in her apartment, she’s on a fixed income and I paid for them. When I got home and tallied everything up, I had less money than I thought. I spent more than I should have. I took out a $400 payday loan to ease the pain. The biweekly “interest” on a $400 loan is $88. So, you have to either pay $488 to pay the loan off completely or pay $88 interest to “roll over”. After that my car broke down and I had to roll over the loan a few times. Then it was Christmas and I had no money, so of course, I ADDED to the loan – another $400 to cover the shortage. Now the interest payments are $176 every two weeks. I can’t afford to pay down the loan because the interest payments are eating up all my available money.
I’ve been saving a bit of money every day for the last couple of months, 3 dollars a day exactly, as suggested by Brian Flemming’s blog – the Million Dollar Club. About 3 weeks ago I put in overtime at work. Between the overtime and part of my little savings pile, I paid down half the loan. Last pay period I paid down an additional $100 towards the loan. Next pay period I will be paying off the rest of the loan even if it means $25 left for groceries!
The interest rates for these things are too high! If you need the loan, you will not be able to pay it back. At least not until you roll it over a bunch of times and pay a huge amount of interest. I didn’t have any money put aside for savings before this, I didn’t save enough for my trip, and I didn’t plan ahead for an unexpected expense and for Christmas. It was my lack of planning that caused me to pay all these fees. HOWEVER, the loan companies charge a huge interest rate. These companies are rolling in huge profits. And they even make you sign a paper stating the clerk has told you how much you are approved for. I don’t remember exactly, but I was approved for almost $1000 loan. Much more than I could ever pay back with those types of rollover fees/interest.
I’m now saving every day. I wish I would have saved the $176 every two weeks towards an emergency fund instead. My outlook and discipline has definitely changed. I’ve discovered personal finance blogs as a result. But it was a costly experience. Sorry, long post…
Winner
I’m flipping a coin, Emm heads, Charles tails. The winner is ….. Emm. Congratulations, I’ll email you to find out your PayPal email. Thank you Charles and Emm for sharing your stories, hopefully someone will learn from your experience.
Are Colleges Creating a Legacy of Credit Card Debt for Students and Alumni?
If you don’t graduate with credit card debt your alma mater may try and help you accumulate some once you’re gone.
Not only are some schools allowing credit card marketing to students on campus, selling their students’ personal information to credit card issuers, and failing to provide student education on the proper use of credit cards but now they’re peddling credit cards to their alumni. I recently received the offer below from the school where I earned my undergraduate degree.
I don’t know whether the school gave my information to credit card vendors while I was in school but obviously they feel comfortable doing so after graduation. They lead off the ad encouraging their alumni to carry more than one credit card. Many people graduating today already leave college with student loans and some credit card debt, why are schools pushing us to accumulate more?
The motivation behind the campaign is obvious, you can “support your alma mater” every time you swipe the card. In my opinion, most of us already helped support our school by paying thousands of dollars of tuition for four years. Why would we be interested in supporting them by giving them a cut of all credit card debt we acquire? Of course, used responsibly, alumni cards could be a simple way to support your school. However, statistics show that most of us don’t use credit cards responsibly. In light of this it seems a valid question to ask, what kind of legacy are schools leaving with their credit card policies?
Enter Your Email below to request free access to the member newsletter and article updates.
I'm Ben Edwards and I've been addicted to personal finance since I was 12 years old.
That passion for money has paid off for my family - so in 2006 I founded Money Smart Life to help you afford the life that you want. Read My Story...
