How Do You Choose an Online Broker?

Choosing an online discount broker isn’t a simple task if you’re anything like me.  There are many companies to choose from, each of which has different strengths and weaknesses and you want to be sure to choose the best one for you.  Just like picking a bank, insurance company, mortagage lender, or other financial service company you probably go back and forth over the decision because the one you choose will have an impact on whether your money is put to good use.

Discount Broker Reviews

Luckily for us, SmartMoney magazine conducts an annual broker survey where they evaluate the online brokerages on a number of criteria and come up with a list of the worst and best online brokers.

The survey rates each discount broker from one to five stars in each category to come up with category winners; and also picks an overall winner.  This year’s survey is coming out in the latest edition of SmartMoney so we don’t know quite yet who the best are in each category.

I’m curious which aspects matter the most to you when choosing an online broker.  Here are the categories that the survey rates:

• Commissions & Fees
• Investment Products & Mutual Funds
• Customer Service
• Trading Tools
• Banking Services
• Research

Which of these are most important to you?

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Make Extra Money Selling Legos?

Making extra money is something that all of us have probably felt the need to do at one point or another in our lives. There are many different ways to bring in some extra cash, the trick is to find work you can do or something you can sell that fits into your current life situation.

For example if you already have a full time job, you could get a part-time job in the evenings. Of course you have to consider things like how far away you’d have to travel, how much money you’d be making, any related child card expenses, etc

It’s not always easy to find the “perfect” side job that earns you a nice amount of money compared to the work you have to put in and is something that you enjoy. Fortunately for our family, my wife found a part-time job that worked really well for us after she left her full time position a few years ago. However, it’s looking more and more like she might be losing that job due to budget cuts.

This has us thinking lately of ways we can make extra money and reminded me of a video I made a while ago for everyone on the Money Smart Life newsletter. The video talks about a former co-worker of mine who makes enough money in his side job to pay his mortgage each month by selling Legos. I remember hearing him talk excitedly about the idea when he first started his venture and each year he started making more and more money.

I have to warn you, it’s one of my first videos so it’s a little long and I use a monotone voice so it’s not very exciting, but I think the information is good so it might be worth a few minutes of your time to check it out the link below if you’re looking to make some extra side money.

Make Extra Money with Legos

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Six Credit Card Rewards Tips to Maximize Your Points

How you earn and redeem credit card rewards points can make a big difference on how much money your cash back or travel rewards program can end up putting in your pocket.  Like any other tool, even the best rewards credit cards won’t give you the ideal results if not used properly. Here are some things to keep in mind when earning and redeeming rewards points.

Watch for Rewards Promotions

Chase is running a promotion this summer where certain cards earn you 10 points for each dollar you spend on qualified categories.  As I mentioned when covering this Chase Sapphire bonus, this effectively amounts to 10% cashback for a few months, which is a really good offer.

Keep an eye on your mailbox and your email for similar promotions.  Sometimes credit card companies announce these with a flyer in your bill envelope and other times it’s a separate mailing specifically for the promotion.  In my case I got something in the mail and an email about it as well.

Earn Seasonal Cashback

Cards like Discover pay different rewards rates for certain categories during different times of the year.  If you have more than one rewards card, make sure you’re aware if any of them offer different rates during different seasons.

For example, during the first quarter of this year you could have earned 5% cashback on travel related spending through Discover .  So if you were travelling for Spring Break, that might have been the best card to use for the highest rewards.

For the second quarter, the promotion switches to home and fashion so if you’re doing house projects this summer and choosing between Discover and another card in your wallet when checking out at Home Depot or Lowes, your highest cashback option might be the Discover card.

Pay Your Credit Card Bill on Time

I was reminded of this this today as I looked over my bill for my American Express Blue Cash card and saw that my rewards payout is coming up this month.  I also noticed the following note:

“Remember to pay at least the minimum due, by the payment due date, to avoid cash rebate forfeiture.”

Of course you want to avoid late payments so you’re not hit with fees and interest, but you also want to avoid losing any rewards points that you’ve earned.  One thing I do to make sure I don’t have to worry about this is schedule my payment to go out a few days early.  That way in case there is any problem with my payment I still have time to handle it and not have to worry about losing rewards points.

Check the policies of your rewards card and see what their policies are how late or missed payments effect your rewards.

Know the Rewards Tiers

Most rewards program have specific rules about the points or cashback you earn based on how much, or how little, you spend in certain areas.

For example, some cards pay a lower cash back percentage for each dollar until you’ve spent a minimum amount of money.  At that point your cashback percentage bumps up to a higer tier and you earn more money.  Knowing which spending tier you’re in can help you choose your card that will earn you the most.

Other cards cap the amount you can earn in a certain category during a given time frame. If you’ve already earned the maximum amount for a category, you’ll want to use a different rewards card until that time period has ended.

Be Smart About Redeeming Rewards Points

Depending on the program there are various ways to reedem your rewards points, such as:

• Turn them in for cash or gift cards
• Earn a statement credit
• Apply rewards towards a purchase

How far your money goes may depend on how you use your points, you may get more bang for your buck by getting a gift card then requesting the cash back.  However, when evaluating your options, keep in mind the reason you signed up for the reward card in the first place.

For example, when I opened our AmEx blue cash card, my goal was to earn cashback so I use it just to help us take a bite out of our bills.  I periodically get offers in the mail suggesting other ways I could use the rewards I’m accumulating but I stick to my plan.

Another thing to keep in mind, if your cash back is applied as a statement credit, rather than you getting a check, don’t be tempted to spend more that month simply because you’re getting your reward. 

Get Your Rewards!

Cards like Chase Freedom and Chase Sapphire let you log into your account and decide how you’ll use your points.  The choices you have through their Ultimate Rewards program are nice but it also means you don’t get your money or rewards until you ask for it.

Keep an eye on how your points are accumulating. When you have enough points, login and redeem them!

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TradeKing Promotion for New Accounts

TradeKing Bonus – $50

TradeKing promotions like this latest $50 referral bonus help explain why the number of investors opening a TradeKing account grew by about 50% last year.  According to the online brokerage, many of these people were new to self directed investing so they’ve focused heavily on education and training for new investors.

The current promotion gives new customers a $50 bonus if they’re referred by an existing investor, then deposit money into the new account and make a trade. TradeKing doesn’t leave new customers hanging; they offer new client orientation webinars where they go over a range of topics like monthly statements / trade confirms, how to place orders, and how to track trades for tax purposes.

TradeKing Training

As a TradeKing customer I get their training annoucements every 2–3 weeks where they publish thier schedule of education webinars.  As I mentioned, some are specifically for new customers, such as explaining the difference between Market, Limit, Stop and Stop Limit orders and how to read market data (the bid, the ask, size, and volume).  The webinars also cover more advanced topics like trailing stops, Candlestick charting, and stock trends (ex: CBOE Equity Put/Call Ratio, CBOE Volatility Index, Acceleration Bands).

TradeKing Referrals

While there are lots of online stock brokerages to choose from, not many offer a $50 referral bonus like TradeKing.  Of course customers aren’t just opening an account for the cash promotion, the quality of the brokerage is what’s really important.  It doesn’t hurt that TradeKing has consistently received high marks over the last few years:

• SmartMoney magazine gave TradeKing a five-star rating for both the quality of its service and trading tools.
• Barron’s Online Broker survey has given TradeKing a 4 out of 5 star rating for four consecutive years.

• Wall Street & Technology featured TradeKing as one of the most innovative investment firms

This latest promotion only runs through the start of next month, for more details on the TradeKing bonus click here.

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Sell Your House Faster By Fixing These Problems

If you’re trying to sell your house, you’ll have to fill out a Sellers Disclosure form that alerts potential buyers to any possible problems with your home.

If you put your house on the market and your Sellers Disclosure form has a long list of issues, buyers may walk away and look for a different house that needs less work.  Or they may ask for a lower price or for money in an escrow account to pay for fixing the problems.

Any of those scenarios stand in the way of you selling your house quickly and at market value so it’s best to resolve these problems before listing your house for sale.  We just went through and filled out our disclosure form as we prepare our house for sale. Here’s a list of things you’ll likely be required to document; if you make sure they’re not a problem then you should be able to sell your house faster and closer to your asking price.

• Any settling dirt, poor grading, and drainage problems
• Roof age & condition (roof leakage caused by old or damaged shingles or improper flashing)
• Bugs infestations (termites or other wood destroying insects)
• Structural issues (foundation walls, floor joists, rafters, and door headers)
• Shifting or movement of house (foundation, walls, crawl space, slab)
• Water leakage and dry rot
• Fireplace or chimney problems
• Plumbing leaks
• Electrical issues (inadequate overload protection, faulty wiring)
• Mold & radon testing

Here are some other problems that would give a buyer reason to hesitate that are also documented in the Seller’s Disclosure.  If you’re plagued by any of these it’s best to have them resolved before trying to sell.

• Liens on your house
• Zoning violations
• Unpaid Home Owners Association fees
• Problems with the title
• Ongoing litigation or settlement on the property

You’ll also likely be asked for the last service date of your air conditioning system, furnace, and water heater so you may want to have those serviced before listing your house.

Home Inspections

I asked our real estate agent if we should hire a home inspector to do a property inspection to prove to buyers we weren’t experiencing any of these problems.  He pointed out that the buyers will want to hire someone they know and trust to do the inspection so even if we paid someone to inspect the house, chances are that the buyer wouldn’t trust it and would hire someone else.

We decided not to pay for our own home inspection as a seller; however, if you suspect you might have some of the issues covered it’s a good idea to have a qualified professional come take a look. Tapping into your friends and family is a good way to find an experienced contractor and another good source is to choose a highly rated company on Angies List.

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How to Find a Realtor to Sell Your House

When you have a house for sale, you want local realtors who know your area and will get your home in the mls listings and on realtor.com

Unless you live in a small town you’ll probably find lots of real estate agents who meet those property listing criteria so how do you find the best realtors to sell your house?

As we interviewed agents I asked around for tips on choosing a real estate agent and what questions we should ask them.  Here are some comments from other bloggers and good questions  to ask your realtor.  Of course there was some overlap in suggestions but that probably indicates those are important questions to ask so I didn’t edit them out. 

Everyone was generous with their time and I got some pretty detailed answers; in some cases I’ve excerpted some of their suggestions:

Jason from Frugal Dad:

• How long they’ve been selling houses/how many houses have they sold?
• Are they familiar with your neighborhood or part of town?
• What’s the average days on market for properties they’ve sold in the past year or two?
• Is their commission negotiable (it’s a long shot, but worth asking).  

Sun from Suns Financial Diary:

Ask the realtor to give you a list of houses sold in your area and the houses they sold. If they are not referred to you by others, you can ask for some references as well to make sure they are not pushy.

Phil from PT Money:

Ask what are their different channels for advertising your home? What sets them apart from other realtors?

Kevin from No Debt Plan:

• Are you willing to take a discounted commission?
• What is your ratio of homes listed vs. homes sold (or homes listed vs. homes sold vs. offers on homes, etc.)?

Craig from Free From Broke:

Find out what their exclusive agreement is. In other words, how long do you have to use them. If things aren’t working out can you fire them?

DR from Dough Roller:

• How many homes of your sold? How many in our neighborhood/school district?
• What would you suggest we list our home for and why?
• How would you market the home? Website, mailing, newsletter, etc?
• What, if anything, would you suggest we do to the home before listing it?
• How many homes do you have listed now and how long have they been on the market?
• Can we get references from the last three homes that you listed/sold?

Pinyo from Moolanomy:

Pre-negotiate a discount if they turn out to represent both you and the buyer.

Jeff Rose from Good Financial Cents shared his recent home selling experience:

Our old house was in a mature and well known area in a community that is considered to be in the best school district in the county. We didn’t think we would have an issue selling our home.

We put on on For Sale by Owner.com, took out a few ads in the newspaper, put up some signs along some highly trafficked areas. In the first weekend, we had an offer, but then fell through to financing. A month later, had a 2nd offer, with the same result. After that, it went cold for about 6 months.

We weren’t in a hurry to sell…at first, but our house was nearing completion. We dropped the price, had a few lookers, but no offers. Finally, we settled on an agent (Century 21) and had our house sold in 3 weeks.

Based on my experience, I would go through the same process if I wasn’t in a hurry to sell. There are a lot of potential buyers that won’t buy your house just based on the fact that it’s FSBO. I found that out after the fact.

Last but not least, Baker from Man vs Debt used to be in the real estate market so he had a lot of tips to offer:

Ask them how long their average home is on the market (and then add 2-3 months, because they are underestimating it). Ask them how many sales they’ve had the last 6 months each month.

I would worry far less about negotiating 1% (commission) and far more about finding a team that has been able to continue to kill it throughout the last 2 years. Luckily, the markets have removed a lot of the bottom feeders, but here in Indiana it’s still only about $500 or so to keep your license and union fees, so many just hang onto any hope.

Get one of the top 10% and pay them. A real estate agent that is in the top 10% of the market will easily net you more on average than you can get on your own. This may not be true of all markets, but I can’t imagine it’s that market specific.

Even if you decide to sell yourself, I would offer the buyer’s agent a commission (again if that is how you state treats agency agreements) and I would pay a ala carte/cheap service to list it in a realtor-specific network as well.

Great realtors know how to work with other realtors. They know how to weed out and pre-qualify, saving you time, stress, and money. Most importantly they know how to set expectations for you and for others. Don’t underestimate this in the process.

Selling yourself may work for some and if you have the time, experience, and skills you can make up for the (seller’s side of the commission, again if that’s how your state operates). But just like any industry, a great agent is well, well worth the commission. 🙂

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FNBO Direct Online BillPay Bank Bonus

FNBO Direct is offering an online banking bonus of a $25 when you open a new online billpay account with them by the end of next month.  The account is designed to be used in conjunction with the FNBO Direct online savings account so that you can easily transfer money between the two –  Get the Bonus

FNBO Direct Features

While the BillPay account comes with all the standard online bill pay benefits, there are a few things they offer that make it easier for you to use.

Visa Check Card Access

Even though it’s easy to move money from checking to savings accounts you don’t always have to.  One nice feature that FNBO Direct offers is your check card can be used to access both your online savings account and your BillPay Account.

Mobile Payments

The First National Bank of Omaha (FNBO) also added in a new way you can send money called Popmoney. The service allows you to make mobile and email payments right out of your FNBO Direct accounts. You can accept or send money to and from both individuals and businesses. 

FBNO Direct Cash Bonus

Of course there are some criteria you have to meet for the $25 bank bonus.  It has to be your first account with FNBO Direct, your Online BillPay account has to be open for 90 days, and you have to use your Visa check card at six times before the end of next month.  Once you’ve qualified for the bonus, it will be credited to your FNBO direct Online BillPay account the middle of the following month.

The good news is it doesn’t really cost you anything to to try it out.  FNBO Direct only requires $1 to open an account and has no ongoing minimum balance.  The bonus runs through the end of next month, if you’d like to try out Online BillPay and get the $25 bonus – click here.

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House for Sale Weekend

Our family has been building a “house fund” for a few years in anticipation of someday moving into another house.  We bought our current home soon after we were married and didn’t really intend to be here as many years as we have.

We actually bought a lot more house than we needed as newlyweds and had many rooms sit empty for years.  Over time we setup an office, added two kids, and accumulated a lot of stuff for my wife’s teaching jobs.  The advantage of having more space than we needed is that we’ve been able to grow into it.

Selling Our Home

Of course there were some things we didn’t know as first time home buyers; aspects that turned out to be not so perfect about our house, especially with a gaggle of little kids running/crawling around.  Since we hope that our family will continue to grow, we could use a house with more space and a more family-friendly layout.

We finally decided to put our house on the market and have spent the last two weeks making decisions and getting it ready to sell; hence the recent how to prepare your house to sell for more post. 

Over the coming weeks I’m sure you’ll hear a lot from me about the different aspects of selling a home.  It’s the first time we’ve gone through this process and I’ll be sure to share what we learn.

Also, here are a few personal finance posts you might want to check out this weekend:

Taxes

– How to Adjust Federal Tax Withholdings @ No Debt Plan
– How the Age and Pension Amount Tax Credit Works @ Million Dollar Journey

Investing

– The European Sovereign Debt Crisis and Your Investments @ The Digerati Life
– Vanguard Mutual Funds vs. ETFs: Which Are Better? @ Bargaineering
– InvestForLess: American Funds With No Load? @ My Money Blog
– Vanguard Now Offers Commission Free Vanguard ETFs @ Suns Financial Diary

Credit

– A Plea for Credit Score Transparency @ Lazy Man & Money
– Chase Sapphire Bonus @ Money Smart Life
– Stop Identity Theft with a Security Freeze @ Fiscal Geek

Personal Finance

– Putting the Brakes on Overspending @ Generation X Finance
– Secret Costs of Moving Out on Your Own @ My Dollar Plan
– 44 Ways to Ruin Your Financial Life By Age 30 @ Frugal Dad
– Six Ways to Get Top Dollar for Your Car @ Free Money Finance
– 5 Tips for Raising a Financially Savvy Family @ Moolanomy
– 5 Dangerous Misconceptions People Have About Money. @ My Two Dollars
– 5 Financial Items We Tend to Procrastinate @ Fiscal Fizzle
– Five Things You Should Do Before Tying the Knot @ Get Rich Slowly

Debt

– How to Bail Out Family Members Without Going Broke @ Cash Money Life
– Simple ways to improve your debt management skills @ Good Financial Cents

Real Estate

– 10 Tips for Homebuyers in Next Wave of Foreclosures @ Financial Highway
– When Will the Housing Market Recover? @ Five Cent Nickel

Insurance

– Insurance Companies Work for Shareholders, Not Customers @ Consumerism Commentary
– How to find Disability Insurance @ Brip Blap
– How Much Life Insurance Should You Buy? @ Free From Broke

Thanks to Kay Bell and Well-Heeled for featuring articles from this site on their blogs:

• Stimulus Tax Credit Help from the IRS in the Carnival of Taxes
• Smart Ways to Invest Your Tax Refund in the Carnival of Personal Finance

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How to Prepare Your House to Sell for More

Preparing your house for sale can be a daunting task. When you’re selling your home, there are things about your house you might not notice or mind that can make a big difference with potential buyers.  Even if these fixes or improvements seem small by themselves, taken as a whole they can have an impact on how much you can sell your house for.

We’re thinking about putting our house on the market and a realtor gave us some tips for preparing and staging our house that have been shown to result in higher sale prices.

Curb Appeal

• Trim your trees & shrubs
• Plant seasonal flowers
• Weed flower beds
• Put out fresh mulch
• Paint your front door
• Keep your porch clean

Cleaning Your House

• Clean the carpets & then keep them vaccumed
• Polish or wax wood/vinyl floors & then keep them swept
• Wash all your windows
• Clean your light fixtures
• Replace the bulbs with higher watt bulbs

• Clean out fireplace ashes

House Smell

• Air out your house for cigarette or dirty diaper smells
• Keep a candle burning
• Get the pets out when showing

Decluttering Your House

• Clean out your closets
• Organize your drawers & cabinets
• Don’t have things lying on the floor
• Clear out piled-high shelves
• Overcrowded with furniture
• If limited kitchen counter space, keep it clear
• Keep kids toys out of front yard and off porch

Bathrooms & Kitchens

• Keep bathtub, shower, & sinks sparkling
• Caulk and Grout tubs and tile
• Fix any leaks in your faucets

Upgrading Your House

These are tips that aren’t necessarily required and will cost you money but can also make a big difference when selling your house.

• Remove old wallpaper in the bathroom, kitchen, or entry
• Replace outdated light fixtures
• Where needed, paint the interior and exterior
• Install new appliances

If you’re selling your home, hopefully some or all of these tips will help you get a better price.

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5 Lessons Learned Starting a Business

My friend and his wife started their own consignment sale business this year and held their first sale this spring.  We caught up with them last weekend for the first time since the sale and as we talked about what they’d learned from starting a business I asked if they could share some of thier lessons learned.

Of course, when you start a business there are many things you learn about as you go, but these are some of the ones that stuck out in their minds.

Don’t Underestimate Start Up Costs & Time Required

I was thinking early on that a consignment sale business was the perfect way to make extra money.  No inventory to keep a hold of, only work a couple weeks out of the year. 

Unfortunately, the start up costs were double what I thought they would be.  We made about as much as I thought we would for our first sale but not enough to cover up the start up costs. 

Also, the time it took to get it up and running was incredible.  There were so many things that kept popping up that made it impossible to get good rest and the lack of sleep really took it’s toll.
 
 
Study Small Business Marketing

I don’t have a background in marketing and could have done more to attract customers. I thought I would be fending people off to come shop our sale so I focused soley on getting consignors to list items for sale up until the final week.

We did a decent job attracting customers via word of mouth through our personal network but we were still left wondering “Where are the shoppers?  Who wouldn’t want a good deal?” 

Our location probably had something to do with it but the lack of marketing to shoppers was definitely a big part of it.
 
Beware Burn Out

You can only work 16 hours a day for so long.  Even since the sale has been over, I’m having some major motivation problems to focus in on the next sale.  The parts of the business are all in place now. The web site is built, the point of sale system is in place, etc but I’m having a hard time gearing up for the next one.

Hopefully I’ll be over this hurdle soon.  Also, maybe the year we had twins wasn’t the best time to start a business venture like this. (Editor’s Note, I imagine doing anything with twin babies would be exhausting, let alone starting a business!)
 
Location, Location, Location

We picked an older building for the cheaper rate.  In hindsight it was a bad decision and we had many, many complaints.  Next time we’ll find a better location to hold the sale.

The Value of a Dollar

When you’re an employee you don’t always appreciate what it takes to earn a dollar.  As long as you go to work each week your paycheck shows up in your bank account.

When you start your own business you have to earn every penny. At one point in the sale I took money for 3 hours straight, I thought for sure we were making money enough that day to cover start up costs.  Unfortunately, it wasn’t close but it did make me appreciate how long it can take those dollar to add up.

We hit some roadblocks along the way but we certainly learned a lot.  Although starting our own businesss was exhausting, I’d do it again but this time learn from these lessons and make better decisions.

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