Being Mature About Debt

I found this article interesting on Yahoo finance called "6 ways to be a grown-up about debt" by George Mannes from Money Magazine. Since I've been down on our credit card debt I was happy to see that I was not the only one in this sinking ship. It seems that since 1990 credit card debt has more than doubled according to CardTrak.com. The reason why? Because it's so easy to charge things and have that "I want it now mentality". So what can you do to save your financial prosperity?

Money Magazine suggests this:

1) Admit that you're the problem. Almost sounds like AA, Hi my name is Mike and I have a credit card addiction. Actually this means taking responsibility for your credit dilemmas. Understand that eating out and using your credit card to pay for it makes for a very expensive meal.
2) Play Tricks on Yourself. Lock up the credit cards, shred them, burn them. Do anything to keep them out of reach and don't use them anymore. Start putting money aside for an emergency fund, so that if something comes up you aren't tempted to bust out a credit card.
Another good idea that they have is that if you need to get something big, pull the money out and put it in envelopes until you have enough for that large purchase.
3) Make success simple. Now that you've put a brake on your credit card debt, come up with a plan to start paying off your cards. Start by paying of the highest interest card and work your way down.
4) Beware of the easy out. Debt consolidation and Home equity loans can keep you in the same trouble if you don't change your spending habits and your mentality on credit card debt. Also with a home equity loan you are risking your home to get out of debt.
5) Get help if needed. Get help from a reputable credit counselor, who may be able to get you some better rates on your credit cards, just don't pay more than $75 and do your research.
6) Think outside the debt. Even though you are in debt don't forget to save some for an emergency and for retirement. Talk your expenses over with your significant other so that the future will look much brighter.

This article made me feel a little better, especially since I just figured out that we owe a ton of money on our credit cards. We didn't get in debt overnight, so I guess we aren't going to get out of debt overnight either.

Forex 101 Pt 2

I've been checking out some of the forex forums online and came across an awesome site for forex newbies, like myself. The site is www.babypips.com and it is full of all types of useful information. One of the things I found very interesting is their subject on what to look for in an online Forex Broker/Dealer. The following comes straight off of their site, so all of the credit is theirs.

What to look for in an online Forex broker/dealer:

1) Low Spreads. In Forex trading the "spread" is the difference between the buy and sell price of any given currency pair. Lower spreads save you money.
2) Low minimum account openings. For those that [are] new to Forex trading and for those that don't have millions of dollars in risk capital to trade, being able to open a micro trading account with only $250 (We recommend at least $1000) is a great feature for new traders.
3) Instant automatic execution of your orders. This is very important when choosing a Forex broker. Don't settle with a firm that re-quotes you when you click on a price or a firm that allows for price "slippage". This is very important when trading for small profits. [...].
4) Free charting and technical analysis. Choose a broker that gives you access to the best charting and technical analysis available to active traders. Look for a broker that provides free professional charting services and allows traders to trade directly on the charts.
5) Leverage. Leverage can either make you super rich or super broke. Most likely, it will be the later. As an inexperienced trader, you don't want too much leverage. A good rule of thumb is to not use more than 100:1 leverage for Standard (100k) accounts and 200:1 for Mini (10k) accounts.

-Babypips.com-

I have been having a hard time figuring out which brokerage sites were better, which were legit and pretty much everything else about forex accounts. If you are as confused as I am please check out their site. They have alot of information an make it easy to understand.

Tags: Forex

Doing the Nasty, Figuring Out Our Credit Card Debt

So since this was one of my New Year's Resolutions, I figured it was time to recalculate our credit card debt. Pretty depressing. We owe around $25,000 in credit card bills and around $6,000 in a home remodeling loan. Someone shoot me if we ever pick up a credit card again. Actually most of the stuff was for our wedding, and stuff for our first house, so I shouldn't feel too bad, but if I had it to do over again I sure would do it a different way. Well enough wining it's time to come up with a plan to knock out our debt. I've heard of a lot of different ideas, but I think we are going to go with paying more on our highest interest credit card and working our way down. The only thing that worries me is that having an addition to our family may make this hard, so I am going to have to look at some alternate ways of picking up some income. I already have an simple IRA through work that matches my deposits, and have a Roth IRA to work on our retirement, so I am thinking about starting a Forex account to hopefully get some extra money going to pay off some bills. I really don't want to get a part time job or anything like that, so I better get a move on learning about the Forex Market. As of right now I am reading "Forex Made Easy: 6 Ways to Trade the Dollar" by James Dicks, but I was left a comment by Jon that says I should also check out a book called Forex Evolution so I will try to search for this book also. Thanks for the info Jon. Any other books or suggestions on forex would be appreciated.

Tags: Debt Reduction, forex, Credit

To Hedge or Not to Hedge?

As an Amateur Investor, I am not ashamed to say that I do not or did not have a clue to what hedging was. I usually see or read about investors hedging, but never really got the gist of what they are talking about or what they really meant about hedging. I have been reading a new book called "Forex Made Easy: 6 Ways To Trade The Dollar" by James Dicks. As anyone who has read this blog before knows I really want to get into forex trading. I've just started reading this book and found it interesting that the author talks about four mistakes investors make:

1) Trading against the trend- I've made this mistake, luckily I just had to wait it out and was able to make my gains back, but if I would have cut my losses and got back in at the bottom I would have done a lot better.

2) Don't listen to so called experts, they all have there own agenda. (So if I took his advice I shouldn't be reading his book) This part I get because most of the experts on TV, stockbrokers, etc... are pretty much looking out for there best interest. This is why I like to read blogs, I can usually find a lot of great information out there.

3) Unwillingness to sell. I guess this would be the Enron syndrome, where the boat is sinking and no one is getting out.

4) Getting emotionally involved. This is how I got into mistake number 1. I kept saying to myself "hey this is a good company they will come back", luckily they did, but what if they would not have. Leave emotions out, if the signs say get out, get out.

Anyway in between explaining the mistakes investors make, the author starts talking about how Forex can be a hedge to your stock market investments. The only problem is that he didn't explain what a hedge was and what I was getting out of it was to hedging was like diversifying, but it turns out that they are totally different things. Wikipedia says that a hedge is an investment that is taken out specifically to reduce the risk in another investment. So I guess what the author is saying about Forex is that you can use it to offset some of the risk of your stock market investment and vice versa. Though I still don't totally understand the whole hedging thing, at least I have kind of an idea what it is, If anyone out there can explain it better to me I would greatly appreciate it. Anyway I will keep you up to date on the book and on the more I find out about hedging.

Moving the Computer

Well there goes the computer room. I got everything moved into our bedroom making it smaller that it already was. So if anyone has been wondering about why I haven't been posting in a while, it's cause we are in the process of getting the babies room organized and ready to paint, my blue walls will be changing to pink and some other pastel color. I actually like the move with the computer. Now I can watch TV, jam to tunes, surf the net, and work on my blog all at the same time. How is that for multi-tasking. Anyway wanted to let people know what's up and I will get back to posting more personal finance material as soon as I can.

Tags: goals, resolutions, tasks

Resolution Time

Well the New Year has begun. Hope everyone had a happy and safe holiday. Now it's time to work on those new resolutions. I've already started clearing our my office for the impending arrival of our daughter. I am also going to total out our credit card debt, which should be pretty depressing, so that we can make our plan of attack on how we are going to get these evil pieces of plastic paid off faster. This is probably the one thing that I am not looking forward to. The one good thing that came out of the Holiday's is that this past year we did not use our credit cards once for either Christmas or New Year's, so I am very happy about that. We didn't even go through withdrawals for going cold turkey on our credit cards. Anyway I will be working on our debt numbers and a budget for the year and will keep everyone up to date on our progress. Even though I was feeling like it was going to take forever to pay of, this year I am a little more optimistic. My year has started out well and I hope everyone else's has too.

Happy New Year's Eve and Day

Just wanted to wish everyone a Happy New Year's. Hope you all have a great and safe night and day. We plan on spending the holiday with family and shooting off some fireworks, so that should be pretty interesting. Anyway have a great holiday.

New Year's Day is Around The Corner

Well New Year's Day is just around the corner and since I already have my New Year's resolutions listed, I figured I'd start working on some short term goals to keep up with what we have planned and list the order that we are gonna attack things. I know that the first thing that I want to get get working on is what is to be the new babies room, which was/is my computer room. So that means a lot of moving things around and trying to find room to store things. We are in the process of deciding whether or not to get a storage unit or not. Chances are that we will, even though I don't want any extra expenses. Oh well, that's what happens when you live in a tiny house. The good thing about living in a tiny house is that our mortgage payment is cheaper that the last one room apartment I had, so I can't complain too much. Once we get some of credit card debt under control, we can start looking at moving into something bigger, so for now our little house will have to do. Well once we work out a list of things we need to do to meet our goals, I will post it so that I can keep track of them.

Well Christmas is Over

Well Christmas is over and we made it through without going totally broke. This is the first year that we did not use our credit cards for any gifts and we even made a budget of what we would spend on gifts. It actually feels pretty good and we have enough left over to get us to next payday, without having to bust in to into our emergency fund. So not only did we have a happy holiday, we kept our spending under control, which means less credit card debt to pay off. Yeah! I hope everyone else had a happy holiday. I am looking forward to the new year, not just for the food and parties, but also for the chance to get working on the wife's and my new year resolutions and the more we plug away at our debt the sooner we will have it all payed off. Which means we will be on our way to financial freedom.

Happy Holidays everyone and I hope your Christmas was as enjoyable as mine.

Tags: Debt Reduction, Budgets

Merry Christmas

Just wanted to wish everyone out there a Merry Christmas and hope that all of your holiday wishes and dreams come true. I plan on stuffing my face so that I have a reason to work out hard next year. See got my New Year's resolutions already worked out. Anyway, hope your holidays are full of fun and family.

MERRY CHRISTMAS EVERYONE!!!!!!!

:)

Tags: Holidays

New Year's Resolution

Well it's getting close to that time of year again. I figured this year I would start a little early so that I am not rushing for ideas at the last minute. For 2007 there are a lot of things that I want to do or do better, especially now that we will be bringing a daughter into the world. My first resolution for the new year is to make sure to have everything prepared for her arrival. This is my most important resolution so I plan on keeping it. Here is a list of my other resolutions.

2) Get out of debt. I plan to continue plugging away at our debt and hope to knock out as much as possible.

3) Continue to grow my emergency fund. This way if anything ever comes up, I will not have to use the credit cards again (They are evil).

4) Continue investing a little at a time. Like our emergency fund both continue to grow, so we plan on keeping them up.

5) Get back in Shape. I've already been working out for the past couple of months and I plan to continue so that I can keep up with our child. It sucks being out of shape.

6) Continue reading and learning as much as I can about money, personal finance, debt reduction & management, investing, forex, and anything else that catches my attention.

7) Continue blogging. Not only does it keep me interested and focused on where I am going, but every once in a while I get one or two good articles in.

8) Budget better and give more to charity.

So this is my tentative New Year's Resolution. What are some of yours?

Tags: personal finance

The Courage to Be Rich

Now that finals are over and I have a little more time on my hands, I've started to read "The Courage to Be Rich" by Suze Orman. I can't exactly say that I am a fan of hers. I saw her show once and can't say that I was too impressed. Maybe her personality just turned me off, but I may have to re-think my opinion because her book seems to be pretty good so far. Just from reading the first couple of pages I find it interesting that she says that the three things that hold us back from getting rich or getting out of debt are shame, fear, and anger. So I decided to pose the question to myself on how I felt about being in debt. I am mad at myself for letting myself get into so much debt. I wish I would have known more about being responsible with my money and credit cards before I got married and I also worry that it will take forever to get out of debt. I don't feel ashamed about my debt, but if I had the chance to do it over again, I would do things differently and stay out of debt. So I guess two out of three isn't bad. I know that from now on I will be alot smarter about using my credit cards and that when my child is old enough, I will teach her the value of money and how to make it work for you, instead of being a slave to debt. So far as the book goes, it seems pretty good. I will probably add some more insight on it as I get further along, and will do a review once I have finished reading it.

New Carnival in Town

Carnival of Thoughtful Consideration #1 is up. I would like to thank Andy for including my article on Some Tips for Holiday Shopping. Andy has done a great job on his first carnival and I love the mixture of personal finance and other assorted articles. Keep up the good work. I will be posting a couple of my favorite articles from the carnival and Congrats again to Andy for a great carnival.

Tags: carnivals

Favorite Articles of the Week

Here are some of my favorite articles for this week. Impact of the Dollar Decline by Mike D. of The Time and Money Group has a very interesting article on why the dollar is declining and what some of the fall out could be. Another good article this week is from Personal Finance Advice "Investment Risk Tolerance: What's Yours". Check it out and take the quizzes to find out what your risk tolerance is. Another great article is by Life Training - Online, "Automate Your Way to Wealth". This is a great article on automating your emergency fund. These are only a couple of the articles I liked from the Carnival of Personal Finance and from the Carnival of Investing. Check them out to see a lot more.

Carnivals for This Week

Carnival of Investing #52 is up at Investor Trip, TJP has done an excellent job this week, definitely check it out. Thanks go out to TJP for including my article on Forex 101. The Carnival of Personal Finance #78 is also up at kirkwalsh.com. Thanks go out to Kirk Walsh for including my article on Giving to Charity the Right Way and for doing a great job with the carnival. As always I will include some links to my favorite articles for this week.

Giving to Charity the Right Way

So if you are planning on giving to charity or are just interested in philanthropy the first step to take is to figure out what charities you would be interested in giving to. Then you want to research these charities like investment companies, and find out where the money is going. You want your money going to a company that is going to make a large impact by using most of your money for the charity it supports, not just for itself. Next would be to decide how much to give and how often. You need to plan out a strategy for how much you can afford to give, and how often, monthly, annually. Whatever you feel comfortable with, most charities are going to be happy with whatever help they can get. Make sure whatever charity you choose is accountable for your money. Like any company, nonprofit charities should be accountable for what they spend on expenses and what amount actually goes to helping your cause. BusinessWeek.com has a good article on Four Steps to Smart Giving and CnnMoney.com has an article on Do The Right Thing, The Right Way. Both of these articles have a lot of good advice on giving to charities. Also check watchdog groups like give.org and charitynavigator.org to find out the standings of your charities. Remember giving is a good thing, but do your homework first.

Tags: philanthropy

New Car or Keep the Old?

Lately I've been thinking about getting rid of my wife's older car and getting something newer with better gas mileage and well just something new. I have a company vehicle that she drives and I drive her old 98 Mustang GT. The problem is that I drive a lot further to get to work, so I've been thinking about getting something a little better on gas and a little more comfortable. The cons to this idea is that the vehicle is still in great shape, has low mileage, and has not caused us a lot of problems. It needs some minor maintenance work, but it will still come out a lot cheaper than buying a new car. I guess as I write this I have made up my mind to keep on with not having a car payment. Why get into more debt, when I can use the extra money to pay off some of our credit card debt. I guess seeing it in writing showed me what a dumb idea it would be to trade in a running, paid off vehicle. Oh well, goodbye new vehicle.

Some Tips For Holiday Shopping

Here are some holiday tips for Christmas shopping. First make a list of all of the people that you are shopping for. Next come up with a budget that you are willing to spend on each person. This will keep you from splurging and going crazy shopping. Some other tips would be to shop online. It is easy to compare prices without having to go too far and you don't have to deal with all of the crazy people in the malls and stores, fighting over the new tickle me Elmo dolls, or get shot trying to get a PS3. I guess the best tip would be to start early, so it is less stressful and you can get everything on your list. Too bad that I can't follow my own advice. I always like to wait until the last minute so that I get totally stressed and then swear that I will never do this again, until next year that is. Anyway I guess the secret is planning, and for once in my life I am going to try it out or maybe I can talk my wife into doing all the shopping.

Tags: Shopping, Christmas

Carnivals

So I've been slacking in my carnival duties lately. I'll blame it on finals and work, not that I have just been lazy. The funny thing is that I have been getting invitations to join other carnivals, which I thought was pretty funny since I thought that I was the only one reading my blog. J/K, I know there are one or two of you out there. Anyway some of them seemed a little fishy, but one seems like it is on the up and up. The Carnival of Thoughtful Consideration, just sounds nice. I have also looked over the site some and it seems pretty cool. It will host both personal finance and non personal finance topics. So anyone interested check out his site.

Tags: carnivals

The Financial Edge Part 2

So I got a ton of information at this seminar. I learned about stocks, options, foreign exchange, mortgages, and more Forex. Which is what I wanted to learn about to begin with. OK, so here is some new stuff I picked up that I did not know. In Forex the pip is the smallest unit of currency. A one cent move = 100 pips. A lot usually has 100 - 1 leverage. A standard lot is worth 1,000 dollars or $10 a pip. A mini lot is worth $100 or $1 a pip. There are also mini/mini lots, but I won't get into those. The dollar is the benchmark in the foreign exchange market and currencies are traded in pairs. Pretty basic stuff, but I didn't know about it. I've been practice trading on forex.com, but still don't have a clue to what I am doing, well maybe a little. Anyway The Financial Edge gave us a ton of info in a short period of time, but the classes were well worth it. The idea behind the short seminars is to pound you full of information, leaving you wanting to learn more and getting you to go to more seminars which cost an arm and a leg. I personally can't afford them, so I will stick to trying to learn forex on my own or from reading some books. All in all I enjoyed the seminar and can't say anything bad about it.

Tags: Seminars, forex