#261: Thank You, Bear! (Friday, December 30)

Early one morning, a little bear found a little box.

He looked inside. Then he exclaimed,

“Why, it’s the greatest thing ever! Mouse will love this.”

Bear’s friends aren’t so sure of his newfound treasure, however. “That’s not so great,” says Monkey. “I’ve seen those before,” says Owl. And by the time Bear finds Mouse, his own doubts have grown. But Mouse has the last say when he looks inside the little box. “It is the greatest thing ever,” he tells his friend. “Thank you, Bear.”

Excerpt from Thank You, Bear by Greg Foley

We're at the end of another year of Good Fridays! I can't believe we've gone through the year so quickly.

Like Monkey, you may have thought my financial tips were "not so great". Or some of you may have "seen them before", as did Owl. But I hope the majority of you were like Mouse and found them useful (yes, I know "the greatest thing ever" might be a bit of a stretch. LOL). 

And if you are even a little better at financial management than you were at the beginning of the year, then for me that is "the greatest thing ever".

As we leave this topic and move into 2012, here's the one link you need to help you manage your money and stay on top of your financial goals:

Wisebread: 190 Resources for Saving Money

Use it. Love it. Live it.

#260: The Things You Can Count On (Friday, December 23)

There are only two things that are certain in life: death and taxes.


Every year before December 31, I make sure I do one thing: I contribute to the 529 plans I have for my godchildren and niece. In New York, I get a deduction for contributions which is great for a single gal like me. But every April when I'm filing my taxes I inevitably hear about some other deduction that I might've qualified for if I'd done it in time. Buzzkill.

So I was absolutely thrilled to find this article on CBSnews.com that plainly lists the 7 deductions that are expiring this year as well as some other tax strategies that I can put in place, depending on whether I expect my income to increase or decrease. Yay!

Check it out; you only have a week left to take advantage of some of these before they're gone for good.

#259: You Are Not Your Stuff (Friday, December 16)

Accumulating debt can be a trap; it limits your possibilities because you're always consumed with paying it off. I've been following this blog, Man vs. Debt, for a little while and I think it's one of the best real life examples of how to become financially free. There's a post from a woman who sold the stuff she didn't need and netted $15,000 which she used to pay off her loans over the course of 9 months. But the most impressive thing thus far for me has been the list of the family's possessions. Yes, everything they own is cataloged on the website with pictures.

Many people spend a lot of time focusing on their "stuff"--the things they have and the things they want to have. We spend an inordinate amount of effort and money to acquire and store things we don't need. In fact, this year when I considered downgrading to a smaller apartment quite a few people discouraged it, even though I have a room that I barely use.

As we approach the holiday season of gift-giving it's important to remember that while it's essential to have good credit and some measure of savings, we are not our stuff.

I challenge you to spend one day before the year ends going through your stuff. Consider gifting the items you don't need (instead of buying new ones), or selling them and putting the proceeds into your emergency fund.

#258: The Courage to Be Different (Friday, December 9)

There is a saying that doing the same thing over and over again and expecting different results is the definition of insanity. I heard the same sentiment expressed a different way today:
"Running into a brick wall hurts just as much the first time as it does the 500th time."

In order to get a different result you have to be different. Whether you're trying to improve your credit, change your spending habits, save more or pay off your loans you have to change your current behavior in order to be successful. Sticking to existing habits and expecting your financial situation to change is like running into a brick wall over and over again.

They say in order to form a habit you have to practice the behavior for 30 consecutive days. I'm not sure how true it is, but it's worth a shot right?

So for the next 30 days, use your phone's calendar to keep track of your daily spending. Just write the amounts you spend. I recommend using your phone because it's something that's always with you so you don't have to worry about maintaining another log.

If you have an iPhone, you can download one of the many free aps available; just search "expense tracker" in the App store. Blackberry users can use Expensify or Money Menttor.

Keeping your spending habits at your fingertips is a great way to cut back expenses.

Breaking a bad habit is hard, but isn't the end result worth it?

#257: The Cost of Waiting (Friday, December 2)

We're already in December, can you believe it?! That means we only have five more Fridays to make some positive changes in our finances, so I'm going to make these five weeks count by providing some actionable idea you can implement every Friday 'til the end of the year!

This week we'll focus on the cost of waiting to save. What is it costing you? For me, every month I buy drinks from the vending machine instead of saving it, it costs me $40. Now that may not sound like a lot, but if I saved that money for a year I'd have over $500. Not to mention that water is a healthier alternative.

I found this wonderful tool called Me Save? on Feed the Pig that can help you figure out what kind of spender you are and how much you could save if you put that money elsewhere.

Use it and let's make these last five Fridays count!

#256: Spare Some Change? (Friday, November 25)

I had a wonderful conversation with a couple of girlfriends this past weekend about (people's ability to) change. A couple days later, I read about a guy in Canada who'd saved $723 worth of change in seven months. And then I overheard someone on the bus saying she had to go switch out her change at the machine so she could go Black Friday shopping. So I figured it was a sign that this week's Good Friday idea should be about change. LOL.

I once read that the average household has $90 worth of change lying around the house. $90! Either I'm living in the wrong household, or I'm sitting on a goldmine. So what do you do with this spare change? Here are a few ideas:

• Use it for your holiday shopping
• Pay a bill
• Use it for your kids' allowances
• Donate it to charity; in some countries your 60 cents could do a world of good
• Do something fun: go on a date, treat yourself to dinner, etc.
• Invest it

I guess we could all use some change...And speaking of change, help change your community tomorrow by patronizing a small business in your neighborhood. Support Small Business Saturday! 

#255: Deal Breakers (Friday, November 18)

"A deal breaker is ‘the catch’ that a particular individual cannot overlook and ultimately outweighs any redeeming quality the individual may possess." - Urbandictionary.com 

In every relationship (whether it's a friendship or a romantic liaison), there are deal breakers. Deal breakers are just another way of saying "standards"; it's the measuring stick that helps each of us define our personal limits of what we will and won't accept.

The other day, a friend and I were talking about financial deal breakers. He had two: his prospective mate "must have good credit", and if over 30 she must also have "at least one major asset such as a home, a car, a business--something we can build on." Thankfully, I wasn't trying to date him. LOL. (I discovered, the hard way, that in America paying off your bills and canceling your credit cards actually hurts your credit score. Go figure.) I thought his second deal breaker was a little excessive, but what was even crazier is that my friend was seeking qualities in his prospective mate that he had yet to accomplish, thus breaking the Golden Rule of Deal Breakers: never write someone off for something that you don't possess yourself.

Deal breakers often get a bad rap, but from a financial perspective they can actually be quite helpful when trying to meet your financial goals if they're not too restrictive or unrealistic. You can have financial deal breakers for yourself, or for your partner...which may not be a bad idea considering that many marriages break up over money matters.

My personal financial deal breakers:

• No layaway: If I have to put it on layaway, I don't need it. And after hearing about Chuck Schumer's latest initiative regarding layaway, I'm glad this is one of my deal breakers.
• No loans: I really HATE owing people money. If I have to borrow money to pay for it, I don't need it. Obviously, this excludes major things (college education, home purchase, car purchase) or if I fall on hard times, but this is the general rule.

What are your personal financial deal breakers? 

#254: Rebounding from A Bad Situation (Friday, November 11)

"If you can make one heap of all your winnings
And risk it on one turn of pitch-and-toss,
And lose, and start again at your beginnings
And never breathe a word about your loss;"  - Excerpt from If by Rudyard Kipling 

The other day I was watching a program on TV. They were interviewing Carl Payne, one of the main characters on the Martin sitcom. He was working as a car salesman in LA, and from the line of questioning, I could tell that the interviewer was trying to make it seem like he'd fallen from grace ("How do you go from Martin to this?").

I thought Carl Payne's response was brilliant: "I love what I do, but more importantly I have a family to feed and there's no shame in honest work and taking care of your family." Brilliant.

Nowadays, I'm noticing that a lot more celebrities and athletes are going broke. It seems like every few years Toni Braxton is bankrupt; Terrell Owens just petitioned a judge to reduce his $40,000/month child support payments because he couldn't afford it and I'm sure this NBA lockout will likely produce a few more. So I was very inspired to read this article about basketball couples who are changing their financial strategy in preparation for the lockout. It sounds like they'll be one of the success stories.

I know it's annoying to regular Joes like you and I who live on substantially less incomes to understand how someone with a multi-million income could be broke. But it's not the situation itself, but how you respond to the situation that determines the outcome. Most of these bankruptcies are a result of poor financial management, not how much money they earn.

But you even after a financial crisis, you can rebound and rebuild. It is up to you and your attitude. Will you be a Carl Payne or a Toni Braxton?

#253: Turn Your Thoughts Into Action! (Friday, November 4)

After last week's post, I was delighted to discover that people are using their power and speaking up. In fact, I recently read about a bank transfer day, started by a consumer just like you and I, who was frustrated with the fees of Bank of America.

On the inaugural day, which will be celebrated tomorrow, November 5, customers are encouraged to transfer their balances from (for profit) banks to (non-profit) credit unions. I don't know if that was the impetus for Bank of America to cancel the debit card fee, but I'm sure it didn't hurt. And other banks, after seeing the near-revolt B of A experienced, have sensibly decided not to implement similar fees...for now.

If you decide to take advantage of Bank Transfer Day to move your balance, do your research. Compare rates, fees, etc. for different banks on bankrate.com and make sure that you're making your choice based on the features you're looking for in a bank, rather than just moving it to a non-profit institution to avoid fees.

#252: You Are Powerful; Use It! (Friday, October 28)

"You can lead a horse to water, but a pencil must be lead."

This week I heard the story of The Mouse Trap. Many people have asked me about my opinion on the Occupy Wall Street movement, and I think this story summarizes perfectly my feeling on the subject. See, my opinion is not the popular one; I don't think we're here because of "corporate greed" and "political incompetency." Yes, those things contribute to the economic crisis we find ourselves in, but I think this could have been avoided if there were more consumers who were "mice." Alas, most of us are "chickens, pigs and cows" who generally don't act until the situation affects us personally or hits close to home.

The Netflix situation is a perfect example of how consumers can use their power to effect change. The company lost 800,000 subscribers in three months and that made them pay attention and revert to more consumer-friendly practices. Here's how you can use your consumer power:

1. Stay informed. Whenever corporations are deciding to implement new policies, they usually do a test run or conduct focus groups. I set up a Google Alert for my bank so I know whenever they're in the news.
2. Ask questions. Even if the company you give your business to isn't the one conducting the test, if their competitor successfully implements a policy, it'll only be a matter of time before they follow suit. Remember the story of The Mouse Trap; even if it doesn't seem immediately apparent, it may ultimately affect you! Call your company ask questions.
3. Take individual action. Don't assume someone else is protesting or taking action. Each individual has their own power. If you are a good customer, a company will not want to lose your business. I've gotten reduced rates, fee waivers and other perks just because I chose to take action.
4. Spread the word. You'd be surprised how many consumers may be in a similar situation. Discuss your experience with family and friends, in public forums and via Twitter and other social media outlets. No company wants negative publicity.

As a consumer, you have enough power to change corporate policies. Use it to your advantage.

#251: The Right Thing vs. The Easy Thing (Friday, October 21)

"It betta fi lose yuh time dan yuh character." - Jamaican proverb, meaning "It's better to lose your time than your character."

Sometimes the stars align and you get an opportunity to do the right thing and it's easy. But more often, one supersedes the other and it requires a proactive and conscious effort to choose to do the right thing.

This is especially true when it comes to your finances. It's always much easier to get the immediate gratification of spending than to save. I was truly inspired the other day when I watched this story about a family of four who are DEBT-FREE and live on one teacher's salary of $40k. 

I'm sure it can't be easy, but they did what was right for them and their family. And they are raising their kids to be financially aware as well; the kids have to divide their allowance into 3 jars: one for spending, one for saving and one for giving. What a fantastic lesson!

Every day we have to make decisions that will impact our future. Will you take the easy road, or will you do what's right?

#250: The Best Investment (Friday, October 14)

With all the focus on Wall Street, unemployment, corporate greed and the like, a lot of people don't even want to hear the word "investing," let alone think about putting their money in an investment.

Yet, ironically many people with portfolios or those who are thinking of investing often overlook the most important (and the best) investment: themselves. It sounds like a silly concept, but if you're thinking of putting money into companies hoping for a greater return in the future, why can't you put money into you?

So how do you invest in yourself? Consider these opportunities:

• Are you healthy? You can only be your best if you're healthy--both physically and mentally; this is the most important part of investing in yourself.
• Do you take time for yourself? Many of the best portfolios have active managers who rebalance the portfolio when it departs from its original investment objective. Are you doing the same for yourself and taking time to regroup and re-evaluate your goals?
• Is your resume up to date and ready to go at a moment's notice? Opportunity only knocks once and if you're not ready, it could pass you by.
• Are you willing to spend money to improve yourself, your image and your opportunities? Consider memberships to organizations in your field, or in the field you're trying to get into; learn a new skill or a skill related to what you do.
• Are you monitoring your network and ensuring that it contains a diverse group of people? If your network contains only individuals that are similar to you (race, gender, age, industry, culture, etc.), you're doing yourself a great disservice.
• Are you involved in initiatives that are aligned with your goals?

Happy investing!

#249: Life Is Happening; Tune In (Friday, October 7)

Last week, I was watching an episode of The T.O. Show, a reality series about football player Terrell Owens. He has been having some financial issues after a "friend" stole his debit card and going to town with it. He's also been having some difficulty locating his financial advisor, who seems to have just disappeared off the face of the earth. And to top it off, he hurt his knee; with the NFL lockout, his age and (let's face it) his controversial history, he's not exactly first pick for many teams.

In this episode, he was selling one of his homes and breaking the news of his financial struggle to his family. My first reaction to hearing the story was disbelief. I just couldn't understand how someone, especially in his position could a) let another person have such unlimited access to his bank card; b) not realize that so much money was being taken from his account; c) not have a person around him who would catch this situation before it became so huge.

And then I got it. When you're surrounded by people that you trust, you let your guard down. You become careless. You assume that if you don't catch it, others around you will. The problem is that many of those "others" are making the same assumption so it becomes a case of diffusion of responsibility. But you have to tune in. Be alert and don't be afraid to ask questions. And check the backgrounds of EVERYONE who manages your money:

• For accountants: Check your state's board of accountancy, or check the IRB List published by the IRS' Office of Professional Responsibility for a list of disbarments, suspensions, resignations, censures for attorneys, CPAs, enrolled agents and enrolled actuaries.
• For investing: the Financial Industry Regulatory Authority (FINRA) has a wealth of resources for investors. From education materials to investor alerts to pre-investment tips; you should definitely go here first. There is also a BrokerCheck feature that allows you to see your financial advisor's licenses, customer complaints history etc.

Please use your resources and be alert!

#248: A Balancing Act (Friday, September 30)

Last week, Wall Street had it's worst week in 3 years which prompted protesters to swarm the Financial District in droves. And now there's talk that another recession is approaching. So, like me, many people are having the same dilemma: should I be spending to help boost the economy or should I be saving and bracing myself for the months ahead?

I think the answer is a little bit of both...a balancing act, if you will. Life is short, so I don't think one can totally halt their goals and dreams just because they are afraid of a recession. If you've made plans and have a list of things you want to accomplish, you should still try to stay on track. On the other hand, I don't recommend frivolously spending. Tighten your spending where you can and try to increase your emergency reserves. I found this great video on CBS that provides tips on how you can increase your cash reserves.

Happy balancing!

247: An Essential Skill (Friday, September 23)

One of the most essential skills for successful financial management--or even life, for that matter--is the ability to budget. Budgeting, or lack thereof, is part of the reason our country is in a financial mess; it could mean the difference between staying on top of your bills and being engulfed by them.

My budgeting is generally very loose: I live off one paycheck a month and wherever it ends,  it ends. But there are times when I need to stick to a stricter budget and when that happens, I use The System, a bunch of envelopes that keeps me honest. Most people have heard about the jars, but I find that they aren't practical; who walks around with a bunch of jars?

How The System Works:

1. I make envelopes for each category of my expenses: Rent, Grocery, Commuting, Entertainment, Bills, Miscellaneous (doctor visits, medication, etc.)
2. I put the budgeted amount for each category in that envelope. For Rent and Bills, I use checks. For the others, I withdraw cash and keep it in the envelopes.
3. I leave my debit card at home and only carry the envelopes. 
4. I only use money from the appropriate envelope.
5. At the end of the month, if there is money left over in any envelope, I add it to my savings.

The System has been successful every time I needed to keep track of my expenses. If you have difficulty figuring out where your paycheck goes each month, or have difficulty meeting your monthly financial obligations, I definitely recommend this method.

#246: Do You Have the Formula? (Friday, September 16)

Good things come to those who work.


Life is a series of equations and formulas; you just have to apply the right one in order to find the answer you need. I think Success = Preparation + Hard Work + Timing + Positive Thinking. In order to achieve a goal, these four things must be present.

We all came into 2011 with financial goals--whether it was to pay off debt, get a better paying job, make a large purchase, save more, cut spending, start a business or get better at managing your finances. But how many of us have been applying the formula that will enable us to be successful?

An acquaintance of mine had the financial goal to increase his income in 2011. In order to do so, he needed to complete a certification in some IT system that would make him more marketable. In the beginning, I was his biggest cheerleader. I sent him links to places that offered his certification and followed up with him every week on his progress. (I think my constant followup was what made him register for the certification program to begin with.) But then I came to the realization that in order for him to be successful, he needed to be applying the formula for himself. I still provided encouragement, but stopped doing the work and preparation for him. He ended up taking the summer off and has decided to "wait and see what happens"...but he is still complaining that he needs to be making more money.

Do not sabotage your financial goals; apply the formula and you will be successful.

#245: The Glass is Full (Friday, September 9)

In the last couple of weeks, there has been so much focus on jobs and unemployment and it has largely been depressing. Most experts are saying the jobs are gone for good because the U.S. doesn't produce anything and corporate taxes are too high and we're victims of consumerism and blah, blah, blah. If you're someone who's out of a job right now, this coverage would probably send you over the edge of despair.

But remember, even in the Great Depression when the unemployment rate was at 25% (16% higher than it is today), 75% of Americans were still employed. 


So where are all the jobs? They are still many out there; I once read somewhere that most people already know the person/people who will get them their next job opportunity. I believe it's true; these days, getting a job is less about what you know and more about who you know. So here are some tips that may help you get the job you want (and I spoke to a couple recruiters about this, so it's not just my uninformed opinion).

1. Network. Networking is not about exchanging business cards. It's about establishing meaningful relationships with others. As a practice, I don't even own business cards; I take others' cards after I make a connection so I can follow up.
2. Befriend a recruiter in your industry. You need to know someone in your industry with whom you can discuss salary trends, available jobs and the like. Only a recruiter who specializes in your industry will have access to that information.
3. Do your own legwork. You can't just rely on a recruiter to send you jobs. You also need to help yourself. LinkedIn is still the best resource for finding jobs and people who can connect you to that job opportunity. TheLadders is also another resource if you're interested in jobs of a certain dollar amount, but it's subscription-based and they mostly compile existing information, so with a little groundwork you can find the same jobs on your own. If there are particular companies you want to work for, check their website frequently and also try to meet contacts there.
4. Volunteer. If you're currently out of a job, volunteering in your field can help you get in the door. For one, it helps you maintain a consistent work history (rather than having a gap in your work experience) and it can help you hone your skills. A friend of mine recently got a marketing job after volunteering her marketing services at a nonprofit.

Remember, "10% of life is what happens to you; the other 90% is how you react to it." Happy hunting!

#244: Til Debt Do Us Part (Friday, September 2)

For many men, their masculinity is tied to their ability to provide for their spouses and family. And in today's world, that often equates to making lots of money. Now I can't speak for every woman out there, but for me it's not about how much money a man makes, it's more about how he manages it. In relationships when couples argue about money, it's usually not about how much of it there is, but more about how it's being spent.

So when a friend of mine told me about a show--a reality show in Canada--that helps couples manage their finances and get out of debt, I was all over it! And then when I found out the host, Gail Vaz-Oxdale, is Jamaican, that sealed the deal. I couldn't believe some of the episodes: couples with $70k, $80k in debt and still spending. There was one episode where the couple had been paying off a $1,500 payday advance for years! Yikes.

And I just found out that the show is coming to CNBC; in fact I think one episode has already aired. I've got my TVR set!

#243: Your Choices Determine Your Path (Friday, August 26)

I am not the aunt or godmother that'll do arts and crafts with the kids. I can't solve a Rubix cube in a few minutes. I suck at video games, I don't know how to ride a bike and my magic tricks never work. But I'm great at money management, and that's what I hope to impart on my nieces, nephews, godchildren and the like.

I want them to know at a very young age, as I did, the value of money and that their financial choices will help to determine their lot in life. Just consider these 3 scenarios from children in my life:

1. I started to open a 529 for Child #1; the mom said she'd rather do it through work so she could do direct deposit. Three follow-ups later, Child #1's mom still hadn't made a move. It's been a dozen years...and Child #1 doesn't have a plan.
2. Learning my lesson, I opened a 529 plan for Child #2. I told the parents that I had done so, and gave them the information so they could contribute. Five years later, I'm still the only person contributing to the plan, and they don't have another account.
3. I also opened a 529 plan for Child #3 and shared the information with the parents. They made contributions and linked up their cards. Now when any of us shop (or when I dine at certain restaurants and pay with my card), a portion of our purchases goes directly into Child #3's account. The account value is already higher than that of the 529 account opened five years prior with the same amount.

Three set of parents, three different choices...but each will have an impact on their child's attitude about money and also on the child's future (Child #1 won't have a college fund to help pay for books, tuition and other expenses.).

Think about your choices...

#242: Whispers & Screams (Friday, August 19)

"Listen to the whispers before you hear the screams." -Reverend Run

I once heard Reverend Run use that quote in the context of relationships, but I think it can be applied to any situation. He was basically trying to say that when you don't address the little things, they turn into big things.

It's an appropriate quote for our current economy: the housing crisis, the debt crisis, the job market...they all began as whispers. Even consumer practices that we've now come to accept as commonplace (ATM fees, paying for checked baggage on airplanes, no meals on airplanes) all began as whispers.

So, it was with great alarm that I watched a report on CBS yesterday about banks "testing" debit card fees. Wells Fargo is testing a $3 debit card fee in some areas, and JP Morgan Chase and a couple of other banks have already implemented these fees in certain areas. It was only a few months ago that I talked about banks testing exorbitant fees to non-customers who use their ATMs.

This is eerily reminiscent of when the airline industry started their testing, a tiny little whisper which got very little resistance from consumers who were willing to forgo certain conveniences for a lower ticket price. Now we have to deal with the screams: numerous fees that cancel out the lower ticket prices we originally thought we were getting anyway.

If you're one of the increasing number of people who rely on their debit cards rather than carry cash, then this may ultimately affect you. (Once one bank tests the fee and do not get consumer push back, other banks will start to implement it too.) Listen to the whisper: be proactive and monitor whether your bank is testing a similar fee and be vocal about it.

#241; Beneath the Surface (Friday, August 12)

The other day my friend got an email offer to try American Express' prepaid card, which offers access to American Express benefits with no fees except for ATM withdrawals. Before getting the email, she'd been considering one of the Rush prepaid Visa cards, which may charge fees (monthly fee, requesting a paper statement, bill pay fee, etc.) that vary depending on the services you choose.

So it's a no-brainer right? Who wouldn't want access to Amex benefits (they're the chosen card for U.S. Tennis Open, Tribeca Film Festival and many other exclusive events) and the prestige often associated with the name, even if it's on a prepaid card?

But if you're being offered a prepaid card rather than a credit card, chances are there may be issues with your credit. And if you're having credit issues, then you need to look beneath the surface of these two cards to the one that will be more beneficial in the long run. So that's what I recommended to my friend.

We discovered that despite the fees of the Rush card (which can be mitigated by using it only for essential services) it could actually help build credit in the long run since they'll report bill payments to credit reporting agencies. So the fee could actually be justified. In contrast the Amex prepaid card doesn't monitor or track payments, so it's probably better for people who are seeking the prestige and access that Amex can provide.

Sometimes you have to look deeper than what's presented on the surface.

#240: A Thin Line (Friday, August 5)

I got a lot of feedback from last week's Good Friday. One in particular is an issue that is somewhat related to business with family and friends. My friend Dave writes:

"Interesting Good Friday post about family and friends in business. I'm in IT, and my friends and some family always ask me to look at their computers. Should I be charging them? I feel like a bad friend asking for money but it takes up a lot of my time. What is a good way to bring up payment between friends."

This can be a sticky issue. The key is to not take advantage of your friends' goodwill by constantly asking for their help with the expectation that it will be free. Paying a friend for their help can also let them know that you respect their talent and time. Here are some tips to consider to keep things fair and balanced:

• Generally speaking, if you ask a friend for help and the task is how they make their living, they should be paid. For example, asking your friend who's a mechanic to look at your car; or your friend who's an accountant to help you with your taxes.
• It's considered polite to offer payment for the help and let the person decide whether or not to accept it.
• If you're in dire straits and cannot afford a monetary payment, you should explain your situation and either: 1) Offer to trade services if you have a specialized service they may be able to use; 2) Offer a non-monetary compensation, such as making the person dinner; or 3) Offer to make payment at a later date.
• Services between friends and family are typically charged at a discount, however you should use your discretion as every situation is different.

#239: When You're In It For the Long Haul (Friday, July 29)

This week, I heard that singer Beyonce is suing her dad for allegedly stealing money from her. A couple days later, news broke that Leighton Meester is suing her mom, who is also her former manager, for misuse of funds.

It's easy to judge celebrities who sue their parents, siblings and other family members. However, when you consider that financial woes are one of the top two reasons for divorce (communication's the other), it's not so surprising; a business is just like a marriage.

Some people will say that getting into business with family and or friends isn't wise; and you'll find others who have done it and succeeded. It really is a case-by-case decision, but here are some things to consider if you decide to go that route:

1. Maintaining the relationship should be your first priority. Business should always be the secondary goal.
2. Define your business relationship with a partnership agreement that includes as many scenarios as possible. Note: you will never be able to capture every situation that could occur in a contract, but it's always a good place to start.
3. Have an exit strategy as well as a dispute resolution strategy.
4. Always consult an attorney. There should be one for the partnership, but you should each have your own attorney as well.
5. Keep Tip #1 at the forefront of your mind at all times. Remember that you love and care for the person with whom you are working.

#238: When Life Throws You A Curveball (Friday, July 22)

One of the reasons I suggested making three financial goals is to get in the habit of constantly being in motion and working toward something. It's easy to lose focus and get distracted by life. But what about when you stick to the plan, you see your goals getting closer and then life throws you a curveball? How do you (and should you) rebound and get back on track? The good news is financial setbacks are generally easier to rebound from, especially if you keep these tips in mind:

1. Create an emergency fund and keep it funded; don't dip into it unless all other resources have been exhausted.
2. Think of several hypothetical scenarios that could affect your goal and create back up plans for how you'll address those situations should they arise.
3. Surround yourself with great cheerleaders and like-minded people who want to see you succeed at what you're doing. (Look carefully; it's always easier to find naysayers and folks who are more than willing to say, "I told you so.")
4. And most importantly, remember that the setbacks are a natural part of life and are only temporary. Don't let it dissuade you from continuing to pursue your goal, and certainly don't use it as an excuse for why you can't get back on track.

#237: Life Lessons (Friday, July 15)

There are some life lessons that cost you your life or your quality of life.

Failure to visit the doctor on a regular basis could mean you discover a terminal illness when it's too late, or after you've had to amputate a body part, or lost your sight or some other necessary function. This is a tough lesson to learn the hard way, but it's also a lesson that will inspire those closest to you to be more proactive and do things differently.

There are some life lessons that cost you your time.

Staying at a company for years and being continually overlooked for promotions, and having your potential ignored. This may teach you to be more agressive to get what you want, but if you're also learning while you're being overlooked, you're amassing new knowledge that is transferable and also makes you more marketable.

Or being in a relationship for many years before realizing that you're not compatible, or you want different things from life. This is a valuable life lesson; it's simply preparation for the right person.

And there are some life lessons that cost you money.

For example, starting up your own business. When I started my magazine, it was the realization of a dream. Two years and $40,000 later I had to close it. I've never regretted doing it, and if I had to do it all over again, I would; it was worth every penny. The lesson I learned: I CAN do anything I set my mind to doing. 

Or what about this ad that I've been seeing in the NYC subways, which is part of the NY Consumer Affairs Protect Your Money series. At first glance, I thought "Why would this man pay $6000 to someone to fix his credit? Why wouldn't he just pay that money towards his bills? But losing that money probably taught him the valuable lesson that there are no quick fixes to getting out of debt and also led him to a Financial Empowerment Center where he can develop good LONG-TERM money management skills that he can also pass onto others. 

The bottom line: There's no price that you can put on an experience that will change your outlook on life, or that will make you a better person. If you come out of a situation even a little changed than when you went in, it's worth the cost.

#236: Painful Reality (Friday, July 8)

I recently ran into a small business owner that I used to frequent. She is really creative and has wonderful stuff, but her customer service skills were terrible. It would take her weeks to return emails; you'd run into her at a festival and place an order and never hear from her again; and even though I'd met her a million times and given her numerous referrals, she never remembered my name. Even her marketing emails about sales were in disarray: she'd send the same email twice, or forget to include the location of the sale...

It all got to be too much, so I stopped patronizing her about six years ago. Although the potential business she lost from me wasn't that much (I probably would've spent about $200 more since I had most of her pieces), I imagine the business from referrals may have been a lot more.

When I ran into her, she wanted to know why I, one of her "best customers" had just disappeared. I explained why; she seemed very surprised but acknowledged that her business had been suffering lately and she'd lost a lot of loyal customers. She thanked me and promised to follow up to see how she could repair the damage and get back the customers she'd lost. I still haven't heard from her.

The painful reality is that if she continues down the same path, it'll mean the demise of her business. If you're thinking of starting a business (or if you already own one), its financial success depends on your ability to create and sustain great relationships with your clients.

#235: Like Sand Through the Hourglass (Friday, July 1)

Instead of letting the time slip away, allow the best of your dreams to more fully unfold with each passing moment. -Ralph Marston

We're half way through the year. Twenty-six weeks of possibilities both realized and forgone. Exactly six months ago, we set three financial goals one of which was supposed to have been successfully completed today. How did you fare? Did you accomplish your goal with ease? Did you struggle, but were you ultimately successful? Or did you abandon your goal after a couple weeks?

If you didn't accomplish your goal, what stood in your way? How will you approach it differently for your longer-term goal?

#234: Who Are You? (Friday, June 24)

Are you someone who is able to take very little money and turn it into something magnificent? Or do you find yourself constantly wondering where your money went? Although nurture has a lot to do with it, some people are just destined to be better at money management than others because of their financial personality. 

Your financial personality can have a major impact on achieving your goals (saving for retirement, saving for a major purchase, maintaining good credit, etc.) so it makes sense to know what type of person you are when it comes to money management. I found three online "personality" tests that may help you figure it out. And although they were very different questions, my result was essentially the same:

1. The Love & Money Personality Scale (LAMPS) is especially good for couples, but can be used by single folks as well. It tells you how you score against other people of your gender. I'm a very stronger Pioneer (8)/Spartan (8)/Banker (37), which means I like to maintain control over my own finances, I don't like to take risks with my money and I prefer to live modestly than to have a luxurious lifestyle.
2. The Quibblo Personality Quiz is a little more fun. It uses scenarios from real life, so it may be more difficult to find the choice that best suits your personality. But it's still a fun quiz to do. I was Plansy McPlansalot. 
3. The Visa Personality Quiz was also very specific in the choices, but again was spot on in the results, especially the part where they say "Money is for security, which is fine when you have enough of it to feel safe. When you’re short, though, you can feel panic-stricken." That describes me almost perfectly. LOL. 

While these quizzes aren't an exact science, I'm sure you can probably find a pattern in your spending/saving habits. And as they say, knowing is half the battle. :)

#233: It's All In The Details (Friday, June 17)

This week, a couple of my experiences made me realize that sometimes it's all about paying attention to the details. My regular lunch spot, a buffet place across the street from the office, usually charges $6.99/lb. That was last week. On Monday I went in, and the price had been subtly raised to $7.59/lb, 60 cents more per pound. No big sign, just an imperceptible change on one sign hanging from the ceiling.

To add insult to injury, this place requires a $5 minimum to use a credit card, so even if you wanted to control your portions and only get a salad (which generally weighs less), if you don't have cash you have to purchase $5 worth of food to charge it.

What's wrong with this picture?

1. It's illegal for merchants to require a minimum purchase for you to use your card, but alas, many of them do because they have to pay fees to the credit card companies. So the $5 minimum should not even be in place. I've threatened to report them to the attorney general a couple times when my lunch has been under $5, and they've let me pay with a credit card, but it's still unacceptable.
2. Even if the minimum payment requirement was taken away, the increase in price is still excessive. If you purchase a pound of lunch each day, that's an extra $3 more each week or $156/year, which is about half the cost of a plane ticket to the Caribbean.

My second experience happened when I was booking my hotel room for an upcoming trip. One hotel was $99, the other was $111. Going for the cheaper one is a no-brainer, right? But it turns out that the more expensive hotel was a 4-star, 4-diamond hotel located more centrally, while the other was a hotel chain that would require more cabs to get around. 

Sometimes it's all in the details, which is why it's so important to read the fine print.

#232: Knowing Is Half the Battle (Friday, June 10)

The other day, someone mentioned the practice of redlining. I'd heard the term before and had a general sense of what it meant, but wanted to do some more research. The context of the discussion was that it was an old practice that happened in the pre-Civil Rights era, but as I read more, I realized that it's still happening today.

It seems crazy to me that I can be denied services or credit, or charged a higher interest rate just based upon my zip code, but that's pretty much what redlining is. And since I live in a predominantly black neighborhood, it means that a whole race of people are automatically lumped into the same category,  regardless of their individual credit  worthiness. Unfortunately, redlining is not just about financial services; it's also about food. I've often complained about the caliber of fruit in my neighborhood which is way different than say, the fruit in 10024. And it's probably no coincidence that there are more liquor stores, check cashing places and rent-to-own stores per square mile in my neighborhood than there are in 10019. All this because of zoning.


But what really blew me away, was reading a story about Kevin Johnson, whose Amex credit card limit was reduced by $7,000 because of where he shopped. Yes, where he shopped. The reason? "Other customers who have used their card at establishments where you recently shopped have a poor repayment history with American Express." Financially profiling aside, do you know the damage a $7k reduction in your limit can wreak on your credit score? And all because of where he shopped. The story is a couple years old, but the lesson is still important: knowing about the practices that could affect your finances is very important.

Kevin started a website based on his experience with is a WEALTH of information about credit developments. Check it out: www.newcreditrules.com

#231: Dealing With Your Issues (Friday, June 3)

After last week's Good Friday entry, I got an email from a woman I didn't know. Her friend had forwarded it to her as a "mini-intervention." The woman writes:

I was offended when my friend sent this to me. I thought she was being condescending. But when I read it, I understood and I was even a little scared. I didn't realize that my bad could hurt my kids' chances of getting loans for school (and they will need them)...I'm signing up to speak to a non-profit debt counselor to help me get my finances under control.

The good news is that she's realized that she has some things to work out. I think that's half the battle. It's much easier to resolve your finances when you know what you need to work on.

Here's to financial empowerment!

#230: Newton's Third Law of Motion (Friday, May 27)

For every action, there is an equal and opposite reaction. -Sir Isaac Newton, Laws of Motion

Unfortunately, many people don't realize that not paying your bills on time could affect your loved ones too. Here's a true story:

A friend of mine (we'll call her Pam) was really bad at money management. She had multiple credit cards and store cards which she rarely paid on time, and very time I visited her house, she was either dodging a phone call from a bill collector or there were numerous "Past Due" notices on her kitchen table. There'd even be times when I called and her cell phone would be shut off because she hadn't paid the bill on time. And to add insult to injury, she always has new clothes for every occasion.


A few years ago, Pam's son was ready for college. She hadn't saved any money for him. ("Oh, he'll get a scholarship, or financial aid, or take out loans and work," she'd said when I suggested she open a college savings account for him.) Unfortunately, since scholarships are usually so competitive, he didn't get any of the ones he applied for. Even with his financial aid (which included work study), he would still have to come up with about 40% of the funds for each school year. Since he had work study, he didn't have enough time to get another job and keep up his credit load, so the only other option was to take out a loan.


He applied for a student loan, but the bank told him he needed a guarantor, who would accept responsibility for the loan in case he defaulted. He used his mother's name, but because of her credit history, they said he needed a second guarantor. Alas, since Pam's poor money management was no secret, none of her family members or friends wanted to take on that responsibility.


He decided to take a couple years off to work until he could afford to go to school. He still hasn't gone back. 


The moral of the story: you don't have to pay your bills on time, but don't be surprised when it prevents you from reaching other goals such as owning a home, sending your kid to college or getting a job you've always wanted (yes! more employers are looking at your credit history these days before they hire you).

#229: 3 Things You Need to Know About Retirement (Friday, May 20)

So recently I had a conversation with a friend who didn't realize that Social Security was in trouble and might not be around by the time we get to retirement. I was completely shocked by this, since I write about these statistics every day and just assumed everyone knew. Then I had a similar conversation with another friend and realized that many people are in the know, so here are five things you need to know about retirement:

• Last week the Trustees of the Social Security Fund released their 2011 Annual Report. The report shows a projected deficit of $46 million for 2011, and that the Social Security reserves will be exhausted in 2036, a year earlier than previous projections. This means that unless Congress comes up with a plan to fund Social Security (which, given the current budget problems, is a bleak prospect), tax income would only be sufficient to pay 3/4 of scheduled benefits through 2085.
• Given current medical enhancements, people are living longer than any generations before them. This means that you could spend 30 years or more in retirement. Since the reserves expire in 25 years and the tax income will last only another 49 years, those of us in our 30s or younger, need to start saving our own money for retirement.
• The average monthly SS benefit is $1,077...not nearly enough to cover expenses such as mortgage/rent, food, healthcare costs, etc.

This isn't to scare you, but it is to make sure you know you have to be proactive and start making a plan now. Assume you will not get full SS benefits and that you'll spend 30+ years in retirement. Assume you'll need a monthly income (comparable to what you use now) to live on in those 30 years.

Start today by taking one small step: Maximize your contributions to your 401(k) or other retirement account--especially if you are lucky enough to have a company match. It's money you're leaving on the table.

#228: How to Get to 100% (Friday, May 13)

I’ve been learning a lot about credit lately—even some things that I didn’t know I didn’t know. Last week, I learned about the factors that make up one’s FICO (Fair Isaacs) score. This is really good information to know, especially if you plan to make a major purchase in the future. Here are the five things that make up your credit score: 

Payment history: 35% - This takes into account how often you’ve paid on time, how many times you’ve been late, etc. 

Amount owed: 30% - Lenders need to know this information to see how much of your credit you have in use (generally your debt should be no more than 20% of your net income) versus the amount that is available to you. So for example, if you have a limit on your credit card of $10,000 and you’re using $9,500, you may not be an ideal candidate to receive additional credit. 

Length of credit history: 15% - How long have you been using credit. Generally, those with longer credit histories have higher scores than those with new credit. 

Mix of credit: 10% - This looks at the elements that make up your credit. Ideally, it is better to have different types of credit (student loan, credit card, car payment, store cards, etc.) since each type of credit has its own requirements. For example, the requirements for obtaining a student loan is very different from that a store card. 

New Credit: 10% - This looks at how much new credit you’re applying for. If you already have credit and you’re applying for new lines of credit, this presents a risk to a lender and they are less likely to offer you a loan. 

#227: Peas 'n Love - The Economics of Eating Out (Friday, May 6)

If you're like me, you spend a lot of your time eating out--and it's usually group dining. Years ago it wasn't an issue, but recently dining out has become a complicated event. I've watched groups bicker over who pays for what and sometimes, it can end up being a financial burden when it should be about enjoying great company and good food. (I once paid $40 on a non-birthday dinner when I'd only had dessert, just to keep the peace.) I don't mind splitting the check evenly, but I do realize that not everyone is in the same financial situation. A regular Tuesday dinner for me could be someone's monthly treat.

My sorority sisters and I have a great plan that has worked for us for over 10 years. For birthday dinners, we add the birthday girl's tab, tax and tip and divide it by 6, then add that to whatever we ordered. And if we all ordered something comparable, we split the tab.

Eating out shouldn't break your wallet, nor should it be a complicated event. Here are some etiquette rules from the experts for group dining:

• It is acceptable etiquette to ask for a separate check. If you're in a large group, ask the waiter quietly (so that every party at the table doesn't want a separate check) and do so before the meal begins.
• If it is a birthday dinner, it is customary to split the check for the person celebrating the birthday.
• If the group has opted for one check and everyone orders food in the same price range (within a few dollars), it is acceptable to split the bill evenly.
• Conversely, if someone orders food that is significantly more expensive than others or more drinks, that person should offer to leave more. 
• However, the taxes and tip should be split evenly among all diners regardless of how much individual meals cost.
• Bring cash to group dinners.
• Diners can opt to just pay for what they order, but it is rude to use calculators during dinner. Instead, round your portion to the nearest dollar.

Don't let a squabble over the bill ruin a great evening with friends.

#226: Tap Into Your Support System (Friday, April 29)

When I started this financial improvement theme in January, I identified one of the key ingredients to a successful financial future: a buddy. Everyone needs a support system, no matter how independent one perceives themselves to be. And when it comes to financial matters, it's even more important to surround yourself with like-minded people who will keep you on track.

Last week a friend of mine had the financial equivalent of a nervous breakdown. She had underestimated the need for a financial buddy, so when she found herself on the brink of a financial crisis, there was no one to dissuade her from taking a course of action that would ultimately be a blow to her financial goals. But mistakes, if nothing else, are great teachers, so now she's enlisted a support system to help her rebuild her finances. I'm glad she's back on track.

I have several financial buddies myself: there's one for investing; there's one--actually a few--for home buying matters; and then there's one who talks me off the ledge whenever I'm going to do something rash. It requires a lot of trust, support and sharing before you can decide to call someone your financial buddy.

Believe it or not, there are a lot of financial support groups available if you prefer to lean on people who are not so close to you:

• DailyStrength.com is an online forum where people share their financial woes and receive words of encouragement from readers. If you ask me, it's a bit of a buzzkill, but for some it can be motivation to ensure that they avoid some of the pitfalls mentioned on the site.
• The Money Honeys are a group of women who met in a financial literacy class and provide support to each other. Now this is my kind of support group: actionable and results-oriented. One woman cleared $50k of debt within a year of joining! Love it.
• For investing buffs, the NAIC (National Association of Investment Clubs) provides a formal model for groups to start their own investment clubs. 

#225: Your Worst Enemy (Friday, April 22)

I keep this picture (it's me trapping myself under a wine glass) very close to me as a constant reminder of something I realized a long time ago: sometimes I’m my own worst enemy. Here a just a couple examples of how in this week alone, my errors ended up costing me both money and opportunities:

1. Opportunity only knocks once. Last week I saw a sale to New Orleans: airfare and hotel for a little over $600. I should’ve jumped on it, but I hemmed and hawed. By the time I finally decided to book it, the airfare alone was nearly $500 and the hotel deal was over, so I would have had to pay $150/night. I could have saved $300+ if I’d jumped on the opportunity. That wasn’t the only missed opportunity; I found out that Soledad O’Brien whom I absolutely LOVE would have been in the same hotel as I at the same time.

2. Early bird catches the sale. After my New Orleans deal fell through, I decided to go try somewhere else I’d never been. Providence, RI fell out of the hat. I had two options to get there: the train, which was $97 each way; or the bus, which was $23 each way—and they both took the same amount of time to get there. No brainer, right? For me, not so much. Once again, I debated the merits and disadvantages of both, and by the time I’d decided on the bus, it was sold out. I ended up taking a crowded train with a bunch of noisy kids that cost $109 (I didn’t buy it 3 days in advance so the fares were more expensive than the original price), $86 more than I needed to spend. 

3. One in a million chance? A couple years ago, a friend of mine sent me an application for a housing lottery in Bed Stuy. I never applied. Those housing lotteries are so competitive and especially for neighborhoods like Bed Stuy. What were the chances of me actually winning a spot? I thought. Turns out, they were pretty good. The friend who forwarded the application won a property—six blocks from where I live now and at a deep (think 40% discount off current brownstone prices). He moves in May. I know there’s no guarantee that my name would’ve been selected, but I’ll never know.

I know I’m not alone. Are you sabotaging yourself financially (or in any other part of your life, for that matter)? Are you doing things that undermine the financial goals you’ve established for yourself? Is procrastination affecting your income/earning potential? Don’t be your worst enemy.

#224: Turning A Negative into A Positive (Friday, April 15)

After last week's Good Friday, I realized that there are still a lot of people who haven't done their taxes. According to the IRS, about 36 million people wait until the last minute to file. But even though it's a more complicated tax year this year and you may have to deal with longer lines at the post office (if you're not filing electronically), there's good news:

• You'll have the weekend to sort through everything since the deadline was extended to April 18. 
• You also have until April 18 to make a 2010 contribution to your IRA and if you're eligible for a tax-deductible contribution, it'll lower your tax bill.

I found a lot of great last minute tax tips in an article on MSN Money, 8 Important Tips for Last-Minute Filers.


And remember the most important tip of all: even if you can't pay your taxes, you should still file. (If for no other reason, it's a crime that's punishable by a fine of up to $25k or one year in prison...who knew?)

#223: Choices, Choices (Friday, April 8)

Every choice you've made in your life has gotten you to this point. Even the seemingly "insignificant" ones.

With the tax season closing, many people are probably looking forward to their tax refund. What will you do with yours? Spend it or save it?

A few years ago, I decided to spend my entire tax refund. It was good while it lasted, then I felt like, "Now what?" You can choose to spend your entire tax refund on a big-ticket item, or you can use it to serve multiple purposes. Consider dividing your refund as follows:

• 20% for yourself; do whatever you want with that money. I generally put this money in my Vacation Fund or buy something ridiculous for myself that I wouldn't ordinarily buy.
• 30% in your savings; if you don't have an emergency fund, this is a good opportunity to start building one.
• 30% towards your bills; use that money to reduce your outstanding debt. Since my student loans are paid off and I don't own a credit card, I usually divide this between my savings and miscellaneous.
• 20% for miscellaneous; if you have kids or other family members that you support, this can be used for them. I use this for gifts to my parents and to fund 529 plans for my niece and godchildren.

I promise it'll be more rewarding to handle multiple financial needs with your refund than spending (or saving) it all.

#222: Don't Discount Your Work! (Friday, April 1)

I work hard. Really, really hard. But thankfully working for a corporate giant has it's perks--and I take full advantage of them all. If you work for a large company, you may be missing out on great opportunities to save a lot of extra cash.

For example, one of my favorite past times is going to the museums. The MoMA, one of my favorite museums, is $20 as is the Met; the Brooklyn Museum is $10; the Guggenheim is $18 and the Museum of Natural History is $16. Through my company, I can get free admission which can save me up to $50 per month.

My employee card has also granted me discounts at the gym, Broadway shows, parking, cell phone service, hotels, car rentals and a host of other things that I wouldn't have thought to use my employee card for (even coat check at the museum!). Just last year alone, I was able to save over $300 using my employee discounts. I like to consider it as a salary augmentation. Lol. I just found out that government employees also get a discount at my gym too, so it doesn't just apply to people who work at large corporations.

What discounts are you missing out on? Check with your employer (and the organizations you belong to) to see how you could save some cash.

#221: What You Don't Know - Part II (Friday, March 25)

Last week's Good Friday was dedicated to financial situations that you may have that you don't even know about. I found some other situations that could be costing you valuable money: recurring subscriptions, bank fees and state laws.

Recurring Subscriptions: Two years ago, Amazon had an offer of free overnight shipping if you signed up to use their Prime service. I took the trial offer...and forgot about it. They ended up charging my card $75 for the year--the most expensive book I've ever sent. But since I didn't cancel after the first year, they billed me for 2010 in August. Thankfully, Amazon's policy is that they will refund your membership if you haven't used it, so I was able to cancel and get the 2010 membership fees back. Most recurring submissions bill annually, so it's easy to miss it on a credit card statement. Check your statements to make sure you're not being billed for an annual subscription that you may have simply forgotten to cancel.


Bank Fees: Banks are becoming increasingly regulated so they have to figure out ways to still operate profitably. As a result, many banks are now cutting back on rewards programs  and a few have even raised the fees on ATMs, overdrafts, insufficient funds and the like. In fact, Chase just announced that it's testing $5 ATM fees for non-customers! Of course, banks are legally required to notify you before they change the fees on your account, but how many of us actually read the notifications from our bank unless it's a statement? Double-check the fees you're currently paying your bank. Use the worksheet from Good Friday #212, or go to bankrate.com.


State's Rules: I just found out that in California, cell phones are considered a luxury, so there is a luxury tax on them. Yes, you'll have to pay your taxes, but knowing is half the battle and you can make more informed decisions.

#220: What You Don't Know You Don't Know (Friday, March 18)

Last January, I got a new phone. I'd never gotten insurance on my phone before, but after hearing that they would replace the phone, no questions asked, I thought it was a pretty good deal. So I got the insurance and have been paying my premiums faithfully ever since.

A couple days ago, I accidentally dropped my phone and my display went dead. I took it into AT&T who told me it was covered by my insurance. I was ecstatic. I called the insurance company to file a claim. "Sure, we can send a new one in the mail right away!" the associate promised. But if you remember, I got my insurance license last September so I'm a little more informed and knew to ask about the deductible. It was $125. Did I mention that after my rebate the phone cost me $99?! So the deductible plus the sum of my premiums ($75) was twice what the original phone had cost me.

To add insult to injury, they were going to send me a refurbished phone and while they could give me a Blackberry, they couldn't guarantee that I would receive the same model phone as I'd previously had.

What are you paying for that isn't financially beneficial?

By the way, you should have completed (or be very close to completing) your 3-month financial goal by now. How are you doing?

#219: Moving In, Moving On, Moving Up (Friday, March 11)

This week I got a couple questions on moving in from different people in different situations: one was looking for a roommate, the other was thinking of moving in with her boyfriend.

Moving in with a roommate or a significant other can save you money, but if you're not careful, it could also cost you big in the long run. What if your roommate loses his/her job and can't afford to pay the rent? Or what if their credit isn't good? Or what if they decide to move out early and your name is on the lease? I know firsthand about the potential financial woes that could come with having a roommate. A similar situation cost me a friendship and put a nasty blotch on my credit which it took nearly five years to clear. But moving in can be a great financial decision, if you know how to play it smart:

Moving in With A Significant Other

• DON'T completely merge all your finances with a significant other until you're married.
• DO split bills and rent equitably, based upon your income. For example, if one person makes $2,000/mth and the other makes $4,000/mth, use percentage of income when calculating bills.
• DO discuss the goal of moving in: is it just to save money or is it in preparation for marriage?
• DO discuss spending habits and attitudes about money, as well as future financial goals.

Moving in With A Roommate

• DO draft a roommate agreement that outlines the course of action that will be taken if a roommate defaults on the rent, any of the bills or decides to leave early.
• DO try to find an apartment with utilities included so there is only one bill to split.
• DON'T put all the bills in your name. Either put both names on the bills or alternate bill responsibility (put your name on the gas, and your roommate's name on the electricity).
• DON'T share grocery bills. Although it can work out, it usually creates more of a hassle than it's worth (are you really going to keep track of who drank most of the milk?)
• DO get a credit check of your potential roommate and also agree to provide one. If someone has a history of non-payment or late payments, they may the same way when it comes to paying rent and bills.
• DO try to negotiate separate lease agreements with your landlord, so that if your roommate leaves, you won't be responsible for the rent.
• DO create a pool (each contribute $50/month) for shared expenses (toilet paper, common area furnishings, etc.)

#218: The Cost of Keeping Up with the Joneses (Friday, March 4)

If you compare yourself with others,
you may become vain or bitter;
for always there will be greater and lesser persons than yourself.
Enjoy your achievements as well as your plans.
Keep interested in your own career, however humble;

-Max Ehrmann, Desiderata

Earlier this week my cousin and I were talking about keeping up with the Joneses. A few hours later, I got this article in my newsfeed, so I thought it was a sign that it should be the topic of this week's Good Friday.

Many people use those around them as the benchmark for how they live their lives. The result of trying to "keep up with the Joneses" means that many people are living above their means. Even something as simple as maintaining your lawn could get you into financial trouble. The reality is that the Joneses are broke:

• Nearly half of Americans spend more than they earn each year.
• Over 1.5 million people filed for bankruptcy in 201o, a 9% increase over 2009.
• 26% of Americans (and 51% of African-Americans) admit to not paying all of their bills on time.
  

It's important to enjoy your life and the things you've worked hard for, but we can all use a few tips on how to keep ourselves in check:

• Keep your credit card debt between 25% and 30% of your credit limit.
• Keep your debt-to-income ratio at or below 36%. If your DTI is between 43% and 49%, financial difficulties are imminent. If your DTI is over 50%, you may need to get financial help (credit counseling) to get your finances under control.
• Build your net worth with real assets. A fancy car may be nice, but the value of cars depreciate quickly. Consider assets that will add value to your net worth over time.

#217: Unhealthy Relationships (Friday, February 25)

There are some relationships in life that work perfectly and then there are those that need some work. Unfortunately, it's these unhealthy relationships that most consume our lives. Your relationship with your finances is no different. Before you can really start improving your financial status, you should evaluate your relationship with money.

An unhealthy financial situation can have massive consequences. It can derail your goals (purchasing a home, starting your own business, having children), mess up your marriage and cause problems in your friendships.

Consider the following questions when evaluating your relationship with money:

1. Are you still on track to accomplish the 3 financial goals you set at the beginning of the year? If not, what has delayed your schedule?
2. Do you often make purchases you know you cannot afford?
3. Do you often forget to pay bills or consistently pay them late?
4. Do you shop or make unnecessary purchases when you're stressed or unhappy?
5. Are you living within your means?

Answering these questions can help you actively think about the behaviors that may be sabotaging your financial goals.

#216: In Case of Emergency (Friday, February 18)

I once read something that said most people are just an emergency away from being homeless. It's a scary thought, but it really does take only one unforseen situation (losing a job or an illness) for a lot of people to find themselves in dire financial straits.

Are you prepared?

The Idea: Begin creating an emergency fund for 3-6 months of your living expenses. Keep this fund in a separate account from the rest of your savings/checking. I recommend an online account. Your living expenses include all the bills you currently pay now: rent/mortgage, car payment, utilities, student loan (although you may be able to defer these payments), groceries, etc.

You're probably wondering where the money to create your emergency fund is going to come from. Well, we've already identified a few areas in previous Good Fridays:
- The fees you could save by re-evaluating your bank
- Earning extra cash that you dedicate directly to your emergency fund.
- The money you save by prioritizing your needs over your wants.

We'll have more opportunities to add to your emergency fund throughout this year's Good Friday.

#215: Missed Opportunity? (Friday, February 11)

I'm usually a practical, no-nonsense kinda gal. But every so often, I go completely nuts and have an impractical yearning for something that I know just doesn't make sense.

In 2008, it was the Christian Louboutin Goya shoes. They were $945 when they came out, but I had a "hook up" where I could get it for $750. At the time and even at that price, it was $100 shy of my monthly rent and nearly four student loan payments, but I didn't care. I wanted those shoes. I ended up putting the money into my online banking account, where it was less accessible. Since then, I've earned $75 in interest.

The Idea: For major purchases, determine whether it is a want or a need. If it's a want, consider the following questions:

1. Will making this purchase keep me on track to meet the three financial goals I set for myself this year?
2. Is this a temporary satisfaction or will it benefit my long-term financial future?
3. What do I have to give up to purchase this item?

Your answers to these questions may help you determine whether you should purchase this item.