Personal Finance QuickTake: Insurance

A friend of mine from work had her kids visiting her for Christmas break. As they were about to go back home they found out that their home was under 13 feet of water due to the flood in Fernley Nevada. Luckily everyone seems to have made it out OK, but the house is probably a total loss.

They have renter's insurance, but they have found out that it doesn't cover floods, since they are in the desert. FEMA is there helping, but it really is totally devastating to lose everything like that.

We are all trying to save money, but it is so important to make sure that you are properly insured. A year ago we had a small house fire, and everyone was OK and we had the extra rider for not only fire, but the water damage that ensued from the fire department putting it out. If we hadn't we would of been out of thousands of dollars.

Every year it is a good action item to do a total review of your insurance needs; Life, Home, Car, everything. A lot of time we can be over-insured, especially on cars that are not worth as much, so you might even save some money! But the wrong time to find out you are not insured is after something bad happens. A small payment a month vs devastating loss is a big price to pay!

Don't be penny-wise and pound foolish...

Keep Your Budget and Keep Your Hobbies...

I really enjoy playing Golf with my friends. It really started just this year, but it has been great. It is relaxing (most of the time) it gets me outside and away from the computer, and it is one of the only sports (don't worry, I use the term loosely when associated with me) where you only really play against yourself. On top of it all my daughter will often "caddy" for me so we get some one on one time as well.

So when money came to a real head in July and we all made the pledge to cut expenses, especially non-Needs, and get on a budget (although it took to September to really get things in order). I was thinking that my golf time was behind me, at least until our debts were paid off.

It had been drilled into me as a small fry that Golf was a Rich Man's game by my family. I believed that you really couldn't play unless you were willing to pay big money, or at least had big money. I had a chance to go out a couple times with our Reps and Sales Guys and it reinforced the issue. They played at nice, often private clubs and spent like a liquored up monkey on the latest gear. So not willing to spend that sort of money, I moved on.

For my Birthday last year my wife surprised me by getting me a gift cert for a set of club and 6 lessons. I bought some off-brand clubs that actually fit me (I am 6' 4") took the lessons and found that I enjoyed it. I started to play on the weekends with my brother and step-father at a local course and really enjoyed it.

But even this was going to be out of my "allowance range" now that we were on budget. Then some friends clued me in to some great ideas as they were trying to play for as little as possible too.

We started by looking into "Twilight Golf" meaning a round at the end of the day, especially on a weekday. This gave you big savings because hardly anyone plays at that time! We would go right after work and found deals that took expensive courses that normally ran $55, for $20! We then found a little 9-hole course that we could play for $5!!! It started at 5pm and we were always last, but we got to play!

I then turned to equipment. Golf is like fashion, every-year new sparkly things come-out and the old stay for a year or so, but get severely marked down. I started by using balls that were a generation or two behind and buying ones that were on closeout, since they weren't as popular. These were balls that had been $40+ just 6 months ago, now going for $14 or less.

I really wanted one of the new drivers that just came out that help your slice. But using what I know now I waited and saved. Sure enough the driver kept coming down in price until it was on closeout for 70% off. I will have saved enough in two more weeks to get it...using 100% of saved allowance cash.

The point isn't to bore you with Golf stories. The same goes for any hobby. Just because you are on a budget doesn't mean you have to give up the things you like. Put creative though on how you can do them for less. I guarantee you will appreciate them even more...

Personal Finance QuickTake: What $1 Million Buys in Homes

There is an interesting story on abcnews.com this morning regarding what sort of home you get for $1 Million today around the world and it was shocking, at least to me.

I knew how expensive New York and London are, but it seems every major city, even now in Central or Eastern Europe, it is getting tougher and tougher to live in the close to the heart of these major cities.

I looking at any issue it is important to look at the ripple-effect of what these prices can mean. A couple thoughts:

• Salaries - In order to even afford basic housing you are going to have to make a lot more. I don't see salaries (especially mine!) growing fast enough to keep up. Which means...
• Longer Time at Home - Kids will need to stay longer with their parents to get a real start. This can really hurt retirement planning for the parents though. In many parts of the world multi-generational homes are the norm, we may be headed there as well.
• Telecommuting Gets More Important - IF you can't afford to live near the office, you can either commute a really long way and time (the norm for a lot of Californians) or telecommute. As a country we are behind Korea and other countries with 3G or even 4G bandwidth. We'll need it if more start working from home.
• Financial Planning - It is more important than ever to instill the skills and desire to be careful with money as it seems logical that with higher expenses and salaries not keeping up that everyone is going to need every dollar!

In 1977 my parents paid $45,000 for a 3 bedroom, 2 bath home in Omaha. It is probable that my kids could pay $1 Million for the same thing here is Oregon when it comes time! I wonder if the time is coming where more parents try to save for the kids home down payment instead of or in addition to college...

The Dark Side of Debt Reduction: What I Could Have Bought...

Saturday is bill paying day and I was feeling pretty good. We paid everything, our overflow (which is our cash leftover after two weeks) gave us the ability to refill our coffers from our recent Ninja Bill, and we have hit my initial savings goal for the month already.

Then as I was tallying something hit me. Over the last 60+ days we have been able, as a family, to pay off about $4300 worth of debt. This is due to my checks being a bit higher for those two months and applying all of that plus our budget savings to draining the debt pool.

Then it hit me...this isn't just a number, this is payment of a lot of things that we just couldn't wait for; dinners, rounds of golf, guitar stuff, a couple new furniture pieces, etc..

Holy smokes, if we were debt free, think what we could have done with that money!

• Taken a trip to Sandals, Jamaica - We have never even really had a couples vacation. we have wanted to go to the Caribbean for along time.
• Bought a second used car - Since I changed jobs, no more company car. It would be much more convenient to have two and it would be paid off.
• HUGE Christmas - Could of gone nuts!!! Lots of plastic pieces to step on YEAH!
• Killer Guitar - Their is a great guitar that I could get a great deal on, once in a lifetime deal in fact!
• Doubled our savings! - Nearly $7000 in savings for Emergencies or to help us begin our re fiance program.

Anyway you get the point...what I am paying for is dinners that were a long time ago, that we couldn't obviously afford and other stuff, most of which is gone!

Instead of depressing me it really helped to clarify why this is so important to accomplish. I just don't want to be alive, I want to LIVE and experience all the great things life has available to us.

Think about this the next time you pick up the plastic...are you alive or Living!

You deserve better...

Personal Finance QuickTake: Align Your Finances with your Values

I found this neat article this morning on Yahoo from David Bach's Automatic Millionaire column that I thought that you might enjoy as much as I did.

Basically, David points out that our Personal Finance Goals need to be aligned with our Personal Goals and who we are as a person. Tie your core beliefs into our core investment strategy.

I have my financial goals wrapped up for the year, but I need to go back and work on my personal goals. It is so easy to stare at the trees you miss the forest. I want to make sure I end up not just finishing, but finishing at MY finish line. Otherwise it is like running 26 miles in a random direction and then wondering why you didn't complete the marathon! :)

This really resonates with me. It reminds me to make sure as I work through this years Goals that they tie to where I want to go as a person, husband and Dad to three Monkeys.

Good weekend thing to ponder and work on...

In Managing Your Money; Hope for the Best, Plan for the Worst...

How do you know a crisis is coming? When you aren't prepared for it.



It at least seems like that to me. I would have money in my checking account, my bills paid, so I would go buy something pretty for myself (like a nice Sand Wedge :) ). The next day a bill would arrive from the IRS asking for $1200 I didn't realize I owed them. Scramble time! I would run around, maybe do a Direct Deposit loan at Wells Fargo, use a credit card, whew..all is well. Of course, I racked up debt, blew my budget and didn't manage my money well at all.



I have extolled the virtues of having an Emergency Fund before, but I believe being prepared for success mean, not setting yourself up for failure. Here are my top five ways I have seen me and my friends set ourselves up:

• No Emergency Fund - Enough of me beating a dead horse to death, but I disagree with some that say pay your Credit Cards off first, because you can charge any issue that comes up. This was my fervent believe, but I didn't pay it off right away. Plus I never broke the Credit Card vicious cycle.


• Budgets like a dictatorship couldn't live under - You really want your budgeted amounts to be based in reality. Not, we'll I read you can live on $40 a month per person even though we always spend $150. You are setting yourself up for failure. Nothing wrong in beating your budget! Successes breed more Successes, Failures breed Pop Stars..sorry I meant Failures.


• Not reviewing at least the last two years expenses - You will miss large swaths of land if you don't. Like "oh yeah, I need a car battery every x year, and tires."


• Cut up your cards, but don't cancel your accounts, yet - I disagree with Ramsey a bit here. Bad things do happen. As you are paying off your credit leave the accounts open. This is in case something happens that swamps your Emergency Fund. Not to mention that a big part of your FICO Score is your percentage of available credit and credit length. Better scores mean better rates.


• Expect Everything to get Better in a Month - You hopefully didn't spend it overnight, ingrain the habits overnight, don't expect now that you are working it rain will stop falling. Too many get discouraged by a setback. Setbacks are learning experiences! Embrace them and move forward

As with everything I post I am not a CPA, nor did I sleep in a Holiday Inn last night, do what works for you and your budget, it is the only way you will ever stick to it and that's all that matters...

New Carnivals Featuring Life, Liberty and the Pursuit of Money

For me it is a real honor when someone recognizes your work and includes your submission in a Financial Carnival. It really means a lot to me personally, and to the blog as well, because everyone likes to be heard!

Being Frugal is a favorite blog of mine and right now it is running a Carnival about 2008 Financial Goals. They have included my 2008 Top 10 Goals in their listing and it is always really interesting for me to see what others are working on as well.

Dividends4Life is running their weekly Carnival of favorite posts as well and was kind enough to include us. They picked our article on "Very Wealth People's Characteristics", which has seemed to be a favorite of my recent posts.

In other quick news; Life, Liberty and the Pursuit of Money just passed two important milestones (at least to me). We just had our 500th visitor and 2000th page view! I know a lot of Blog get that in a day, but for someone who though no one would ever find us, it is a pleasant shock!

I can't thank everyone enough for visiting and commenting and cross linking the way you have. It is very much appreciated...