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Monday, September 30, 2013

Student-Loan Defaults rise

Just as real estate isn't guaranteed to appreciate, college and advanced degrees don't guarantee a job or high income.  Student-loan borrowers in the U.S. are struggling.  It's prudent to consider if a college degree is right for you before taking on the debt.

Kid-Friendly Vacation Deals for Free

Here's a list of vacation freebies for those traveling with kids.  Of course, if you're trying to pay off debt, a stay-cation may be more appropriate.   

For Up to the Minute Coverage of the Pending Government Shutdown . . .

Reuters is live blogging.

If We Managed Our Finances Like the Government Manages Its Finances . . . .

Here we go.  The government finds itself in the precarious position of needing to raise the debt ceiling.  Is this deja vu all over again?

We don't know about you, but we can't raise our personal "debt ceiling" anytime we're at risk of not being able to pay our bills.  On the rare (thankfully) occasions when we were at risk of not being able to pay our bills, we cut back our expenses and tried to generate more income.  That meant not dining out as much, canceling cable, cutting back on grocery expenses, clipping coupons and finding additional sources of income, etc.

If we can't pay our bills, we can't just come to an agreement between ourselves and take on more debt.  We do have the option of calling our credit card company and asking for a debt limit increase.  They may or may not oblige.  Regardless, this isn't financially prudent.

We understand the value of a balanced debt to income ratio.  We know that an imbalance of this ratio negatively impacts our credit scores.  Poor credit scores mean higher interest loans or denials for loans.  A poor credit score these days can, also, mean not getting a job in a market in which it's already hard enough to get a job.

If we managed our personal finances as the government manages its finances, we would be in financial ruin.  Truth be told, the U.S. Government isn't in good health financially.  Don't let politicians deny it.  Countries such as Greece, Venezuela and Argentina are proof that debts do, in fact, catch up with governments.  We can't continue to print money out of thin air, artificially suppress interest rates and take on more and more debt without it catching up with us.

Both sides will blame the other and it won't be long until we're hearing the same talking points again.  Our country needs people who are able to strategically cut spending, while raising taxes.  Just as we manage both sides of our balance sheet, so must the government.

The reason our politicians don't do this is because they aren't held accountable.  If they were held at least as accountable with the government's finances as we are with our personal finances, this tired story wouldn't be playing itself out yet again.

Poor Reasons for Not Saving for Retirement

Good arguments against seven popular arguments for not saving for retirement.  Be careful with chasing 0% interest credit card offers, as too many of these can hurt ones credit score.  Pay off higher interest rate cards first (those in the teens), then start investing when you only have moderate and lower interest debt.  The point, however, is to not put off one, thereby delaying the other. 

Buying a Home? Proceed Cautiously.

We agree with Shiller that there's currently no "irrational exuberance" in the housing market.  We do, however, agree with our advice last week to proceed cautiously if you're in the market for a new home.  Regardless of market performance or perception, buy less than you can afford if for no other reason than it's no fun being house-poor.

Retire in Ireland?

A few weeks ago we posted an article about retiring in warm, tropical climates.  If that's not your cup of tea, how about Ireland?  As a country, it's not necessarily cheap, but there are hidden gems.

Lysander Spooner's Take on Government Debt

A Reason review of Spooner's, who was a lawyer and abolitionist, beliefs on government debt and the legality of holding citizens accountable for debt incurred by a few.

Get Out of Debt Fast and Avoid These Games

If you're dealing with debt collectors, you're probably not in a good place mentally or emotionally.  Make the changes in your life necessary to get out of debt as fast as possible and avoid these games.  Debt collectors have a job to do and this company paid for their mistakes.  However, keeping them out of your life is best.

Start Planning/Saving Early for Retirement

CNBC has a good interview on planning and saving for retirement.  As one of the commenters says, our failure in this country is not making money management education part of primary education.  We spend a lot of resources preparing our children to earn as much money as possible, but nothing on how to manage that money when they do earn it.  Therefore, many fail to save, invest, avoid debt and plan for big life events. 

Sunday, September 29, 2013

Be Prepared When Applying for a Mortgage

Yahoo!Homes provides good advice to eliminate debt when applying for a mortgage.  Yes, there's a strategy to it.

Habits to Break to Repair Your Credit

Here are habits to break or avoid with regard to credit cards.  There are more, of course, but this is a good start.

Lessons on How Not to Manage Your Finances

Read this and do the opposite.

Bumped: National Coffee Day Means Free Coffee

Sunday, September 29, 2013 is National Coffee Day.  Here's a list of places offering free coffee and other perks (get it?) in celebration.

Are Our Accounts Safe from the U.S. Government?

It looks like other countries are following Cyprus' lead.  Don't panic, but be aware.

Stimulus Funds for Denver Trees

Our neighborhood benefited from some of these trees and we're certainly not high-income.  As I understood it, all residents were afforded this option.  If interested, you needed to sign up.  Our community is very engaged.  I wonder if that was the difference.   

Friday, September 27, 2013

Start a Home-Based Business

Don't only think of a home-based business as a primary career option.  It can also be used to supplement income from a primary full-time job.  This is a great solution for those trying to get out of debt or achieve other financial goals quickly.  There are many options available.  Find something you're interested in doing on the side.  Who knows?  Maybe it'll turn into a full-time job.  We started a t-shirt business a few years ago.  The barriers to entry were low and it was fun.  It didn't turn into a full-time career, but it did teach us a lot.

Coutur Right-Sizing

After Lehman collapsed in 2008, right-sizing became an underground sensation.  With the economy not improving fast enough and more people out of work, a company is capitalizing on the growing trend.  If it saves you money and you're up for it, do it.

Life Imitates Art?

We saw a version of this in The Best Exotic Marigold Hotel.  Many northern Europeans and Northern Americans are moving abroad to more tropical climates for the golden years.  Cheaper healthcare, more affordable housing and warmer weather?  What's not to love?   

Are You Leaving Money on the Table?

Request and negotiate better pay raises.  Not doing so, apparently, can leave millions over the course of your career on the table.  If you can negotiate more money, you'll have more liquid cash to put towards debt you're paying off, emergency savings you're building up or your the retirement.

A Refreshing Take on Solving Income Disparity

CNNMoney interviews Mike Novogratz.  Mr Novogratz provides a refreshing take on fixing income disparity in the U.S.  He makes lots of good points, including the need for CEOs to have a "moral revolution."  What stands out most is his belief that part of why times are tougher for lower income individuals and families because of the gridlock in Washington.  He, also, believes most of his billionaire peers wouldn't be against "raising taxes on the rich" if government could prove itself a good steward of GDP.  Neither party has proven capable of that.

Ways to Improve Credit Scores

Yahoo!Finance has suggestions for improving credits scores.  Some tips are different than what we use, but do what works for you.  Always be cautious and manage your credit day to day.  If a piece of advice isn't working, stop.

Who's Getting Rich?

It seems like the only group making money out of all of this is the Federal Reserve, which is a private bank, and the banks who are pushing bad loans off onto the Federal Government.

Are We Learning or Is the Cycle Starting All Over Again?

Although it is good to see consumer spending up, it hearkens back to the days not so long ago that our economy was being propped up with debt induced euphoric spending. With the increase in spending tracking what appears to be the increase in home prices, have we really learned our lesson or have Americans become used to the Home Refi ATM again? We hope that more have learned the Debt Free Principles and are finally able to spend more due to #moneyconscious spending.

Thursday, September 26, 2013

National Coffee Day Means Free Coffee

Sunday, September 29, 2013 is National Coffee Day.  Here's a list of places offering free coffee and other perks (get it?) in celebration.

Year-end Tax Planning

As with anything related to your finances, you need a plan.  Here are some good considerations from CNBC about tax planning before the end of 2013.

How to Not Stink Like a Fish

MarketWatch has advise from advisors to millennials on how to afford moving out of their parent's house as quickly as possible after college graduation.   

Basics of Obamacare

Regardless of opinions on Obamacare, understanding the basics is important.  CNBC put a good list of basics together.  Plan accordingly. 

Mom and Dad Living with Grandma and Grandpa

7.7 U.S. children are living with grandparents and 8 in 10 of those children have at least one parent also living with them.  Guests are like fish.  They stink after three days.  Though this may be a good short-term solution for young parents to find their financial footing, it can be a drag on grandma and grandpa's retirement and retirement nest egg. 

Fun for Less Than $21

Here are some cool things to do for less than $21 while you're paying down debt or reaching for other financial goals.  Free access to 1,500 museums around the country is this Saturday, September 28th.  We'll take advantage of that.

Is France Exacerbating Their High Unemployement Rate?

France adding restrictions to when people can earn and spend more money doesn't seem like a wise move with an unemployment rate for young people over 24%.  But, hey, it's their country. 

Wednesday, September 25, 2013

QE3 Smoke and Mirrors Continue?

As Glenn Reynolds of awesomeness always says, "Something that can't go on forever won't."

Durable-goods Up Slightly

Durable-good orders rose 0.1% in August.  This is a cautiously optimistic sign for the economy.  Auto orders were the biggest contributor to this increase.  If you're in the market for a car, you will want to pay attention to this.  The asking price for new cars and then used cars will increase if this trend continues.  More new car sales, mean more new cars being built.  That's good for the economy.  Of course, do what's good for you and buy a "pre-owned" car.  Another positive sign is the increase in capital orders.  This is business investments.  If business is comfortable investing in infrastructure, they're feeling better about the economy.  This should impact hiring.  Again, be cautiously optimistic. 

Talking about Retirement with the Better Half

We're surprised with even 38% of couples talking about retirement.  Our goal is to get everyone talking more.  Talk, talk, talk . . . .  Preparation is key to financial success and that includes talking about goals, risks, concerns and being honest with each other about finances.  

USPS' Inevitable Changes

The USPS as we know it today won't last forever and that makes us a little sad.  We've recently gotten into the habit of sending thank you cards and short notes via traditional mail.  It's personal and surprises people in these days of electronic communication.  Watching how they evolve will be interesting.  

Education: A Key to Staying Competitive in the Job Market

Great article with suggestions on determining if going back to school is a good choice for you and weighing the costs. One glaring item that is missing: employer tuition reimbursement. See if your employer will pay for the classes.

Tuesday, September 24, 2013

"In-sourcing" Will Be Good for the U.S. Economy

"Made in America" is gaining steam again and that bodes well for our economy.  This has been trend for a while and industry insiders have been referring to it has "in-sourcing".  It's good the media is catching up.  Unfortunately much of this is attributable to "declining labor costs" from high unemployment, reduced hours and those who dropped out of the labor force.  For those who benefit from this trend, pay yourself first, pay off debts and save, save, save.

Progress for Same-Sex Couples, but Things are Still Murky

There has been a lot of progress for same-sex couples, but there is still a lot of confusion.  Accountants will be earning their pay over the next few years.  We've been saying for years that marriage equality will finally be complete when either the IRS or private companies put pressure on the government to make things simpler.

Home Prices on the Rise

This is good news for the economy, but be careful if you're in a "bubbly" city.  If you're in the market for a home purchase, you're best served if you buy less than what you can afford and especially don't spend more than three times your income, not including bonuses.   

Know When to Keep Your Financial Guard Up

HuffPo has a great article about the five situations when we're most likely to overspend.  These are good points to avoid spending more than you need or want.

Sunday, September 1, 2013

Welcome Back!

It's been a long time since we were posting on the blog, but we have decided to pick it back up again. We are live on Twitter at @DebtFreeGuys, join us over there for additional conversation. Remember to always be #moneyconscious!