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By Kevin M Identity theft seems to be all around us these days, and while we shouldn’t live our lives in fear, we can lower the chances of becoming a victim considerably with just some minor modifications in the way we manage our affairs. Consider the following ten suggestions: By Kevin M You didn’t read that title incorrectly—that’s the question I’m asking, What Career Will You Have in Retirement? For most people the answer to this question should be given at least equal weight with the more popular focus on retirement savings. I’m not saying that we should de-emphasize retirement savings—quite the contrary. Most of us probably need to be saving more for retirement than we are, and that’s the basic problem. How much can we save between now and retirement while navigating the cost of living in an uncertain economy, and in unpredictable financial markets? Can we ever know for sure that we’ll have enough? Kevin M I hate this topic—so why am I writing about it? Because it seems to be a staple topic of the personal finance blogosphere! And almost universally, the conclusion will inevitably come down on the side credit cards as the better deal. Warning: if you’re looking for that same conclusion here, you’ll be disappointed. Being contrarian by nature, here’s my take on the debate. I think debit cards are the lesser of the two evils mostly because there’s little chance with a debit card that you’ll end up paying for this months expenses next month, next year or over the next 10 years. That ices it for me, but we can go on. We can get into the mechanics of which costs more or has better benefits, but those are details that ignore the most important element–the human factor. If we’re all trying to get out and stay out of debt, spending with a credit card is a contradiction in terms. Worse, for those who have dug themselves out of a debt hole and think that credit cards are now your friend, just remember that like an alcoholic, you aren’t cured, you’re just recovering. Why play around with credit cards when you got into trouble with them in the past? By Kevin M A family living in a McMansion loses their home to foreclosure. An overbearing manager earning a six figure salary loses his job in a department shut down. The (former) most prosperous family in the neighborhood is forced to close down their business for lack of sales; there’s a for sale sign on their front lawn. A couple who drove high end cars and traveled often is facing bankruptcy. A women in old clothes approaches us in a shopping center, tells us her husband has lost his job several months ago, and they have no money to feed their children. How do we react?
PART TWO—REFINANCING YOUR CURRENT MORTGAGE AND CONCLUDING THOUGHTS By Kevin M Yesterday, in Part One of this series, we took a look at the largely hidden costs of purchasing a new home. Today we’ll take a similar look at the hidden costs of refinancing your current home to determine if doing so is truly in your best long term financial interest. Refinancing is far less expensive than buying a new home, of course, but the decision to refinance your mortgage to a lower rate isn’t always as clear cut as it seems. With refinances, people tend to be obsessed with rate. But let me offer that rate alone can be a deceptive metric. PART ONE—BUYING A NEW HOME By Kevin M In response to the mortgage meltdown/real estate slump of the past two to three years, the U.S. government has intervened with the take over of FNMA and FHLMC to insure the free flow of mortgage money, interest rates are being held down to the 5% level and an $8000 home buyer credit has been put in place to stimulate activity. But should you as a homeowner take the bait and either trade up to a new and more expensive home, or perhaps refinance into a lower interest rate loan? I’m going to take the contrarian’s view and argue against either course. By Kevin M On Tuesday, August 25th, I will be interviewed by Neal Frankle for his program, The Wealth Pilgrim Show, on BlogTalk Radio. You can listen to the interview, or even participate in the discussion by either of the following methods: CALL IN: The call-in number is 347-637-2262 . Guests can listen/call in on any phone. ON THE WEB: You can listen to the program on your computer by going to www.blogtalkradio.com/Wealth-Pilgrim-Show/2009/08/25/Neal-Frankle-on-Wealth-Pilgrim-Radio. If you listen by your computer, you will need to register at www.BlogTalkRadio.com. By registering, you can also participate in the program. Registration will take about two minutes. We are going live on 8/25/09 at 3 pm PST, 6 pm EST, and the program will run for one hour. Please join us! By Kevin M I’ve been a PayPal customer for a few years, and have become so accustomed to its advantages that I hardly notice anymore. But by definition, a service is outstanding when it is so efficient that you use it and never think about it. Perhaps that’s because you never need to think about it! After all, it’s the squeaky wheel that gets the grease, not the one that’s functioning efficiently. My wife and I signed up with PayPal a few years back when we wanted to begin selling our kids old toys on Ebay. It’s been a pleasant ride since. OOYR Preface: Proper understanding of the big picture is the first, best strategy for preparing and rearranging your life to prosper in the future. In order to prepare effectively for the future—in regard to careers, spending, saving or investing—we must first have a realistic assessment of the situation at hand and where it can reasonably be expected to lead. In the current economic environment, an optimist isn’t one who expects a quick return to the prosperity of yesterday, but rather the person who considers the economy in realistic–though perhaps dismal—terms, and prepares his life, finances and occupation in a proactive manner. The post below, which provides that necessary perspective, is an article written by Charles Hugh Smith at OfTwoMinds.com, and reprinted here by permission. His blog is perhaps the most concise and easy to understand analysis of the state of the economy and the forces driving it as you will find anywhere. Charles is also the author of the e-book Survival+: Structuring Prosperity for Yourself and the Nation. Both the blog and the ebook are highly recommended.
A number of lethal traps hobble structural reforms to the failing Status Quo. |
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Fast Track to Frequent Flyer Miles
OR, AVOID ROUTINES – DO SOMETHING UNUSUAL!
By Dave Kelly
Are you in a rut, bunky? Feeling like every day is like the day before? And you are certain that you are not caught up in a “Star Trek” or “Groundhog Day” like time loop?
I have an idea for you!
Change things up! Do something impulsive, unusual, or out of your world. Go for a bike ride, take a dance class, or apply to be an astronaut. An astronaut? Sure! You might not make it, but would it not be cool to go through the interview process?
Or take a trip.
Continue reading Fast Track to Frequent Flyer Miles →