Tuesday, June 30, 2009

Understanding Financial Statements


When looking over your investments, do you ever wonder how the value of the companies you’ve put your money in is determined? What factors decide how well a company is really doing? What’s the source of the company’s financing? Will it meet or exceed this quarter’s projections? While some consider the stock market to be little more than a house of cards, subject to the whims of individual investors, there are, in fact, some very real and measurable things that can help you to diagnose the financial health of a company.

Take a statement

It’s not an interrogation but you’ll want to ask the hard questions before you invest. Only by examining and drawing conclusions from a financial statement, will you truly know how well a company is doing. At first glance, you will see that a financial statement is made up of three main sections, the balance sheet, the income statement and the cash flow statement. Each statement depicts a different aspect of the overall financial picture of a business. The balance sheet details companies’ current assets such as cash and prepaid expenses. It shows the financial position at a particular date. This statement tells you what the current liabilities or existing debt the company has, that has to be paid within that year. Examples of debt include accounts payable, salaries payable or income taxes payable. The amount of current assets over current liabilities determines the amount of working capital or leftover cash the company has to cover other operating expense s. Whether or not there is enough money left over after the current debt is paid off, tells you whether the company is on solid financial ground or might be headed for destruction.

The income statement is a summary of the profits a business has earned for a specified period of time. This is where you would see the amount of revenue or profits obtained for a companies’ products or services and the expenses incurred for salaries, supplies or income taxes. The difference between the revenue and expenses gives you the net income, which when compared over a period of say two years shows you how the net income is rising or falling, a fairly good indicator of how profitable the business is. Basically, this statement tells you if the company has revenue coming in.

The cash flow statement is particularly important when considering new ventures such as an internet startup. The ability to balance cash flow now is a sign that the business has a long and profitable future ahead of it. This reports the cash going out and coming in from operating, investing and financing activities. In this statement, changes in the net cash flow indicate the company’s ability to meet its debt obligations and pay dividends, how much external financing the company is using and its ability to generate cash flow in the future. Operating cash flow can be described as the cash effects from revenue and expense transactions. Investing cash activities comes from the purchasing and selling of properties or assets and financing cash activities shows how owners of the company have used loans from creditors to finance their business.

Know the facts

Investing should never be based on emotion. While you might be tempted to invest in a company because you like its products or because you’ve just read a favorable article about it in a magazine or newspaper, you should make sure you’ve done your research before ponying up your hard earned cash. Think of the financial statement as a kind of scorecard that helps you determine which company is the one you should invest in. What you’ll find is a hard look at the financial structure of a business that shows you what it’s really made of. Ask yourself a few questions and see if the statements help answer them. Does the revenue exceed expenses in the income statement? Does the amount of assets exceed liabilities on the balance sheet?

Notes often accompany financial statements. Read these notes carefully as they disclose information that can help you interpret the financial information on the statements. The notes reveal any changes that could have an impact on the company’s finances. It can provide some startling insights such as what type of debt the company purchased, for how long and for what purpose. For example, the notes might state that company A entered into a two year term note of which the proceeds were used to purchase the company’s out of state manufacturing facility and headquarters. Essentially, the notes are a complement to the statement providing more details. If you’re a shareholder, it’s your company. So you’ll want to make sure you know as much as you can about it.

Read more about Understanding Financial Statements…

Vulture Consumers Gain From Others' Misfortune

In the current economic slump, many consumers are finding bargains by low-balling salesmen or snapping up foreclosed homes. Reporter Jennifer Saranow weighs the ethics of “vulture consumerism” — benefiting from another’s misfortune.

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Monday, June 29, 2009

Mint Map: Resource Consumption by Country

Knowing where resources are produced is only half of the equation. To really understand the role that natural resources play in a country’s overall economic picture, you have to understand how those resources are consumed. As you’d guess, the largest populations do tend to be the largest consumers, but it’s interesting to note that some consumption is based on the manufacture of products for which the country’s residents are not typically the end consumers. Which country will be the first to run out of oil or natural gas? Which will be forced into building more environmentally friendly transportation systems or means of production? Our latest map takes a closer look at the world’s resources with an eye to how they are being consumed.

Click to enlarge the map below:

Read more about Mint Map: Resource Consumption by Country…

Michael Jackson autopsy

Results of the Michael Jackson autopsy have thus far been inconclusive, but controversial. The first and second Michael Jackson autopsy haven’t clearly identified a cause of death, and the toxicology report is going to take a few weeks before it’s finished. There was a report in which the singer was said to be severely undernourished, in fact starved, and had gone almost entirely bald by the time of his death, with pills being the only content of his stomach. It was flatly denied by Dr. Conrad Murray, Jacksons’ personal physician, and others as being only rumor. The accuracy of the rumor over the Michael Jackson autopsy is unknown, but many would give fast cash to find out.

Saturday, June 27, 2009

A Day at the Community Garage Sale

Kris and I had a l-o-n-g day today. We rose early and drove to one of Portland’s nicest neighborhoods for the 24th annual Eastmoreland Garage Sale. Officially, there were 141 families hawking their Stuff. Unofficially, there were well over 200.

Eastmoreland garage sale 2009For seven hours, Kris and I walked up and down the quiet residential streets — not so quiet today, as they bustled with a carnival-like atmosphere. (This year, there were plenty of people playing Michael Jackson tunes at their sales.)

“What are you after today?” I asked Kris before we started.

“Jars,” she said. She and her friend Rhonda are avid jar collectors, and they’ve found that yard sales can be a good source for them. “What about you?” she asked.

“I’m not after anything in particular,” I said. “I have a $50 budget, but I don’t want to come home with a lot of Stuff. No more Stuff.”

Each year, certain items seem to be for sale at every house. This year there were lots of lawnmowers and luggage, as well as a large supply of vacuums. And, as always, there was kids’ stuff galore. (There’s just no reason to ever buy kids’ stuff new. You can buy everything used at huge discounts. Well, except for diapers perhaps.)

Kris and I had a great time wandering the sale together, just hanging out. We got to meet a GRS reader (hi, Emily!) and we spent a couple of hours with Kris’ sister, Tiffany.

After looking through the stuff in one driveway, I had to chuckle. “What’s up?” asked Tiffany.

“Did you see that girl back there?” I asked.

“No,” said Kris.

“She’s maybe ten years old, and she had an arm full of scarves,” I said. “Her mother said, ‘Are you sure that’s what you want?’ The girl said yeah, so her mother gave her three bucks. But she warned the girl, ‘Here’s the thing — we’re just getting started. You can buy those now, but what if we go to the next sale and there’s some toys that you want?’”

“So she didn’t get the scarves?” asked Kris.

“No,” I said. “She bought the scarves! But at least her mother tried to get her to think about her choice.”

In the end, I spent $32.50 of my $50 budget. Here’s what I bought:

Garage sale loot

  • $2.00 — a heavy, long-sleeved Nike “dri-fit” running shirt for winter
  • $0.50 — Motoring Atlas of Europe (2006)
  • $0.25 — Road map of Alsace-Lorraine, my family’s ancestral homeland, and one of the most hotly-contested corners of Europe
  • $1.00 — Leather-bound Tiffany & Co. world atlas (1994), travel sized
  • $2.00 — Bible-like edition of Shakespeare’s complete works (onion skin pages, tabbed by play, etc.) from Oxford University Press (1924)
  • $5.00 — Chatterbox Cats and Dogs, a 1909 children’s book of stories about anthropomorphized animals, wonderful illustrations. I love this book.
  • $0.25 — October 1953 phone book for Bend, Oregon
  • $0.50 — December 1933 issue of Popular Science, with articles like “Radio Pen Writes in Letters of Fire on Far-Away Screen”
  • $8.00 — set of 5 vintage cut-crystal champagne glasses
  • $4.00 — set of 4 vintage cut-crystal port glasses
  • $4.00 — set of 3 vintage cut-crystal cordial glasses
  • $5.00 — 1960s molded glass liquor decanter

“It’s interesting to see that even wealthy people have the same junk as the rest of us,” Kris said when we were finished. It’s true. But I like to think that this is higher quality junk. It’s certainly high-density junk, as there are over 200 yard sales crammed into a small area. The $32.50 I spent today would have been well worth it, even if I hadn’t come home with anything. We had a lot of fun.

Note: Kris and I look forward to this sale every year. I wrote about it in 2006, 2007, and 2008. I’m sure I’ll write about it next year, too.

Dishwasher full of jarsKris came home with enough old canning jars to fill the dishwasher. The total cost for 31 jars? $7.25.

This evening, Kris and I chatted about the things I bought. “You realize that the things you bought today are just Stuff, right?” she said.

“Yeah,” I said. “I know.” I keep trying to tell myself that — except for the decanter, which Kris looks upon with disdain (”There’s nothing special about that!”) — none of this is Stuff. I have a purpose in mind for each item. (I have a purpose in mind for the decanter, too, but Kris really doesn’t like it, so it may not live long in this house.)

“It may not seem like Stuff now because they’re all things you intend to use,” Kris said. “But it’s still Stuff, or soon will be. It’s still gooing to clutter your life. I think you should consider purging some your old Stuff to make room for this new Stuff.”

As usual, my wife is right.

Related Articles at Get Rich Slowly:

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OptionsHouse Review

OptionsHouse, OptionsThis and OptionsThat. So many options brokerage houses which means confusing choices for us all. How does OptionsHouse get you to remember them? How about $2.95 per stock trade?

Click Here to Sign Up for an OptionsHouse Account

Fees Come First

That’s not a typo. Over at OptionsHouse, stock trades are just $2.95 no matter what. When a company can make money like this, it really makes you wonder how much money other premium stock brokers are making off us. What’s even better is OptionsHouse’s flat rate options commission structure. The per contract fee can quickly add up because you buy or sell so many contracts per trade. With this broker, it’s $9.95 per trade no matter how many contracts exchange hands, no questions asked.

Other Fees?

Here’s some of the other fees of the options broker.
optionshouse rate and fees
Exactly what I like to see. No maintenance fees, no minimum trade requirements, and if I ever want help, broker-assisted trades are still just $2.95!

OptionsHouse Interface

optionshouse screen
Upon looking into the account, I found that the interface is very much like the professional trading platforms of the higher end brokers for professional traders. Within the main screen, you can see an account summary, quote lookup, order statuses, positions, and detailed information on particular securities.

Webinars and Seminars

I’ve begun to really love the education that these brokers provide and OptionsHouse is no exception. It’s obvious that the company’s expertise is in options trading because all the webinars are concentrated in that area but I expect it to expand to stock trading and other subjects in the future.

Don’t Underestimate Them

While many of you may not have heard about this brokerage firm, they seem to have their act together. In fact, Barron’s 2009 Online Broker Survey ranked them #1 in trade experience, beating out the likes of thinkorswim, optionsXpress, E*Trade and Charles Schwab.


optionshouse transfer feesOptionsHouse really gets my blood flowing because of its extremely low trading fees. Is it SIPC insured? Check. Is there good word out there? Another check. Changing brokers is really a hassle though. But like others, they are willing to reimburse me for up to $100, which is enough to move from pretty much any institution. Hmm… decisions decisions decisions. As for you, there’s really no right answer, but I’d say that $2.95 stock trades is reason enough for you to at least give it a test run.

Click Here to Sign Up for an OptionsHouse Account


Who is OptionsHouse Anyway?

To be honest, one of the first reaction I had when someone told me about OptionsHouse was: “Who?” I then went to do a little research and here’s what I found out.

OptionsHouse is really OptionsHouse, LLC and is owned by PEAK6 Investments, L.P. The company’s headquarters is in Chicago, the home of the Chicago Board of Trade. The parent company have been in the options and derivative trading business for years, and is actually one of Chicago’s 101 best and brightest companies to work for.

Related Articles at Personal Finance Blog by Money Ning:

Read more of OptionsHouse Review…

Friday, June 26, 2009

South Carolina Gov. Mark Sanford - Lies, Betrayal & a Love Affair

Personal Money Store Videos on Youtube

South Carolina Gov. Mark Sanford admitted Wednesday he has carried on an extramarital affair with a woman in Buenos Aires, Argentina. “First and foremost, I apologize to my wife and my four boys. I have made decisions that have hurt and will continue to hurt them, and for that I’m sincerely sorry… Jenny has stood by me through campaign after campaign, through hard time after hard time, and neither she nor the boys deserve this. Please offer them your prayers.” Sanford said he was resigning as head of the Republican Governors Association to spend more time in the state. He did not answer questions about whether he planned to resign as governor. Nonetheless, Sanford has about a year remaining in his second term, and is barred from running again.

For more information on this article and others like it, please click on the following link:Personal Money Store: Gov. Mark Sanford Affair

Eddie Bauer Files For Bankruptcy, Will Continue Operations

Personal Money Store Videos on Youtube

American apparel chains could definitely use more of the former, as bankruptcy cases have been popping up all over. Mervyns, Steve & Barrys, Goodys and Gottschalks have fallen under the axe. Now Eddie Bauer and bankruptcy will be spoken in the same sentence. Its a fact. Cost cuts, management and merchandise changes werent enough to save the outfitter from this legal action.

For more information on this article and others like it, please click on the following link:Personal Money Store: Eddie Bauer Files For Bankruptcy

Looking at old photos

It's so weird looking back to high school and to remember proms and whatnot. I remember my grad night after I graduated. I won a camera. I think I'm just lucky. When I heard my name called I was freaking out. I walked up on the stage and accepted my prize of course. It was awesome. I won a lot of other things as well but it was awesome to win all the things I specifically needed. I really like winning things that I need. It made it a lot more helpful when it came to buying all the things I needed for college. I didn't know I was going to need so much though. Luckily I got by. I think that's how most college students are anyway.

Thursday, June 25, 2009

Shaker Heights Yearbook Cover | Will it Cost Taxpayers Money?

Personal Money Store Videos on Youtube

A big controversy over the Shaker Heights yearbook cover has erupted and spread like an internet wildfire. At first glance, one might not see why the Raider Nation yearbook cover is causing such a stir. The yearbook cover says Raider Nation across the top and the rest of the cover is filled with what Michael McIntyre describes as a creative interpretation of a crowd of Red Raider mascots drawn by an artistically gifted student. So whats the problem with the Shaker Heights yearbook cover?

For more information on this article and others like it, please click on the following link:Personal Money Store: Shaker Heights Yearbook Cover

Spokane Hoopfest Brings Bling to Washington State

Personal Money Store Videos on Youtube

As Illinois kicks off the worlds largest outdoor food festival, Eastern Washington’s claim to fame, Spokane Hoopfest, begins Friday.Every year at this time, the City of Spokane and basketball fans from all over are thrown into a tizzy. Restaurant owners schedule extra staff to handle the crowds. People travel from all over to compete. Spokane Hoopfest is the worlds largest three-on-three basketball tournament. Spokane is commonly referred to as a mid-size metro and has a population of about 450,000 in the city and surrounding areas. However, that number grows significantly during Spokane Hoopfest. Basketball enthusiasts book hotel rooms months in advance. Although some Spokane residents chose to stay home to avoid the crowds, Spokane Hoopfest brings in a huge influx of instant money for hotels, retailers, restaurants and plenty of other businesses.

For more information on this article and others like it, please click on the following link:Personal Money Store: Spokane Hoopfest

Farrah Fawcett Dead at 62

Farrah Fawcett - Wikipedia
Wikipedia article featuring a biography for actress Farrah Fawcett. Includes career highlights, achievements, personal life, and a filmography of work.

Farrah Fawcett - IMDb
Photos, biography, and filmography for actress Farrah Fawcett, who’s most famous for her role as one of the original Charlie’s Angels.

Farrah Fawcett, sex symbol and actress, dies
Farrah Fawcett, the blonde-maned actress whose best-selling poster and “Charlie’s Angels” stardom made her one of the most famous faces in the world, has died. She …

Farrah Fawcett Dies of Cancer
Farrah Fawcett died Thursday at St. John’s Health Center in Los Angeles after a lengthy battle with cancer, Usmagazine.com confirms. She was 62. The Charlie’s …
Farrah Fawcett - Photos, Articles, and Info.

Find a profile of Farrah Fawcett, along with photos and articles, on Chickipedia. … those Charlie’s Angels remakes, as Farrah Fawcett (one of the original three …

2010 Census Won't Count Same Sex Marriages

And it will change survey responses

Plans for the 2010 Census are currently underway, and a great deal of controversy surrounds the matter. Since we know that the Obama administration has already taken a distressing, anti-human rights stance against the Defense of Marriage Act (DOMA), is it any surprise that come the 2010 Census, same-sex married couples aren’t going to be counted? Perhaps if they became anti-payday loan, anti-cash advance advocates, then Obama would come forward and say we should recognized them…

As it stands now, the United States Government wants gay and lesbian couples to be invisible. If this is not what they desire, they should speak now.

We live together

Heather Gilligan writes that Iowa, Vermont, Maine, and New Hampshire all voted in favor of same-sex marriage, despite the colossal failing on the part of Californians. One might say that only liberal-dominant states support these unions, but research indicates that just isn’t true. The Williams Institute at the UCLA School of Law has conducted studies that indicate that Mississippi, for instance, has “the largest number of same-sex couples with children.” Furthermore, “registered same-sex couples live in just about every county in the U.S.” According to Gilligan, researchers discovered that 99.3 percent of counties in the United States have households head ed by same-sex couples. ... click here to read the rest of the article titled "2010 Census Won't Count Same Sex Marriages"

I am highly addicted to The Sims

I think my Sims addiction is actually more like an obsession. I really love building houses and little towns for my sims to enjoy. My obsession with the game recently caused me to pick up every expansion pack for The Sims 2. Luckily for me since The Sims 3 just came out I really didn't have to spend much money on getting all of the expansion packs. My friends make fun of me because I really getting into the building process. I even go as far to go and get the free real estate books from the grocery store to build houses from. I like to play the actual game and make my sims live out their life, but for the most part I just enjoy building.

Writing songs on napkins

Have you ever noticed that people who are famous for their writing tend to write on napkins a lot? The person who wrote the Harry Potter books starting by writing them on a napkin in a restaurant. People who write songs often times start on napkins. Maybe if I decide I want to write something that becomes famous I should start by writing it on a napkin. At least that way I have a good story to go along with my famous book or song that I write. It will go along with all the other people who did it. At least then I would fit in with all the other famous people.

My pants are cursed

I have this problem where I always sit in pee whenever I wear this certain pair of jeans. One time I was at my sister in law's house. While I was there I sat on the couch. It was really wet. Because it was so wet I sat up and smelt it. Apparently my nephew had just peed there. I decided to avoid their home for a while. After I washed that pair of jeans I went over to a friend's house. I sat down in a big puddle of cat pee. It was disgusting. I have officially decided that the pair of pants I was wearing is cursed. If I weren't wearing them I would never sit in pee of any sort. That is just my conclusion.

Nonverbal communication

Nonverbal communication includes any and all methods used to communicate, except for language—written or spoken (Martin & Nakayama, 2005, p.149). Nonverbal communication encompasses a wide range of forms of communicating. It consists of, among other things, gestures, facial expressions, eye contact, time orientation, and paralanguage, which includes the tone, pitch, and volume of voice. When coupled with verbal communication, it can either contradict or reinforce the verbal message. By themselves, nonverbal messages can simply substitute for a verbal message. How do we learn nonverbal behaviors and how we know which expressions mean what? All forms of communication are learned, but nonverbal behaviors are learned more subconsciously and gradually. According to Riggo and Feldman (2005), "People of all cultures learn to use nonverbal behaviors…as part of their communication repertoire." A few paragraphs later, they go on to say, that "if this is the cas e, it is no wonder that the cultural rules of nonverbal behavior are well ingrained in us by the time we are adults, and that we use them without much second thought" (p. 260). Each culture possesses its own "rules" for nonverbal communication, based on the values and beliefs of that culture. As we grow up, using nonverbal behavior becomes like second nature to us; it is not usually necessary to think about which nonverbal message we are going to send next. We learn nonverbal behaviors through watching and observing others. For example, how do we learn that when someone is being sarcastic they mean the opposite or something different from what the words they use mean? Newman suggests that when "someone says something sarcastically the tone is different to that used in a sincere remark. Children learn to understand this tone and therefore to pick up on sarcasm and humour" (2004, p. 98). If no one is there for a child to learn from, he most likely will not lea rn anything. One thing that a child might learn from its pa! rents is to put their hands on her hips when saying something like "I'm right and you're wrong." It is likely that nobody has told the child to specifically bend their arms at the elbow and place their hands decidedly on their hips to more clearly get their point across. As stated, nonverbal behaviors are learned unconsciously; we imitate others all the time without even knowing it.

Wednesday, June 24, 2009

Nothing better than a good book

Reading has always been an enjoyable activity for me, at least from what I can remember. All sorts of good memories come of reading, especially with my dad. He would read to us from time to time when we were little. Almost every book he read to us he would also read the copyright page and sometimes he would read the book backwards. It was always fun to hear what the book said when read in reverse. Sometimes he would even read each word backwards, and that's when it sounded like some foreign language, but it was so hilarious. He often had us laughing and giggling all over the place.

Thinking back on graduating from college

I was watching a movie the other day that made me think about all the people I used to know. In the movie he was graduating from college. When he was graduating he was talking about all the people and where they would end up. He said that the nicest people were going to become dead beats. He said that you wouldn't even recognize some of them in time. He said that they would all choose their paths in life and so many would end up corrupt. It made me think of all the people I graduated from college with. I hope that none of them turned out that way. I don't even want to know how they turned out.

It’s weird to think they all turned out that way

I hate going back to high school and seeing how all of my friends turned out. I remember going back to high school for our ten year reunion. Everyone had stayed close to home and become dead beats. I don't see how I could be the only one out of fifty kids to turn out. They all became alcoholics or had really bad relationships that they had gotten themselves in. My best friend from high school had turned into a jerk that did drugs whenever he could. It didn't make sense to me that so many people I was so close to could ruin their lives so quickly. It's weird to think they all turned out that way.

College Cost Reduction and Access Act Helps with Federal Loans

New program to kick in

Did your college diploma come with a hefty student loan bill?

Did your college diploma come with a hefty student loan bill?

The College Cost Reduction and Access Act went into effect in 2007, but some of the provisions are still kicking in. Specifically, The Income-Based Repayment Plan kicks in on July 1.

The part of the College Cost Reduction and Access Act, which is already in effect, is the The Public Service Loan Forgiveness Plan.

Income-Based Repayment Plan

First off, the College Cost Reductions and Access Act only applies to federal loans. If you got student loans from a private loan company, these programs can’t help you, unfortunately.

But every little bit helps, right? The Income-Based Repayment Plan caps payments on federal student loans based on the family size and income. Most eligible borrowers will get their payments capped at only 10 percent of their income. For low-income families, the payments could be even lower.

In the long run

The Income-Based Repayment plan also forgives any remaining debt after the borrower has made payments for 25 years. This is similar to a provision in The Public Service Loan Forgiveness Plan, which forgives any remaining debt after 10 years, starting in October 2007.

The Public Service Loan Forgiveness Plan is designed to help and encourage public service workers. Degrees to work in the public service sector can often be very expensive, and salaries are average or lower than average.

More on Public Service Loan Forgiveness

In order to qualify for The Public Service Loan Forgiveness Plan, borrowers must work in public service full time for 10 years. As long as public service workers are making regular payments and working full time, any debt to the feds will be forgiven after 10 years. ... click here to read the rest of the article titled "College Cost Reduction and Access Act Helps with Federal Loans"

Today I learned that the word gravid means pregnant

It just happened to be the word of the day. I thought it was funny considering my sister in law is now about eight months pregnant. I thought I would call her gravid and see what she thought about it. When I said it to her, she laughed and asked what exactly it was that I was calling her. I told I was just calling her pregnant and she laughed for a really long time. I thought she might be dying or something considering how much she was laughing. I was afraid she was going to go into labor or something. It was pretty funny.

My Sister’s Keeper: Sharing Financial Goals with an Accountability Partner

“Don’t you have any tips for single folks?” I’m often asked. Like any writer, I tend to write from my own experience — that of a married man. Fortunately, there are plenty of single people in the GRS community who are willing to share the things they’ve learned. Here’s a guest post from Kinley Levack about how she and her sister hold each other financially accountable.

Over Christmas 2007, my sister Michelle and I started chatting about our finances. We had independently come to the same conclusion: we each needed to get our act together. We decided that beginning 01 January 2008, we would help each other move in the right direction.

Sharing accounts and goals
We started by baring it all. We both made lists of our debts, accounts, etc. I had already spent about two years knocking down a credit card balance that had crept up to nearly $6,000. But I had virtually nothing in the way of savings, and had only recently begun contributing to a 401(k).

Michelle's goals were primarily related to debt reduction. She had accumulated a couple of store credit cards that she wanted to pay off, as well as an outstanding amount due for a class at a local university. She had fairly limited savings.

We each created a document listing:

  • The amounts we contributed to our savings and investment accounts each month
  • The amounts paid toward debts each month
  • Our monthly goals
  • Our major expenses each month
  • And so on…

A simple Microsoft Word document with a page-per-month view worked best for me.

Performing a monthly review
At the beginning of each month, we send updates to each other with that month’s set of goals, the most up-to-date figures for each account, and a quick recap of how we did with the previous month's goals. My updates are never more than one page in Microsoft Word. They take about 20 minutes or so to pull together.

Some goals are very specific. One of my goals in January 2008 was to increase my 401(k) contribution from 3% to 6%. But other goals are more vague. Michelle noticed that her Starbucks spending was getting out of control, for example, so she worked to be more aware of what she was spending there.

Each January, we also develop year-long goals.

Over the past 18 months, Michelle has nearly paid off all of her debts. (She has a little left on her primary credit card.) She has also substantially increased her savings, and in the past five months alone has raised her credit score nearly 100 points. I have increased my savings to cover almost three months of expenses, fully funded a Roth IRA each year, and set up a holiday fund that I contribute to monthly to cover Christmas expenses. (That seems to be a budget-buster for me every year.)

Providing support!
This has been a great accountability system for both of us. As sisters, we have no problem calling each other out when we think the other one is being irresponsible. But we are also incredibly supportive of each other. We’re both in our twenties, so we have plenty of time before retirement, but we needed to get the ball rolling toward being financially fit.

This partnership also works well because we have similar mindsets about saving and investing; we have a lot that we want to accomplish, but we also want to enjoy ourselves now and have about the same tolerance level for shopping, dining, and travel. I think it's important to have a counterpart with roughly the same idea about saving versus spending. If one of us was a big shopper and the other super-frugal, we'd probably just irritate each other.

Michelle and I haven't ever discussed an end point to this system; we just keep learning as much as we can and making bigger goals. We'll see how it all turns out. So far, so good!

When you have a spouse or partner, you generally have built-in financial support. I think Kinley and her sister have discovered a great way to lend each other support, even while remaining single. Photo by Snippets 101.

Related Articles at Get Rich Slowly:

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Dream on a safer side

When you grow up, you stop dreaming .The child inside you turns out to be someone you don't know or may be even someone whom you don't know if you want to know. And as the child disappears along with that goes the dreams of that cheerful bubbly happy kid. Some people never let that child in them go away and keep their dreams safe for the rest of their lives.

One might think giving up is easier but that is one of the toughest tasks one could think of doing. To leave something that you love, leaving out a part of yourself, to accept that some things weren't meant to be the way you thought. To grow up.

This does not mean one doesn't have dreams anymore. It only means they dream in the safer side. We are dreamers but we have grown up. This is not how it was meant to be, but then life still has to go on.

On the other side may be we have not grown up, it's just the child in us that has fallen asleep.

Tuesday, June 23, 2009

The Fresh Diet CEO Nominated for Entrepreneur Award

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Zalmi Duchman, CEO of three-year-old company The Fresh Diet, has been nominated for the Ernst & Young 2009 Florida Entrepreneur of the Year. His company The Fresh Diet was featured on The View, and the companys web site is offering a special deal for The View audience.

For more information on this article and others like it, please click on the following link:Personal Money Store: The Fresh Diet

Gooey brownies are the best

They’re not too cake-like, and they’re not too soupy. Brownies should never be either of these. Brownies are a separate thing from cakes and soups. If I wanted cake, I would make a cake, not brownies. And if I wanted chocolate soup, I would melt some chocolate. When making brownies, you must always remember to not put in too much flour. This will make it more like cake. You also want to remember to bake it long enough, but not too long. Also, a good frosting will compliment the tastiness of your brownie, but is not necessary for a good quality brownie.

Prom Ride on a Tandem Bike

I know a woman who is a fan of blues music like me. For the past few months, every time I run into her, she has insisted that I go to the Prom Ride. I really never was clear about what she was describing, but I knew that it involved prom clothes and bicycles, so I decided to give it a go.

I had resolved that I would go for the ride, whatever that entailed, but that I wouldn't dress up. But when a friend called and asked if wanted to do the Prom Ride on a vintage Schwinn tandem bike, I knew I had to dress for the occasion. We – both riders and the bike — dressed up in full prom regalia: coordinated, formal, black and red, prom clothes for the riders; handlebar streamers, bicycle bells, and Thing One, Cat in the Hat and a few other Dr. Seuss stuff animals in the baskets for the tandem bike. At the last minute, a couple of other friends with classic Schwinn bikes and perfectly too-small, thrift-store, prom clothes decided to ride along us.

We rode a few miles to a downtown bar where the prom-goers were to meet. The date was June 6, but it was only 50°F when we set out around 7:00 in the evening. Prom clothes are neither warm nor wind-resistant. We rode through traffic to the meeting place and we laughing as we watched people in all kinds of prom clothes pulling up on all kinds of bikes. There were long taffeta skirts, short tight little dresses, tiaras, plunging necklines, tuxes with tails, tuxes without tails, ill-fitting checkered jackets that looked like someone had to have died in them, wife-beater shirts with cummerbunds, men in prom dresses and women in suits. A few riders wore proper prom shoes, but sensible bicycling shoes were pretty much the order of the night. We went inside and mingled a little until we found the free popcorn.

Pretty soon, word spread that the promenade was about to begin. People filed outside, found their bikes and saddled up. There was a rider with a stereo on a wagon behind his bike. We started down the street, with the music playing. There were 125 riders. We trailed through downtown where everyone rang their bells each time we turned or went through an intersection. We came to a round-about and the group kept circling until all 125 riders were included in the locutions. We came to a big city park with a fountain and a carousel. All 125 riders paused and circled around the fountain together, with the lighted carousel in the background.

We came to a paved bike path that crossed a college campus. The path had bridges that arched up over the streets. It wound along a river. After about seven miles of riding and bell-ringing and laughing, we arrived at a resort on the outskirts of the city. Everyone pulled up, dismounted, and filed into the court yard where dance music was already playing. There was a bench draped in red tulle with a backdrop of big heart-shaped wire frames covered with white string lights. It was a prom, after all, and there's always a place to pose for photos at the prom. There was a long table filled with cupcakes arranged like a winding path connected by yellow dots of frosting like the lines down the middle of a road. There were little bicycle party favors riding down the cupcake road.

The party was just getting going by the time I left, but I had a 10 mile ride home and it was already 11:00. I went to a couple of proms in high school, but I don't remember anything about them. The Prom Ride, on the other hand, was a prom I'll never forget. I'll go again next year, and I'm already thinking about what I'm going to wear.

Basil for a Birthday Present

I'm on a real tight budget and my significant other is having a birthday next week. I've thought of a couple of very inexpensive things to buy and wrap up for the occasion, but the main thing I'm offering up is 40 basil plants, planted at my house, with a promise to water and care for them all summer long. That cost $25, which is as far as I can go. But I really like this idea.

My significant other always plants a bunch of basil and makes and freezes containers of pesto. But this year, the planting season was slipping away and there was no sign at all that the basil would be planted. So I did it. Granted, I was a little motivated by greed. I do want pesto this winter. I'm not willing to make it, but I'll grow the main ingredient!

Oakland is a city in California.

I actually discovered that it is the eighth largest city in the US. My parents got married in Oakland so I decided to do a little research on the area. Apparently it stays in about the seventies all year round. That would be nice to have the weather not change so drastically every few months. Apparently the crime is pretty bad in Oakland. That is never a good thing. I would be worried about living there with children. I wouldn't want them to become a part of the crime as victims or as criminals. They do have a professional baseball field which is definitely a good sign. I don't think I will ever be able to live there. That's too bad for my family and me.

Cash For Clunkers 2009 Site Up, But Rules Aren't Ready

It must need a kick-start

If you have multiple cars on blocks outside and no immediate plans to rearrange the furniture on your front lawn, perhaps you should give your homestead look a bit of summer loving. At the very least, you should take advantage of the Cash For Clunkers 2009 program and get something that will purr when you turn the key. Their car allowance rebate system should help the environment and change your lounging area from a rust garden into a place where grass will have a fighting chance.

But the operative word is should. Apparently, the Web site it up but the rules aren’t completely in place. Until then, use cash advances as the fast loans that help you make that down payment on a newer vehicle.

“Tell your dealers so we don’t have to!”

Justin Hyde of the Detroit Free Press reports that while Congress has passed Cash For Clunkers 2009 and the Web site www.cars.gov is in place, rules to govern the program could take up to a month to hammer out. That’s government efficiency for you.

Cars.gov so far is a source that offers information on how the exchange process (clunker for fuel-efficient roadster) will go down. It also urges consumers to contact their local dealers in order to talk them into registering for the program. To me, it seems that that should be the job of the government. I elected you for what reason, again? I pay taxes for… what was that again? Representation? What a concept!

Will Cash For Clunkers 2009 be enough incentive?

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Congress has sent their approved version of the $1 billion bill to President Obama for his signature. As it stands, it is designed to give about 250,000 consumers $3,500 to $4,500 in money off the sticker price of a newer, more fuel-efficient vehicle. The original target was $4 billion and one million cars, but the real question is whether people who have held on to their rust buckets will even be able to afford the reduced-price cars once the deal is made. $3,500 to $4,500 isn’t that much if you’re talking a sticker price of $25,000 or more. It helps, but higher-priced vehicles will still be out of reach of many. ... click here to read the rest of the article titled "Cash For Clunkers 2009 Site Up, But Rules Aren't Ready"

The Hunchback of Notre Dame

The Hunchback of Notre Dame was one of the movies I really liked as a kid. I used to watch it all the time. I remember one year for Christmas my parents bought me action figures of the gypsy and her lamb that goes around with her everywhere. I loved to play with those while I watched the movie. They were my favorite shows. I wish Disney made movies like that still. I am pretty sure that they don't because all the good ideas are already taken and have been used up. I wish I still had that figure. It probably has become a collectible and is worth a lot of money.

Ed McMahon Dies | America's Straight Man Escapes Debt

He rode high, lived high

Fans of late night American television over the years have heard of Ed McMahon. He was the perennial straight man, a foil for the jokes of the all-time king of late night, Johnny Carson. Now like his leader in hilarity, Ed McMahon too has died. He was 86 years old.

If you could go through life with someone announcing your entrance in much the same way that Ed McMahon would joyfully exclaim “Heeeeeere’s… Johnny!”, wouldn’t it be fun? Everybody dreams of being somebody, and having someone like Ed prepping the room for you would be a hoot.

You know what else everyone dreams of being? Financially well off. Ed McMahon did well for himself during his career, but the lavish homes and lifestyle caught up to him in his later years. His mansion was foreclosed and his credit rating took a hit. It seems he even took it upon himself to go to the homes of Publishers’ Clearing House in an attempt to reclaim the giant checks he’d delivered. Sidekick’s gotta have money. I wonder if he ever tried payday loans for fast cash?


Mark Silva blogs for Swamp Politics that Ed McMahon was “a sounding board for years of good, clean fun.” In addition, his product hawking was always received with good humor. Without McMahon’s endorsement of Publishers’ Clearing House, that would never have become the national name that it did. ... click here to read the rest of the article titled "Ed McMahon Dies | America's Straight Man Escapes Debt"