March 2012


Here is March’s review of blog posts.  We hope you find something you enjoy!

 

Get Rich SlowlyReader Story: I Quit My Passion and Took a Boring Job – Sometimes doing what you love is not the right choice for you. Maybe having “just a job” for a regular paycheck will help you avoid stress and improve your life.

 

The Simple Dollar Make Money From a Passion (posted on 3/16/12 on thesimpledollar.com – we can’t pull the website up to link to for some reason) – If you have a passion that you spend a lot of time on it, think of a way you could make money doing it. Even if you don’t have a product to sell, there are many different ways to potentially make money.

 

Wise Bread 15 Ways to Reuse Detergent Bottles – Just some fun ideas you may never have thought of.

 

Please let us know if you have a favorite financial blog that you think we should be reading.

 

 

  • Disclaimer: The information on this blog is not meant for specific financial advice. The ideas/opinions stated are not suited for everyone, and readers should use their own judgment in applying them in their financial lives.

 

This week, over at The Simple Dollar, Trent Hamm wrote about how he handles his three kids’ allowances in the post “Segment Their Allowance.” It’s part of his “365 Ways to Live Cheap (Revisited)” series.

Trent doesn’t make his kids’ allowances dependant on anything (like chores or behavior). They receive a certain amount each week, dependant on their ages, and are paid in quarters. After they turn 4, they have to start putting away into different buckets. They have to put at least one quarter a week in each bucket and then are free to use the rest of the money as they choose.

There are 4 categories Trent uses: spending, saving, investing, and giving. The categories are pretty self explanatory. Spending can be used immediately on anything the kids want to buy. Saving is used to save for something bigger and more expensive down the road. Investing money is invested for use when they grow up. And giving is money that is donated to a charity or cause of their choice.

Regardless of how you handle the amount of money your kids should get for an allowance and why, we think this is a great idea. Many people who were never taught how to be responsible with money as a kid make financial mistakes as adults because they honestly don’t know any better. If you learn at age 5 that you can’t spend $1 on a candy bar unless you’ve already put 25¢ in your saving jar, and continue on with that lesson into your teenage years, it seems much more likely that your 25 year old self will be less likely to spend $30,000 on a new car with no money in the bank or a retirement fund.

Of course, that’s not to say someone who learned this lesson as a child will never make any financial mistakes as an adult. But they may be much more likely to make decisions responsibly.

  • Disclaimer: The information on this blog is not meant for specific financial advice. The ideas/opinions stated are not suited for everyone, and readers should use their own judgment in applying them in their financial lives.

 

This week, over at Get Rich Slowly, there was a great post called “Prepare to Get Sick.” Donna Freedman talks about her own experience with needing an unexpected surgery and what you might do to prepare for such an event (or just coming down with an unexpected cold).

 

What do you have in your house right now that would come in handy if you came down with something? Over the counter medicine for your symptoms? Facial tissue? And electrolyte drink in case you need to avoid dehydration? Cans of soup? Many of the things that would come in handy when you are sick can be bought beforehand. Even if you don’t plan on it (who does?), everyone comes down with something every once and awhile, some more than others. It wouldn’t hurt to stock up on some basic supplies when they are on sale to have at home.

 

Not only can you save some money by being prepared, you can also save yourself some suffering. Are you really going to feel up to running to the store to buy what you need when you have a fever and can barely stay awake? That probably wouldn’t be the best idea. Even if you have a friend or relative willing to pick up some things for you, it’s possible they wouldn’t be able to immediately drop what they’re doing to help you out.

 

What about if something more serious happens, like an unexpected surgery? Would you be prepared? Do you have enough cash on hand to cover the costs that are related to something like that? This kind of situation is the exact reason to have an emergency fund built up. If you have to deal with an emergency health situation, there is always going to be cost involved, usually significant cost, which is not built into your everyday budget. Save yourself the headache (and the credit card bills) by making sure you have a comfortable emergency fund.

 

We would highly recommend that you check out Donna’s post. It points out some important “what if” scenarios that should be planned ahead for.

 

 

  • Disclaimer: The information on this blog is not meant for specific financial advice. The ideas/opinions stated are not suited for everyone, and readers should use their own judgment in applying them in their financial lives.

 

This Tuesday over that The Simple Dollar, there was a post entitled “Toxic.” In this post, Trent Hamm discusses five things in his life that he felt were having a “poisoning” affect and how he took steps to “detox.”

 

This post really struck a chord with me (Dawn), especially the first toxin Trent mentions, his love of a certain soft drink. I’m the type of person who can’t stand drinking water. I also can’t stand drinking milk. I’ll drink certain fruit juices, but what I really love is pop (soda for those of you not from the midwest). I’ve been that way for as long as I can remember.

 

As I’ve gotten older, I’ve gotten more conscious of what I consume by trying to eat/drink healthier. And I have taken steps to “detox.” I gave up my favorites, Dr. Pepper and Cherry Coke, cold turkey about 2 years ago and haven’t gone back. Unfortunately, Mt. Dew has taken their place.

 

Like Trent, I will often buy a 20 oz. at a store or a glass at a restaurant for $2-$3. I end up feeling guilty for it, though usually for wasting money, not for drinking the pop. Based on this, I would say I easily spend $15-$20 a month just on pop (which doesn’t even take into account the 2 liters I will buy at the grocery store to have at home). It’s not enough to break the bank, but it’s enough to make me feel like I should be making a change, my personal “Latte Factor.”

 

Trent suggests figuring out five things that are “poisoning” your life and take steps to “detox.” While I’m not going to do what he did to stop drinking his favorite pop (I can’t bring myself to do that!), I am going to think about what steps I might take to at least reduce my pop intake and the amount of money I spend on it. I already know before I start that I’ll feel much better for it based on my experiences in the past with Dr. Pepper and Cherry Coke. But it’s still hard to take the first step when it’s been a part of your life for so long.

 

What small things in your life are poisoning you? What step can you take to detox?

 

 

  • Disclaimer: The information on this blog is not meant for specific financial advice. The ideas/opinions stated are not suited for everyone, and readers should use their own judgment in applying them in their financial lives.

 

As the tax filing deadline quickly approaches, how are you handling your taxes? Do you prepare and file them yourself? Have a relative or friend handle them for you? Do you hire an accountant?

 

However you handle the preparation and filing, how is it working out for you? While we don’t prepare and file taxes at our financial planning firm, we do assist some of our clients with investment related tax information. Also, we often will review their taxes after filing to ensure that nothing crucial was missed. And what we often find is that some of those who are preparing and filing their own taxes really shouldn’t be.

 

That’s not to say that everyone that files themselves shouldn’t be. It’s typically fine for someone with a relatively simple tax situation to prepare their own taxes without problems. Or if you have more than a passing knowledge about tax rules and regulations, preparing your own taxes should be fine. However, the more income you have, the more deductions, the more investments, etc, the higher likelihood that preparing your own taxes may not be a good idea.

 

The question that comes into play is how much is saving some money really worth to you? Are you spending countless hours sorting and prepping your tax info, dealing with headaches, and then still worrying at the end that you might have missed something or done something incorrectly? In our opinion, if this is how you spend every tax season, it would probably make more sense for you to hire an accountant.

 

Not that all accountants are equal either. If you are going to go down that road, make sure you find an accountant you are comfortable with and who you feel would be able to handle the level of complexity your tax situation lends.

 

With the popularity of tax software and online tax filing sites like TurboTax, “do-it-yourself” taxes are becoming more popular. However, just because it is an option for you, doesn’t mean you should utilize it, even if it will save you some money. Who knows, maybe the accountant you decide to hire will find a deduction you were missing and will pay for themselves!