Archives for November 2006

One Reason Not To Become A Landlord…

Besides asking family friends for real estate advice, my father-in-law also manages rental properties himself. He is an extremely handy guy, and I hope to get him to teach me some useful home repair and remodeling skills later on. But today, he was replacing a tenant’s toilet and dropped it on his foot. The result was a side trip to the Emergency Room and a stylish cast. As a klutz myself, this is not good.

Take The First Step Towards Your Goal Today.

No, I didn’t forget! Over 100 people joined me in my Make A Goal Experiment and shared their goals. Since they are cached somewhere in a Google database by now, your goals are now a permanent piece of internet history.

Now to make it happen… I’m going to share a little tip my mom taught me. Whenever you are too lazy to study, exercise, or do a chore, tell yourself to just do it for five minutes. If you want to stop after that, fine. But you’ll be amazed. Once you do it for 5 minutes, most of the time you’ll keep doing it. I often do this with jogging. Sometimes I just come home after a circle around the block. But 90% of the time I go much longer.

Most of the goals involved a certain sum of money, be it for a house, debt repayment, or retirement. Applying my 5-minute trick, my suggestion is spend those 5 minutes and set up a small automatic transfer towards this goal today. Open an online savings account. Washington Mutual, Citibank, Capital One 360, whatever – They are all earning around 5% interest right now, are FDIC-insured, and you only need $1 to open. Or depending on your goal, start an automatic transfer into your 401k or an automatic billpay to a credit card.

With most of these services you can set up automatic transfers weekly, biweekly, monthly, quarterly, whenever. No matter what your goal is or what your budget is, you can make some sort of commitment. If you can only do $10 a week, that’s still a start. After a while, that $10 will feel like nothing and you can increase it.

As for me, I am going to set up an automatic transfer of $125 to my savings account every week. This won’t make me reach my goal 100%, but it will get me moving and build some momentum.

Free Online Foreign Language Courses

Here’s a great find – learn a new language for free (well, your taxes may have paid for it) at FSI Language Courses:

These courses were developed by the United States government and are in the public domain. This site is dedicated to making these language courses freely available in an electronic format. It is an independent effort to foster the learning of worldwide languages.

Included are Arabic, Cambodian, Cantonese, Mandarin Chinese, French, German, Greek, Hebrew, Korean, Portuguese, Spanish, Swedish, Turkish, and Vietnamese. If you have problems downloading like I did, try using Internet Explorer and Right Click > “Save File As…”. The audio should show up in mp3 format. Thanks to DumbLittleMan for the tip.

TEDTalk Videos: New Ideas In Economics And Business

I’ve just spent the last hour watching various talks from previous TEDs, which from what I can gather is a symposium about exchanging ideas from innovative people from around the world. If you have an iPod, these would be great videos or podcasts (about 20 minutes long each) for a commute.

While not necessarily all money-related, many of them touch on economics and business. Here are a few that I found intriguing:

Rethinking Poverty: Novogratz

Jacqueline Novogratz is the founder and CEO of Acumen Fund, a non-profit that takes a business-like approach to improving the lives of the poor.

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Advice From A Successful Real Estate Investor

Over Thanksgiving holidays we met up with a family friend who is a very successful real estate investor. She has millions of dollars of property both here in the U.S. and internationally. We started talking about investing and here are some of the points that I recall:

Get started as soon as possible. When she found out that we were without kids, making a decent income, and still renting, she looked at me like I had three eyes. I think most successful real estate investors are like that. When I explained that we’d be moving in 6 months, she still said that we need to start as soon as possible. Think long-term, but get on that property ladder!

Learn more about taxes. If you want to have rentals, you need to keep great records and take advantage of all the numerous tax breaks. She said she once took H&R Block’s income tax course and it was the best money she ever spent. That way, it forces you to examine all the byzantine forms step-by-step.
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You Have Some Money. Where Do You Put It?


I went over understanding your spending and also free budgeting tools. Once you start managing your money better, you should be spending less than you earn. Or maybe you have come across a lump sum of money somehow. Now what do you do with the money? Although everyone’s situation is different, I think that a good discussion can evolve from this.

Here’s a list of possibilities:
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My Money Guide: A New Project

A few publishers used to ask me for book proposals on my views on money management, but have stopped bothering since it is quite apparent that I just don’t have the time or discipline to do such a feat. Instead, a new ongoing project for this blog is to try to collate all the knowledge that I have gained so far (and am still gaining!) into a sort of free online finance book. The ongoing rough draft will be housed here (Update: I moved it to it’s own domain — and then moved it back :P). Tentatively, I am going to call it “My Money Guide”, but I don’t really like that name.

My Money Blog Thanksgiving Giveaway Winners!

First all, thanks for everyone who participated in my Thanksgiving Giveaway. I think it was a huge success, and I was overwhelmed by the response. As for my weekend, my family was in town and despite all my anti-consumerism ramblings we did a fair bit of shopping. It was great to see them and I look forward to seeing the other half of my family over the Christmas holidays. I truly have much to be thankful for.

Enough of that, let’s get to giving out some prizes! First, I had to split up them up between guessers and bloggers. This was simply done by Excel’s random number generator add-in. Here are the results:
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Discover’s Holiday Promotion Has A $100 Loophole

As part of the Discover Mall Holiday promotion, they are offering $20 for each $200 spent. However, there was no mention of what would happen if you returned the items after you “spent” the money. Since credit card companies are usually masters of the fine print, I figured they had some sort of mechanism in place to prevent this. Nope.
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Is Costco Executive Membership Worth It?

We are currently Costco Gold members, the standard level. We joined because you know you’re getting a fair price (if not necessarily the best) on great variety of products, the customer service is great, and you gotta love their food court. So after spending another few hundred dollars on food and gifts today, amongst all those banners pronouncing *2% Cash Back for Executive Members*, I started to ponder if I should upgrade my membership level too?

Executive membership costs $100, regular is $50. At 2% back, basic math says you’ll need to spend $2,500 a year to break even. I probably don’t spend that much. Then I remembered a rumor I kept hearing that if you don’t profit with the Executive Membership, Costco will give you back the difference. Say you only get $20 in rebates. Bring in your rewards check at the end of the year and they’ll give you $30. So there is no risk. This is part of their 100% Satisfaction Guarantee – “We will refund your membership fee in full at any time if you are dissatisfied.”

In addition to the membership cost savings, thanks to the commenters below, I am also reminded that there are tons of other discounts offered to Executive members only on things like insurance, small business services, cheaper check printing, real estate services, and more, that don’t end up on your rewards rebates but still save you money. So not only is there no risk, there is much potential upside.

Heck, you may spend more than you think at Costco. I started doing some math on the drive home. I never spend less than $100 per trip at Costco. Since I go at least once a month, that’s about $1,500 right there. In addition, we occasionally buy things for office parties and get reimbursed. That’s another $500-$1,000. If that doesn’t put us over, add in holiday gifts and other big-ticket items, and who knows, you might just spend over $2,500. Think about signing up for before you do all your shopping!

Update 2: I have actually never experienced the “hard sell” that others speak of below, but I can see how it might happen at specific stores. I’m guessing that each store is measured by how much Executive members they have shopping there, and a manager may decide to aggressively sign up new customers.

Update 3: Earn More with Costco Credit Card: You can get 3% cash back on gasoline at U.S. stand-alone gas stations (up to $4,000 a year), 2% cashback at U.S. restaurants and on eligible travel purchases, 1% on other purchases with the TrueEarnings® Card from Costco and American Express. It even doubles as your Costco membership card. Terms and restrictions apply. More info over at my review.

“Disclaimer: This content is not provided or commissioned by the issuer. Opinions expressed here are author’s alone, not those of the issuer, and have not been reviewed, approved or otherwise endorsed by the issuer. This site may be compensated through the issuer’s Affiliate Program.”

True Cost of Holiday Shopping Calculator

Can you hear that sound? Sleigh bells a-jingling? Carol singers? No, it’s credit cards a-swiping as part of what is now officially BUY BUY BUY season.

Here’s a psychological trick that I use to temper my “self-gifting” urges. It’s based on the fact that every dollar that you save now will be worth much more in the future. However, it can be hard to forgo short-term pleasure for long-term gain. Use the calculator below to see how much of your own “future money” you’re actually spending your disposable income on.

Step 1: Pick Your Purchase:

Name Your Own Impulse Buy Price

Step 2: Pick your estimated annual return (default is 6%):
4%     6%     8%
Step 3: Pick your time horizon (default is 30 years):
10 years    20 years    30 years    40 years
Assuming a 3% inflation rate, the inflation-adjusted TrueCost™ of your impulse buy in years is:   

That’s the power of compounding. A $450 sweater? $1,000 MP3 Player? $7,000 Flatscreen TV? Maybe you’d think twice about how badly you want it. This is not to say Starbucks or the occasional splurge is never worth it. (Just writing this gave me an urge for a Peppermint Latte.) Perhaps it is. But I hope that this calculator can provide a different perspective while you are barraged by retailers to buy stuff you really don’t need. Now just imagine if you invested that money instead…

Sunrocket VoIP – 2 Years for $199, No Code Required

Today (11/21) only, SunRocket is offering 2 years for $199. This “special” seems to come around every other month or so. I’ve been using SunRocket instead of a landline for over a year now now and I remain very satisfied for the price – check out my SunRocket Review for details. My faxing now works 95% of the time.

Added: You can also get two years for $199 from ViaTalk VoIP.