Archives for May 2011

GigWalk: Get Paid For Simple Jobs With An iPhone

My Money Blog has partnered with CardRatings and may receive a commission from card issuers. Some or all of the card offers that appear on this site are from advertisers and may impact how and where card products appear on the site. MyMoneyBlog.com does not include all card companies or all available card offers. All opinions expressed are the author’s alone.

Help yourself pay for that $30 a month data plan by putting that iPhone to work! 🙂 New iPhone app GigWalk pays users to take pictures of specific objects, record audio/video, or verify something live in person. For example, client TomTom asked folks to take pictures to help with their GPS service. Gigs start at $3 but go up to $90.Via Gizmodo via Techcrunch.

It kind of reminds me of Amazon’s Mechanical Turk, which uses crowd-sourcing to perform small tasks that are very difficult to automate and thus is best done with humans. Currently, there are Gigs only in the following metro areas: Los Angeles, New York City, San Francisco Bay Area, Boston, Chicago, Philadelphia, South Florida.

My Money Blog has partnered with CardRatings and may receive a commission from card issuers. Some or all of the card offers that appear on this site are from advertisers and may impact how and where card products appear on the site. MyMoneyBlog.com does not include all card companies or all available card offers. All opinions expressed are the author’s alone, and has not been provided nor approved by any of the companies mentioned.

MyMoneyBlog.com is also a member of the Amazon Associate Program, and if you click through to Amazon and make a purchase, I may earn a small commission. Thank you for your support.


Vanguard Lower Minimum Investment On Target Retirement Funds to $1,000

My Money Blog has partnered with CardRatings and may receive a commission from card issuers. Some or all of the card offers that appear on this site are from advertisers and may impact how and where card products appear on the site. MyMoneyBlog.com does not include all card companies or all available card offers. All opinions expressed are the author’s alone.

Effective May 11st, Vanguard has lowered the minimum initial investment on their Target Retirement Funds to $1,000, down from $3,000. Thank goodness, as this avoids having everyone pointing out that the Vanguard STAR fund was the only one with a minimum of $1,000. But seriously, I think this is a smart and overdue move by Vanguard, as it allows investors with limited funds to start out investing in a low-cost, diversified investment that adjusts with age. I put my own mother’s Rollover IRA in a Target Retirement Fund a couple years ago, and I sleep well at night.

(See previous post on the Vanguard Target Date Retirement Funds Glide Path to see how the asset allocation changes over time. I kept my mom’s target date close to their default recommendation, as my dad’s retirement accounts are on the conservative side.)

What if you have less than $1,000? There are plenty of “how to invest with just $100” posts out there, and if I look back I’ve probably done one myself. However, my new advice is this: Don’t bother. Instead, focus your energy on investing in yourself, by either learning about investing in general or improving your career and business skills. Put what you have safely in the bank, now once you have $1,000, then stick it in a Target Retirement Fund via a tax-advantaged IRA.

My Money Blog has partnered with CardRatings and may receive a commission from card issuers. Some or all of the card offers that appear on this site are from advertisers and may impact how and where card products appear on the site. MyMoneyBlog.com does not include all card companies or all available card offers. All opinions expressed are the author’s alone, and has not been provided nor approved by any of the companies mentioned.

MyMoneyBlog.com is also a member of the Amazon Associate Program, and if you click through to Amazon and make a purchase, I may earn a small commission. Thank you for your support.


House Value Update Q2 2011: Mortage Loan Payoff Calculations

My Money Blog has partnered with CardRatings and may receive a commission from card issuers. Some or all of the card offers that appear on this site are from advertisers and may impact how and where card products appear on the site. MyMoneyBlog.com does not include all card companies or all available card offers. All opinions expressed are the author’s alone.

As part of tracking our financial status, I regularly check in to see how long it will take to pay off our home mortgage. Buying versus renting is a very personal decision, but we ended up buying our house three and a half years ago and still plan on staying in it for the foreseeable future. I see it as an inflation hedge (our mortgage payments won’t go up) and paying it off quickly as an integral part of our early retirement plan (lower expenses means smaller portfolio needed).

We obtained a 30-year, fixed rate mortgage. Our current interest rate is 4.75%, after two rate modifications, which were basically low-cost refinances through our original lender that didn’t need additional appraisals, etc. This way, we were able to advantage of dropping interest rates over the last few years.

Home Value Estimate
Good comps are still the best way to estimate your home value. Recently, a house very similar to ours was sold through a short sale by Bank of America for 92% of our original purchase price. The house is the same model with basically the same floorplan, original construction year, and is about 10 houses down from us on the same street. The main difference was that it was in worse condition in terms of interior updates and deferred maintenance. We feel this puts a pretty good floor on the current value of our house, although I like to subtract another 6% due to broker costs if we really did sell. This gives us a current value of 86% of our original purchase price. Definitely not great, but it could be worse, and we aren’t underwater.

You can also try internet valuation tools such as Zillow, Cyberhomes, Coldwell Banker, and Bank of America (old version). After using them for a year, I found them to be interesting but imprecise tools.

Remaining Mortgage Balance
On top of our normal mortgage payments, we’ve been making sporadic additional payments directly towards principal. Our current mortgage balance is 66% of the original purchase price, 77% of the value estimate above, and 82% of the original loan value (we put 20% down).

We’ve had the mortgage for 3.5 years, but we can calculate “how far” we’re actually into our mortgage by comparing the remaining balance and the remaining principal on a regular 30-year amortization. You can get this amortization table from many online mortgage calculators. Currently, we are at the same remaining balance as if we were 9 years into a normal 30-year amortization. This means if we just pay the “minimum” mortgage payment amount based on a 30-year paydown from here on out, we’ll have 21 years left until the loan is paid in full. Not bad, already cut over 5 years off the end. 🙂

Several months ago, we set up a regular additional principal payment of 25% of the normal 30-year payment (i.e. $500 on a $2,000 payment). This automation makes our monthly budgeting easier. According to this mortgage payoff calculator, this puts us on track to pay off the loan in only 15 years (another 6 years early). Ideally, if all goes well I would like to shave this down into the 10-year range.

Looking back, it would have saved me some interest to simply go with a 15-year mortgage initially. However, the 30-year option gave me more flexibility with lower payments back then and even now, so I don’t regret the decision all that much. I do recommend people using a 15-year mortgage to determine if you can “afford” a house to my friends now, because a 30-year mortgage just seems so long.

My Money Blog has partnered with CardRatings and may receive a commission from card issuers. Some or all of the card offers that appear on this site are from advertisers and may impact how and where card products appear on the site. MyMoneyBlog.com does not include all card companies or all available card offers. All opinions expressed are the author’s alone, and has not been provided nor approved by any of the companies mentioned.

MyMoneyBlog.com is also a member of the Amazon Associate Program, and if you click through to Amazon and make a purchase, I may earn a small commission. Thank you for your support.


Link Dump: Tiny Apartment, Kindle eBook Sharing, Stripper Loans, Seasonal Sales, Law School Bait

My Money Blog has partnered with CardRatings and may receive a commission from card issuers. Some or all of the card offers that appear on this site are from advertisers and may impact how and where card products appear on the site. MyMoneyBlog.com does not include all card companies or all available card offers. All opinions expressed are the author’s alone.

Today, I find myself staring at a bunch of links that are mildly interesting, but nothing that inspires much additional research or spewing of opinion. Maybe I’m just tired and cranky. In any case, I think they are worthy of sharing.

Tiny Transformer Apartment
A fellow in Hong Kong has created an apartment with sliding walls that transforms what is basically one big room into many – a bathroom, kitchen, living room, or a bedroom simply appears with a bit of pushing. Quite cool in only 344 sq. ft. It’s easiest to watch the video to really understand it.

Lendle, eBookFling, BookLending
Apparently you can lend eBooks on Amazon Kindle now, but it’s not really built for easy sharing. If a publisher allows their eBooks to be sharable, you can lend out each book only once to another user for 14 days. If enough Kindle users sign up with a regular stream of books, it might actually be useful.

Mortgage Brokers Argue Over No-Doc Stated Income Loan For Stripper
Read the thread of emails from the bottom up. An exotic dancer in North Carolina applies for a stated income loan (no income or bank statements) based on an income of $140,000 a year. An excellent example of the keen underwriting skills shown across our great land in 2007.

Calendar of deals: What’s on sale when
Consumer Reports provides a general guide to what items tend to go on sale at the same time each year. For May, we’re looking at athletic apparel, camping gear, and lawn mowers.

Law Students Lose the Grant Game as Schools Win
The NY Times reports that some law schools are awarding more merit scholarships in order to attract better students. The catch is that the scholarships require you to be on the top third of the class, which if you give enough scholarships means some are guaranteed to promptly lose those scholarships and get hit with the full bill. Lesson to prospective law students: read the fine print.

My Money Blog has partnered with CardRatings and may receive a commission from card issuers. Some or all of the card offers that appear on this site are from advertisers and may impact how and where card products appear on the site. MyMoneyBlog.com does not include all card companies or all available card offers. All opinions expressed are the author’s alone, and has not been provided nor approved by any of the companies mentioned.

MyMoneyBlog.com is also a member of the Amazon Associate Program, and if you click through to Amazon and make a purchase, I may earn a small commission. Thank you for your support.


Questioning the Value of a College Degree

My Money Blog has partnered with CardRatings and may receive a commission from card issuers. Some or all of the card offers that appear on this site are from advertisers and may impact how and where card products appear on the site. MyMoneyBlog.com does not include all card companies or all available card offers. All opinions expressed are the author’s alone.

With the rising costs of college tuition coupled with high unemployment for new grads, it is becoming very fashionable to question the value of a college degree. At least, that’s what this long New York Magazine article (via TML) says. Most articles in the past have focused on the pay gap between a median bachelor degree holder and a high school graduate, which recently has increased to $21,900 a year.

Now, there are more articles about how a college degree is worthless. As part of their argument, if you assume a high school graduate goes out, gets a job, and starts earning their lower salary and investing money right away, that person’s nest egg will outpace a college graduate that eventually earns a higher income has to start later and pay off a ton of debt first. Given the head start and lack of debt, the high school graduate actually ends up with more money. This is fed even further with the notion of a college tuition bubble.

Is college worth it? My answer is the most common true answer. It depends! One way I started thinking about it was by going backwards in a way. Let’s look at some possible outcomes and how that may affect how you look at college tuition.

Outcome #1 – You won’t need a college degree.
There are several outcomes that won’t have needed a college degree. You could end up working in a skilled trade such as electrician, plumber, or carpenter that earns a healthy salary. If you add in some business acumen (no MBA required), you could own your own business and end up like the millionaires profiled in the popular book The Millionaire Next Door. You might prefer to be a outdoor adventure guide or flight attendant.

Outcome #2 – Any college degree will do.
There are many jobs out there that simply require some sort of undergraduate degree. It’s just a lazy screening process for applicants, but that’s reality. In this case, the best value would have come from getting your degree from any accredited university for the least amount of money. Perhaps this involves two years of community college and one year of intense upper division coursework at an in-state university (taking additional courses during the summer as possible) to graduate in a total of three years. It’s possible, and you could end up paying less than $10,000 even without any financial aid.

Outcome #3 – You’ll actually use the technical skills you learned.
Professions that come to mind are accountant, doctor, nurse practitioner, engineer, lawyer, professor, teacher. Here, it’s more likely that you’ll use the technical skills you learned in school. If you’re talking about a profession that requires a graduate degree like law or medicine, then the final school is the matters the most in terms of prestige. If you really take full advantage of your education, then your return on investment can be high. I know doctors with $250k of debt, but now they make $250k a year.

Playing The Odds

The fact is, nobody really knows ahead of time which outcome will actually happen. But you probably have an idea of the relative odds based on the child’s interests and motivation levels. I would say take into account all your options, and make a decision based on the individual and your financial situation.

The reason why many pushy parents want their kids to be either a doctor, lawyer, or engineer is that this increases the probabilities that the kid will get a decent job and support themselves. Sure, some engineers or lawyers don’t make that much, but how many of them are starving? Parents are playing the odds. I imagine if I really wanted to play the odds these days, I’d teach my kid a skilled trade (ASE certified mechanic? Electrician?) in high school, and then continue to push them towards college and a professional degree.

My Money Blog has partnered with CardRatings and may receive a commission from card issuers. Some or all of the card offers that appear on this site are from advertisers and may impact how and where card products appear on the site. MyMoneyBlog.com does not include all card companies or all available card offers. All opinions expressed are the author’s alone, and has not been provided nor approved by any of the companies mentioned.

MyMoneyBlog.com is also a member of the Amazon Associate Program, and if you click through to Amazon and make a purchase, I may earn a small commission. Thank you for your support.


American Express Premier Rewards Gold Card Review – 25,000 Bonus Membership Points

My Money Blog has partnered with CardRatings and may receive a commission from card issuers. Some or all of the card offers that appear on this site are from advertisers and may impact how and where card products appear on the site. MyMoneyBlog.com does not include all card companies or all available card offers. All opinions expressed are the author’s alone.

American Express Premier Rewards Gold CardAmerican Express is again promoting their newest flavor – the Premier Rewards Gold Card from American Express®, which is slightly different from their other Gold/Zync/Platinum cards. This is a charge card, so it is intended for folks that pay off their balance in full each month (as all of you should do anyway). If you are not a current AMEX *charge* card holder, then you are eligible for their current sign-up incentive:

  • Receive 25,000 Membership Rewards® Points after you spend $2,000 on purchases on your new Card in your first 3 months of Card Membership.
  • 3X points for flights booked directly with airlines. 2X points at US restaurants, US gas stations, and US supermarkets. 1X points on other purchases. Terms and limitations apply.
  • No matter where you’re traveling, when you use your Premier Rewards Gold Card there are no foreign transaction fees from American Express.
  • $100 Airline Fee Credit. Up to $100 a year in baggage fees and more at one airline.
  • With The Hotel Collection, you can get up to a $75 hotel credit on qualifying charges, plus a room upgrade at check-in if it’s available, when you book a stay of at least two consecutive nights.
  • There is a $0 introductory annual fee for the first year, then $195.
  • Terms and limitations apply.

Extended warranties and roadside assistance. As with all such “premium” AMEX charge cards, everything you buy with the cards comes with a free automatic extended warranty. American Express will double the length of the original U.S. manufacturer’s warranty for up to one additional year on eligible purchases with warranties of 5 years or less. This can be very handy for electronics like home theater equipment and laptops. Read more at their official FAQ and at this Consumerist article about a guy who got a new laptop.

Historically, there have also been varying promotions for specific airlines, for example a 20% bonus for transfer to British Airways last year, and currently 50% additional miles (expired) for transfer to Delta Skymiles. This means you can be getting more than 1 mile per dollar spent.  In summary, this card has some new features and a nice sign-up incentive, but the target demographic seems to be higher-income cardholders that are big spenders, especially on airfare.

My Money Blog has partnered with CardRatings and may receive a commission from card issuers. Some or all of the card offers that appear on this site are from advertisers and may impact how and where card products appear on the site. MyMoneyBlog.com does not include all card companies or all available card offers. All opinions expressed are the author’s alone, and has not been provided nor approved by any of the companies mentioned.

MyMoneyBlog.com is also a member of the Amazon Associate Program, and if you click through to Amazon and make a purchase, I may earn a small commission. Thank you for your support.


Housing Bubble History: Book Covers From 2005-Present

My Money Blog has partnered with CardRatings and may receive a commission from card issuers. Some or all of the card offers that appear on this site are from advertisers and may impact how and where card products appear on the site. MyMoneyBlog.com does not include all card companies or all available card offers. All opinions expressed are the author’s alone.

I ran across this funny image on Imgur and just had to recreate it with a bit more detail. All of these books are by the same author, David Lareah, along with the publishing dates of each book. (The first two books are essentially the same book with different titles.)

Hover your mouse cursor over each book cover below to see the full titles, the progression is both funny and sad. Or, you can click on each book cover to see the corresponding Amazon book page. Comparing old and new reviews for the books can also be a nice lesson in investor psychology.

All Real Estate Is Local: What You Need to Know to Profit in Real Estate - in a Buyer's and a Seller's Market  Why the Real Estate Boom Will Not Bust - And How You Can Profit from It: How to Build Wealth in Today's Expanding Real Estate Market Are You Missing The Real Estate Boom?

Now, which popular books of today will be the jokes of tomorrow?

My Money Blog has partnered with CardRatings and may receive a commission from card issuers. Some or all of the card offers that appear on this site are from advertisers and may impact how and where card products appear on the site. MyMoneyBlog.com does not include all card companies or all available card offers. All opinions expressed are the author’s alone, and has not been provided nor approved by any of the companies mentioned.

MyMoneyBlog.com is also a member of the Amazon Associate Program, and if you click through to Amazon and make a purchase, I may earn a small commission. Thank you for your support.


Vanguard Target Date Retirement Funds Glide Path

My Money Blog has partnered with CardRatings and may receive a commission from card issuers. Some or all of the card offers that appear on this site are from advertisers and may impact how and where card products appear on the site. MyMoneyBlog.com does not include all card companies or all available card offers. All opinions expressed are the author’s alone.

Inside a recent Vanguard article was a nice graphic of the current glide path for all Vanguard Target Retirement funds, which shows how the fund’s asset allocation will change over time. The fund will automatically rebalance towards these allocations, even if market returns shift things.

First, you’ll notice that the Target Retirement Year of any specific fund assumes that you will retire at age 65. Nothing really changes from ages 25 to 40, and then from 40 onwards there is a gradual transition. According to the article, the changes will continue to change for 7 years after the Target Retirement Year with a final mix of 30% stocks and 70% bonds/cash. However, the graph above seems to indicate even less stocks past age 72. Either way, this means a fund will stick around even well after the retirement date has passed, like with the Vanguard Target Retirement 2010 Fund.

Knowing the glide path helps you decide if you want to make some slight adjustments you can make when buying one of these all-in-one funds:

  • The Target Date assumes that you will retire at age 65. If you plan on retiring earlier or later than that, you can simply choose a different Target year. Keep in mind that your Social Security benefits will also adjust according to when elect to start receiving payments. When you do, that will provide a regular, inflation-adjusted income stream in addition to any income for retirement account withdrawals.
  • The Target Date assumes a generic risk tolerance level. If you want a more aggressive or conservative asset allocation over time, again, simply choose a different Target year. This will shift your glide path above accordingly.

If you’re buying one of these things, you’re doing it for the low costs, ease of use, and even perhaps how it keeps you from fiddling too much. These funds are especially great if the great majority of your retirement savings are in tax-deferred accounts like 401ks and IRAs, which is probably true for many investors that are just starting out. Otherwise, you may decide that you want to separate asset classes according to their tax treatment by the government.

My Money Blog has partnered with CardRatings and may receive a commission from card issuers. Some or all of the card offers that appear on this site are from advertisers and may impact how and where card products appear on the site. MyMoneyBlog.com does not include all card companies or all available card offers. All opinions expressed are the author’s alone, and has not been provided nor approved by any of the companies mentioned.

MyMoneyBlog.com is also a member of the Amazon Associate Program, and if you click through to Amazon and make a purchase, I may earn a small commission. Thank you for your support.


British Airways Visa 100,000 Mile Bonus (Expired)

My Money Blog has partnered with CardRatings and may receive a commission from card issuers. Some or all of the card offers that appear on this site are from advertisers and may impact how and where card products appear on the site. MyMoneyBlog.com does not include all card companies or all available card offers. All opinions expressed are the author’s alone.

Update: This card offer is now expired.

A final reminder that this offer is scheduled to end on Friday actually more specifically on Thursday night 5/5/11 at 11:59PM EST. It is not being extended.

This is the highest credit card mileage bonus I have ever seen. The Chase British Airways Visa Signature card (expired) is offering 50,000 British Airways (BA) Executive Club miles for new cardmembers with first purchase, and another 50,000 BA miles after spending $2,500 within 3 months of opening, for a total of 100,000 miles. There is an annual fee of $95, but you should be able to easily get $1,000 worth of value from this deal, if not more. We took advantage of the last time this deal was around, and ended up flying to Europe in business class with fully lie-flat seats across the Atlantic Ocean, on tickets that retailed for over $8,000 each.

To quickly recap, for those of you that primarily travel within the US, you can redeem British Airlines miles on American Airlines. You can get 4 roundtrip coach tickets within the continental US for 100,000 miles, or 3 round-trips to Hawaii for 105,000 miles. For those of you that like to travel internationally, in addition to British Airways destinations in Europe, you can redeem your miles on Cathay Pacific to Asia, or redeem on LAN to South America. 100,000 BA miles could get you a roundtrip, business class ticket to these destinations. More details in previous post here.

My Money Blog has partnered with CardRatings and may receive a commission from card issuers. Some or all of the card offers that appear on this site are from advertisers and may impact how and where card products appear on the site. MyMoneyBlog.com does not include all card companies or all available card offers. All opinions expressed are the author’s alone, and has not been provided nor approved by any of the companies mentioned.

MyMoneyBlog.com is also a member of the Amazon Associate Program, and if you click through to Amazon and make a purchase, I may earn a small commission. Thank you for your support.


Ally Bank Rolls Out eCheck Check Deposit: Scan Your Checks Online

My Money Blog has partnered with CardRatings and may receive a commission from card issuers. Some or all of the card offers that appear on this site are from advertisers and may impact how and where card products appear on the site. MyMoneyBlog.com does not include all card companies or all available card offers. All opinions expressed are the author’s alone.

The Ally Bank blog recently announced that they are gradually rolling out their eCheck Deposit service, where you can use a scanner and submit your deposits over the internet without having to visit a branch or mailing anything in. This is another step towards being able to step away from the big Brick & Mortar banks and take advantage of the higher interest rates and lower fees of internet banks.

The service is currently only available by invited account holders of an Ally Interest Checking account, but you can call them at 1-877-247-2559 and ask to be added to their next rollout list. They expect to continue expanding this service throughout 2011. (Update: Ally contacted me and said that invited account holders of their online savings account and money market account are also eligible.)

This adds another feature to my Ally Bank Checking account review, which I found comparing the features to be one of the best online checking account alternatives out there. No minimums, no direct deposit required, all ATM fees refunded, 24/7 phone reps, and a decent interest rate.

My Money Blog has partnered with CardRatings and may receive a commission from card issuers. Some or all of the card offers that appear on this site are from advertisers and may impact how and where card products appear on the site. MyMoneyBlog.com does not include all card companies or all available card offers. All opinions expressed are the author’s alone, and has not been provided nor approved by any of the companies mentioned.

MyMoneyBlog.com is also a member of the Amazon Associate Program, and if you click through to Amazon and make a purchase, I may earn a small commission. Thank you for your support.


Bank of America Raises MyAccess Checking Account Fees 5/24

My Money Blog has partnered with CardRatings and may receive a commission from card issuers. Some or all of the card offers that appear on this site are from advertisers and may impact how and where card products appear on the site. MyMoneyBlog.com does not include all card companies or all available card offers. All opinions expressed are the author’s alone.

My very first big boy bank account was with Bank of America, opened when I first landed at college nearly 15 years ago. I realized today that even though I have probably opened and closed nearly a hundred (yes, 100) bank accounts since then and pocketed several thousand dollars in signup bonuses (yes, a least that much) in the process since then, I have always kept that same Bank of America account open.

BofA has a bunch of different accounts across the nation, but from what I recall, the MyAccess Checking account I opened was one of the most basic and the easiest to avoid a monthly fee on. Today, I received notice that they will be raising some fees, effective for statement cycles starting on or after May 24, 2011. The monthly fee is now $12, up from $8.95. To avoid it, I’ll have to keep at least $1,500 in my account or have a direct deposit of at least $250. Previously, a direct deposit of any amount was acceptable.

Neither of changes will really affect my current banking patterns, but it does signal that fees are going up and reminds me that there are other deals out there. Am I somehow emotionally attached to a bank account after all these years? Or maybe I’m just a creature of habit.

My Money Blog has partnered with CardRatings and may receive a commission from card issuers. Some or all of the card offers that appear on this site are from advertisers and may impact how and where card products appear on the site. MyMoneyBlog.com does not include all card companies or all available card offers. All opinions expressed are the author’s alone, and has not been provided nor approved by any of the companies mentioned.

MyMoneyBlog.com is also a member of the Amazon Associate Program, and if you click through to Amazon and make a purchase, I may earn a small commission. Thank you for your support.