SimpleCents.org

We've Moved

2009-04-06T22:39:00.003-04:00

Whelp, it's official. Simplecents.org is all grown up. As a result, we've outgrown our free place here at blogger. These days you can find us at:

freefamilyfinance.com

Please visit us there for all the same great content and a few extras along the way. Thanks for being an important part of our virtual community.

Southpark on the Bailout

2009-03-26T08:07:00.003-04:00

Stan finally figures out how the treasury system works.

BillShrink.Com

2009-03-25T10:01:00.003-04:00

I was recently introduced to billshrink.com. It appears to be a nifty little utility that guides you through saving money on three areas: gas, cell phone, & credit card expenses. Best of all, it is free.

Have you used billshrink.com? Tell us about it. Comment to this post with your experience.

Better Late Than Never: Tax Help

2009-03-21T13:44:00.004-04:00

Today, the IRS is offering free, face-to-face help for you and your taxes. Of course, some restrictions apply - after all, it's the IRS. But if you qualify, this could save you some dough.

Sorry for the late notice. However, the IRS didn't make the announcement until early this week.

"The Big, Bad Bailout" by John Stossel

2009-03-17T14:15:00.002-04:00

Below you will find an very interesting video clip that appeared on 20/20 last week. It is view on the government bailout which often does not make the media headlines.

The Big, Bad Bailout: Part 1 of John Stossel's 20/20 special "Bailouts and Bull".

"Don't worry. I'm from the government and I'm here to help."

A Pro-Hole Agenda

2009-03-04T11:08:00.002-05:00

Top 5 Things to Do In a Recession [5 of 5]

2009-03-01T13:19:00.005-05:00

This post is part of a series. You can find the rest of the series here:
part 1 | part 2 | part 3 | part 4 | part 5

"Top 10 5 Things To Do In a Recession" [Part 5 of 5]"
5. Focus on Productivity In Every Department

As you go through the budget [see part 4], look again. Ask yourself this question, "am I getting the most for my money?". Maybe its time to consider switching cable providers, dry cleaners, or grocery stores.

Recently I took the time to shop my insurance. I had 4 agencies quote it. Up until this time, I had been a State Farm client. I had always read that independent agents were much more price competitive, so I asked three different independents to price the same coverages as State Farm. The independent agencies were an average of 38% cheaper. The winning company was almost half the price of State Farm. He saved us big bucks and he quoted quality providers.

In the midst of the recession, take a second look at things. With a little fine-tuning, maybe you can find more room in your budget.

Top 5 Things to Do In a Recession [4 of 5]

2009-02-28T13:19:00.005-05:00

This post is part of a series. You can find the rest of the series here:
part 1 | part 2 | part 3 | part 4 | part 5

"Top 10 5 Things To Do In a Recession" [Part 4 of 5]"
4. Forecast Your Cash Position

Forecasting your cash position is just fancy business talk for 'do a budget'. If money is getting tighter, maybe you need a tighter leash on your money.

Be sure your budget includes a hefty dose of reality in it. You aren't budgeting for the month from heaven. You will need to live in those numbers. So be sure you can.

Top 5 Things to Do In a Recession [3 of 5]

2009-02-26T13:19:00.005-05:00

This post is part of a series. You can find the rest of the series here:
part 1 | part 2 | part 3 | part 4 | part 5

"Top 10 5 Things To Do In a Recession" [Part 3 of 5]"
3. Invest More In the Right Things, Less In the Wrong Things

As it relates to your finances, where is your money going? Maybe you have some portion of your saving on automatic withdraw. Are you still satisfied with where it is going? Today's market is very different than two years ago. Maybe you continue the course, or maybe not. If your company has recently distributed temporary pay cuts to reduce overhead, you may want to reevaluate your savings & investing goals. You might need to carefully re-prioritize to ensure you meet those goals.

As it relates to your job, many companies are reducing operating hours along with those temporary pay cuts. If you find yourself with a 4 day work week, or shortened work days, make the most of that time. Use that time to better yourself. Read a book, take a class, or start that small business you've always dreamed about. Don't let the man get you down. Recharge yourself so that you are poised to rebound alongside the economy.

Top 5 Things to Do In a Recession [2 of 5]

2009-02-24T13:19:00.006-05:00

This post is part of a series. You can find the rest of the series here:
part 1 | part 2 | part 3 | part 4 | part 5

"Top 10 5 Things To Do In a Recession" [Part 2 of 5]"
2. Negotiate Everything

We live today within a buyer's market and if you have the kahonas to ask, you can save a bunch of money. Whether we are discussing big new TV's or just the cable bill, prices are often much more negotiable than most of us realize. Today's market is the perfect time to ask:

"is that your lowest price?"
"does anybody else get a better price?"

At least make them lie to you. You'll be surprised at the outcome.

Challenge the suggested retail price!

Top 5 Things to Do In a Recession [1 of 5]

2009-02-22T12:19:00.010-05:00

This post is part of a series. You can find the rest of the series here:
part 1 | part 2 | part 3 | part 4 | part 5

This week, I had the privilidge of attending a seminar entitled, "Top 10 Things to Do In a Recession". The seminar was led by two local individuals, a business growth consultant & a sales consultant. Five of the ten points were applicable to both businesses, as well as individuals/families. Thus, I present to you:

"Top 10 5 Things To Do In a Recession" [Part 1 of 5]"
1. Get More Business From Your Best Customers

Ok, so this is definitely geared toward businesses. But let's take the same concept and move it one notch down on the supply chain. How about this, "Give Your Employer More of Your Best"?
What do I mean?

Well, according to the news, the entire population of the earth will be laid off from their jobs by sometime next week. But, just in case that does not happen, you should ask your self, "what can I do to become a more valuable employee?". Is there a need in your office that isn't being met? If so, can you plug that hole? Maybe it requires a little extra training. Maybe it simply requires a little extra time. Maybe it requires better use of time you currently spend at work (lay off the facebook!). Only you know. But ask yourself that question. Try to grow your roots deeper into the company so that you don't get the axe.

Even if downsizing is looming. Maybe you have the skills required to perform your job and part of someone's. Make that known, by words or by actions. Make yourself a more valuable employee. Don't allow yourself to be expendable.

Review: 20 Things To Never Pay Full Price For

2009-02-20T16:10:00.004-05:00

The fine folks over at the Bargainist have posted an interesting article entitled, "20 Things You Should Never Pay Full Price For".

The List & Some Thoughts:

Groceries - i sure hate grocery store savings clubs. i have a card for every freakin' store and i leave them in my car every freakin' time.
Bathroom Supplies - we've found great prices at Dollar General Market stores
Airline Tickets - i have always found the airline website to be the cheapest, but i will use kayak.com to help find the cheapest airline.
Contact Lenses - we'll have to try this one.
Restaurants
Flawed Merchandise - never hurts to ask.
Cell Phones - i'm too techy to get the free phone.
Magazines - watch out for the rate increase at renewal time. i often cancel and resubscribe each year to save money.
Gas
Appliances - i think scratch & dent is the way to go.
Prescriptions - seems like too much trouble to bounce around.
Pets
Movie Rentals - redbox and itunes $.99
Books - amazon is the way to go.
Cable Service - i have been threatening to leave for over a year (every 3-6 months, based on the discount period they give me). works every time.
Clothing
Massages
Coffee
Furniture - we've also had good luck here. if two stores carry the same brand, tell them. let them bid for your business.
Houses - use the register of deeds for the property's records. find out what the current owner paid for it. that info may help with the negotiations.

Tax Payer Prize Patrol

2009-02-19T14:00:00.003-05:00

oh my!

It's So Simple, It's Funny.

2009-02-18T15:33:00.005-05:00

Inflation, The True Stimulant

2009-02-15T08:39:00.009-05:00

How great is this commercial? In a serious way, I share a lot of the same sentiments concerning our new government leadership and the stimulus package they are schedule to finalize Tuesday.

A wise and frugal government, which shall leave men free to regulate their own pursuits of industry and improvement, and shall not take from the mouth of labor the bread it has earned - this is the sum of good government.
Thomas Jefferson

At the very base of my opinion, lies the foundational thought that government should leave us alone. I am a fiscal libertarian. Over the course of history, often times when the government has acted, it has resulted in short-term success and long-term failure. All government regulation comes with unintended consequences. Look around at the industries that struggle: airlines, health insurance, and most recently housing. Airlines & health care have long been inundated with government regulation, and now they are a disaster. Recently the housing & credit markets have tanked, due to...(you guessed it)...government 'helping' unqualified people get houses (see the community reinvestment act).

Our government has been able to introduce much of this regulation under a guise. They introduce a tremendous amount of fear into the minds of Americans and provide a solution soaked in mistakes (and agenda).

Our government has kept us in a perpetual state of fear — kept us in a continuous stampede of patriotic fervor — with the cry of grave national emergency. Always there has been some terrible evil at home or some monstrous foreign power that was going to gobble us up if we did not blindly rally behind it.
Douglas MacArthur

You probably heard all of the politicians warnings. Under both the Bush White House & the Obama White House, the message was the same - pass this bailout bill by tomorrow or the world will come to an end. Time and time again the bill wasn't passed by the artificial deadline and nothing happened. Hell, Bush passed a stimulus bill and the end result was nothing more than increased national debt.

We are spoon fed the dismal state of our economy. How everyone has lost their job and everyone's house is being foreclosed on. Things aren't that bad. Take job losses for example - not that bad.

Or even unemployment - not that bad.

My point is this, our leaders are either idiots or liars. They are either misleading us for political gain or they are so stupid they shouldn't hold office. I'll assume that they mean well and are simply subjecting themselves to the same fear we see on the nightly news. A country governed by emotion is a country in disarray. Fear will drive us to make costly decisions.

Delay is preferable to error.
Thomas Jefferson

Our leaders should rise above the emotion and political gain. They have unbelievable access to factual information. They should pursue truth and exercise leadership. I don't want a popularity contest winner in office. I want someone to lead our country.

If you want to have something to be fearful of, I'll give you something. The one thing I am fearful of is the very same thing Washington believes will resolve all of my fear. That is the stimulus package and our inability as a government to fund it.

We are playing with borrowed money. It doesn't take an economist to tell you, debt=risk. On a national scale, debt also equals inflation. The US dollar is worth less because our country is fiscally upside-down. Subsequently, we take a beating on the exchange of currency on everything we import, which is everything. Deeper we go...

Those who would sacrifice freedom for security deserve neither.
Benjamin Franklin

Interesting Update: I spoke with a banker yesterday concerning the bailout funds. He said that even though banks have received money, they have also received countless new government regulations on how they can lend it. He explained that the new regulations kept him from lending quality loans to quality people. What sense does it make for government to give money to banks to soften the credit markets and then regulate the inability to lend it?

Simple Wisdom: Marcus Tullius Cicero

2008-11-26T10:38:00.007-05:00

They say history repeats itself. I think "They" are correct. I may only be a wet-behind-the-ear, twenty something...but I am a thinker. About two millennia ago, a fella by the name of Marcus Tullius Cicero wrote this little nugget of truth:

"The budget should be balanced, the Treasury should be refilled, public debt should be reduced, the arrogance of officialdom should be tempered and controlled, and the assistance to foreign lands should be curtailed lest Rome become bankrupt. People must again learn to work, instead of living on public assistance."
~55 BC

Oops.

That being said, you can bitch & moan about the government until the cows come home. That isn't the point of this post. However, one important truth does resound in the streets. This statement is as true for Barack Obama as it is to Johnny American. Read it again. Do you see the principles at play:

"The budget should be balanced" - have a budget
"the Treasury should be refilled" - have an emergency fund
"public debt should be reduced" - minimize/avoid debt
"the arrogance of officialdom should be tempered and controlled" - make financial decisions based on controlled logic & reason. not emotion.
"the assistance to foreign lands should be curtailed" - priority one, take care of your own. then, if the budget permits, go out from there.
"People must again learn to work" - there are two sides to the equation - income & outgo. if you are struggling, it might not be because of your spending. you might need to find more income, some way, some how.
"instead of living on public assistance" - wean yourself off of the government 'teet'. you are the only person in your life that can make your dreams happen. In the words of the Sugarhill Gang, Jump On It. Grab it by the throat and take control.

Now is the time. 1,953 years in the making. Make it happen for yourself.

Good News / Bad News - Commentary on the Election

2008-11-05T17:00:00.005-05:00

Well SimpleCents faithful, I've got some good news and I've got some bad news.

First, the good news...
The election is over. Now the stock market can stop wigging out all the time. The election of Senator Obama has introduced some much needed 'stability' into the government. Get excited. They can stop talking about the DOW every night on the news.

Now, the bad news...
Did you feel any different today? When you woke up this morning, did you still have to put your pants on one leg at a time? Were you still late to the office? Are you still going to have to fill up the tank on the way home? Is the savings account still running on empty? Are you still going to eat left overs tonight for dinner?

Why do I ask? Well, because your answer to most of those questions is probably 'yes'. I ask, because in a micro sense, nothing has changed. An elderly gentleman, a man who has seen his fair share of elections, said it best,

"No matter what happens tonight, I'm still going to wake up in the morning and have my oatmeal."

Unless you buy into the nightly news and stress out about the macro hype, this is still the good ol' U.S. of A. The only way food will be on your table is if you get a job, go work, earn some money, buy some food, & put it on the table. Nobody else is going to feed your family. No one else is going to buy your gas. No one else is going to pay your mortgage. And no one else is going to 'fix' your life, except for you. Obama or McCain - it doesn't matter. The government is not going to fix your life. If you think they are, you better pack a lunch. Because its going to be a while.

A TOSHA inspector once told me, the first thing he says as he approaches a construction jobsite for inspection is,

"Don't worry. I'm from the government and I'm here to help."

Then he just laughed and laughed - the way that only government officials can, as they write you up for violations & subsequent fines. Yikes. Those are some scary words.

I'm sorry to break it to you. But here is the bad news: If you want your life to change, Democrat or Republican, put your work boots on. Go make it happen. Because if you don't, no one else will.

Our Country's Tax Structure

2008-10-23T10:23:00.003-04:00

Here is a popular forward that is going around the email circuit. It is a fairly basic depiction of our countries tax structure. Maybe somewhat helpful.

Suppose that every day, ten men go out for beer, and the bill for all ten
comes to $100. If they paid their bill the way we pay our taxes, it would
go something like this:

The first four men (the poorest) would pay nothing.
The fifth would pay $1.
The sixth would pay $3.
The seventh would pay $7.
The eighth would pay $12.
The ninth would pay $18.
The tenth man (the richest) would pay $59.

So, that's what they decided to do. The ten men drank in the bar every
day and seemed quite happy with the arrangement, until one day, the
owner threw them a curve. 'Since you are all such good customers,' he
said, 'I'm going to reduce the cost of your daily beer by $20.' Drinks for
the ten now cost just $80.

The group still wanted to pay their bill the way we pay our taxes so the
first four men were unaffected. They would still drink for free. But what
about the other six men - the paying customers? How could they divide
the $20 windfall so that everyone would get his 'fair share?' They realized
that $20 divided by six is $3.33 But if they subtracted that from every-
body's share, then the fifth man and the sixth man would each end up
being paid to drink his beer. So, the bar owner suggested that it would be
fair to reduce each man's bill by roughly the same amount, and he pro-
ceeded to work out the amounts each should pay.

And so:

The fifth man, like the first four, now paid nothing (100% savings).
The sixth now paid $2 instead of $3 (33% savings).
The seventh now pay $5 instead of $7 (28% savings).
The eighth now paid $9 instead of $12 (25% savings).
The ninth now paid $14 instead of $18 (22% savings).
The tenth now paid $49 instead of $59 (16% savings).

Each of the six was better off than before. And the first four
continued to drink for free. But once outside the restaurant, the men
began to compare their savings.

'I only got a dollar out of the $20,' declared the sixth man. He pointed
to the tenth man, 'But he got $10!'

'Yeah, that's right,' exclaimed the fifth man. 'I only saved a dollar, too.
It's unfair that he got ten times more than I!'

'That's true!!' shouted the seventh man. 'Why should he get $10 back
when I got only two? The wealthy get all the breaks!'

'Wait a minute,' yelled the first four men in unison. 'We didn't get any-
thing at all. The system exploits the poor!'

The nine men surrounded the tenth and beat him up.

The next night the tenth man didn't show up for drinks, so the nine sat
down and had beers without him. But when it came time to pay the bill,
they discovered something important. They didn't have enough money
between all of them for even half of the bill!

And that, boys and girls, journalists and college professors, is how our
tax system works. The people who pay the highest taxes get the most
benefit from a tax reduction. Tax them too much, attack them for being
wealthy, and they just may not show up anymore. In fact, they might
start drinking overseas where the atmosphere is somewhat friendlier.

David R. Kamerschen, Ph.D.
Professor of Economics, University of Georgia

For those who understand, no explanation is needed.
For those who do not understand, no explanation is possible.

Simple Wisdom: Investing in the Market

2008-10-23T09:17:00.004-04:00

Lately in the financial world, the proverbial sky has been falling. Our country is in a recession (it's not). We are headed into the next Great Depression (meanwhile people are lined out the door at starbucks each morning, buying their $5 coffee). Unemployment is through the roof (tell that to my alarm clock). Blah, blah, blah. Alot of folks are acting like the clip above. The panic of the masses.

So what does this mean to you, the wanna-be wise investor? Beats me! I don't know. Who do I look like, Miss Cleo?

But just like you, I want to know what the top notch investment guys are saying. Unlike the morons on tv, lets hear from the folks with the cash. They are practicing what they preach - and it has 0's on the end.

A few month's ago, Money Magazine interviewed a few celebrities & financial gurus, asking them for the best financial advice they had ever received. My clear-cut favorite came from Christopher J. Ailman. He shared:

Al Czervik from the movie "Caddyshack," played by Rodney Dangerfield, gets a call on the golf course: "Hello. It's my broker. What? Then buy, buy, buy! Oh, everyone's buying? Then sell, sell, sell!"
What I learned from Al is don't follow the herd, they are generally wrong and late. If everyone wants to buy, look around, it's probably the top. Definitely if everyone is heading for the exit, it's the bottom.

Warren Buffett, investment super-guru adds a similar thought:

Most people get interested in stocks when everyone else is. The time to get interested is when no one else is. You can't buy what is popular and do well.

Robert Shiller, an Econ Professor at Yale is also drinking the Kool-Aid:

One needs to think antisocially to excel in investing, to resist the patterns of thinking that seem mysteriously to arrive simultaneously in the minds of millions of people around the world.

That's such a Yale Professor answer, isn't it?

So what does this mean you us then? In my mind, it looks like a wonderful time to invest, but only if you are ready. If you are free of debt and have some money to leave alone for 5+ years, do it! "You can do it!" Do it with confidence. At least, that's why I am hearing from the guru's. But maybe Miss Cleo would give different advice.

You can start a mutual fund with as little as $250. Or you could start one (with most fund companies) with a $50 automatic contribution each month. That's right. Only $50 down and $50 a month will get you in this beautiful....mutual fund.

Overcome your fear. Turn off your tv. Proceed with confidence. Now is an excellent time to invest. But only if you are ready.

Our Country's Tax Structure

2008-10-23T09:15:00.000-04:00

Here is a popular forward that is going around the email circuit. It is a fairly basic depiction of our countries tax structure. Maybe somewhat helpful.

Suppose that every day, ten men go out for beer, and the bill for all ten
comes to $100. If they paid their bill the way we pay our taxes, it would
go something like this:

The first four men (the poorest) would pay nothing.
The fifth would pay $1.
The sixth would pay $3.
The seventh would pay $7.
The eighth would pay $12.
The ninth would pay $18.
The tenth man (the richest) would pay $59.

So, that's what they decided to do. The ten men drank in the bar every
day and seemed quite happy with the arrangement, until one day, the
owner threw them a curve. 'Since you are all such good customers,' he
said, 'I'm going to reduce the cost of your daily beer by $20.' Drinks for
the ten now cost just $80.

The group still wanted to pay their bill the way we pay our taxes so the
first four men were unaffected. They would still drink for free. But what
about the other six men - the paying customers? How could they divide
the $20 windfall so that everyone would get his 'fair share?' They realized
that $20 divided by six is $3.33 But if they subtracted that from every-
body's share, then the fifth man and the sixth man would each end up
being paid to drink his beer. So, the bar owner suggested that it would be
fair to reduce each man's bill by roughly the same amount, and he pro-
ceeded to work out the amounts each should pay.

And so:

The fifth man, like the first four, now paid nothing (100% savings).
The sixth now paid $2 instead of $3 (33% savings).
The seventh now pay $5 instead of $7 (28% savings).
The eighth now paid $9 instead of $12 (25% savings).
The ninth now paid $14 instead of $18 (22% savings).
The tenth now paid $49 instead of $59 (16% savings).

Each of the six was better off than before. And the first four
continued to drink for free. But once outside the restaurant, the men
began to compare their savings.

'I only got a dollar out of the $20,' declared the sixth man. He pointed
to the tenth man, 'But he got $10!'

'Yeah, that's right,' exclaimed the fifth man. 'I only saved a dollar, too.
It's unfair that he got ten times more than I!'

'That's true!!' shouted the seventh man. 'Why should he get $10 back
when I got only two? The wealthy get all the breaks!'

'Wait a minute,' yelled the first four men in unison. 'We didn't get any-
thing at all. The system exploits the poor!'

The nine men surrounded the tenth and beat him up.

The next night the tenth man didn't show up for drinks, so the nine sat
down and had beers without him. But when it came time to pay the bill,
they discovered something important. They didn't have enough money
between all of them for even half of the bill!

And that, boys and girls, journalists and college professors, is how our
tax system works. The people who pay the highest taxes get the most
benefit from a tax reduction. Tax them too much, attack them for being
wealthy, and they just may not show up anymore. In fact, they might
start drinking overseas where the atmosphere is somewhat friendlier.

David R. Kamerschen, Ph.D.
Professor of Economics, University of Georgia

For those who understand, no explanation is needed.
For those who do not understand, no explanation is possible.

Best Article I have read in a while

2008-10-11T19:52:00.005-04:00

I have read countless articles as of recent that kind of make me sick. Everything you read recently has to do with how the government did this or that, needs to do this or that, senators should think about this, big banking is responsible for this or that. This article was different. It was nice to have someone remembering personal responsibility amidst all this mayhem.

10 (More) Reasons You're Not Rich

Many people assume they aren't rich because they don't earn enough money. If I only earned a little more, I could save and invest better, they say.

The problem with that theory is they were probably making exactly the same argument before their last several raises. Becoming a millionaire has less to do with how much you make, it's how you treat money in your daily life.

The list of reasons you may not be rich doesn't end at 10. Caring what your neighbors think, not being patient, having bad habits, not having goals, not being prepared, trying to make a quick buck, relying on others to handle your money, investing in things you don't understand, being financially afraid and ignoring your finances.

Here are 10 more possible reasons you aren't rich:
You care what your car looks like: A car is a means of transportation to get from one place to another, but many people don't view it that way. Instead, they consider it a reflection of themselves and spend money every two years or so to impress others instead of driving the car for its entire useful life and investing the money saved.

You feel entitlement: If you believe you deserve to live a certain lifestyle, have certain things and spend a certain amount before you have earned to live that way, you will have to borrow money. That large chunk of debt will keep you from building wealth.

You lack diversification: There is a reason one of the oldest pieces of financial advice is to not keep all your eggs in a single basket. Having a diversified investment portfolio makes it much less likely that wealth will suddenly disappear.

You started too late: The magic of compound interest works best over long periods of time. If you find you're always saying there will be time to save and invest in a couple more years, you'll wake up one day to find retirement is just around the corner and there is still nothing in your retirement account.

You don't do what you enjoy: While your job doesn't necessarily need to be your dream job, you need to enjoy it. If you choose a job you don't like just for the money, you'll likely spend all that extra cash trying to relieve the stress of doing work you hate.

You don't like to learn: You may have assumed that once you graduated from college, there was no need to study or learn. That attitude might be enough to get you your first job or keep you employed, but it will never make you rich. A willingness to learn to improve your career and finances are essential if you want to eventually become wealthy.

You buy things you don't use: Take a look around your house, in the closets, basement, attic and garage and see if there are a lot of things you haven't used in the past year. If there are, chances are that all those things you purchased were wasted money that could have been used to increase your net worth.

You don't understand value: You buy things for any number of reasons besides the value that the purchase brings to you. This is not limited to those who feel the need to buy the most expensive items, but can also apply to those who always purchase the cheapest goods. Rarely are either the best value, and it's only when you learn to purchase good value that you have money left over to invest for your future.

Your house is too big: When you buy a house that is bigger than you can afford or need, you end up spending extra money on longer debt payments, increased taxes, higher upkeep and more things to fill it. Some people will try to argue that the increased value of the house makes it a good investment, but the truth is that unless you are willing to downgrade your living standards, which most people are not, it will never be a liquid asset or money that you can ever use and enjoy.

You fail to take advantage of opportunities: There has probably been more than one occasion where you heard about someone who has made it big and thought to yourself, "I could have thought of that." There are plenty of opportunities if you have the will and determination to keep your eyes open.

Simply Insane: Why the "Bailout" is bad.

2008-10-01T20:35:00.005-04:00

The "bailout" is something that should place fear into the hearts of clear thinking Americans, and here's why. The government (highly known for efficiency and effectiveness) takes over two failing companies and all of the sudden, "two wrongs" make a right. Why are government run/assisted companies NEVER good? Simple, they don't have to be. You could be the ugliest woman in the world, but if your the only woman at the bar, you suddenly become more attractive. The same is true with government industries. There is no competition, no reason to be productive, no incentive, no punishment, etc. In the private sector with competition for customers and profits, if your company stinks, your company disappears. For example, the post office just announced they will be 2.5 Billion dollars short this year. What does that mean? Better luck next year! Seriously, what happens when a privately owned business is so in-efficient, un-productive, and mis-managed? It shuts down, closes shop, adios. But, when the government runs the show with no accountability for results or competition for survival, we get results like the picture below-

Simply Not Suggested: $220 - Comcast

2008-09-29T13:21:00.003-04:00

If you know me, you know I hate Comcast. In fact, I hate most government subsidized entities - phone companies, cable companies, & utility companies. When the government interferes and removes competition from an industry, the customer service function of that company always goes to pot. For example, the utility company that services my home is one of the most terribly run companies I have ever seen. They are a bunch of idiots with no concept of how the private sector operates. Nonetheless, they could hire deaf people to answer the phones & I still have to buy my water from them. I have no choice unless I want to drill a well in the middle of suburbia, Tennessee. I digress.

I have been feuding with Comcast for years, but most recently last week. To summarize, the company is run by computers and trained monkeys. I was facing a $105/mo bill for cable & internet. I negiotiated by way to a $50/mo bill for the same service, and here is how...

Call over to the dreaded 1-800 maze, dial your way through as though you were cancelling your service & eventually you will get to speak with the 'retention department'. People in the retention department are the only folks at Comcast that give a damn. Apparently at Comcast, customer service only matters when you are ready to cancel your account. The folks at the retention department get paid, on commission, for every account they 'save'. Opportunity knocks. There are a couple of different tactics here:

My bill has just gotten too expensive and I can't afford it anymore.
I saw a Comcast promotional ad for a better rate than I am paying, now I feel like I am getting screwed.
I saw an ad for a dish company & they offered more channels for less money.
etc.

Give them the story and they will most likely offer you a promotional rate of some sort, to keep you around (Note: You may have to play hardball, but usually not). We have generally seen cable & internet for $65/mo as a typical promo. The other author of this blog has seen success with option 3. I have personally used 1 & 2. We have seen them all work. The promotional rate will usually last for 4-6 months, depending on the promotion. At that time the rates adjust back to the original inflated price. However, repeat the process as needed & you are good to go. Remeber, the comcast website is always a good source of leverage. Like the old NBC commercials say, "The More You Know...".

Current Savings: $220
Running Total: $2,220

Simple Cents University: Renter's Insurance

2008-09-25T11:12:00.011-04:00

First & foremost, if you live in a apartment or rental property of any type, you need renter's insurance. Why? Well, you know that 400 pound man that lives above you? The one that stomps around in the size 15, steel-toed work boots at 3am. The one that plays fetch with his 3 german shepherds inside the apartment and every time he throws the ball, a stampede of footsteps runs from one side of your ceiling to the other (and back again). Well, what if he is cooking meth in his bathroom? Or has an extensive candle-burning shrine to Scott Baio? What if he decides that he can fix his own washer & dryer or doesn't know the rule about throwing water on a grease fire? The possibilities are endless.

"Only two things are infinite, the universe and human stupidity, and I'm not sure about the former."
-Albert Einstein

All of this is to say, you need renter's insurance. There is no magic to it. How much would it cost to replace all of your crap? That is how much coverage you need. Go talk to your insurance guy and have it added. It is pretty inexpensive - roughly $150/year will cover $20,000 of your stuff. Well worth it. If you are reading this and thinking about how little you have to insure, think again. Go home and stop. Look around your apartment. Sure your furniture might be a little crappy, but if your pad burned down, you would still need a place to sit & play X-box. Speaking of X-box, it would be gone too. You would still need to replace your guitar or that closet full of clothes. I don't know a person in American that doesn't have $150 bucks worth of clothes in their closet and it is unlikely that you would be wearing them all the day your apartment explodes. All things considered, you probably need the protection.

The one nuance you need to be aware of, as it relates to insurance...you need to have a record of the stuff you are insuring. Just like insuring your car, when you have to show them the title, proving that you own your ride. Renter's insurance is the same way, as is home insurance for that matter. You must prove that there were things in the apartment that need replacing and what those things were.

In this digital age that we live in, it couldn't be easier. Just snap some photos of your rooms, closets, etc. Make sure your important stuff is in the photos. If you really want to cover yourself, maybe pull the receipts from some of your big ticket items and scan them on the computer. This way you have proof of ownership and proof of replacement cost, if something were to happen. This extra step would certainly grease the wheel of your claim, were lightning to strike (figuratively or literally). Just make sure you save those files on a computer away from home. Or maybe upload them on your MobileMe account, so that they are stored in the virtual heavens.

If you are not already, make sure you get yourself covered. Soon. Before Johnny Lead-foot upstairs decides to deep fry his Thanksgiving turkey in his living room.

Why Social Security Sucks

2008-09-24T09:11:00.005-04:00

Ok, the average American makes about 45k a year. Uncle Sam forces you to pay 6.2% of your income to Fica, aka Social Security. Uncle Sam also forces your employer to match that 6.2%, also contributing it to Fica on your behalf. Thus, 12.4% of your income is contributed to social security. Assuming you are the average American making 45k per year, you contribute roughly $100 into the social security system each week. That's alot of dough.

Assuming you work from age 22 to age 62 (40 years of service) and never get a raise, you have contributed $192,000 towards the government's mandatory retirement plan. Then you retire at age 62 and live to be 77.8 years old, all the while drawing about 30k a year from social security. However, while you are retired, you will probably have to liquidate most of your assets for living & healthcare costs, because 30k per year isn't much money. When you die, social security stops and your withdraws have totaled approximately $480,000. That calculates out to be a 4% return on the money you have contributed to social security. At the time of your death, whatever assets you have will be held against your debts, and whatever remains is passed on to your heirs.

Now, let's pretend for a moment that the government did not force you to participate in social security. Instead, you contributed the same money into mutual funds via Roth IRAs & 401(k)s. You invest the money, gaining a 12% annual return (the average of the US Stock Market since its inception), over the same 40 year time period. At age 62, you will have invested the same $192,000 into retirement, however instead of $480,000 in retirement funds, you would have 10 times that - over $4.7 million! Thank you compounding interest. Now you retire at age 62, live off of 5% of your investment ($230,000 per year!!!), and your nest egg remains untouched. Thus, you die leaving your heirs with $5 million buck in inheritance.

To summarize:

Social Security: $192,000 @ 4% = $480,000 / 30k per year at retirement / $0 left at death.
Private Retirement: $192,000 @ 12% = $4,752,000 / $230k per year at retirement / $5 million left at death.

That is why Social Security Sucks.