Feeding the Pig?

What a cute site...and easy to understand....interactive...and you are learning about your own spending and saving habits with the folksy graphic-rich tutorials. Even with all the reading and podcast listening I do, heavy in financials, I was able to get an insight into my own habits and savings tendencies.

After listening to the pig talking about...what else..money, I clicked on "Me, Save?". Yeah, I was a little freaked out by the pig's head on the man's body...but it was an effective visual to get me to pay attention. I was then presented with a few different choices of personalities, such as the Trend Spender, the Newbie Nester and the Plan-a-Phobe, among others. I ended up choosing the Chronic Collector, 'cause I do have a few collections around the house and like to keep things forever.

You can then pick habits and find out how much those habits are costing you in...ka-ching....$$$$$$....the only thing that seems to get through my thick skull sometimes. Luckily, I think I only had one or two of the habits listed...now I can see exactly what those habits are costing me, including interest!

Feed the Pig

I'm going to go ahead and check out the 5% challenge. Let me know what you think about the site, which is part of a huge campaign by the Ad Council and the AICPA to get the younger-somethings (which is why it is graphics heavy) to think about their savings and also to learn how to save. I think it's a good idea. What do you think? If I had a teenager, I certainly would get them to check out this site.

The Top 10 List for Personal Finance for Any Situation

Okay, so I'm OCD about personal finance and all things that surround it. I just enjoy crunching numbers and reading about what's best for our money. If you are not like me, and don't like reading everything under the sun about personal finance, just follow this simple list, and you'll be set for life. You can continue these tips even in today's economy.

• Pay yourself off the top. Set up an automatic payroll deduction that invests the money in good growth stock mutual funds (index funds work well), before you ever get your paycheck. The market WILL go back up, and if you are 50 years and younger, you'll retire at a much better position than what you have today fortunately.
  
• Shoot for 10-15% of your income off the top. Divy out what you need to spend on necessities every month (housing, food, utilities, transportation). 10-15% should be left over. If not, you either need to cut expenses or get a better paying job or work extra hours delivering pizza (as an example).
  
• Try to max out your IRA every year. To me, this is "free" money, ie tax-free interest. Take advantage of that.
  
• Understand your military spouse's LES and get familiar with all the entitlements that you are due. You have got to be able to look at that statement and understands what it says. I can't tell you the number of times ours has been just plain wrong!
  
• If you have kids, start looking at college savings ideas when they are young. Mostly recommended as the biggest bang for your buck, college 529 plans. Compare the different plans out there. Some have high fees and others don't allow you to pick which investments they choose. I've heard that the Utah plan is one of the best deals out there, and no, you do not have to attend a college in that 529 plan's state.
  
• Make sure your stock mutual funds have low turnover rates and that they invest in different market sectors. DIVERSIFY in the different sectors and parts of the economy. Stick with mutual funds and not individual stocks.
  
• Forget savings bonds and have grandma contribute to a 529 instead. Savings bonds were a noble effort after WWII, but now earn just a pittance of a return. Also stay away from pre-paid college plans. You'd make more money for your child in a regular mutual fund than prepaying today's rates for college.
  
• Don't buy a house for just a few years if you move around a lot. You won't get your money back when it's time to sell, especially now. If you must buy, then you'd better have a plan in place to rent it out and have someone you trust (and pay) to manage the thing. If you run the numbers, in most markets, it just does not pay off to purchase a house if you are only going to live at that location for a few years.
  
• Make sure your mortgage is not more than 25% of your take home pay, after taxes. And when looking at your potential mortgage payment, be realistic on what your additional expenses would be with that new home, to include insurance, property taxes and other monthly expenses. When we compared mortgage offers with our last house, we only budgeted $300 extra for these items...with the volatile housing situation of the last few years, it ended up being $600 extra..and who knows where it will go this year...hopefully down! Always overestimate!
  
• Realize that the turtle wins the race and not the hare. Be patient. Don't look what the Joneses are doing, and stick with the basics above.
  

Oops, almost kept going. So that's the top ten. Keep that in mind, whatever you do with your money, and you WILL come out on top. What is your top money mantra?

Give so they can do anything but not nothing

Warren Buffet once said, "Give enough to your kids so they can do anything, but do not give them too much so they can do nothing." Love the quote! So the great billionaire Warren Buffet, instead of just throwing money at his kids, he's giving them just enough to learn how to deal with money and to make a difference in the world...kudos to him. We are no Warren Buffets.....so how do the rest of us get our kids in the right mindset when it comes to money?

• Kids need to learn early on that working for money builds character. This is why many parents are moving towards the commission based system rather than the allowance system.

• Lead by example. It does no good to preach to your kids about living within your means and delaying gratification if you can't do it yourself. Kids will copy what you do. Do what I do and not as I say, right?

• I blogged once before that our kids do not just get things from the store on a whim...if it's not a birthday or a major holiday, they ain't gettin' it (and now they don't even ask). If they see something they like, they save up for it or use some of their own money from their piggy bank. I let them exchange the money for the item at the checkout counter themselves. Make sure you tell them about sales tax and how that figures in. My kids understood that concept as early as when they were seven years old.

• Don't always bail your kids out. My kids have done without when they didn't plan ahead. How often does this happen? Almost never now. This isn't quite as effective when they are smaller, but it sure is when they are teens and older. You have to sit back and think...am I helping them or enabling them? If I give them this money, will it get them out of a bind and on the road to being independent or am I making them be more dependent by doing this? For example, let's say your child is constantly letting the gas run low on their car and is always asking for a handout. They don't plan ahead. So, let's say you don't give them the money next time...and they just can't go out or they do without. It's not going to kill them. As soon as they figure out they need to be more responsible and you won't bail them out every time...they will forced to be more responsible. It's almost magical.
  

• Teach them about money and limits and delaying gratification. Talk to them about money coming in and money going out, living on credit, what an interest rate is and how it affects them. I am always shocked our schools don't teach basic money management. It's up to you, the parents, to send your kids down the right path. Don't rely on anyone else. A child as young as eight can understand these concepts..that's when our kids "got it".
  

• When your child is 13, open up a checking account for them. Have them deposit their babysitting or lawnmowing money in there. Show them how to do a checkbook ledger. Show them what happens when you don't keep track and get overdrawn. How will they ever do this stuff as an adult if you don't teach them now?

• If they absolutely want to have that next big ticket item, get them to cut out a picture with the price, and put it on their wall as an incentive to save. It may even be cheaper by the time they actually get out there and buy it.

• It's okay for your child to make mistakes. Better to make them now then when they are totally on their own. My motto has always been to learn from others' mistakes, but for kids, screwing up themselves tends to make the concepts stick more.
  

Continue to set a good example for them. They learn by watching you. Set them up for success early in life and spare them the mistakes later...when they are more costly.

How do you teach your kids about money?

Quizzle - No Straight A's for Me!

If you haven't heard already, Quicken Loans has a new site out there called Quizzle. It's a site that will give you your entire financial snapshot, to include a free credit score by Experian. You don't give out your your social security number, just your name, birthday and your address. Here's how it panned out for me.

After inputting the data, verifying your email and answering a few questions about things only you would know from your credit record (at least hopefully), you are presented with a snapshot of your finances. They give you a number and letter grade for your credit, home value, budget, mortgage and rainy day fund. I got an A in credit but a big fat D for our home value...go figure in today's market....especially here in Florida.

You can read more about other bloggers thoughts on Quizzle below.

Quizzle Blog

EquiDash Blog

What's the Diff?

Banker Girl

Net Banker


I went ahead and used a disposable email address...just in case they decide to bombard me with offers. They keep saying there is no catch on the site. Quizzle has even been featured in the Wall Street Journal twice to supposedly high reviews. I'm assuming that they will send you mortgage offers, if you have good credit and if you have some equity or wiggle room in your mortgage...of course my equity was as low as you can get....zero, null, nada...guess I'm not going to be getting any offers. I'm crying over it already.

I did check out the budget tool. Nice little gadget where you can go in and add your expenses and debt. It's worth a look. The home valuation tool uses the automated valuation model (AVM), which a lot of people aren't very thrilled over. I think I've gotten a more accurate valuation over at Zillow. For example, here on Quizzle, they aren't taking into account home sales of homes with pools or no pools (we purchased our home without a pool and added it later). We are just being compared by square footage and number of bedrooms it seems (none of the other homes had large lots or pools). So I'll take Quizzle's value with a little grain of salt.

All in all, a neat site to get a quick fix of your situation and worth a visit. Have you tried Quizzle yet? Your thoughts and opinions?

Get a Guaranteed Safe Return of 6.06% on Your Next Investment

We all know the stock market absolutely sucks right now. In fact, it sucks so bad, that I haven't even been checking our mutual funds. When you "lose" thousands of dollars every month, it tends to make you feel a little sick inside. But...with that being said, I know the market goes through cycles and 10 to 30 years from now, when we hope to use some of that money, the market WILL be back up again. So, I'm not fretting too much about it. Now's the time to be buying right? Sell high and buy low, right? We have a CD about to become due and with the miserable CD rates out there...thanks subprime mortage mess....the rates being offered by the banks are even less than the inflation rate right now...so what is someone to do? Believe it or not, there is a very safe and legitimate investment out there that'll get you just over a 6% return...and from the government no less. Here's more on it, and if you're gonna spring for it, do it by the end of April.

I'd like to thank Clark Howard, the consumer advocate for this one. We all remember the Series EE savings bonds from our childhood. Remember getting those as Christmas gifts? At least I did...every year like clockwork...still have them.....still barely eeking out a return on them. Have you heard of Series I Bonds? I had never heard of them until listening to this podcast (download it) by Clark Howard. Please be sure to check it out below (from his site):

A lot of savers with idle cash are griping about the low rates on savings accounts and CDs from banks. Well, Clark wants to offer a possible solution. It's been a while since he's talked about Series I savings bonds, which were a fantastic deal in the 1990s up to about 2001. They're a great deal once again if you buy them before the end of April. Over the next 6 months, you'll get a return of 4.28% APY. Beginning in October, the rate will bump up to 6.06% for the following 6 months. That's a very competitive rate. Series I bonds are an unnecessarily complicated product. The "I" stands for inflation, and they're like the cousins of the original savings bonds. I bonds offers a fixed rate of interest for as long as you own them, plus a floating rate based on the rate of inflation. You can own I bonds for a minimum of 1 year and a maximum of 30 years. I bonds give you the opportunity to benefit from what's harming you. As high inflation erodes the value of your savings, I bonds give you the rate of inflation and a guaranteed return. That guaranteed return is puny, but earning anything about the rate of inflation on something that's 100% safe is great.

So, there you have it. Thanks Howard. Have you been looking at ways to bump up your portfolio? Or are you just sitting tight or something in between?

Place Oxygen Mask Over Your Face Before Helping Children

Remember your last flight? You know, when the flight attendant briefs you on putting the oxygen mask over your face before helping your children. Why is that? Because if you pass out for lack of oxygen, fiddling with trying to help your kids...neither of you will be helped. The same goes for kids and money. This post is especially for you folks with teens in the house. Before handing out your next chunk of change to your kid, remember this.

• Being overgenerous with your kids will actually backfire on your child. Your child will think money does not need to be earned and that it grows on trees. They will forever have a screwed up vision of money and managing their life.

• When you give your teen or adult child money, will it speed up or prolong their dependency? If you are constantly bailing them out and giving them a hand out, how will they learn to be independent? If you have a situation where you can give them money to get them to the next level, then by all means, do it. I just want you to go through this thought process before handing it out...every time, thinking you are helping them, when you may in fact not be.
  

• There is a better chance of your kid somehow finding money for college (work/study programs, scholarships, grants) than you later finding money to fund your retirement. Your retirement should come first, then save for college. You don't want to be a burden to your kids when you are older than dirt do you? Save now so this won't happen to your family.

• Foster responsibility and independence early on. Teach your kids that the decisions and habits they have now can and will have consequences. Didn't do your homework, well, then no tv today? Didn't clean the cat litter box? Sorry, you won't be able to go over to Johnny's house today. Start this early and when they are young, and you won't have a problem later on when teenage hormones start affecting their brainwaves!

• Encourage your kids to save early on. Our kids do not get toys and junk unless it is Christmas or their birthday. And you know what, they don't ask for anything, except around those times of year..and they have had a bright and fulfilling childhood. When they do get a surprise gift at any other time, they truly are surprised and appreciate it more. If they really, really want something, I encourage them to cut out a photo, write down the price, and start saving. If it's something high priced, I might even offer to match what they can save up.

How do you deal with your kids when they have a case of the gimmies? How do you go about with money and your children?

Added 5/7/2008:

Another thought, how about matching your child's savings? I know someone who opened up an IRA for their teenager. Every dollar that child puts into that account from her waitressing job, the parents are matching it...what an incentive! You can also do this with your child's piggy bank. Every time she decided to put the money in there rather than spend it, you can match it. I like that.

Ask VMW: How Does My Mom Get Her Part of the Retirement Check Sent to Her?

Today we have a reader question that I haven't addressed yet:

My mother and father are in the middle of a divorce. My father was in the army and receives a pension check. My mom was giving her portion of the check to my dad when they were together to help out with bills. Now that they are apart, she has not been getting it. We are in the state of Pennsylvania . Who does she contact to get her portion of the pension check sent to her?

Any retirement pay issues are handled through the Defense Finance and Accounting Service. These are the same guys who cut all our military paychecks in the system. Call the toll-free number below and explain your situation.

Annuity/Annuity New Accounts	Casualty/Retired/New Retired Accounts
Correspondence/Mailing Address: Defense Finance and Accounting Service US Military Annuitant Pay P.O. Box 7131 London, KY 40742-7131 Toll Free: 1-800-321-1080 Commercial: (216) 522-5955 FAX: 1-800-982-8459	Correspondence/Mailing Address: Defense Finance and Accounting Service US Military Retirement Pay P.O. Box 7130 London, KY 40742-7130 Toll Free : 1-800-321-1080 Commercial: (216) 522-5955 FAX: 1-800-469-6559

If your spouse is thinking of retiring and would like to know how to get going down that road and how much his retirement pay will be, read the military's Preparing for Retirement.

One nifty little feature is Ask Military Pay with questions from you and answers from them on every kind of military pay related question you can think of...and then when you can't find it, you can ask the question yourself. I found it very informative and easy to navigate.

Why I'm Not Going to Freeze My Credit and What I Will Do Instead

Do you know you can put an almost indefinite freeze or fraud alert on your credit record if you are in the military? In most states, you have to be a victim of fraud, and show proof or pay $10 to freeze and unfreeze your credit. Many credit freezes are only authorized for 90 days and then automatically unfreeze. Why would you want to freeze your credit? Because you are afraid of identity theft and don't want others to open up credit accounts in your name. It happens all the time, and many don't notice there is anything wrong until they themselves try to get credit or a mortgage or other financial product. At first, I thought, let's do it. It'll be peace of mind, right? No one would be able to open an account in my name, so I wouldn't have to worry about any unauthorized cards or illegal activity in my name. I've come to find out it would be more of a hassle and not only because I'd have to unfreeze our accounts if we wanted to refinance one of our mortgages or open another credit card, but for another reason I hadn't thought of.

We typically buy a certificate of deposit (CD) every few months. I also like to shop around mutual funds. If I freeze our credit record, I won't be able to do that. You would only be able to purchase financial products at a bank you already do business with. Well, that would defeat the purpose of shopping around! So I decided against it. Instead, I will follow these tips to keep a close hold on our credit:

• I will get a free credit report every three months.

• I will never answer any emails asking for personal information, and if I have an account with a financial company, I will always access my account by visiting their site directly (I type it in the browser window).

• I will not put any personal information on any networking site, to include my name, address, phone number or birthday. I will use a fake name and fake birthday information if asked.
  

• I will shred all outgoing paper that has our name, address or any personal information on it.

• I will not put outgoing mail in our mailbox, and especially not anything with personal information or checks inside. That's just asking for it right there!

• I will not log into banking or personal sites on hotel computers. Many hotel computers are infected with key logging software that records your keystrokes. Many hotel personnel are unaware of this and frankly, it's so easy for these thieves to upload one of these programs and then download the information later. Don't risk it.

• I will not transmit passwords or personal information over any WIFI networks. Thieves regularly sit and intercept these transmissions, especially at airports. I once saw a documentary where thieves drove around your neighborhood, looking for unsecured home networks to log on. Don't leave your home network unsecured and make sure it has the latest security technology (thieves regularly defeat some of the older ones, making them useless).

What do you do to try to protect your identity? I realize nothing is fool-proof, but if there is a way to make it harder on the thief, they will move onto someone or something else.

The Military Widow as a Cash Cow

This is something I always have in the back of my mind. I hope and pray that it never happens to our family. We've been lucky at our current assignment, at least for the last two years. My husband's trips out of town consist of forays to Ft Bragg and DC and a few places in between. He stays gone maybe a few weeks to three months at most. We have been lulled into complacency. At his new assignment, it will be back to a combat unit, back to a unit that deploys, back to the heartache and sadness of visiting the spouses of fallen warriors, back to the worry and stress...it's not a matter of if but when. I am absolutely dreading it. For many of you, you are right there, right now. We always hear of the troubles spouses go through, trying to keep their financial house in order...to tell you the truth...I never thought of the flip-side, especially after some of the changes that have been put in place.

I read an article on Friday from the New York Times, entitled - Military Kin Cop with Loss and Gain. I'd like you to stop and read it. Did you know the military has increased the death benefit from a few thousand to $100,000? Many of you already know that life insurance amounts have increased. There is also more help available with housing, education and medical care...more than ever before. You are even provided with the help of a financial advisor, to come up with a plan for your future as well as your childrens'. According to the article, only a small percentage of widows take this advice. Many widows end up blowing through all the money....I have seen it happen myself....many are also looked at as a cash cow by relatives coming out of the woodwork. Can you imagine that? I guess money can bring out the best and the worst in people! That is just unbelieveable!

What can you do now to put yourself ahead, should you ever find yourself in such a situation? Follow the steps below. I can honestly tell you, if I am ever meant to be in such a situation, I want to make sure my family is taken care of.....that I am independent enough to run the household, that I am aware of what the Army and our government owes me, that I look out for my childrens' well being and that I can grieve and reflect on my own time...and dime, without any distractions.

Be sure to understand each of these points:

• Know where everything is. Know where all your financial records are to include your wills, insurance policies, bills, car titles, home records, mortgages records and anything that is of importance to you and your family. I personally run the finances in our house. It's just easier when my husband comes and goes all the time. This gives me the confidence too, to know where we stand financially and there can be no surprises for us. I also have my husband tell me (and I tell him should something happen to me), what means something to him from our household junk. My husband is a stamp collector and has many thousands of stamps, but I can still pick out which collections are dear to him, and which ones I can then pass on to his children.

• Set yourself up to be financially secure should the inevitable happen. The $500,000 life insurance from SGLI and military death benefit just won't be enough to sustain you over the long haul. I want to be able to do what I want and when I want, without having to worry about where the money is coming from. You can replace your husband's income and live off the interest from his life insurance if you purchase ten times his income. Please make sure it is term life insurance and not one of the other products insurance agents peddle. Shop around and make sure the policy is the right one for someone in the military. For example, you want the policy not to have a war exclusion cause! Because of my husband's high risk job, I have only found one company that offers this benefit at a reasonable price. Be sure to read about it here.
  

• Become familiar with your military benefits. You will also be assigned a casualty assistance officer who will help you navigate through all the red tape.

• Know that there are some books written on the subject. I didn't even know this myself. The best one out there is Military Widow: A Survival Guide by Joanne M. Steen and M. Regina Asaro. There are also some others out there that cover other aspects of losing a loved one. As much as I don't want to wish something like this on anyone, I do follow the mantra of trying to be prepared...not so much for my benefit, but for my children.

• You can find support and others who have gone through similar circumstances. One great thing about being military, is the comradiery of the spouses. Visit the Society of Military Widows. There you can find support and comfort from others...just like you. They even have a new widow checklist on their site. It's great to have family and friends too, but it just isn't that same as what you can get from others who are in your situation.

• Vow to be a part of your family readiness group. I can honestly tell you...I've been lucky to have been a part of some solid groups in the past. If you have an active group of spouses, they can easily organize themselves into a support system for that widow. Years later, I met up with a widow again at an Army Ball function (she gets invited every year), and she told me she would never forget the meals, the laundry and household being taken care of, the children being driven to school and everything that was done for her. She didn't realize it until later, how helpless she was, and she said without our support, she doesn't know if she'd ever have gotten back up again. Now, I will never forget what she told me and vowed to make sure my next family readiness group is close and has a plan. This is something you can do now too.

Sorry to start of the week with such a glum subject, but you know me. If you've read any of my posts, you know I like to be prepared for just about anything. I like to learn and grow from mistakes. I would like you to do the same! Does anyone have any tips on how to survive something like this? Has anyone helped a widow...any widow....get back on her (or even his, the widower) feet? Please do share.

An Army Career = Job Security in Today's Economy

How depressing. I just read about a lady featured on CNN who made $70,000 a year, suddenly lost her job and now is struggling to put food on the table and keep her house with her $2,500 mortgage. She was also recently denied food stamps. When was the last time middle class America had such a rough time? Why do I feel safe that this won't happen to us?

I am reminded about my neighbor. They were solid middle class too...til he lost his job. They are about to lose their home, and at this point, he is looking at just about any slew of jobs he can get, including delivering pizzas. The wife is out cleaning other peoples' houses. I also know someone in the airline industry who is waiting for the "other shoe to drop". Delta will not be the only one in trouble. There will be massive layoffs coming again in the airline industry this year. Our local newspaper has even shared a few stories of hardworking Americans who are struggling right now.

There is a silver lining though for those of us in the military. Unless the US government totally goes under, we will still have our military, and my husband will still have a job. He won't get downsized. If for some reason the Army no longer needs his specialty, he will be given the opportunity to reclassify. His pay will not be cut. Historically, that has never happened. He'll continue to get his benefits. His pension will not be taken away. And, he won't get fired unless he does something illegal or immoral. How is that for job security? What company or corporation in America can offer the same? I can't name a single one myself.

Even with this kind of job security, he does take responsibility for himself and his family. How many of these families hurting today had an emergency fund? I don't care what your situation is or how much money you make right now, you need to save up three to six months worth of living expenses. We have about two years worth saved up, easily accessible, but that is because we have a chunk of rental houses. You never know what is going to happen there either, and if all the houses were to stay empty for a few years, we would be sweating it. Make a commitment today, to start saving. Vow to never be in such a situation. Make sure you have a good life insurance policy. If you are non-military, you'll need a good disability insurance policy as well. Many of these families in crisis today, didn't see it coming. You won't either, but if you follow these steps, you'll at least be able to roll with the punches and recover quickly.

Do you have any tips to share about fortifying your family and your life? Does anyone have any enlightening or uplifting stories to share?

FREEBIE on CD: Family Records Organizer

Moving around a lot with the military, we really need to have our records in order. Do you know where your marriage certificate is? Or your kids' shot records? More importantly, does your husband or anyone else in your family know where to look? Does your family know where to look for your personal and financial records should something happen to you or your husband? I've found a nifty little tool on CD, that is of course free, to help get all your paperwork stuff organized.

It's called the Family Records Organizer and is available FREE from T. Rowe Price. T. Rowe is a mutual funds company and prides itself on all its financial tools, calculators and literature. I've done business with them for years via their mutual funds (which are some of the best rated BTW), and can vouch for their customer service.

From their site:

Wouldn’t it make life simpler if your important financial information and accounts were organized in one safe place?

Most of us have what feels like dozens of financial accounts and records to keep track of, such as retirement plan accounts, bank accounts, investments, debts, mortgages, and more. Even for a simple estate there is a lot of information to manage. T. Rowe Price has developed a tool called the Family Records Organizer CD-ROM to help you with these organizational challenges. This unique, interactive CD-ROM provides you with an easy way to gather all your family's records in one safe place, including primary contacts.

The Family Records Organizer CD-ROM:

• Offers a single place for you to capture important personal information about your investments, banking and credit cards, insurance, and more with the intent of passing this information along to your beneficiaries or keeping it in a safe place.
  
  
• Features a comprehensive Learning Center containing helpful videos and topic information on each of the CD’s recordkeeping categories.
  
  
• Captures the wide variety of information that is key to your and your family's financial well-being and organizes it so that anything you may need is available at a moment's notice.
  
  
• Allows you to be paperless if you choose. You can save your information electronically or print it out.
  

Take the time to check it out! If you know of any other freebie goodies to share, please post them below!

Every Soldier's Worst Nightmare

I've never really talked to my husband about it in any kind of depth, but I know the thought must've at least crossed his mind. I'm talking about being so severely wounded that you can't function by yourself and would possibly have to call it quits with a career that has sustained you the last few years. With my husband's Type A personality and his love for all things Army, this would hit him especially hard. Read about this young Special Forces officer who was blinded and severely injured in Iraq. Find out what he is doing to try to get his life back on track and to plan for his future career and retirement. Why am I talking about such stuff? Because it's important, that's why...it is our duty to have a plan for the future, regardless of how we might get there.

Please read this informative and thought provoking article and then send it to your spouse.

A Soldier's Story: Financial Rehab

Money for the Long Haul

I still hear people talking about pulling out of their mutual funds and dropping some of their investments...and then buying something else. I mean, we all know the market is bad right now. I used to be a Chicken Little myself, but I've come to realize it's the turtle that wins the race and not the hare. You don't have to play the lottery to win millions either....you have the simple formula right in front of you. You don't even have to do anything beyond the initial set-up. Retire a millionaire with these simple steps.

• Get in the right mindset. Making money should really be automatic. You need to let your money work for you. If you let it "do it's thing", it's going to work through the miracle of compound interest.

• Don't listen to the "sky is falling" doomsayers. I used to listen to them babble about "the Dow Jones average fell 20 points today", and I guess we were supposed to get all upset over it. Never more. Look back 10, 20, 30 years. Has the stock market ever been less now than it was back then? No it hasn't, even during the Great Depression compared to now. So stop worrying about the ebb and flow of the tide...THIS IS NORMAL and this too shall pass.

• Know how much is going out vs what is coming in. I admit we spent YEARS not following this. We were just lucky that we were living within our means and we had money left over every month. Most are not so fortunate. I shudder to think what would've happened had it gone the other way. We really had our heads in the sand back then. You don't necessarily have to have a budget, just have a general idea of how you spend your money. You can follow along here.

• Do not buy high and sell low. Any financial guru worth his salt will say to buy low and sell high...but who wants to sell winners? This is mostly for short-term financial goals and buying individual stocks, which I try to stay away from. If you are in the stock market, invested in good growth stock mutual funds, you should be staying in til you retire or you need to re-balance your portfolio.

• Invest the most you can in your IRA and/or tax-free 401k, hopefully 10-15% of your paycheck. Take it off the top of your paycheck immediately and automatically. Pretend it isn't even part of your pay. Many companies, and I know the government, will take it right off the top, before it gets taxed, and invest it as you designate. We do this with our kids' college money too. That way, we know the rest has to be divvied up into our basic necessities and then our wants....in that order!
  

• Don't put all your eggs in one basket, and if it sounds too good to be true, it probably is. It's all about risk and the probability of probabilities. Diversify! Not just in the types of investments, such as stock funds, bond funds and international, but also in the types of industry, such as medical, consumer goods and banking. Take for example the mortgage market right now. Those companies that are involved in that field are not doing so hot right now. But, if you've invested in other areas too, those losses can be offset by the areas that are doing well. And, NEVER put all your money in one fund or something that touts to be a big winner. Even if it's not shady, the risk to lose it all is just too great. Don't do that to yourself!

• Face your income problem. I've gotten email from folks who say they are living hand to mouth and don't have a cent extra to spare or much less save. In that case, they have an income problem, especially if they have a family. You do have a few choices. You can get another part-time job to bring in some extra cash. Delivering pizzas can be a great way to do this on on a more flexible schedule. Many times, this only has to be temporary in order for you to get a leg up. Another option is to try to move up in your current job. Take on more responsibility. Volunteer for it. Offer to be in charge when a special project comes up. Make your company more money. Then you will be in a position of strength when it comes time to ask for a raise. Plus, you'll really deserve it. The other option is to get more education so you can get a better paying job. You'll have to weigh the risks and costs here. More education means you have to spend more money. Will the money you spend now, which you don't have, be offset by a higher paying job in the somewhat near future? If not, then don't borrow money to go to school. Pick another field that will pay off. I know someone who spent over $100k to get her doctorate and to be a professor, and now she can't find a job because she is in such an obscure field that is low paying to begin with. You need to research this stuff ahead of time, before you take the leap.

How are you socking away money for the long haul? When did you first start saving? If you aren't saving yet, what roadblock is keeping you from getting started?

Don't Get Audited

While we are in tax season, I thought I would post a few quick tips that will lessen your chances of getting audited. I've never had the "pleasure" myself. Hey, these are the things you can control:

• If you are sending in a written return, be very neat and double check your math.

• If you have high expenses, send in documentation of why. Were you in a car accident and had a lot of medical bills? Did your house burn down? Show them the proof.
  

• Sign your return. Again, if you write it up by hand, don't forget to sign! Many returns that are audited are not signed.
  

• People typically give no more than 2% to charity. A figure of 10% is considered high. Do the math and see where you fall in. Go ahead and attach any documentation, especially if it's high. I know our church sends us a statement at the end of the year. If you didn't get one, go ask for one.
  

• Watch the home office deductions. Be very, very careful what you deduct, and read the IRS literature to make sure you aren't deducting something you shouldn't. Yes, I read about someone who tried to deduct their boob job cause they got more tips.

• File your return right about now. Percentage-wise, it seems less people get audited who submit their returns in late February to early March. No one knows the exact IRS formula, but wouldn't it be great to lessen your odds of getting audited?

Read more about getting audited at Red Flags for tax auditors.

So, with all that being said, you can bet I'm keeping a file handy of everything...just in case it does happen to me. Last year, 7% more people got audited, and I bet the number will rise this year too. What do you do, thinking it will lessen your chances of an audit? How to you keep your papers organized?

Don't Forget About the Free USAA Wiping Out Debt Web Seminar

Just a reminder on this web seminar coming up at USAA. I don't know if they've had these in the past, but this is an online seminar led by a certified financial planner. You will get strategies to reduce debt and be able to ask some questions, so be sure to gather your thoughts and think of something that's really been bugging you or maybe something you don't totally understand. As an added bonus, they are offering ten chances to win a "sit down" with one of their financial planners, to get your own financial house in order. They say that's a $195 value. Be sure to register in advance, or you'll miss being able to participate. The seminar takes place, right here on 4 March at 7 PM Central Standard Time. You can arrive up to 15 minutes early. I just may see you all there!

"America Saves" Week - Get Inspired Today for Tomorrow

This week is officially "America Saves" Week. I guess there is now a week for everything. But, I think America saving is a very good excuse for its own week. Don't you think? I was actually was very inspired by many of the stories. Good tips too! Go to America Saves to get enlightened and don't forget Choose to Save and Military Saves, a good place for military families to get started. Start the new trend and start living for tomorrow! You'll be a happier and healthy person (and family) for it!

Investing My Muffin and a Cup of Coffee With Their Help

I was lucky in that I learned the basics of investing and checkbook management at an early age. But what if you aren't so lucky? What if you don't have a clue? What if you didn't realize your morning muffin and coffee ALONE can turn you into a millionaire at retirement? What if I don't have the knowledge, time or inclination to do this all by myself? How am I supposed to find someone who can help me? Keep these thoughts in mind before you trust someone else with YOUR hard earned money.

We have been with our financial planner for about 15 years. We used to do it all by our lonesome selves. We read some of the financial magazines and picked from the top recommendations in mutual funds. But, as I mentioned once before, past performance does not mean the fund will continue along in that direction. In fact, most times, they go the opposite direction and probably already hit their high point right when you jumped in! Some people even pick the losers, saying the only way to go now is back up! Before long, you find you are wasting your time or have no real sense of direction. Plus, I know we kept second guessing ourselves. Inevitably, you sell the losers and buy the winners...when in fact you should be doing the OPPOSITE! I admit, we've done that!

So, there we were....not doing a very good job of it and getting more discouraged in the process....to the point of just throwing our hands up and saying...whatever. We were really at a loss of what to do next! We just knew we needed some help. How do you find the right person? An honest person who will look out for your best interests. Back then, there weren't that many resources on the internet...like there are now. We ended up going with a planner who had been doing the financial planning for my husband's family, for many, many years. We already knew him, his family and his personality. He had many years of experience as a planner. He had the memory of an elephant, was licensed, had no disciplinary action against him and took the time to find out more about our financial situation and our goals before he even started talking investing. He told us right away that we need to be focused for the long haul. Don't watch the market as it goes up and down...because it will...but look at how it reacts in the long term. He reminded us to look back at the market 10 years ago, 20 years ago...is the value now higher than it was back then? Has it beat inflation? Yes! Well, that's where you want to be...nothing less and nothing more needed to make your millions and a comfortable retirement.

You are probably asking...well, how do I find someone? Other than talking to people you know in your community and your circle of friends and making appointments with random financial planners in your area, you can check a few resources online. But there are so many directories and databases out there too!

Many of you know I listen to Dave Ramsey...lots of good sound financial advice from that man. He does have financial planners he does endorse, and you can find them on his website. Dave just doesn't endorse anyone, so I would think he does at least a little background checking before he allows someone to be on his list. Use this as your starting-off point in researching planners. Narrow down your list to three to five certified and registered financial planners. Be sure to ask them these questions.

• Ask the planner how they are compensated. Are they fee-based, meaning they charge a flat fee per month, per year or per value of your portfolio? Are they commission based, meaning they profit only when they sell you a financial product? Be sure you understand completely, how they make their money. If they are fee-based, you do have to keep an eye on them, to make sure they periodically re-balance your portfolio and that they sit down with you at least once a quarter to discuss where you're at. They also may not be as motivated as a commission-based planner because they get money whether they do something worthwhile for you or not. A commission based planner can be tricky too. Are they selling you an investment just to make themselves money? Do you find yourself buying and selling a lot of investments over time? Investing should be done for the LONG TERM. You should not be doing a lot of buying and selling and you should be taking fees into account when you calculate your rate of return! Ask them about ALL the fees of a fund, not just is it front-loaded, no-loaded or whatever else. Not all fees are listed in the company prospectus for each fund.

• Ask about their professional background. No, this is not rude, it’s expected, and you're about to put your money in their care. Find out how long they have been at their company (or on their own) and what their schooling is. Be sure they are not just an insurance agent or a stockbroker. You will get hosed if they are, and they are just not working in your best interest here…just theirs. Anyone can hang out a shingle and say they are a financial planner. I also like to see a background in accounting, finance, business or law.

• Ask if they are registered by the SEC? If not, wish them a good day and get on out of there. In fact, get this information even before you make an appointment. Any financial planner committed to what they are doing should be registered.

• Ask for their CRD number. You can get a free report on the financial planner, as well as their employment background and any possible disciplinary action. Check out the Central Registration Depository. You can look up the broker as well as the company itself.

• Don't go with a planner just because they are a friend. Friends and money just aren't a good mix..most of the time. We are talking about your life savings and not a small favor. You have to be more diligent than that! Don't let this be your only criteria.
  

• Hire someone who has been in the business at least 10 years. You want someone who has gone through some market ups and downs. When it comes to your money, you really need someone with experience and someone who doesn't react to everything the market dishes out on a weekly or even yearly basis!
  

• Ask what their investment philosophy is. You want to know what their strategy is and how they see investing your money. Make sure you understand what they are saying. You are not stupid. If they can’t explain in plain English, then they are not the planner for you, and THEY are the stupid ones for not making themselves understood.
  

• How does the planner actually pick the investments? Does he go with new ones or tried and true ones from the past? Does he like to try a lot of new things? Does it follow along with something you’d be happy with? Does he sit and listen to your entire financial situation and then make a determination? Does he ask about your debt and mortgages and other areas of your life? Or does he talk immediately about some investments he would recommend?

• Get references. I realize some will say they cannot do this because of some kind of client/planner confidential relationship. Tell the planner that you need this to get a warm and fuzzy feeling or you will have to move on. Most will comply, and frankly, they should already have a list of ready clients who have already agreed to do this beforehand. You are not going to call these people to ask how much money the planner made for them. Every financial situation, years invested and circumstances will be different for each person. Past performance is no indication of what the future holds. Ask for at least three clients who have been with him at least three years. Call and ask them if they are happy with their planner. Ask if he is what they expected. How often does he contact them and rebalance their portfolio? Is he pushy? Does he explain things? Does he give other ideas such as in life planning, taxes and other areas of your life that would affect you financially?

• Does he have a personalized plan? Is he asking you things like your job situation? How old your kids are? How old you are? Your insurance status? Don’t settle for a generic blueprint.

• How often will you meet and/or talk? He’d better say at least quarterly. Your portfolio might get too top heavy in one area and may need to be re-balanced. He should be watching this and reacting accordingly.

• Do I feel comfortable with this person? Do you have a good feeling being around him? Does he seem to look down upon you? Is there something not quite right there but you can't put your finger on it? Does he make inappropriate comments or jokes? Then go ahead and pass on it. You want someone you can talk to and feel comfortable with. This person is someone you should be knowing a long time, so get started off on the right foot here.

With all that being said, ultimately, YOU are responsible for the care and management of YOUR money. Don't ever put it ALL in the hands of ANY financial planner without oversight. Be prepared to be involved. See what they are doing. Realize what the fees are. Understand your true rates of return and any tax implications. Have a financial plan and a sense of direction of where you want to go. Are you saving for a big purchase? Your retirement? Kids' college? What?! Your planner is who is going to help you do this..not take over and you wash your hands of the whole thing!

How do you go about your finances? Do you have a planner? Do you do everything on your own? How do you feel about that?

Please be sure to stop by the Carnival of Personal Finance #142 to read more informative personal finance articles!

A Complaint That Will Get Attention

How many times have you ever bought a product or service that severely disappointed you? Probably more times than you can count I bet! Don’t just sit back and take it. I’ve actually had some success writing complaint letters to companies…more often than you would think!

Here are some tips to get you going:

• Address the letter by name and never “to whom it may concern”. Especially with the internet, you should be able to find the name of someone in charge at that company. Address it to the person in charge of that department or even the CEO of that company.
  

• Don’t write a novel. Keep the details brief. State what happened, when, how and where. Give dates and places if needed. Explain the situation clearly and don’t put any emotion into it!

• Don’t rant and rave. If you show you are angry and out of control, the company may just choose to ignore you just because of that. People hate to be pushed around.

• State what you want to resolve the issue. Don’t leave it open ended. If you want the thing fixed, say it. What about a replacement? Your money back? Reimbursement for whatever? Always say what you want the company to do and what result you'd like to see.
  

• Don’t threaten. It’s too early in the complaint process to do that. Give them the opportunity to respond to your initial request.

• Send documentation. If you need to send photos or receipts, enclose a copy, not the original.

• Make a copy of the stuff you are sending. I have a file in my cabinet just for complaints and company correspondence..and no, I write maybe one complaint letter every other year...I don't do this is a hobby or just for kicks. I just do this when I have a legitimate problem. Write the date you sent it along with any mail documentation.

• Send it through trackable mail. This way, the company knows you are serious about it, and there is a way to follow up to find out if they even received your letter.

• Follow up. Give it a week or two after receipt, and then call and just inquire about it. In 80% of the instances, I’ve had the company offer me something that made me happy. The other 20%, I had to decide if I wanted to pursue it or just drop it all together.

If you don’t get any results or help from the company, there is one other step you can try before pursuing small claims court. Small claims court can use up a lot of your time, effort and money.

Try filing a complaint with the Better Business Bureau. I let the company know I am going to do this. One time, it even spurred the company into action. There also are a few websites that give you a global voice such as Planet Feedback or try to shame them into responding at Complaints.com. I am reminded about the person who complained about the first generation IPOD battery. It was only intended to last a certain length of time, and once it was spent, you were SOL. The battery couldn’t be replaced. The company told the guy, sorry, you’ll just have to buy a new IPOD. Well, that was the wrong answer for this guy. He ended up starting an internet campaign. Many others jumped on his bandwagon, and pretty soon, their voices were so loud that Apple had to come up with an answer and a solution…just like that. Keep that in mind the next time you deal with a company on an issue. The little guy CAN sometimes win!

If you do go the small claims court route, call your county clerk or look on the internet for your county and small claims court. File your claim. Be sure to find out how much money to bring along and if you can pay by cash or check. Take a copy of the letter and any documentation you already sent to the company and any response they may have already sent back to you. Ask the clerk for help in filing your suit. Many times, they are more than happy to give you some pointers. When you get your court date, be on time and be prepared to wait awhile. They are many times behind schedule. Be sure any witnesses you have are there too. Don’t wing it when you go in there. Have either an outline or what you are going to say. Have key dates and points written down in front of you. Look and be organized to make things run more smoothly and to keep you from getting flustered or off track. Don’t interrupt the judge or defendant and be sure to keep your cool!

Have you ever had to deal with a company you've been unhappy with? How did you go about it? Were you successful?

Have Any French Francs Lying Around?

With all our military travels, we tend to have money from each of our visited countries lying around the house. At first, we collected the stuff...saying it was for our kids to enjoy. Well, now they have a huge jar of money...bills with Saddaam Hussein's mug to animals and scenery and other folks we have no clue who they are. Enough is enough. So, I started wondering...I wonder if any of this old money is worth anything now. Boy was I pleasantly surprised.

If you've still got French Francs, the Bank of France is still able to exchange those Francs for Euros til the year 2012. Since we are heading back to Germany soon, this was perfect timing. The exchange rate is something like four to one, so our 900 Franc will turn up some nice spending change.

Be sure to send your French Francs registered mail (so you can track it), to the address below. The best price to send something registered is through the USPS via Express Mail International. It'll cost you $25, so you have to be committed and have a large number of bills to make it worthwhile. In hindsight, we should've probably kept the darn things til we actually got over there! Anyway, they are only exchanging bills, so no coins. Be creative. If you have a lot of coins and have determined they have no collector value, turn them into jewelry, or even a key chain.

Here's the address:

Banque de France
Caisse Générale, Service 18
10 Boulevard Duclaux
63407 Chamalières Cedex - France

Good luck with it and let me know how it goes. Even if you don't plan to go over to Europe, your bank here in the US can exchange those Euros into US Dollars.

Update 3/28/08:

I got a registered letter in the mail today from the Bank of France. They typed up a nice little letter in French and English, showed me what the exchange rate was and stapled brand new crisp Euros to my letter. So, yes it does work, and yes, it was worth it!

FREE Download of Suze Orman's "Women and Money"

Suze Orman has some great financial advice. I may not agree with all of it, but her stuff is easy to read, understand and follow. Today's the last day to download her book Women and Money for FREE. Thanks Wisebread for the heads up!