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Higher Paying States Do Not Make Up for Higher Costs

The Business Insider lists the best and worst states to make a living. The summary of their findings:

Not all states are created equal when it comes to making a living. While your income might be greater in places like New York or California, high tax rates and cost of living can greatly affect your lifestyle.

Of the top ten best states, all but three have costs of living below the national average. Of the ten worst states, nine have costs above the average -- most with costs FAR above average.

It's been an on-going debate about whether or not higher-paying cities/states cover the higher costs often associated with living in those states. The data is mixed for sure but more often than not the facts fall into the lower cost markets being a better option financially.

For more on this issue, see these posts:

• Where You Live Has a Big Impact on Your Net Worth
• Move, Save Money, Become a Multiple Millionaire -- All in One Step
• ​Great Money Saving Tips People Hate: Move to a Cheaper Area

But why settle for either high costs/high income or low costs/low income? My suggestion would be to have a high income in a low cost area. That's how you can really become wealthy.

Now that's better, isn't it? :)

What's the Best Money Advice You've Ever Received?

US News lists thoughts from several bloggers on the best money advice they've ever received.

I thought I'd join this party and add my thoughts as well as ask you yours.

I think the best advice I ever received was from the book The Millionaire Next Door: The Surprising Secrets of America's Wealthy.

The book lists seven common denominators among those who successfully build wealth but the ones that stood out to me were:

• They live well below their means.
• They allocate their time, energy, and money efficiently, in ways conducive to building wealth.
• They believe that financial independence is more important than displaying high social status.

I took this advice, applied it over a couple decades, and the rest is history.

I'd also list the advice in The Richest Man in Babylon as very solid -- maybe even better than The Millionaire Next Door. Their seven cures for a lean purse are spot on! But I didn't read this book until well after TMND, so that's why it's listed as second. :)

So how about you? What's the best money advice you've ever received?

Best of Money Carnival

The Best of Money Carnival is now up. Congrats to all participants and especially the winning post, Why haven’t women taken the stage yet?

Enjoy!

Best Finance Stuff in 2011

Kiplinger lists their "best of everything" in personal finance for 2011. I went through all their slides (so you wouldn't have to) and found the following that I wanted to comment on:

• Best Value College-Savings Plan: State Plans. Specifically your state's 529 is your best option if you get a tax break. (FYI, residents of Arizona, Kansas, Maine, Missouri and Pennsylvania get a tax break for contributing to any state plan.) We have has Michigan 529's for years now and take advantage of the nice tax break every year. ;-)


• Best Retirement Planning Calculator: Quickplan Retirement Calculator. For those wanting a link, here is the calculator they recommend. As you know, I've set my retirement number, but I may need to give this calculator a try just to see what it comes up with. Update: based on Karen's comment below, here's a retirement calculator I like (it was noted in my roundup yesterday -- and FYI, it's from a friend, not a paid link.) ;-)


• Best Gift Card: Starbucks. I don't buy much coffee (maybe a couple a year from McDonald's to warm up after a few soccer games in the cold) and I certainly don't buy enough to get a gift card. But this gift card sounds cool. Here's what Kiplinger's says about it: "The most highly evolved gift card on the planet comes from Starbucks. It doubles as a rewards card—you earn rewards points toward free drinks and other stuff. View transaction history, protect your balance if the card is lost or stolen, reload it automatically, and even have friends reload it via a Facebook app." Anyone use one of these?


• Best Travel Booking Site: Kayak.com I haven't used Kayak. I think I may be missing something. I know some of you use it based on your comments here. Can you tell me what you like so much about it?

And FYI, Kiplinger's named the Chase Freedom credit card as the best overall card. It is listed #1 on my list of the best cash back credit cards and is a card I use myself. Good to know I'm on the same page with them. :-)

21 Best Money Tips Ever

CNN Money lists what they call the 21 best money tips ever. They asked "some of the nation's leading business owners, investors, and thinkers" to "share their thoughts on rebuilding your wealth." Here are some of the highlights IMO:

• Jane Bryant Quinn - "Pay off your mortgage before you retire if you want financial safety and security. There is bankruptcy among people in their seventies and eighties who had a lot of debt that they couldn't carry when the paychecks stopped."
• Jack Bogle - "Your bond position should be commensurate with your age. In my case that means I have more than 80% in bonds. Someone in their fifties should consider 50%."
• Liz Ann Sonders - "One thing I see with our clients and individual investors is an aversion to risk, and a favoring of fixed-income funds and Treasuries. In the past 20 years, we've been in an environment that's been good to bonds relative to stocks. But it's rare for that to happen over an extended period -- and the last two times it happened, the subsequent five-year period favored stocks."
• John Challenger - "Become deeply engaged in civic, professional, and educational organizations that matter to you. And constantly build new relationships with people through these affiliations."
• John Schnatter - "Live below your means and be frugal. The economy is going to get worse before it gets better. And folks who have savings have the best chance of getting through this."

It's some decent stuff (especially John Schnatter's advice -- now I know why I like Papa John's pizza so much!), but personally I think this advice is much better. ;-)

I LOVE "best advice" sorts of pieces, and if you do too, check out this round-up of all sorts of "best" articles. In particular, look over the best money advice bloggers could offer -- collected and posted by me almost five years ago. Think their advice still holds true?

The Smartest Advice Ever

I'm a sucker for "the best money advice you've ever received." There's just something about a lot of good, solid financial wisdom in a small number of words that I love. In fact, I've run several series on the topic including the following:

• The Best Financial Advice I Can Give

• The Best Financial Advice I Can Give, Blogger Edition

• The Best Financial Book I've Ever Read

• The Best Deal I Ever Got

• Best Advice: Financial Advice from Successful People

• Best Money Post I've Ever Written

• Best Financial Tips from FMF Readers

• The Best Financial Advice I Ever Got: Essence Edition

• Bankrate Best Advice

So when I saw that Money magazine had a series on "the smartest advice I ever got", I knew I had to post on it.

They asked 40 "great minds" for their smartest advice. Here are a few of my favorites. The first is swear off debt:

Borrowing money is like wetting your bed in the middle of the night. At first all you feel is warmth and release. But very, very quickly comes the awful, cold discomfort of reality.

Ha! I LOVE the picture that that paints!

The next is live within your means:

Save your money first and get used to living on what's left over.

Exactly.

The final two are similar. There's you can't fight the market, so join it:

My school experiences taught me to buy index funds. As far as I'm concerned, they're the only starting point for an individual investor. You can't control market risks, but you can control costs.

And the less you pay, the more you keep:

It's hard to be certain of anything in our uncertain financial markets. But I feel very confident about one piece of advice: Minimize your investment expenses. The less you pay in mutual fund fees, brokerage costs, sales fees and taxes, the greater your net return.

So true -- costs matter (and they're fixed.) That's why I like index funds.

What the smartest piece of financial advice you've ever received?

Money Rules of Thumb

MSN lists 16 money rules of thumb. I've never heard of many of them -- though it's not clear whether or not the author is saying these are just hers or are ones we all should know. Either way, I wanted to share a few of my favorites with all of you and give some additional thoughts as well. Here goes:

Retirement: "Save 10% for basics, 15% for comfort, 20% to escape." This rule of thumb works pretty well if you start to save for retirement by your early 30s. Saving at least 10% of your income ensures you won't be eating pet food. Fifteen percent should get you a more comfortable living, while 20% gives you a shot at an early retirement (and yes, you get to count employer contributions as part of your percentage). Wait just a decade to start, though, and you'll need 15% for basics and 20% for comfort; an early retirement may not be in the cards.

I don't know many people who are saving 10% and 20% seems almost unrealistic for many. That said, we save about 30% of our living expenses per year (our expenses are far below our income.) Applying the guideline above, if we keep this up and maintain our standard-of-living (don't expand it), we should be able to retire early.

Also note the importance of the power of compounding in this rule.

Student loans: "Your total borrowing shouldn't exceed what you expect to make your first year out of school."

This is ok for a general rule as it attempts to tie costs with expected income. This is exactly what I recommended in How to Get the Most Financially Out of College.

Credit cards: "If you carry a balance, look for the lowest rate. If you don't, get rewards at least equal to 1.5% of what you spend."

You can (and should) do much better than 1.5% back. If you like cash back (and who doesn't like cash?), you can get 2.6% cash back by combining the Blue Cash from American Express card and the Chase Freedom Cash Visa Card.

And I don't have to say what I think of carrying a balance, do I? ;-)

Financial flexibility: "You need to be able to get your hands on cash or credit equal to three months' worth of expenses."

As she notes, cash is better but not everyone's there at this point in their lives (though they should be working towards it.)

Insurance: "Cover yourself for catastrophic expenses, not the stuff you can cover out of pocket."

Yes, yes, yes! This is why we have high deductibles. We wouldn't make a claim unless it was a substantial expense, so why pay extra for a low deductible? Note: we also have adjusted our emergency fund up a bit to be able to cover a big outlay in case we need to come up with a high deductible payment.

Life insurance: "Those who need it typically need five to 10 times their income."

Good enough for a rule of thumb, though I'd prefer to see "their living expenses" replace "their income." Though most people probably live in a world where living expenses equal income, so what's the difference?

The piece also offers some thoughts on having a mortgage, but I prefer my formula for buying a house.

What's your take on these money rules of thumb?

Best Advice: Dave Ramsey

I've written several "best advice" pieces (see my best advice category for details) and love to hear short takes on what financial "experts" view to be their best piece of financial advice. Here's the last bit of advice from a Bankrate article on best personal finance advice. It's from Dave Ramsey, author of "The Total Money Makeover":

"A friend of mine who is a billionaire told me that he reads a book to his grandkids and I should read that book. The book is 'The Tortoise and the Hare.' Every time he reads the book, the tortoise wins. Slow and steady wins the race, and consistency matters. Get-rich-quick never wins.

"If you try to impress other people, you'll lose the wealth race, as well," Ramsey says. "It sure did give me a nice metaphor. It's a good reminder to somebody like me to keep me in check. It has implications for debt, for mutual funds, for budgets -- an overlay for everything."

That's funny. Dave gave me a completely different answer to this question. Huh.

But regarding the advice he gives above -- it's solid. If you can forget what others are doing (mostly spending) and concentrate on what you want to accomplish, you'll be far better off financially.

What about you? What do you think of Ramsey's advice?

Click here to read part 1 of this series.

Best Advice: Peter Navarro

I've written several "best advice" pieces (see my best advice category for details) and love to hear short takes on what financial "experts" view to be their best piece of financial advice. Over the couple several days, I'll share some of these from a Bankrate article on best personal finance advice and give you my comments on them. Today, we'll hear from Peter Navarro, associate professor of economics and public policy at the University of California, Irvine:

"Take every piece of advice you get from any investment adviser with a barrel of salt. Most are trying to sell you things that you probably don't need or want. Think for yourself."

Navarro says he learned that lesson after a bad experience with a financial adviser. "I lost some money, then took control and never looked back," he says.

Oh, yeah. This guy's speaking my language.

For my thoughts on the same issue, see these past posts:

• Many Taxpayers Get Burned by Inept or Crooked Preparers

• The Richest Man in Babylon: Get Advice from Someone Who Knows What He's Talking About

• Make Sure Your Financial Advisor is Not a Loser

• FMF Speaks: My Thoughts on Using Financial Planners (Or "Why I Don't Go to a Fat Doctor")

• Comments: FMF Speaks: My Thoughts on Using Financial Planners (Or "Why I Don't Go to a Fat Doctor")

• MND: How to Choose a Financial Advisor

• MND: Operate Your Household Like a Business when Hiring a Financial Advisor

• MND: Hiring the Wrong Financial Advisor is Bad for Your Net Worth

Certainly there are times when you need a financial professional. For instance, I use a CPA for taxes, a lawyer for estate planning and an insurance agent for disability insurance. But much of personal finance is easy to learn and implement and, I believe, better off left to you.

What about you? What do you think of Navarro's advice?

Click here to read part 8 of this series.

Click here to read part 1 of this series.

Best Advice: Rieva Lesonsky

I've written several "best advice" pieces (see my best advice category for details) and love to hear short takes on what financial "experts" view to be their best piece of financial advice. Over the next several days, I'll share some of these from a Bankrate article on best personal finance advice and give you my comments on them. Today, we'll hear from Rieva Lesonsky, co-author of "Start Your Own Business":

Lesonsky's best advice "was from the owner of our magazine, Peter Shea," she recalls. "He said, 'Housing prices have gone up -- get a second mortgage and pay off your debt.' I did, and I'm debt-free."

You know how I like this advice. :-)

I've been debt free (including my mortgage) for ten years now. It's been great to be without any sort of debt and I'm kind of dreading the fact that if we buy a new house, it's likely we'll have a mortgage at least for a short bit of time. It's not something I'm looking forward to.

What about you? What do you think of Lesonsky's advice?

Click here to read part 7 of this series.

Click here to read part 1 of this series.

Best Advice: George Kinder

I've written several "best advice" pieces (see my best advice category for details) and love to hear short takes on what financial "experts" view to be their best piece of financial advice. Over the next several days, I'll share some of these from a Bankrate article on best personal finance advice and give you my comments on them. Today, we'll hear from George Kinder, Certified Financial Planner and author of "The Seven Stages of Money Maturity":

"It's about the meaning, not the money. If my investing is not really deeply tied to what I think is most important in my life," he says, then, "the asset allocation, the estate plan, the retirement plan might as well be thrown out the window."

His best advice: "Hire a Registered Life Planner (a financial planner with additional training in helping clients identify and reach life goals) to help you through this," Kinder says. "Nobody can do this themselves."

A life trainer, he says, "is trained in how to elicit from a client what is meaningful and how to keep their eyes on the prize."

Huh?

I never thought three sentences could ever bias me against an author and his book. But I was wrong. This seems like worthless drivel to me.

Granted, you need your money to work towards what you want it to achieve, but this advice feels more like Suze Orman's "respect your money and it will respect you" psycho-babble than any sort of meaningful advice.

What about you? What do you think of Kinder's advice?

Click here to read part 6 of this series.

Click here to read part 1 of this series.

Best Advice: Robert Kiyosaki

I've written several "best advice" pieces (see my best advice category for details) and love to hear short takes on what financial "experts" view to be their best piece of financial advice. Over the next several days, I'll share some of these from a Bankrate article on best personal finance advice and give you my comments on them. Today, we'll hear from Robert Kiyosaki, author of "Rich Dad, Poor Dad":

"My rich dad gave me lots of advice. One of the better ones: There's good debt and bad debt. Bad debt is debt you have to pay for and makes you poor. If I use credit cards to buy new shoes it makes me poor. Good debt makes me rich and someone else pays for it."

One example: "I'm closing on a $17 million property and financing $14 million. That $14 million is good debt. It makes me richer every month by putting $20,000 in my pocket."

Ok, work with me on this one.

So he pays $17 million to make $240k. That's a return of 1.4%. Not good.

But let's just say he really pays on the $14 million he borrows. Still, that's only a 1.7% return.

Now let's give him the biggest break and say he only paid $3 million to earn $240k a year. Now he has a return of 8%. Not bad, but he's not getting fabulously wealthy here. Or am I missing something?

What about you? What do you think of Kiyosaki's advice?

Click here to read part 5 of this series.

Click here to read part 1 of this series.

Best Advice: Neale Godfrey

I've written several "best advice" pieces (see my best advice category for details) and love to hear short takes on what financial "experts" view to be their best piece of financial advice. Over the next several days, I'll share some of these from a Bankrate article on best personal finance advice and give you my comments on them. Today, we'll hear from Neale Godfrey, author of "Money Doesn't Grow on Trees: A Parent's Guide to Raising Financially Responsible Children":

"Step away from the television and the magazines. All they serve to do is show you how stupid you are because you've missed whatever they're talking about. It's old news. It's already happened."

The advice came from her financial adviser, she recalls. "I used to call him and say, 'Why didn't we ...?' He'd say, 'Stop it. Step away from the television. It's done.'"

She realized that he was right. "By the time you see it or read it, it's done; it's happened," Godfrey says. And if you listen and follow the hot news, she says, "You will buy at the top and sell at the bottom -- exactly what you're not supposed to do."

A couple thoughts from me:

1. I'm certainly with her when it comes to ignoring what the mainstream media tries to push on us -- especially when it comes to investing.

2. That said, I do watch TV and partake of much in the media. I could likely save a ton of money if I did ignore them altogether.

What about you? What do you think of Godfrey's advice?

Click here to read part 4 of this series.

Click here to read part 1 of this series.

Best Advice: Wayne Dyer

I've written several "best advice" pieces (see my best advice category for details) and love to hear short takes on what financial "experts" view to be their best piece of financial advice. Over the next several days, I'll share some of these from a Bankrate article on best personal finance advice and give you my comments on them. Today, we'll hear from Wayne Dyer, author of "It's Not What You've Got: Lessons for Kids on Money and Abundance":

The lesson "for me was, first, pay yourself," Dyer says.

"When you get your paycheck, take a percentage -- between 10 percent and 30 percent -- and put that away," Dyer says. "You'll be rich enough to be financially independent within a short period of time."

Think this guy has a way of over-stating things? ;-)

I agree that you should save a good amount of your pay. I've done this for years. I fully fund my 401k and have savings to boot on top of that.

But to say "You'll be rich enough to be financially independent within a short period of time" is an over-statement for sure. I've been saving a ton for a couple decades now, and while I'm doing well, I'm not financially independent by any means.

What about you? What do you think of Dyer's advice?

Click here to read part 3 of this series.

Click here to read part 1 of this series.

Best Advice: Gary Belsky

I've written several "best advice" pieces (see my best advice category for details) and love to hear short takes on what financial "experts" view to be their best piece of financial advice. Over the next several days, I'll share some of these from a Bankrate article on best personal finance advice and give you my comments on them. Today, we'll hear from Gary Belsky, co-author of "Why Smart People Make Big Money Mistakes and How to Correct Them":

Be afraid when people are greedy, and greedy when people are afraid. It's basically, "Buy low and sell high." In general, I've been doing better than market averages when I've been handling my investments. I've basically done that by being conservative when the market is frothing and aggressive when the market is down.

I agree with him 100%. Moving against the flow is one of the great ways to make money in America.

How do I put this into practice? A couple ways I can think of right away:

1. I've recently bought MORE shares in index funds when the market has dropped and people are panicked. For details, see Going Against the Flow and Now's a GREAT Time to Invest.

2. While many are moving away from housing/struggling with it, we're looking at the downturn as an opportunity to buy. Of course, having no debt and a lot saved up for a great downpayment or outright property purchase puts us in a good position to take advantage of this opportunity.

What about you? What do you think of Gary's advice?

Click here to read part 2 of this series.

Best Financial Advice from Robert Kiyosaki

A few months ago I wrote a piece for a national magazine and was able to "interview" (via email and via their representatives), some of the top names in personal finance today and ask them what their best piece of financial advice was. Here's the response I received from Robert Kiyosaki, author of Rich Dad Poor Dad and Before You Quit Your Job:

The single best piece of advice I can give is this: Be careful what financial advice you listen to. Most financial advice—such as “save money,” “get out of debt,” “invest for the long term” and “diversify”—is fine for the middle class or the poor. It’s not good advice if you want to be rich because it is obsolete advice. For example, in 1971 the U.S. went off the gold standard and the U.S. dollar became a currency and . . . currencies are designed to lose money. That’s why today, “save money” is bad advice. Remember, your mind is your greatest asset, so be careful what you put into it.

FYI, I wasn't 100% digging this advice -- if you know what I mean.

For those of you interested, here's my best piece of financial advice.

Best Financial Advice from Jane Bryant Quinn

A few months ago I wrote a piece for a national magazine and was able to "interview" (via email and via their representatives), some of the top names in personal finance today and ask them what their best piece of financial advice was. Here's the response I received from Jane Bryant Quinn, the author of Smart and Simple Strategies for Busy People:

All of the best investments are the simple ones. If you’re shown a gee-whiz financial product with a lot of bells and whistles, you can be sure of two things: You don’t need it and it’s overpriced. You can get better results with something plainer and lower cost. What’s simple? Term life insurance. Automatic savings plans, like company 401(k)s. The mutual funds called lifestyle funds. A college savings plan bought directly from your state. Do I use these ideas myself? You bet!

For those of you interested, here's my best piece of financial advice.

Best Financial Advice from Dave Ramsey

A few months ago I wrote a piece for a national magazine and was able to "interview" (via email and via their representatives), some of the top names in personal finance today and ask them what their best piece of financial advice was. Here's the response I received from Dave Ramsey, radio talk show host and author of The Total Money Makeover, Financial Peace and More Than Enough:

The key to getting your money to behave is to bother. Caller after caller to my radio show have gotten themselves into financial messes because they were going through life like Gomer Pyle on Valium and not paying attention to what their money was doing. But people do smart things if they just bother! Get on a plan and stick to it. I learned through my own financial mistakes that the key to financial success was making the guy I shave with behave. Winning at money is 80 percent behavior and 20 percent head knowledge. It’s not about sophisticated financial theories; it’s about taking control. I won with money and you can too. Like Nike says: “Just do it!

For those of you interested, here's my best piece of financial advice.

The Best Financial Advice Ever

Money Central has an article on the best financial advice ever. It's a compilation of personal finance advice from readers as well as well-known personalities. Here are their words of wisdom along with my comments:

"No matter how much or how little you make, always save a little bit."

"Paying yourself first" is one key to a solid financial future, though I recommend paying yourself second.

"Save hard for the first 10 years of your married life."

I've never heard this advice stated this way, but I believe its main message is to save early in life and let the power of compounding make you wealthy.

"Know the difference between needs and wants."

This is a good one -- it's the key to spending less than you earn (which is my personal best piece of financial advice.)

"Think of the true cost."

Whenever you buy something, there are usually additional costs involved -- maintenance, replacement parts and on-going expenses of some sort. Many people only consider the initial cost and (maybe) a small portion of the subsequent costs.

The biggest area where people misjudge the true cost is in the area of pets.

"Buy quality."

I usually check Consumer Reports and buy the best item I can get for the money. When I don't do this, something bad usually happens.

"If your outgo exceeds your income, your upkeep will be your downfall."

Another vote for spending less than you earn.

"Don't pay interest on anything that loses value."

Like a car. Ouch.

"Don't co-sign a loan."

Unless you want to pay it all off. That's what you're saying you'll do when you co-sign a loan.

"If you need more money, then go out and make more money."

I'm currently thinking a lot about this lately. Here are some money making ideas for those of you who can't wait for me to share some ideas over the coming weeks.

One final thought and announcement: Almost a couple years ago, I posted pieces that listed The Best Financial Advice I Can Give (a list of suggestions by top money experts) and Best Advice I Can Give -- Blogger Edition (a similar list from money bloggers.) There are lots of good suggestions in these posts if you want more "best" tips. Also, if you're a blogger who wants to share his/her "best" advice on Free Money Finance, email me your best tip in 1-3 paragraphs and if I like it, I'll post it (along with a link back to your site.) If you're not a blogger but still have a great tip, you can send it to me as well.

The Best Credit Card You Can Use

Here's another item on Money magazine's list of 25 rules to grow rich by. Today's tip lists the best credit card you can use:

The best credit card is a no-fee rewards card that you pay in full every month. But if you carry a balance, high-interest rates will wipe out the benefits. If you carry a balance, you may pay a variable interest rate as high as 19%. And if you've been late with payments or used up too much of your credit limit, you may be hit with a penalty rate, which can run north of 30%.

I like (and use) this advice.

Of all the reward cards, I prefer a cash-back card so I can spend the rewards I earn however I like (I earned $330 last year.) That said, I have a second card that accumulates pseudo-cash that saves me a ton on my car expenses.

The Best Way to Improve Your Credit Score

Here's another item on Money magazine's list of 25 rules to grow rich by. Today's tip lists the best way to improve your credit score:

The best way to improve your credit score is to pay bills on time and to borrow no more than 30% of your available credit. It also helps to pay off debt rather than moving it around because the ratio of your credit card balance to your credit limit is key.

And why would you want to boost your credit score? Well, if you're borrowing money, a good credit score can get you a loan at a preferred rate. But even if you don't need a loan, a good credit score can still save you thousands of dollars.

For a couple other thoughts on how to boost your credit score, see Boost Your Credit Score and Nine Steps to a Great Credit Score -- Save Yourself Thousands of Dollars.

The Best Foreign Country for Retirees

Here's the next item I wanted to cover from Kiplinger's "The Best List". Today, we're highlighting the best foreign country for retirees:

The Best Foreign Country for Retirees: Mexico

A warm climate and a lower cost of living plus access to quality medical care make Mexico a favorite retirement destination. The Lake Chapala area, about 25 miles south of Guadalajara, is home to a large community of U.S. and Canadian retirees. You can't count on Medicare south of the border, but there's no shortage of well-trained doctors and modern health-care facilities. And you can still receive Social Security benefits when you live outside the U.S.

I've actually written on this topic quite a bit. For the masses out there who aren't saving enough for retirement but still want a great (or at least decent) standard-of-living when they retire, moving to a foreign country is a great option. For more details, see these posts:

• Best Financial Tips from FMF Readers, Part 7: Retire Overseas

• Comments: Best Financial Tips from FMF Readers, Part 7: Retire Overseas

• Comments: Best Financial Tips from FMF Readers, Part 7: Retire Overseas, Part 2

• Save Money: Retire in Panama

• Retire in Style South of the Border

• The World’s Best-Kept Retirement and Investment Secret

For more thoughts on retirement, see Best of Free Money Finance: Retirement Posts.

Best Advice Blogger Edition: Post Christmas Debt Reduction

Here's our latest addition to the Best Advice I Can Give -- Blogger Edition series.

Today's post comes from Canadian Financial Stuff where he says:

This seems to be the January battle cry for retail stores, "Since you didn't get what you wanted for Christmas, come here and squander more money, please", or something to that effect. If you didn't get what you wanted for Christmas? What if you wanted Peace on Earth, or have your hip replacement surgery scheduled? Can Canadian Tire do something about that for me? I don't think so, but who knows?

Debt Reduction is like losing weight, you need to stop listening to your impulses and keep to the plan. Now if you planned to go to the after Christmas sales (like at the GAP), and spend the money you didn't spend at Christmas, that is a valid (and a good) plan. My kids got gift cards for Christmas and then proceeded to buy 2/3 more clothing than they could have before Christmas at the GAP (makes an old man proud to see his kids learning the value of being cheap).

If you planned on spending a quiet January hidden in your nice warm bed, not worrying about bills, stick to that too. If you don't have a plan for January, feel free to borrow this one, "I plan to not buy any more crap that I don't need", it's a pretty good plan, which actually could be used for any month of the year.

If you continue to SPEND more than you MAKE you can either get a job as a politician or you can be sure you'll never be able to retire, or stop worrying about your debt. Keep that in mind, when you think next, "I didn't get that Deluxe Cheese Straightener I wanted for Christmas, and it's on sale!".

As I'm sure you could guess, I love this advice -- especially since spending less than you earn was my #1 top 10 post topic of 2005. 

FMF Accepting Submissions for Best Series

If you've been reading this blog for any amount of time, you know that I've run several best series. The posts have been pretty popular, and since I haven't done any of these in quite awhile, I thought I'd open some of them up again.

Here's how it will work:

• You select a "best" series you want to post on
• You email me the post (the words -- not a link to a post you've written on your site)
• I post it (assuming the quality is decent) when I have a slot for it and give you a link back to your blog/site (Note: You do not have to be a blogger to be part of this. You can be a reader/visitor as well.)

There are two types of "Bests" that you can submit posts for. First, you can add a post to an existing series like these:

• Best Advice I Can Give -- Blogger Edition
• The Best Deal I Ever Got
• The Best Financial Book I've Ever Read
• Best Financial Tips from FMF Readers
• Best Money Post I've Ever Written

Or, you can submit to a new series. As you might imagine, I have a lot of ideas for new series, but instead of launching them all at the same time, I'll announce one at a time. For now, I'm taking submissions on:

Best Personal Finance Website -- Tell what your favorite personal finance website is and why. Please refrain from 1) naming your own blog and 2) naming FMF just to please me (if FMF is your favorite, that's ok -- just give a good reason why). Be sure to give good reasons why you like Yahoo Finance, Motley Fool, or any other site -- you'll have a better chance of being published (and impressing those who read your piece).

This should be great! I'm looking forward to reading some good stuff from all of you!

Top 10 Post Topics of 2005: #10 Best Series

Over the next several days I want to share with you what I think were the ten biggest issues/concepts/thoughts here at Free Money Finance during the previous year. It took me some time to compile the candidates, sort through them all, and rank them, but I think it was worth the effort and I hope you enjoy the trip down memory lane (and learn something new to boot).

We're going to do it in a countdown format, so we'll start with #10: The many different "Best Series".

I started the concept of "The Best ________" early on in the life of this blog and it took off rapidly. The basic idea was from an article that I wrote several years ago and it grew from that small start to be groups of posts on all sorts of "bests".

In case you missed any of them, here's the comprehensive list:

• Best Essence Financial Advice
• Best Advice from Successful People
• Best Advice I Can Give -- Blogger Edition
• Best Deal I Ever Got
• Best Financial Advice I Can Give
• Best Financial Book I've Ever Read
• Best Financial Tips from FMF Readers
• Best Money Post I've Ever Written

Hope you enjoy these "Bests"!

Click here to read topic #9.

Comments: Best Financial Tips from FMF Readers, Part 7: Retire Overseas, Part 2

I'm now two or three posts deep on the topic of saving money by moving outside the US. 

Here's a history of where we've been:

• It started with Best Financial Tips from FMF Readers, Part 7: Retire Overseas (which was part of the Best Financial Tips from FMF Readers series)
• Then I had Comments: Best Financial Tips from FMF Readers, Part 7: Retire Overseas which agreed with the original premise -- that you can live like a king in another country.

However, moving overseas is not all a bed of roses. Consider this comment:

My in-laws retired down to Mexico and while everything he says above is true, there are also some other serious issues to consider.

For example, my father-in-law has gotten an amoeba. Twice. And after they came to visit our first child when she was three months old, they had to call us a bit later and say, "Oh, whoops, we may have exposed your baby to typhoid."

Mind you, they don't live in some wild outback -- they live in an established expat community in Aijijic.

Additionally, they have quite a bit of trouble with people breaking into their home fairly often. They finally had to put razor wire at the top of the walls around their house.

You get the picture. But even given all that, they're pretty happy down there and aren't moving any time soon. Your mileage may vary.

That's what I love (hate) about personal finances. The answer is just never easy.

The idea is still worth consideration. After all, who wouldn't put up with robbers and a little typhoid to live like royalty? ;-)

Free Money Finance recommends Emigrant Direct for its 4.0% yield.

Comments: Best Financial Tips from FMF Readers, Part 7: Retire Overseas

Here's a comment someone made to my post titled Best Financial Tips from FMF Readers, Part 7: Retire Overseas which was part of the Best Financial Tips from FMF Readers series:

There is a huge crisis looming for America.  It is 76 million baby boomers beginning to retire in 2011.  I've wondered how these people are going to make it through the next 10, 20, 30 years of their life if Social Security, Medicare, Medicaid, and quite possibly, the Stock Market fails them. The only obvious avenue is for them to relocate to a cheaper cost of living country.

I had the pleasure of visiting Cancun a few years back and ran into a man who had ex-patriated there.  He made less than half the amount of money that I did but lived an entirely different lifestyle.  He had:

• A full time nanny/cook for his kids
• A full time driver for his wife and kids
• A full time cleaning person
• A part time gardner for his garden
• All their clothes was sent out to be laundered
• His children all went to private schools
• His wife didn't work and spent her days shopping. 

How much did this guy make?  About 50k/year.

I've encountered similar ex-pats in places like the Dominican Republic and Costa Rica.  People live like Kings there while they would live like paupers here.  Of course, some people could never adjust to a different culture or language so they won't move but it is certainly worthwhile looking into if you haven't already.

Wow. I never really considered this as an option, but it could be a great solution for many people. What do you think?

Free Money Finance recommends Emigrant Direct for its 4.0% yield.

Comments: Best Money Post I've Ever Written, Part 2; Bad Math

Here's a comment a reader who responded to my post on Best Money Post I've Ever Written, Part 2:

As a believer in Ramsey's principles, and an engineer, I can see the conflicts from the math and psychological.  I have followed Ramsey's "baby steps" and this is the only one I've deviated on.  I attack higher interest rate first.  In fairness to Ramsey, he recognizes and states you will pay your debt off in a few more weeks, but also pays more stock to the psychology of the snowball.  I would recommend the snowball method to most that lack the fortitude, but I felt I could handle it, and I did.  I like Ramsey, and believe he's spot on 95% of the time.  This one tenant doesn't suit me, but I think its best for most.

I'm in the "higher interest first" group too, but I can see the benefits of the other option. It still makes me think, though -- does Ramsey think this is really the best way or does he just want to be different. he's a smart marketing guy just as much as he's a solid financial author, so I wouldn't put it past him.

Free Money Finance recommends Emigrant Direct because of its 4.0% yield.

Comments: Best Money Post I've Ever Written, Part 7; Penny Worth Nothing

Here's a comment a reader who responded to my post on Best Money Post I've Ever Written, Part 7:

Not only is a penny not worth picking up but it's not worth existing.  Should just get rid of it and the nickel can go soon after it.

This comment made me smile, and I thought you'd like it too.

Reminder: Free Money Finance is currently in Russia.

Free Money Finance recommends Emigrant Direct because of its 4.0% yield.

The Best Financial Advice I Ever Got: Essence Edition, Part 6

Essence Magazine asked readers to share the best financial advice they've received and how they used it to build wealth. Here's today's tip:

"I was burned by my first financial adviser because I wasn't as knowledgeable as I should have been and allowed him to invest in what he thought was best for me. In the end his choices benefited him more than me and I lost money. When my income increased, friends steered me to another adviser who challenged me to own what's mine and to become knowledgeable about my investments, even though I was stomping on unfamiliar territory. Now I ask questions and make people explain things I don't understand. It's your money. Make it work for you, not for them."

The issue here was that she needed a money adviser, not a salesperson and got taken. This is one reason I'm leery of financial "experts" (and many readers are with me). I recommend you be very careful when selecting a financial advisor. Do your homework and check references beforehand. Also, learn about financial principles yourself, so you know when and if someone's trying to pull a fast one on you.

The Best Financial Advice I Ever Got: Essence Edition, Part 5

Essence Magazine asked readers to share the best financial advice they've received and how they used it to build wealth. Here's today's tip:

"After our sons--Jack, now 2 years old, and Reid, who's 1--were born, our financial adviser recommended that my husband and I set up a 529 Plan to pay for each boy's college education. After an initial investment of $1,000 per child and small monthly contributions, we're on the way to securing their educational future."

I've posted a bit about 529's in the past (see here, here and here) and I think the jury's still out on these. Conceptually, they seem to be a good deal, but the details are often confusing and the wrong choice can lead to high investment expenses, which eat into your returns.

Click here to read part 6 of this series.

The Best Financial Advice I Ever Got: Essence Edition, Part 4

Essence Magazine asked readers to share the best financial advice they've received and how they used it to build wealth. Here's today's tip:

"As a freelance television producer, my earnings are sporadic. My biggest mistake was not investing in the 401(k) plan offered while I was working on the Oprah show. I literally missed out on free money because Harpo matched employee contributions. When I landed on another show, the first thing I did was set up a 401(k) retirement fund. A sorority sister advised me to ask friends on my same income level what they did to save. After some research I met a broker who advised me to invest in a plan that doesn't penalize you when you borrow against it during times of unemployment."

As most of you know by now, I love 401k's but don't like borrowing against them. Maybe if your income is sporadic then you need something that you can borrow against, but I'd recommend doing all you can to avoid that. Instead, save up and emergency fund and let that 401k money stay and work for you!

Click here to read part 5 of this series.

The Best Financial Advice I Ever Got: Essence Edition, Part 3

Essence Magazine asked readers to share the best financial advice they've received and how they used it to build wealth. Here's today's tip:

"Before I purchased my first home, I learned the difference between using a lender and using a broker to secure a mortgage rate. Some brokers charge a fee to find you the lowest interest rate. I had good credit and was able to avoid the extra fee by going directly to a bank. I got referrals from several lenders, picked two that offered the best rate, and played one against the other. When there's competition, they'll work harder for your business."

Another good piece of advice -- and interesting information too!

Click here to read part 4 of this series.

The Best Financial Advice I Ever Got: Essence Edition, Part 2

Essence Magazine asked readers to share the best financial advice they've received and how they used it to build wealth. Here's today's tip:

"My parents taught me that if you invest early in life, as you grow, you'll reap the benefits. This is advice I've always remembered, along with 'Pay yourself first,' 'Invest in your company's 401(k)' and 'Don't spend all your money in one place.' I chose to invest in real estate, and at 25, along with my mother and my aunt, invested in my first property. My contribution was 15 percent of the asking price. Three years later we purchased a second property together, and a year after that, at 29, I purchased my own home with equity from the first two investments. The benefits from these investments far outweigh the burdens of ownership."

Wow! There's lots of great stuff here! (In particular, I'm a big fan of the 401k)

Apply all of these ideas and your net worth will be MUCH better off.

Click here to read part 3 of this series.

The Best Financial Advice I Ever Got: Essence Edition, Part 1

I AM SO EXCITED!!!!!! I was wondering around Google the other day when I ran into an article from Essence Magazine titled, "The Best Financial Advice I Ever Got"! It's just a PERFECT addition to my best series postings and I'm ecstatic to bring it to you (can't you tell?) ;-)

As if you need any introduction, here's what the piece is about:

Essence asked readers to share the best financial advice they've received and how they used it to build wealth.

Here's tip #1:

"Several years ago I became my own financial planner. It took two years of focus for me to wipe out $12,000 in credit-card debt. I lined up all my credit cards and began by paying off the one with the highest interest rate first. Once that card was paid in full, I applied that payment to the next card until they were all paid off. Today I'm debt-free. I avoid credit cards and have excellent credit. My motto is, if I can't pay for it in full, then I don't need it."

That's a motto we should all live by!!!

And if you must use credit cards, be sure you know the eight commandments of credit cards.

Click here to read part 2 of this series.

Best of FMF: Best Series

As many of you know, I've had a series of "Best" postings over the few months that Free Money Finance has been around. We're going to take a break from these for now (don't fear, we will be back) so I thought it would be a good time to list all the "Bests" we've covered.

They are:

• Best Advice from Successful People
• Best Advice I Can Give -- Blogger Edition
• Best Deal I Ever Got
• Best Financial Advice I Can Give
• Best Financial Book I've Ever Read
• Best Financial Tips from FMF Readers
• Best Money Post I've Ever Written

Hope you enjoy these "Bests"!

Best Financial Tips from FMF Readers, Part 7: Retire Overseas

Here's the next entry in "The Best Financial Tips from FMF Readers" series. Today's post is from Pagar who gives us the following advice:

This subject will not be appealing to everyone. But I urge everyone to read it because one never knows if life could be more fulfilling unless one considers alternatives. 

Stretching Retirement Dollars -- Retiring Overseas -- Specifically: The Country of Panama

We currently live in a smaller town 20 miles from Panama City, Panama.  There are American, Canadian, and  Australian families here in just this one small town. There are thousands of retirees from these and other countries throughout this one country. Of course, there are many in other countries also. My knowledge is of Panama, so I'm addressing this from that view, but whatever country you look at the reasons are basically the same. One can live better on the income they have Overseas.

We choose Panama because my wife is from Panama - she can be with her family and enjoy life more, because it is cheaper to live in Panama.  There are others who have no family here, but can enjoy their retirement much more, because it is cheaper to live in Panama.

An oft quoted amount is 65 percent of what it would cost to live in the US. But I know we don´t spend half of what we spent to live in the states.

Reasons to enjoy retirement more in Panama:

• The Panama government actively encourages people from other countries to retire here. With incentives such as: Pensionada discounts, (25% off the food portion of your restaurant bill-when you show your Pensionada ID) 25% off the first 600 kw of your electric bill, and many other services. 25% off Airline tickets, discounts on hospital, pharmacy charges etc. Pensionada status for non Panamanians is granted by the government for persons aged 60 (male) or 55 (female) -- same as Panamanians.
• Taxes=You pay your regular US Income tax wherever you reside. Panama does not tax income expats earn outside of Panama. There is sales tax on most items. Usually 5%. Property tax is excused on new houses for 20 years.
• Housing is much more affordable.
• Excellent modern Infrastructure=roads, phones, Internet, TV both local and worldwide.
• Great hospitals with outstanding doctors.
• The country is safe to live in, good police and court systems, no hurricanes, tornadoes, blizzards, and little earthquake risk.
• Rich in culture, recreation, history.
• Paradise for birdwatching, fishing, beaches.
• There are high Elevation areas such as Boquete and El Valle for those who like cooler climates.
• Modern airport for quick trips back to States.
• Most organizations such as Elks club, VFW and American Legion are here as well as many churches. 

Ways to learn more: There are more sites on the internet than you could ever read.  Yahoo has some great groups such as:

http://groups.yahoo.com/group/Panama Laws for Expats. Look in their files for all info needed. Visas etc.

www.panamainfo.com has a tremendous amount of info all over their site.

Most important: Don't pay for information. Whatever you are needing info wise is free. You will have to pay a lawyer to do the immigration visa paperwork, house title work etc. But the best advice for every one, visit and decide what you think before you get to the lawyer, housing etc and don't use lawyers etc, until you get some recommendations from other Americans.

This is something I've never considered (and I'm not sure I will consider it, but it's an interesting idea). What are your thoughts?

Best Financial Tips from FMF Readers, Part 6: Keep Watch for Free Offers

Here's the next entry in "The Best Financial Tips from FMF Readers" series. Today's post is from Dawn at Frugal for Life who gives us the following advice:

My best financial advice is to always keep your eye out for free deals. Free deals come in all shapes and sizes.

• They are small like samples for products that allow you to save some money not having to buy an item for a while.
• They are medium size gifts, like receiving free 'hand-me-downs' from someone else for yourself or your kids.
• And they come in large sizes as well, such as decent furniture or household items that someone else got tired of and put along side the garbage. This allows you to give new life to it and fill a need without having to buy new.

Personally, I love FREE stuff. In fact, I love it so much, I made it my first name! ;-)

Click here to read part 7.

Best Financial Tips from FMF Readers, Part 5: Seven Ways to Eat for Free

Here's the next entry in "The Best Financial Tips from FMF Readers" series. Today's post is from Noah Kagan at Okdork who gives us seven ways to eat for free:

1. At Work

A) Get free food by looking at different conference rooms while walking around the office

B) Sign up on company groups email lists and look for flyers of free food while at work

2. After work

A) At Safeway

i) Go to the deli section, you are allowed to sample 1 free thing there. I generally recommend the buffalo wings but sometimes I am partial to the potato wedges.

ii) Go to the candy section where you are supposed to fill it up in the plastic bag. Generally, the chocolate pretzels are my crutch but you may prefer jelly beans or sour worms.

iii) Try out the fruit section, NO please do not snack on an apple and put it back. But trying some grapes or the nuts is not a bad thing.

iv) They have these delicious new Safeway select soups but they hide the sample cups at the deli. So go ask and then enjoy a few cups of soup.

v) Go to the bakery late in the day and generally they will give you the donut holes for free.

Here's one from me that's only three words: Costco - Saturday - 11 am. We've been to Costco at 11 am on Saturday a few times and let me tell you, they roll out the samples all over the store. This past weekend, we had chips, ham and cheese, drinkable yogurt, fish, chicken and pasta, cheese, soda, cookies, and mini-turkey sandwiches. We were so full when we left that we didn't have "lunch" until 3 pm!

Click here to read part 6.

Best Financial Tips from FMF Readers, Part 4: Six Saving Tips When Moving

Here's the next entry in "The Best Financial Tips from FMF Readers" series. Today's post is from Kimberly A. Griffiths who gives six saving tips when moving:

1.  Boxes, boxes, boxes -- Asking your local grocery, drug, or liquor store for their empty boxes is certainly one way to save money.  You could easily spend $100 or more when buying new boxes.  Consider visiting an apartment complex the first weekend of the month when new tenants are likely to move in.  Tenants will be eager to rid themselves of their unpacked boxes and you can score by taking them off their hands.  If your employer is paying for the move, be sure to save and store your new boxes for future use.

Buy your packaging tape at a hardware store instead of a grocery store or office supply store.  It can save you up to $5 per roll!  And remember to be nice to whoever is helping you move, pack books in a few smaller boxes instead of one big box!

2.  Truck Rentals -- If you are ambitious enough to move yourself, be sure to comparison shop weeks in advance of your move to get the best prices on truck rentals. 

At the time this article was written, the following online price quotes were researched from well-known companies offering truck rentals.  Be careful to investigate how the company charges for mileage.  Another hidden charge that you may not be aware of is that of dropping off the truck in a different city/location from where it was rented.  Inquire with the truck rental store or website if there are special promotions or discounts for being a AAA or AARP member.  Do call your insurance agent before you reserve any truck to determine if your homeowner's insurance will cover any damage to your furniture and if your auto insurance will cover the truck.  This will save you worry and money, if you don’t need to purchase additional insurance from the rental company.

As an example, you could expect to pay the following charges for a 400-mile move:

Uhaul, www.uhaul.com, 14' Truck, $109 + $.40 per mile after the first 476 miles

Penske, www.penske.com, 15' Truck, $429 for unlimited miles, receive a 10% discount for reserving the truck online and another 10% for being a AAA member

Budget, www.budget.com, 15' Truck, $452 with a $100 refundable deposit, 515 miles are free

Each of these companies does a great job of up-selling boxes, tape, hand truck rentals, and moving quilt rentals on their websites and in their stores.  The boxes and tape can be purchased much cheaper if you plan in advance. 

In this scenario, Uhaul is the clear winner, but this is NOT always the case.  Prices will vary due to availability, timing, and distances. And, don’t forget … you are responsible for paying for the gas in the truck, which can be an exorbitant cost with current gas prices. Ask the rental company for the average mile-per-gallon of the truck when you are reserving it to estimate this cost.

3.  Storage -- Temporarily storing your belongings may be a necessary expense.  There are a lot of options with storage facilities and you will want to weigh each aspect carefully.  For example, if you are always strapped for cash, and there is the slightest chance they you will not be able to make the payment in a timely fashion, your belongings may be confiscated!  Don’t risk signing a contract with a storage company if you aren’t confident you can make the payments.  An alternate option here is to use your credit card for the recurring monthly costs, but ONLY if you pay off the balance in full each month.

When choosing a storage facility, consider the company’s reputation, whether they have climate controlled units (if this is important to you), and what security the company can promise.  Having easy access 24 hours a day may also be a key attribute for you depending on your circumstances.

If you are renting a truck to move your belongings, be sure to ask what partnership pricing they have with a local storage facility.  Sometimes storage can be obtained for as little as $1 for the first month with a 2-month minimum contract when you rent a truck at the same time.  Buy a padlock for your storage unit at your local hardware store to save spending 3-times the amount at the facility.

4.  Packing Fragile Belongings -- As with boxes, packing materials to protect fragile belongings can be expensive.  A cost effective and space efficient tip is to pack these breakable items in your bathroom and kitchen towels, throw rugs, blankets, bed linens, and even shower curtains!  This is a much better alternative to newspaper, which leaves ink residue behind.  All of your linens can be washed and folded once you have moved into your new home. 

In an easily identifiable place such as a drawer of a piece of furniture, be sure to pack a complete change of clothes for you and your family members, toiletries, a complete set of bed linens, and toilet paper.  This way, you won’t be panicked trying to find the necessities when your first arrive at your destination.

5.  Utilities and Address Changes -- Remember to cancel your old utility services, start new utility services, and change your address.  You may uncover some forgotten money when canceling services if you were required to pay a deposit when you started your service.   Be sure to end the services the day AFTER you move out.  This may incur a few dollars of extra costs, but typically these companies can not ensure a cut off time, and you don’t want to be stuck without electricity or hot water while you are still in your place. On the same note, you may wish to schedule set-up of your utilities at your new residence the day before you arrive to be sure everything will be working when you arrive.  Here is a list of common utility companies to contact. The property management company or Chamber of Commerce in the area where you are moving can give you local company numbers.

• Electric
• Gas
• Water
• Phone
• Cable
• Garbage

Also, if you are moving into a subdivision or condominium complex that has a private trash collecting service, you may be charged for the pick-up of your moving boxes! This cost can be $25  or much higher, depending on the number of boxes. Check this out before putting your boxes out at the curb. You may want to consider donating your boxes to a new neighbor with a ‘For Sale’ sign in front of their home.

In addition canceling and starting new utility services, don’t forget to change your address with your:

• Bank
• Credit Cards
• Utility Companies
• Insurance Companies
• Doctors
• Magazines
• U.S. Post Office (at your old location)

6. Save ALL Moving Receipts -- If your move is not being paid for by an employer, the incurred expenses may be tax deductible.  According to the IRS website, “You can deduct your allowable moving expenses if your move is closely related, both in time and in place, to the start of work at a new or changed job location.” The IRS has an interactive questionnaire, which determines whether your move may be deducted on your taxes.  Contact the IRS or your tax preparer if you have specific questions relating to your move.

Moving even the simplest of households can be expensive.  Save yourself a lot of stress and money by planning far in advance of your move.

Again, some great tips from Kimberly. For those of you who would like more information on Kimberly's thoughts, here's a bit of information about her:

Kimberly A. Griffiths has been through the vicious cycle of debt herself and has made it her personal goal to share her experience to help others. More information can be found at One Paycheck at a Time.

Click here to read part 5.

Best Financial Tips from FMF Readers, Part 3: Save by Visiting Your Library

Here's the next entry in "The Best Financial Tips from FMF Readers" series. Today's post is from Gary Bossert of Durham, NC who says:

Visit your local library. For a long time, I purchased books whenever I read an interesting book review or if a favorite author had a new release.  I would read it once and then it would sit on my shelf collecting dust.  Two years ago, I re-discovered the library.  My local library has nearly everything I want to read, and if they don't, I can request that they acquire a copy.  Not only do I use the library for books, but for investment research (Value Line) and audio books, too.  The library is a great resource, and even a modest donation to the "Friends of the Library" pales in comparison to the money I spent on new books.

Excellent tip! I use this all the time too. My library system allows me to go online, search for the books I want anywhere in the system (roughly 50 libraries), and order a book from any one of them. They then send it to the library of my choice (my neighborhood library only six blocks from my house) and email me when it arrives. I then have seven days to pick it up. As an additional service, they email me two days before it's due to help me avoid and late fees. It's a bargain all the way around!

I listen to roughly one book on tape per week. At $15 a pop, this system saves me almost $800 per year! (Even if I wouldn't buy that many books if I didn't have the library, you can say that I would buy at least a quarter of them, so this idea saves me a couple hundred dollars a year at a minimum.)

Click here to read part 4.

Best Financial Tips from FMF Readers, Part 2: Wisdom from Grandpa

Here's the next entry in "The Best Financial Tips from FMF Readers" series. Today's post is from Financial Fruition who says:

The best tip I ever received wasn't a tip given to me directly.  Upon the passing of my Grandfather I was informed about the size of his estate.  Considering the life he lived (94 years), I reverse calculated that amount to figure out a rough estimate of what his net worth was at its peak.  By doing this I figured he was a multi-millionaire at some time in the late 1980's.  This was an amazing feat to me, as my grandfather emigrated to the U.S. from Russia as a child in the 1920s with nothing but the clothes on his back.

So what "tips" did I glean from my grandfather's sizable net worth?

1) He never spent any of the extra income he received, whether it was a bonus or a big gain on an investment.  He always put that money to work for him.  And that it did!

2) Keep track of your investments.  He was always a student of investing.  He wrote his own investment policy statement and stuck with it throughout his life.  When he passed we found a binder with graphing paper in it.  On these pages were the inflows and outflows of every investment he ever made.  Included in this piece were stock, bond and other ideas, as well as his self written Investment Policy Statement, including dated amendments.  This binder was especially helpful for the Executors to find assets that no one knew about.

3) Last but not least, my grandfather never bought a car new.  Somehow he always knew a "friend" at the car dealer that was giving him a deal on an "executive" car, or a car that was just about over a year old.

Thanks for the lessons Gramps!

Great advice all the way around. I hope I can leave such a legacy for my family.

Click here to read part 3 of this series.

Best Financial Tips from FMF Readers, Part 1: Never Pay Retail

Here's the first entry in our latest "Best" series. The series is called "The Best Financial Tips from FMF Readers" and today's post is from Kimberly A. Griffiths. The piece is titled Never Pay Retail – Ever! Here's a summary of Kimberly's article:

With so many different types of sales running all the time, why would anyone ever pay retail?  In most cases, with a little research, you may never have to pay retail again.

In this post, she covers many different sales offers that we all should look for to save ourselves money. These include:

% off sale price -- Some sales offer substantial savings such as 50% off already reduced merchandise which is probably as deep a discount as you can get.  It may take some time and patience once you’re in the store, but these sales can really be wonderful when buying necessities such as back-to-school clothes and even for off-season holiday shopping.

Buy one, get one 50% off -- The buy one, get one 50% off is my least favorite sale.  It is essentially a way for stores to move their merchandise without offering any great incentive to the shopper.  It’s just another way of saying get a 25% discount when you purchase two items.  Unless you’re shopping with a friend, family member, or neighbor who needs the same thing, it just isn’t all that exciting of a sale.  You rarely need to buy two of one thing.  I would also group the buy two, get one free in this category – uneventful.

Two-for-One -- Lately I have noticed that grocery stores have pulled out all the stops to offer their products at a two-for-one deal.  Almost every shelf is lined with a brightly colored sale sticker offering two-for-one.  But again, more often than not, I only need one item not two!  I can’t speak for all the stores nationwide since they all have different policies, but in my case, I found that if you buy only one item instead of the two that they’re pushing, the one item is half the price.  For example, if orange juice is advertised as two for one at $4.00, one might be $2.00 – ask the cashier!  If you find that the one item is indeed half the price, tell the cashier that you no longer want the second item.  They will put the food back on the shelf… no worries.

BOGO -- Another marketing incentive is the buy-one-get-one-free (BOGO) option.  If you dine out with a spouse, colleagues, or a friend, consider eating out at restaurants offering a buy-one-get-one-free coupon.  Truly, if you tend to eat out often, this could be a substantial monthly savings.  Just commit for one week that you will not eat out unless you have a buy-one-get-one-free coupon.  Go to www.ValPak.com, search for restaurants by zip code, and ooo la la instant printable coupons for restaurants in your area!  A word of caution, no matter how frugal you may be, I don’t recommend using a coupon on a first date.  Know the difference between a special event versus going out to lunch with a co-worker!

Free After Rebate -- Although the free after rebate takes a little work, this can also be quite a good deal.  I notice these offers most often on small electronics.  In fact, the modem I’m currently using was free after submitting a manufacturer’s rebate.  Sure, I had to wait 8 weeks for the check to come in the mail, but I’d rather spend 15 minutes on the front-end of the deal doing a little bit of work so that I can get my money back. 

Free Samples -- One of the best ways to try out a product is when it is free!  From laundry detergent to toothpaste, companies are anxious for you to try their product.  If you live in a major city, free trial mints/gum, aspirin, soda, etc. are passed out on street corners from time to time.  If you want to get more free stuff, try www.StartSampling.com.

Online Sales -- Whether you are researching to buy in a physical store or looking to buy online, always look for product coupons.  Simply type in the product you are looking for and the word “coupon” into a search engine like www.Yahoo.com, www.MSN.com, www.Google.com, or www.AskJeeves.com.  For example, recently I decided to have a few personal photographs enlarged to place on a wall in my home.  I did a search online for “photograph coupon” and found a 40% discount on my purchase at www.KodakGallery.com.  The entire purchase took 2 minutes longer because I searched for a virtual coupon which saved me $20.  Saving $20 in 2 minutes on something I was going to purchase anyway is exciting!

If you cannot find a coupon after doing a search, try using a shopbot, a comparison pricing tool, which finds the lowest price in their network for the product you are searching for.  Some common shopbots include www.PriceScan.com, www.PriceCheck.com, www.PriceGrabber.com, and www.SmartShopper.com.

But what if you don't have a coupon or if the store isn't having a sale? Well, Kimberly has some suggestions for this situation as well:

If a store isn’t offering a sale, don’t hesitate to ask the store manager if the price quoted is the best value they can offer.  Once you ask the question, remain quiet and let the store manager respond.  Don’t look away, don’t interrupt, just wait for his/her response.  This approach takes practice, but you can save a lot of money by learning how to negotiate.  You may flop the first few attempts but remember, you’re the customer and you can always ask.

For example:

At an oil change garage or dry cleaners:

“I have a coupon for your competitor down the street, will you accept their coupon?”  If the answer is yes, then ask “Do you offer any further discounts?”

“Do you have any discounts for new (or regular) customers?”

Speaking to your credit card company:

“I received a credit card offer from Bank X in the mail which offers a rate that is 1% lower than what I’m currently paying with no annual fee.  I’m considering switching to this card unless you can offer the same or better deal.  What terms can you offer me?”

Buying furniture:

“Since I’m buying more than one piece of furniture [on sale of course], can you arrange for free delivery for me?”

Almost every other type of face-to-face purchase: 

Is this the best deal you can offer?

Thanks, Kimberly. For those of you who would like more information on Kimberly's thoughts, here's a bit of information about her:

Kimberly A. Griffiths has been through the vicious cycle of debt herself and has made it her personal goal to share her experience to help others. More information can be found at One Paycheck at a Time.

Click here to read part 2 of this series.

New Best of Series: Best Financial Tips from FMF Readers (Final Reminder)

Just one last reminder to submit your ideas for our new "Best" series called "The Best Financial Tips from FMF Readers". If you read Free Money Finance, you're eligible to participate.

Here's what you need to do to enter:

• Send me an email telling me what your best financial tip is (something like a great money-saving tip, a practice you use personally that's been great for your finances, etc. Note: I am NOT looking for "great" stock tips.) ;-)
• Include your name as you would like it to appear on the site.
• Give me your blog's URL if you want it referenced (could be some good traffic sent your way. Note: It does not need to be a personal finance blog.)

That's it. The series will start soon, and I'll put the posts up on a first come, first served basis.

New Best of Series: Best Financial Tips from FMF Readers (Reminder)

Just a reminder to submit your ideas for our new "Best" series called "The Best Financial Tips from FMF Readers". If you read Free Money Finance, you're eligible to participate.

Here's what you need to do to enter:

• Send me an email telling me what your best financial tip is (something like a great money-saving tip, a practice you use personally that's been great for your finances, etc. Note: I am NOT looking for "great" stock tips.) ;-)
• Include your name as you would like it to appear on the site.
• Give me your blog's URL if you want it referenced (could be some good traffic sent your way. Note: It does not need to be a personal finance blog.)

That's it. The series will start soon, and I'll put the posts up on a first come, first served basis.

Best Money Post I've Ever Written, Part 7

This post continues our series from top personal finance bloggers writing about the best money post they've ever written. Today's entry comes from Frugal for Life where Dawn says the following about "What's a Penny Worth to You?":

I base the best post I have written on feedback from people, and I found that the post "What's a penny worth to you?" generated a lot of responses on picking up pennies.

Here's the heart of the piece:

Now I told this to a friend of mine and she said, “I wouldn’t stoop down for anything less than 25 cents”. I reminded her that over the course of the last couple of days, I had picked up at least 25 cents in pennies, she still thought it wasn’t worth the time to bend down for them.

There are 24 comments as of this writing. Stop by and see if people think a penny is worth picking up. Do you think it is?

Best Money Post I've Ever Written, Part 6

This post continues our series from top personal finance bloggers writing about the best money post they've ever written. Today's entry comes from Mighty Bargain Hunter who tells why "Auto Leasing is Back -- and Better? How so?" is his best post ever:

The big financial websites usually have decent articles.  Sometimes, though, they give advice that isn't really that financially sound.  Part of what financial bloggers should be doing is filtering articles, pointing out the good stuff and the bad stuff, and not apologizing for their opinions if they're reasonable.

Leasing a car is rarely a good idea for long-term wealth building.  So, when this article talked about leasing incentives and things to look for in a lease, etc., I had to comment on this and remind people that there are other ways to get a car, most of them being cheaper in the long run.

I have to agree. It's a great piece, so stop by and check it out.

Click here to read part 7.

Best Money Post I've Ever Written, Part 5

This post continues our series from top personal finance bloggers writing about the best money post they've ever written. Today's entry comes from I Will Teach You to be Rich where Ramit says the following about “All About Stocks and Bonds”:

It describes what stocks and bonds are, how to pick them, and dumb mistakes people make about investing.

It's a good primer for people who are just learning about stocks and bonds.

Click here to read part 6.

New Best of Series: Best Financial Tips from FMF Readers

Our latest "Best" series is starting to fizzle out, and I think many of the personal finance bloggers out there are simply too busy to contribute. Therefore, I'm launching a new series from you -- the readers of Free Money Finance! It's called "The Best Financial Tips from FMF Readers" and can be from anyone who reads Free Money Finance.

Here's what you need to do to enter:

• Send me an email telling me what your best financial tip is (something like a great money saving tip, a practice you use personally that's been great for your finances, etc. Note: I am NOT looking for "great" stock tips.) ;-)
• Include your name as you would like it to appear on the site (if you want it to appear -- it doesn't have to be listed)
• Give me your blog's URL if you want it referenced (could be some good traffic sent your way. Note: It does not need to be a personal finance blog.)

That's it. The series will start soon, and I'll put the posts up on a first come, first served basis.