Thursday, March 31, 2011

10 Commandments of Pulling April Fools' Pranks

Happy (early) April Fools! I was reminded of an old survey showing that April Fools' pranks in the office are frowned upon by a high percentage of marketing executives. Granted the survey was conducted last year, it's still interesting to see the results. I mean things can't have changed that much in a year.

I work at a startup company in the San Francisco Bay Area where the culture is more T-shirt and jeans than suits and ties. Yes, there is a hierarchy, but it's not strict. Our day-to-day interactions are very friendly for the most part. My point is that jokes are well received in this environment. I guess I never really encountered a setting that disapproves of harmless jokes. In college, pranks or "hacks" were unofficially encouraged by the school. It was seen as a creative outlet. Once in a while, you'll see cars being stacked onto rooftops or an extra door added to a random part of the hall way. I once barricaded a friend's door by constructing a "brick" wall made of snack boxes.

They’re all in good fun, but if you're thinking of pulling a prank, there are some ground rules you should abide by to prevent bad blood between co-workers. Here are 10 commandments of playing April Fools' pranks everyone should consider:

Wednesday, March 30, 2011

CD Laddering

I wrote a post about certificate of deposit (CD) a few days ago and mentioned a strategy called “laddering.” It’s a common and effective strategy for maximizing your savings. Basically, it's splitting your money into a few groups and opening CDs with different term intervals.

Laddering is useful in two ways. For one, it's a good method to maximize interest. It also makes your assets more liquid because you have the maturity dates of the CDs staggered. The longest term CDs tend to have the best rates, but that also means your money is locked in for the longest. A 5 year CD, for example, may pay 3% in interest as oppose to 1.05% for an 18 month CD. However, interest rates could go up during that 60 month time period. By spreading your assets, you give yourself more flexibility.

Monday, March 28, 2011

$15 Amazon Gift Card Winner Revealed!

Finally, the time has come to reveal our winner. Thanks to everyone who subscribed to the blog and spread the word in the past two weeks.

Okay let's get to it. Drum roll please!


The winner is..........

Sunday, March 27, 2011

Millionaires and Reality TV

I have to admit, I get a kick out of watching reality TV. Shows like Survivor, Top Chef, or The Amazing Race bring out the competitive side of me. It's like watching a sports game where you find someone or some team to root for. You also get a "behind the scene" look at their processes and strategies for winning. Of course, I don't mind being able to laugh at terrible decisions or stupid remarks that are blurted out either.

That said, some reality shows really make me cringe. The Real House Wives series, Millionaire Match Maker, The Hills, etc. show case the excessive lifestyle of the rich while creating celebrities out of a bunch of none-deserving people. For some, the enticing part of watching the shows is their ability to ridicule the "celebrities" featured. Sadly, it seems like more viewers actually attempt to emulate the irresponsible behaviors displayed.

Friday, March 25, 2011

How a Certificate of Deposit Works

This is the 5th post in the Bank Deposit Account 101 series.

When I first heard about "CDs" in the same sentence as banking in high school, I was super confused. Ummmm...what do compact disks have to do with saving money? If you're as puzzled as I was, don't worry, I'm pretty sure most people have the same reaction. The abbreviation actually stands for Certificate of Deposit.

A CD is a deposit account offered by banks or credit unions that usually pays out a decently good amount of interest compared to your average checking and savings account. Of course, a higher rate of return for your money comes with a catch. This kind of savings vehicle is called fixed term or time deposit, meaning that you have to keep your money in the bank for an agreed period of time. The term can range from 3 months to 5 years. In general, the longer you leave the money and the larger the principal, the higher your interest will be. Jumbo CDs, those with a minimum deposit of $100,000, receive some of the best rates out there.

Tuesday, March 22, 2011

The Importance of Parental Influence

This is kind of weird to admit, but I didn't know that you can OWE money on your credit card for more than a month at a time until I was a teenager. Before that point, I always thought you spend what you can afford and pay it back in full at the end of the month (I guess you would call this a charge card). Okay, now that I've admitted that, you may think I'm not too bright. Or you may think that our educational system should focus more on personal finance. One of those statements is true. Yeah yeah, take it however you want, but I insist my thoughts were heavily influenced by my parental unit. So forget what it says about me. The real question should be what's that say about my parents? It could mean a few things:

  1. They're extremely responsible credit card users.
  2. They wanted me to understand the value of hard-earned money before I learn about debt.
  3. They didn't tell me the whole story by explaining to me more clearly the full purpose and intention of credit cards. (Euphemism for the lying, I suppose) 

Sunday, March 20, 2011

Is Fear Costing You?

Fear of Disaster
Earthquakes, tsunami, and a nuclear crisis. We've been hearing a lot about these catastrophic events in the news lately. While my thoughts go out to those affected by these terrible disasters, it makes me sad to see some media outlets playing up the fear of everyday folks. I agree that we should be prepared for emergencies, but at the same time, we shouldn't buy into sensationalist reporting.

Headlines like "Nuclear Fallout!" aimed to attract viewers/readers when the actual reporting is about how the nuclear particles won't have much of an effect on those living in the U.S. is just irresponsible. That's why it's important do our own research to be able to distinguish between real news and needless panic before jumping to conclusion. Be reasonably concerned, but check the facts. Rushing out to buy all of the potassium iodide pills on the shelves or hoarding canned foods in the grocery store is just irrational fear. Don't let the anxiety of there being a chance of something happening stop you from performing day-to-day activities. It's costly to each individual as well as our entire society. Instead, focus your energy on communicating with family and work to make sound emergency plans.

Saturday, March 19, 2011

Traditional vs. Online Banking

This is the 4th post in the Bank Deposit Account 101 series.

Online banking has existed since the mid-1990s, but it didn't become an established form of banking until this past decade. Due to the wide accessibility of the internet, web only banks are an increasingly popular option, especially amongst young people. So should you consider using an online bank? Below, I've highlighted the advantages of these two types of banking institutions. Read and decide for yourself which one's right for you:

Physical location. The most obvious and important difference between a traditional bank and an online bank is the physical presence of a bricks-and-mortar bank. Not only can you see the operation, use the safe deposit box, you can talk to a teller, a financial representative or a loan officer face to face.

Tuesday, March 15, 2011

Football, Money, and Big Whiny Whiners

It's official. There's a lockout in place for the National Football League, the commissioner is only getting paid $1 a day, and the players filed to decertify their union in order to file an anti-trust suit against the owners. Well that's just great! This means a potentially long, dragged out process involving the courts. So it's looking like my beloved pastime might be shut down next season. Sigh...

A lot of people like to talk about where to place the blame for this unfortunate turn of events. Yup, me too! Apparently asking Mr. Obama was a bust. He said he had better things to deal with. So I decided to read the papers, online articles, and listen to the Freakonomics podcast for answers. What I found were equally aggravating excuses from both sides. The owners claim that the current pay structure is unsustainable for them, that they didn't spend millions upon millions of dollars to lose money. To this I say, there should have been a disclaimer or something telling them that there are always risks involved in any kind of investments. You'd think these billionaires would know that before they signed the last contract almost 2 decades ago.

As for the players, reading and listening to their side of the dispute proved to be equally irritating. Here are some common things they say when asked why they want more money:

Monday, March 14, 2011

$15 Amazon Gift Card Giveaway!

Happy Pi Day all! Being the big nerd that I am, I thought it’d be a perfect time to hold a giveaway. It’s something I've been thinking about doing for a few weeks now. I've been blogging and actively involved in the online personal finance community since the beginning of this year. It's an extremely short period of time compared to a lot of folks out there, but it's also been incredibly rewarding. I want to make my own community a bit bigger in order to get more input and discussion going here.

I’ve been doing some surveys online and getting paid in the form of gift cards. Perfect! Who doesn't love Amazon gift cards? I figured that having some sort of incentive to reward both old and new readers will be a great way to grow. For the next two weeks, you can enter to win by doing one, a couple, or all of the following things:

  1. Subscribe to my blog via email (it's free, and I promise I won't spam you), RSS feed, or by becoming a follower by clicking the Google "follow" button (you'll need a Google account)
  2. Follow me on twitter and tweet me @savvyyoungmoney with hashtag #contest
  3. Get the word out by tweeting or blogging about this giveaway. Be sure to include @savvyyoungmoney and hashtag #contest in your tweet
  4. Comment on any of the other posts on my blog

You'll receive 1 entry for doing each thing above. That means if you complete the whole list, you'll receive a total of 4 entries. Please leave a comment on which method(s) you used for your entry to be counted. If you already subscribe to the blog, you can still have it be counted as an entry by commenting below.

Entries must be received by 11:59pm Pacific Time on March 27, 2011. The winner will be picked using on March 28, 2011. Check back then for the announcement of the winner (you'll know because you'll be subscribed to the blog, right? ;D). Spread the word, eat some pies, and good luck!

Sunday, March 13, 2011

Making a Mental List Goes a Long Way

A few years ago, while I was on break from college, I went grocery shopping with my parents. It wasn't a particularly exciting event (duh!), but I still remember it well. The reason is because I was surprised and extremely impressed by my parents' ability to spot overpriced items. They seem to have a mental database full of prices, which is completely different than the way I shopped for groceries back then.

When we walked down the produce isle to look at peaches, my mom immediate told me that it was too expensive and cited the price at another grocery store. Then, it was the lettuce, the ground pork, and the fish. They look at each product and pointed out whether it was worth buying at that particular store or not. My mom specialized in the vegetables and seafood while my dad knew the prices for meats and fruits. They'd say things like, “wait until the shrimps go on sale. They'll be almost as much as half off sometimes.” They should be hired by the Bureau of Labor Statistics to take data for the consumer price index (CPI)…and no computer spreadsheets necessary!

Saturday, March 12, 2011

How to Choose a Bank Account

This is the 3rd post in the Bank Deposit Account 101 series. 

Opening up a checking or savings account is one of the most basic things you should do when you're working on building your wealth. Whether you're a student, a professional, a part time worker, etc., it is probably the most low risk option for storing your money and possibly earn some modest interest. Not only that, it should be an integral part of managing your finances by simplifying organization, and perhaps, curb your spending. I described the process of opening an account as well as the most common types of deposit accounts available in earlier posts. The following is a list of factors that play into the decision of selecting an account. Determine which of these are the most important to you in order to find an option that's fitting.

Note that this post applies to both bank and credit union accounts, but for the sake of simplicity, I'll collectively call them "bank."

Make sure your money’s safe. Safety first! The FDIC and the NCUA are government agencies that insure your money if the banking institution collapses. Currently the insured amount is up to $250,000 for members. Having this cushion means knowing that your money is protected. It's definitely better than hiding cash under a mattress!

Tuesday, March 8, 2011

ProcrastiNATION Unite!

I read a post about procrastination by Travis over at My Journey Out of Debt a while back and was inspired to write something related to the topic. Well, in the true spirit of a mega-procrastinator, I'm finally getting around to it. Hey, at least I'm doing it!

Unlike Travis, who procrastinated because he refused to be defeated, I do it as a pastime. No joke! I don't mean to brag, but I was first labeled as S.B.L in the 5th grade. Smart but lazy, or so my teacher told my parents. Great, thanks for sharing. In the decade or so that followed, my mom's reminded me numerous times of my terrible habit.

Okay, I'm not sooooo bad that I fail to deliver. Eventually I'll do it and hand over stellar final product, but it can still be problematic. Yes, some have suggested that it's because people like me work better under pressure. Maybe. But it can lead to constant stress, not to mention potential financial losses for waiting 'til the last minute. Procrastination is why some of us haven't gotten started on saving for emergencies/retirement or paying more for shipping after putting off on ordering something important.

Even as an expert procrastinator, I somehow find ways to get things done. Here's a get-it-done guide for those of us who aren’t always on top of things:

Monday, March 7, 2011

Different Types of Deposit Accounts

This is the 2nd post in the Bank Deposit Account 101 series. 

I explained how to open a deposit account in an earlier post but didn't get to mention in detail about what sort of accounts are available. To make it up to y'all, the following is a list of the 4 most common bank deposit account types. Don't blindly pick something to throw your money into. Understanding how each one functions will hopefully help you maximize profit and minimize fees and inconvenience. This information should also be factored into the bank you ultimately decide to open your account at.

Checking Account is the most common deposit account. Like its name suggests, this type of account allows you to write checks and withdraw money easily. It is usually tied to a debit card. Because of these features, a checking account is the most liquid form of deposit accounts and, in general, does not bare interest. In the past year or so, in order to make up for loss profits from government regulations, many checking accounts require a minimum balance to avoid maintenance fee or to receive certain services.

Saturday, March 5, 2011

Don't Get Sidetracked By Instant Gratification

I was reminded while working out the other day of the need for instant gratification. It's part of human nature to want to see immediate results. I'm not gonna lie, it's something I struggle with on a daily basis. Hey, when I pay or work for something, I better see what I expected as fast as possible. I'm too busy/important to wait around!

Week 4 of boot camp just ended, and as I mentioned before, I'm feeling more energetic, my pants are looser, and I'm getting stronger. But when I weighed myself the other day, I gained 3 pounds. 3 friggin' pounds! Now you're probably thinking that I’m angry about nothing because it's just muscle weight. And yes, the logical part of me knows that. In fact, there's physical evidence, too. I lost about 2% body fat. But I've been working my a$$ off for a full month. It's frustrating and even slightly demoralizing to not see "results" in terms of weight loss. Why haven’t doctors/scientists/engineers figured out a way for me to be lazy, eat junk food all day, and still lose weight without any side effects? Yeah! What's up with that?

Tuesday, March 1, 2011

February Budget Sum Up

Helloooo March! You know what that means...a review of my February budget, of course. If you saw my tweet a few days ago, you'll know that it was a very successful month of spending (or the lack thereof). My monthly discretionary total came out to be...drum roll please....$76.22. Almost 25 bucks under the $100 budget. Woot!

Here's a breakdown:

  • $18.67 on coffee (Starbucks and Peet's)
  • $49.25 at other restaurants
  • $8.30 round trip BART tickets (public transportation)

My estimate of shelling out $20 on coffee for February was on target. I know what you're only have $100, and you wasted 20% on coffee??? Well, this month, I'll work on lowering that amount to 15 bucks. Baby steps...