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7 Online Tools to Optimize Your Budget
The number of Web sites and online applications available for you to manage your money and improve your finances keeps growing all the time.
CNNMoney.com has put together a slideshow of 7 technologies for optimizing your budget.
These are targeted at small businesses, but are certainly applicable to many home users.
They include:
The only one of these I can highly recommend is Yodlee, which I've been using for over a year.
Have you used any of these services? What do you think of them?
Let us know in a comment.
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4 Tips for Shopping at Thrift Stores (Or How Not to Spend Like Sarah Palin)
The Washington Post ran an article on Vice Presidential candidate Sarah Palin titled After a $150,000 Makeover, Sarah Palin Has an Image Problem.
The article reports $75,000 bills at Neiman Marcus and $50,000 bills at Saks Fifth Avenue along with a $10,000 handbag among recent purchases, none of which goes well with her efforts to have an "Ah shucks," hockey mom image.
I think it's fair to assume savers on this blog share at least some of my annoyance, but I decided to curb that and let her excess be an opportunity to report a modest but pleasing savings I made just three days before on a pair of $175 Nunn-Bush shoes. I got them for $7.99 at a Goodwill thrift shop.
Better yet they were absolutely 100 percent new; not a scratch, not a scuff, on the tops, on the soles, anywhere.
Finding a brand new pair of shoes at Goodwill is lucky, but there is more to it than luck. Savings at thrift stores comes with strategy and patience. Never shop at a thrift store if you need something right away.
If it's Friday afternoon and you have to get new and respectable shoes for your sister's wedding, then it's not the time to go to Goodwill or any thrift.
Savings at thrift stores is a long-term process requiring regular, but short visits. At Goodwill stores and Salvation Army stores, especially in big metropolitan areas, the good stuff turns over very fast. That is important because infrequent visits mean lots of good stuff will come and go and you'll never see it.
- Frequent visits make it easier to spot the good stuff.
- Plan to stay twenty minutes to a half an hour, but never longer.
- Have a departmental route: pants, shirts, shoes, furniture, electronics, sporting goods, books and so on.
- Don't linger. If the bargain is there, you will see it. If you stay too long you'll get depressed looking at worn out stuff and begin thinking thrift shops are hopeless when they are not.
Thrift shops are a special preserve for those who like a challenge, but they pay off, especially when you find something you might not buy otherwise. The above mentioned shoes are only one of many fun buys.
Include new to nearly new Ralph Lauren, Tommy Hilfiger, Bill Blass and Brooks Brothers shirts, Jos. A Banks pants, 3 all leather belts, New & Lingwood sweaters, a Harris Tweed sports coat, all bought for a song. Take that Sarah Palin.
Fred Siegmund covers America's jobs as part of work doing labor market analysis and projections for a client base of recruiters, trainers and counselors. Visit him at www.americanjobmarket.blogspot.com
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HSBC Direct Drops Rate to 3.00% APY
HSBC Direct, in line with many other online savings accounts, is dropping its interest rate to 3.00% APY.
The account previously had a 3.25% APY after a summertime promo of 3.50%.
FNBO Direct recently dropped its online savings account APY to 3.25%, while ING Direct and E-Loan fell to 2.75%.
Dollar Savings Direct has gone the other way, upping its rate to 4.00% APY. WT Direct is currently at a 3.31% APY.
We currently using HSBC Direct for our housing fund.
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FNBO Direct Drops Rates to 3.25% APY
FNBO Direct has dropped the rate of their online savings account to 3.25% APY (previously at 3.50%).
The bank, which is currently running a "Pay Yourself First" contest, shot on to the scene with a 6.00% APY account in May of 2007 (those were the days).
The account has no fees and requires only $1 to open.
Despite the falling rate, I'm tempted to close my E-Loan account and switch to FNBO. E-Loan has been pretty annoying to deal with — not telling anyone about their falling rates and implementing unnecessary rules.
The rate drop follows ING Direct's decision to lower its APY to 2.75%. Dollar Savings Direct, however, has recently gone the other way, upping its rate to 4.00% APY. Other options include WT Direct (3.31% APY) and HSBC Direct.
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Money Saving Links: 10/26/08
It's been a slow week here, thanks to being offline for some holidays and traveling for the day job. But we're back in the swing of things and have a great week lined up for you.
We participated in this week's Carnival of Personal Finance, #175 hosted by Budgets are Sexy. We submitted The Declaration of Financial Independence: ING Direct.
Check out some of these great stories:
10 More Money Saving Websites With Ongoing Big Fat Deals - Greener Pastures
10 time saver and money saver sites I use to get a little extra mileage out of my budget.
My criteria: I don’t lay out my credit card number unless I know the site’s legit.
How to Maintain Optimism in Tough Economic Times - Tough Money Love
But you know what? We have not given up hope. We can still see the light and are more determined than ever to finish the job we started, to reach the financial goals we set, and do it on our schedule. How is that possible after the all of the damage that has been inflicted upon our net worth? That’s a question that I am now asking myself because to be honest I am surprised at how calm I am at this point.
Saving Is In Again: Thomas Stanley on the Glutton Economy - Cash on the Barrelhead
Hemispheres, the United in-flight magazine, just published a short piece I wrote last spring about saving to become wealthy called Hey, Big Spender.
It includes a quote from Thomas Stanley, author of The Millionaire Next Door. At the time I wrote it, the idea of being frugal still seemed quite out of step with the culture, but Stanley says it’s a habit that never goes out of style for those who hold onto their wealth.
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1929 and 2008: Why Distribution of Wealth Matters
There are many comparisons in recent newspapers between the crash of 1929 and the crisis of 2008. The media of today has not settled on a consistent title for America's current events but "crisis" appears to be the most common caption among the newspapers I see.
Many books and articles have been published on the stock market crash of 1929, but one book in particular stands out as short, only 197 pages, readable and relevant for today's debacle. It is The Great Crash by John Kenneth Galbraith.
After using newspaper and other accounts, he describes what happened in journalistic fashion with a final chapter titled Causes and Consequence. The first cause on his numbered list is "The Bad Distribution of Income."
Allow me a brief quote.
In 1929 the rich were indubitably rich. … The proportion of personal income received in the form of interest, dividends and rent – the income broadly speaking of the well-to-do – was about twice as great as in the years following the Second World War.
This high unequal distribution of income meant that the economy was dependent on a high level of investment or a high level of luxury spending or both. The rich cannot buy great quantities of bread. If they are to dispose of what they receive it must be on luxuries or by way of investment in new plants and new projects.
Mr. Galbraith was writing 50 years ago about events of nearly 80 years ago, but it is helpful for man of his distinction to confirm what is the underlying cause of America's crash of 2008: the bad distribution of income.
The growing inequality of income is well documented in the Federal government's publication of the Current Population Survey.
In their table of Selected Measures of Household Income Dispersion the highest 10 Percent of household income continue to gain income share year by year on the bottom 10 percent, but also the bottom 20, 50 and 80 percent of households.
The wealthy pay the same price for bread, eggs and milk as everybody else which is why they have extra money to speculate in Wall Street's new and exotic investment derivatives: hedge funds, collateralized debt obligations, mortgage and asset backed securities, principal only strips, credit default swaps and so on.
In the mean time, heavily taxed wages are going up slowly — but not as fast as prices, a reality documented by the Bureau of Labor Statistics. More of us are reaching credit card limits and home equity loan limits.
Refinancing mortgages for cash, or lower interest rates, did provide a boast to buying power, but these too are running low.
A mass society needs mass participation, which the unequal distribution of income limits. The crisis of 2008 tells us the wealthy have failed to return their savings and tax cuts back into the economy in a constructive way to create long lived assets and jobs. They have failed themselves and the country.
It is time for the wealthy to pay more tax.
Fred Siegmund covers America's jobs as part of work doing labor market analysis and projections for a client base of recruiters, trainers and counselors. Visit him at www.americanjobmarket.blogspot.com
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Money Saving Links: 10/19/08
This week, we participated in the Carnival of Personal Finance #174, hosted by Greener Pastures. As you can imagine, many of the posts dealt with the up-and-down stock market and the general state of the economy.
The carnival included our own 3 Things the Presidential Candidates Can't Say About the Economy (But Should).
While there weren't many posts about online banking or using the Internet to save you money, there were a number of good stories to read.
Be Careful Where You Get Your Investment Advice - Military Finance Network
Here are some investment tips you should beware:
An “inside tip” isn’t inside information if it is published
Beware of agendas and scams
Beware of the office day trader
There are no guaranteesStop Thinking About That Year-End Bonus - Tough Money Love
Mr. ToughMoneyLove has lots of experience with year end bonuses, both as a recipient in my younger days and more recently as an employer distributing them. My message today is to encourage all of you who have reason to expect a bonus to stop thinking about it.
Pay Yourself First: How to Do It and How It Works - Money Under Thirty
What does it mean to pay yourself first? Think about how you usually manage your money every month. If you’re like most responsible people, you get your paycheck and pay your bills. Even if you don’t stick to a budget, you probably have an idea of how much your bills are and how much you have left over. After your bills are paid, you kind of spend the rest without much thought.
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E-Loan APYs Plummet, They Don't Tell Anyone
E-Loan, who burst onto the online savings scene with a 5.50% APY account, has dropped its rates dramatically — and didn't tell anyone about it.
The regular online savings account, which had been at 3.01% APY, is now down to 2.76% for balances above $10,000. Accounts with $5,000 to $9,999 will be receiving a 2.51% APY.
The worst of all? Accounts under $5,000 will be getting a 1.00% APY.
With that kind of crappy rate, you should definitely be moving your money if you're just starting out.
Why Can't They Let Us Know?
One of my biggest gripes with online banks — and especially E-Loan — is that they don't bother to tell you when the rates go down (they've done it before).
When the rates are rising, they'll certainly let you know. But when they're dropping, you need to constantly be looking out for changes.
It looks like E-Loan adjusted their rates sometime between Sept. 17 and Sept. 20. On 9/20, Interesting Money first reported the rate drop (and also expressed annoyance at E-Loan's lack of communication).
On 9/17, we blogged about E-Loan's new Savings Plus account and the online savings account was still at 3.01% APY.
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Why Are Dividends and Income Taxed So Differently?
In 2007, someone starting out in their twenties with a modest $30,000 a year salary will be expected to pay $5,091.25 in federal income and payroll taxes. For a single person who earns the same $30,000 as dividend income, the total federal tax would be $1,062.50.
For a married couple starting out where both earn a $30,000 a year salary, they pay federal tax of $10,182.50. For a married couple who earns the same $60,000 as dividend income they pay $2,125 in total federal tax. There is no payroll tax on dividend income.
This extraordinary favoritism toward corporate dividends has been going on since 2003. It not only debases work but changes America's saving and consumption. A couple starting out in their twenties will be unlikely to have dividend income, but their very high taxes make it difficult to save anything, or buy a house.
Those with dividend income since 2003 are likely to be older with years of saving and a nest egg of savings and dividend income. Likely as well, they already own a home. Their lucrative tax breaks have generated savings for them and loanable funds for banks and financial intermediaries.
Apparently, they all forgot that savers earn a return only if borrowers can pay back their loans. The millions of sub-prime mortgages and the rapid and large number of foreclosures and defaults make it clear those who are starting out and many others cannot afford to buy a home, or borrow all those loanable funds.
There was a comment in one of my previous posts where a reader suggested Congress and the Bush administration has been pushing sub-prime loans to boast home ownership for political reasons. I am sure that is correct and recent testimony and discussion in the Wall Street Journal confirms that view.
It is the same Congress and Bush Administration that promoted tax breaks for dividends and ignores the income inequality their policies help to generate. It makes no difference what any one says about fairness in taxes.
America has to raise taxes on the wealthy and give tax relief to working Americans, or the economy will continue to flounder and decline.
Fred Siegmund covers America's jobs as part of work doing labor market analysis and projections for a client base of recruiters, trainers and counselors. Visit him at www.americanjobmarket.blogspot.com
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The Declaration of Financial Independence: ING Direct
ING Direct, one of the pioneering online banks, has announced its new "We, The Savers" push, encouraging Americans to focus on finance fundamentals and put saving first.
In a letter on their Web site, CEO Arkadi Kuhlmann writes that we've made some mistakes, but can emerge stronger:
There's no denying it: America is in a tough financial spot, and some of the people in our financial industries have a lot to answer for. Eventually, they will. In the meantime, there is no way to turn back the clock on this crisis and not much the average person can do to alter its course. It has to play itself out, and we have to believe – and insist – that those responsible will play their parts in fixing it.
But what we can do is make sure, as the song says, we don't get fooled again.
Below is a 10-point plan for exactly that. If you live by it, you'll be in control of your financial life. If everybody lives by it, we'll live in a stronger nation. We urge every American family to read it, talk about it together, commit to it. Then print it out and tape it to your refrigerator door. It's a declaration of financial independence that will put your future into your own hands, where it was always meant to be.
ING's 10-point plan is as follows.
- We will spend less than we earn.
- We will use our home as a savings account.
- We will take care of our money.
- We will defend our credit worthiness.
- We will ignore unsolicited credit card marketing.
- We will know the cost of borrowing.
- We will invest for the long term.
- We will take care of the things we have.
- We will remember what matters.
- We will be heard.
We can't argue with any of the points — the level of finanical knowledge in the U.S. is way too low, and anything that can be done to improve it is a step in the right direction.
What We Would Add
Here's what we would add to the decleration:
- We will remember that cash is king.
- We will attack debt to reduce it whenever possible.
- We will not be swayed by the hysteria and panic in the media.
What would you add to ING's Decleration of Financail Independence?
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