One of my favorite financial resources, The Wall Street Journal, published an article about the perfect salary. According to their research, $75,000 is a perfect blend of money and happiness. The full length article can be found here.

This study goes against everything we as Americans have been taught. We’re not taught to “settle.” We’re taught to strive for bigger and bigger salaries so we can buy bigger and better toys, cars and houses. This article basically tells us that what we’ve been taught is a bunch of non-sense and any more money over the $75,000 thresh-hold will not make a significant impact on one’s life.

Here are two quotes that I find fascinating:

“The magic income: $75,000 a year. As people earn more money, their day-to-day happiness rises. Until you hit $75,000. After that, it is just more stuff, with no gain in happiness.”

“Giving people more income beyond 75K is not going to do much for their daily mood … but it is going to make them feel they have a better life,”

I have my own opinion on this. This study makes no mention of location for salaries. I’m sure the people polled we’re from all over the country but I do know that $75k would not go that far in certain areas. Take me for example. I’m a single filer for taxes and live in San Diego. I make close to the $75k figure. With California taxes, high gas and food prices, and high rental costs, my salary does not give me the level of happiness this article is talking about. For example, I have to live with roommates to lessen my rent burden. I’ve talked with co-workers and some pay rent as high as $2,000 a month! I can’t imagine paying that, let alone, being happy paying that. I guess my point is that this study is abroad generalization and can’t be applied in every geographical location.

I do see how the level of happiness plateaus after a certain point. When this happens to me, I’ll let you know! In the mean time, I’m on the quest for that comfortable salary!

What are your thoughts on this article? Have you reached this stage? Do you agree or disagree with these findings? Comment below!

-JE

I graduated college debt free. Most people would say it’s impossible, but I’m living proof that it’s not! It’s so rare these days that most people I tell my story to don’t believe me. Maybe I should write a book on this haha.

I attended the prestigious University of Washington for four years and graduating without a single dollar of debt. I actually graduated with a large surplus in my checking account! Although it was a lonely, hard road, you too can do it. It takes sacrifice, perseverance, a little creativity, and lots of hard work.

The key is to ignore the people around you. No, no, not like that. I mean ignore what other people are DOING AROUND YOU. This means ignoring friends buying new cars, friends taking out loans for tuition, ignoring friends eating out all the time, and ignoring friends with expensive hobbies. All these things take a significant amount of money. If you don’t have the money to do it, don’t go into debt when you have a tuition bill looming over your head! It’s all about your frame of mind.

If you are focused on the long term goal, which was graduating debt free for me, then the actions of people around you now shouldn’t phase you! If anything this type of thinking should excite you! You’re doing something completely against the “American way” and doing something totally unique. And if anything else, you will have an amazing story to tell your friends, family, and children someday.

These are simple, common steps I took to prevent college debt:

I drove an old car

During my senior year in high school I was blessed with the opportunity to buy a friend’s Geo Prizm for $500. Yes, it was a Geo, you heard me right. My pride is still intact! The key here is to drive a low maintenance vehicle that gets good gas mileage. This is especially crucial if you live off campus and commute.

I lived at home

This is a no-brainer. Free food, free cable, free internet, free EVERYTHING. Thankfully, I am blessed to have been raised in a wonderful family, so living at home was an easy choice for me. Living at home will cut out hundreds of dollars in expenses every month.

I worked A LOT

I did some type of work at least 5 days a week for all four years of college. It seems like I worked everywhere. Let’s look at the laundry list: produce clerk at Safeway, desk manager at a local gym, carpenter, and multiple paid internships.

Ran my own side gigs

The beauty of side gigs is that your pay is significantly higher than typical college jobs. I consistently ran two side gigs, landscaping services and furniture moving services. I made roughly $15/hour mowing lawns, weeding yards, and pruning bushes. I would bring a radio and lanscape away. You can;t be afraid to get your hands dirty! The real money maker for me was furniture relocation. I make $25/hour pretty consistently and never had trouble finding clients for weekend work. I advertised on Craig’s List and even set up my own website. It was a hard way to make money, but you can’t beat $25/hour!

Rarely ate out

I remember time after time, friends asking me to go eat out at restaurants. And I remember time after time saying “No thanks!” I’m sure some thought I was being rude, but I had a goal and a silly thing like eating out was not going to stop me! I packed brown bag lunches and brought snacks from home as many times as I could. Thank you Mom!

I had a cheap hobby

Having a cheap hobby is critical during college. My finances were tight so I didn’t want to get into any expensive hobbies. Mine ended up (and still is) being bodybuilding. Since I worked out at my college gym, it was free. Also, food wasn’t that expensive due to living at home.

Shopped at Ross for clothes

Ross is still my favorite place to shop! When everyone around me was buying $200 designer jeans, I was buying $20 Levi’s. I’ve never been a materialistic person, so maybe that helped. I’m not going to lie, I was definitely tempted at times to buy expensive clothes. To be honest, it’s not worth it. Over the years, I’ve learned that improving your personality is far more important than trying to impress people, let alone, people you don’t even know.

Attended an in-state University

When I was researching colleges, I considered out of state schools. But I just couldn’t justify the cost difference. University of Washington was $6,000/year where as most out of state schools averaged $20,000/year. Quite the savings huh?

And there you have it guys! These are tried and true ways I graduated college with zero dollars of debt. It is possible! Comment below if you have more tips.

It’s not rocket science, but it’s a well known fact that wealthy people inherently think differently than poor people. How wealthy people got to this point of thinking differently is beyond me, I’ll leave that for the psychologists to figure out.

I recently read “Secrets of the Millionaire Mind: Mastering the Inner Game of Wealth.” The author, “T. Harv Eker, has a fundamental belief that wealthy people think very differently than poor people. This might seem obvious at the surface of the matter, but it goes much deeper than that. Eker believes that each one of us develop a unique financial blueprint over time. This blueprint is the result of mass marketing, parental influence, education and all sorts of other factors.

Here are 17 ways Eker believe wealthy people think differently than poor people:

1. Wealthy people believe, “I create my life.” Poor people believe, “Life happens to me.”
2. Wealthy people play the money game to win. Poor people play the money game to not lose.
3. Wealthy people are committed to being rich. Poor people want to be rich.
4. Wealthy people think big. Poor people think small.
5. Wealthy people focus on opportunities. Poor people focus on obstacles.
6. Wealthy people admire other rich and successful people. Poor people resent rich and successful people.
7. Wealthy people associate with positive, successful people. Poor people associate with negative or unsuccessful people.
8. Wealthy people are willing to promote themselves and their value. Poor people think negatively about selling and promotion.
9. Wealthy people are bigger than their problems. Poor people are smaller than their problems.
10. Wealthy people are excellent receivers. Poor people are poor receivers.
11. Wealthy people choose to get paid based on results. Poor people choose to get paid based on time.
12. Wealthy people think “both”. Poor people think “either/or”.
13. Wealthy people focus on their net worth. Poor people focus on their working income.
14. Wealthy people manage their money well. Poor people mismanage their money well.
15. Wealthy people have their money work hard for them. Poor people work hard for their money.
16. Wealthy people act in spite of fear. Poor people let fear stop them.
17. Wealthy people constantly learn and grow. Poor people think they already know.

So, what do you think about this list? Any disagreement here? Please comment below with your thoughts.

-JE

One of my favorite websites, Budgets are $exy, organized a challenge to anyone on the quest for the big “million.” Welcome to the Million Dollar Club. Today is the day I announce my membership into this elite club. Ok, well maybe it’s not that elite haha, anyone can join!

With a goal you have to take very deliberate steps to make it happen. For me, writing things down and seeing it on paper helps me visualize the goal in my head.

I have a goal of retiring with a couple million dollars across my retirement savings accounts. Unlike the average American, my goal isn’t to retire so I can travel and spend my money until I keel over and die… I’d rather use my money to help people less fortunate than myself, spread the Gospel, volunteer, and make an impact on people’s lives. At the same time, I don’t want to retire at a late age and be broke. Thankfully, God has blessed me with a promising and fulfilling career path. It’s my duty to be responsible with what God has given me.

To achieve my goal of becoming a millionaire, I have outlined some steps to make this happen. Although your situation might be different than mine, certain aspects of the following steps will be similar to steps you might take.

My personal To-Do list:

1- Max out my Roth-Ira at $5,000/year. I’m with Vanguard and hold a simple group of assets: US stocks index, total bond index, and international index.

2-Pay off the last $5,000 on my auto loan. My goal is to pay this off in the coming months and keep my car for 10+ years. It’s a 2004 Acura TL with 80k miles, so it should last a long long time.

3- Take full advantage of my employer’s 401k matching plan. Goal is to contribute $10k of my own money and my employer to match. I will commit to investing at least $10k/year and raising this amount if I’m able to in the future.

4- Invest every dollar of every company bonus I receive. What better way to treat yourself than to invest your bonus and possibly retire months or years earlier?

5- Sell all my unwanted stuff. I’m huge into living life as a minimalist. My rule of thumb is if I haven’t used something in a month, I sell it if I can.

6- I will take full advantage of credit card offers and make as much money off these companies as I can without incurring a cent of owed interest to them. Cash back, hotel points, air miles, it all adds up. Since I’ve started, I’ve made roughly $1500 a year in credit card rewards and bonuses. Over 30+ years, these few dollars now will be a large number later.

7- Avoid purchasing items that are not necessities. Do I want a 50″ plasma television? Sure, that would be sweet, but do I need it? No, definitely not. The key here is to think twice before I buy expensive items.

8- Check my accounts on a daily basis and keep track of my financial progress and goals. I use Mint.com to help with this.

9- Live frugally and seek discount on everything from clothing to groceries. This means using coupons, site like Groupon, and waiting until the off seasons to buy clothes. I’m willing to take a hit to the pride and make a million bucks.

10- Keep working away on Free Money Wisdom. I’m new to blogging and have a passion for helping people with personal finance. I’m excited to not only help people but also make some side money along the way.

I’m well on my way. Using CNN’s millionaire calculator, I should make my first million in 14 years at age 37. My goal is to retire at age 55.

And there it is. Before you, my 10 pledges I’m making to become a millionaire. Like anything in life, this will take perseverance and sacrifice. BRING IT ON!

Finding my credit score used to be a confusing process for me. Blog after blog has sent me in very different directions, and many links have pointed me in the direction of scam companies. Getting your credit score should not be hard. After much research, I have come to the conclusion that finding your credit score depends on what kind you’re looking for, as various websites provide you with a different type of report.

Here are the basics you should know. A “credit report” is different than a “credit score.” A credit report only details the state of your credit but does not give you an actual score in number format. A credit score will provide you with a concrete number.

Here are the three types of paths you can take:

1-Credit Report. The federal government has mandated that every American can see their credit report free of charge once a year from the top 3 reporting companies. Remember, only use AnnualCreditReport.com for this purpose. All others are scam artists and a waste of time/money.

2-FAKO Scores. FAKO scores are estimates and do not represent your real credit score with 100% accuracy. They are a rough resemblance of your actual credit score. Go with CreditKarma.com for your FAKO score.

3-Real FICO Score. This is your actual FICO score calculated using the Fair Isaac algorithm method. You do have to pay for this score, but is well worth the money one a year or so.

-JE