How I Got Screwed by my Lack of Patience

lack of patiencePatience has never been one of my strengths.  I can think back all the way back when I was a kid and even the long road trips for family vacations irritated me.  I’ve always been someone who wants things to get done quickly with very little waiting around.  I could excuse myself by saying that I need that type of mentality because I work in the construction industry where schedule is EVERYTHING.

However, that would just be a poor excuse.  I’m a sinner like everyone else.  I mess up and let my lack of patience get the better of me.  It’s never a good ending when you are impatient. Thankfully God has stuck by me and helped me grow in this area.  Without the grace of God, I would be a lot worse off!

I was thinking about this article and how I would relate patience back to personal finance.  I even thought about writing something that made me look good.  But, I’ve decided to do something else. I’m going to share with you a story of how my lack of patience slapped me in the face and lost money.

It starts with a “want.”  This want was a desire to buy a luxury desk chair.  With the increase of hours managing this website, I thought investing in a new desk chair would make sense.  This is a great premise but it goes downhill from here…


The beginnings

I go to a small church just north of downtown San Diego.  Near my church there is an  industrial  district with outlet stores.  I’ve always seen signs advertising discounted prices and “one day only” sales.  Many of these stores are  furniture  outlets and others are carpet liquidators. When I started thinking about my desk chair purchase, I began to notice a certain office chair outlet store.  Imagine an entire store dedicated to office chairs!  It really got me excited.



One weekend I decided to visit this office chair store.  I had looked them up online and found out that they had a massive selection of office chairs.  So, why not, right?  The moment I walked in I was attacked by two salesmen.  No one was in the store so I think they were desperate for some commission.  They toured me around and asked me what I was looking for.  I told them I didn’t know and I perused the store until I stumbled onto the most comfortable chair of my life.  You can check out the chair here.  Not only was it a cool looking chair but it was super comfortable.


Price tags lie

The next thing I noticed was the price.  It was retail for $400 with a discount down to $200.  I thought it was such a steal!  Since I was at an outlet store, this had to be the lowest price anywhere!  I was confident in my purchase and happy with the price point.

I got home and cut the tags off.  I was excited to sit in my new chair!  I was curious about the company that made the chair and did a quick Google search.  The first thing that popped up was a link to Amazon for $150.  My stomach sunk.  I had just been had.


No excuses

At first, I felt anger towards the outlet store.  But then common sense took over and realized what had just happened.  I broke my own policy when buying expensive products.  Always do your research before you buy something!  I willingly  purchased  the chair at an outlet store at the more expensive price.  No excuses, I made a mistake.  Times like these are good reminders about taking your time when buying products.  Don’t be like me and let lack of patience slap you around.


Lessons learned?

So, what can you take away from this experience?  Well, I came up with a short list.  Use my poor choice to your advantage and don’t make the same mistake I made!

-Research prices before you go out to stores.  Often times, online retailers will have the cheaper price.

-Don’t buy a product just because it’s “on sale.”  It might not be that good of a price.

-Have patience when it comes to buying expensive items, it will pay off in the end.

-Walk away and take some time before buying something.


I hope my honesty helps you in some way.  Take this experience and don’t make the same mistake! Man, the things I could have done with $50.  Here in San Diego that’s a whole tank of gas!

Is Your Local Retailer Out to get You?

retailerDoes your local retailer deserve your business?   For many consumers, local retailers are certainly a good aspect of the local economy, and for good reason.   However, you might want to be careful if you see some of the following signs present at a local business.


Customer Service

Some people strongly associate customer service with local business.   After all, local retailers will generally take the extra step to connect with their customers.

The contrast can be strong with regard to larger businesses.   In fact, the same general group will often look down upon these businesses, preferring the quality service and experience that can be obtained with a local retailer.   Offering the image of the small town feel❠that local businesses bring, whether or not it’s a small town or city, is generally a selling point for the consumer.

We have all had negative experiences with a local retailer.   It is often the single easiest item to recognize â“ the retailer that doesn’t have your best interest in mind.

A local retailer should take that extra step to ensure your experience is of the highest quality.   A great local retailer will ask the right questions and get a sense of your needs â“ and perhaps give you that small town feel with a genuine conversation (that isn’t all about business).


The Local❠in Local Business

What makes a great local business?   How about the local❠part?

Local businesses that don’t strive to be a valuable part of the community â“ likely aren’t.   Let’s face it: many local businesses will thrive due to their interactions within the community, as we just saw in one dimension.   Yet, if the business and ownership doesn’t care about the needs of the community, it might give you some insight about the business itself.

Selfish businesses can exist in any town or large city.   Top-level local businesses will want to be a part of the community, help where they can, and do what it takes.   Does your local retailer have these altruistic qualities?


Can They Compete?

Let’s face it: if your local retailer can’t offer decent prices, will you become a regular customer?

There is a certain harsh reality to local businesses, so to speak.   Imagine a local computer store that simply can’t compete.   In other words, they might have a decent selection of computers, and even newer ones at that, but if they are continually outperformed by the bigger businesses â“ what’s the point?   You would do much better to save decent money from the larger business in your area, or get what is perhaps the best price anywhere, online.

While we would like to have a little sympathy for the local retailer, businesses must be able to compete with prices elsewhere.   A promising local retailer will do just that, along with discounts and other items to allow the business to thrive.   A good retailer understands that the everyday Joe survives on a tight budget. Mix that with local interaction and top-of-the-line customer service, and there you have it.   Many would give the local retailer the benefit of the doubt if the prices are near the competition â“ but everything else is there.

(This has been  a guest post by Lisa at Health Insurance Comparison, an Australian personal finance blog that provides money-saving health insurance options and ways to optimize your spending habits.)

Betterment Interview With CEO Jon Stein

jon stein bettermentYou may have seen ads around this blog before.  In fact, I have one up on my sidebar right now.  Betterment is one of the few companies that I support and recommend all my readers to utilize in their total financial portfolio.

I was approached a while back to interview Jon Stein and took the opportunity to do just that!  I had the chance to ask some deeper questions than usual.  Jon Stein was a pleasure to interview and I love his passion for helping average Americans!  But first, here’s a short snapshot of his background from

Jon is the Chief Executive Officer of Betterment, which he co-founded in 2007. Prior to creating Betterment, Jon spent his career developing better financial products, platforms, and investment strategies for international banks, brokers and other financial institutions.

At First Manhattan Consulting Group, he counseled a number of the world’s most prominent financial institutions on issues ranging from product design to strategies to mitigate the risks inherent in their products. Jon is a Chartered Financial Analyst (CFA), a Series 7 and 24 Registered Securities Representative, and a graduate of Harvard University (Economics) and Columbia Business School.

He has appeared on NBC, Bloomberg, and Fox and quoted in the New York Times, CNNMoney, and Investment News. His interests lie at the intersection of behavior, psychology, and economics. What excites him most about his work is making everyday activities and products more efficient, accessible, and easy to use.

Hopefully this Betterment interview gives you some more insight as to what Betterment is about and how their services can benefit you and your retirement goals.  Sit back and enjoy the following interview!

Hi Jon, thanks for this opportunity to interview you! I’m a huge supporter of what you’re doing over at  But first, tell us your quick background story. How did you get to where you are today?

At Harvard, I studied psychology and economics. So I’ve always been passionate about helping people make smart decisions with their money.

When I graduated, I had a little cash and I wanted to invest it. My first purchase? Enron. I knew better, and still I didn’t follow the best teachings of modern finance â“ diversifying, re-balancing, indexing.

Then, I spent years working as a consultant for big banks, and found that typical financial products were optimized for corporate profits, not for real people’s goals. Friends would ask me, What should I do with my money?❠Seeing no good answers, and knowing that Wall Street was not looking out for the average individual investor, I felt I had to create a better way.


What is the history of How did it start and what has the journey looked like up to this point?

In 2007, I left my cushy banking job and enrolled in the MBA program at Columbia. I knew I wanted to start a company â“ Betterment â“ I had the name already â“ but the details were still taking shape.

In August 2008, I brought in a few great colleagues who were experienced in financial services, technology, and law. So began our 2-year journey through regulators and technology. We actually finished our site a day before we launched to the public â“ it was down to the wire. We officially launched at Tech Crunch Disrupt in May 2010, where we were voted Best New York Start-Up.

Through my education and in working with large financial institutions, I learned a few things, one of which was that I was no smarter than thousands of others looking at the market, and I didn’t have better information. I was best off applying the concept of Modern Portfolio Theory â“ that there’s no better portfolio to own than the market portfolio â“ than trying to beat the market. So the principles of Betterment were in place long before we had a product.


What is the vision for Betterment?

Betterment’s vision is to make smarter investing accessible to hard-working, busy people like you and me â“ to make Wall Street work for the rest of us.


What is the structure of Betterment and why do you recommend it to the average American?

Betterment is smart investing made easy. We blend the simplicity of an online bank account with the higher long-term returns associated with investing in stocks and bonds. You can quickly and easily transfer money from your checking account by linking it to Betterment electronically. There are no minimum balances, no transaction fees, no holding periods, and no hidden costs. You’ll just pay a low annual management fee of 0.3% â“ 0.9% of your average balance.

As far as your portfolio, you’ll be invested in a blend of stock and bond Exchange Traded Funds (ETFs). With stocks, you’re invested in index funds that are chosen to reflect the U.S. economy as well as some select markets around the worldâ”it’s like owning a little piece of every company in America and then some. Your bond investment is made up of U.S. Treasury bond ETFs that are backed by the U.S. Government. You get to choose a blend that gives you the broadly diversified portfolio that’s right for you. We’ll also automatically rebalance the allocation you set in order to maximize your returns.

The coolest thing about our structure is that we are both a broker/dealer and a registered investment advisor. Because of this we can provide people with sound financial recommendations and the tools to implement those recommendations all in one platform. In just a few clicks of the mouse, your assets can be broadly diversified and invested toward your long term goals. And each of your goals can have a different plan. You set the timeline and asset allocation for each, and we advise you on how much to invest to make your goals reality. Whether you are investing for retirement or saving for a house â“ or both â“ we have you covered.

The other awesome thing is how efficient our platform is, since it’s all automated and built on the latest technologies. We pass the savings on to customers.

It’s the best way to invest â“ the highest risk-adjusted returns for the lowest cost. You save a bundle versus paying brokers to do all this stuff for you, and you don’t pay some guy in a suit to give you so-called advice.❠You invest in a smart way with tens of thousands of people like you. What could be better?


What are the choices for a typical investor?  Can you give us a brief synopsis of how a typical investor would go about starting an account and getting started?

Starting an account at Betterment could not be simpler (or faster). All you do is link your checking account, set your asset allocation using a slider, and then relax and let your money grow. There is no minimum balance and no paperwork to fill out. In about 5 minutes you can start your journey to become a better investor.


Is there any catch❠in terms of fees or trading costs?

At Betterment there are no transaction or trading costs and no hidden fees. All you pay is a low annual management fee of 0.3% to 0.9%, depending on your balance. For a balance like $100,000, the annual fee is $750, which is far less than folks pay for in-person advisory solutions, and all the execution is included.


For the readers out there, what type of protection do you provide investors in terms of insurance?

Betterment is an SEC Registered Investment Advisor, and Betterment Securities is a broker-dealer regulated by FINRA and the SEC. The securities in your account are protected up to $500,000 by SIPC. Betterment is simple and transparent. Your money is invested in well-established funds, chosen for their good management, efficiency, and long track records.


What mistakes do you see investors make and how does Betterment help investors avoid these mistakes?

Some common mistakes that come to mind are buying when the market is low and selling when it’s high, remembering our winners and forgetting our losers, and failing to adhere to good investment practices like re-balancing and dollar cost averaging.

Through our platform, we encourage our customers to invest for the long term. Accounts are based on goals and we ask for specific time lines to those goals. By focusing on long term investing, we steer customers away from trying to beat the market and from those irrational daily impulses. In addition we automatically re-balance all customer portfolios every quarter or any time an asset allocation moves 5% away from its target. And finally, we offer automatic deposit which allows customers to take advantage of dollar-cost averaging. By making automated, regular contributions to your Betterment account, you avoid costly and common timing mistakes.


Say, I open an account and start investing with Betterment. How do I adjust my asset allocation or is this automated?

Adjusting your asset allocation is extremely simple. Within your account you will find an asset allocation slider. You move the slider between stocks (more risk) and bonds (less risk). We encourage you to set the allocation you desire to start, and then sit back and relax. Frequent asset allocation changes typically don’t lead to higher returns. We regularly check to make sure your allocation stays on target, and automatically re-balance quarterly as well as any time it strays more than 5% away from that target.


With many people on I-phones and android devices, is Betterment integrated electronically to make balance adjustments or receive notifications?

We have an iphone app so you can do all the cool things you do on the computer right from your mobile device. You can add and withdraw money, set your asset allocation, and check your account activity right in the palm of your hand.


I’ve heard you use the saying social finance.❠What do you mean by that and what does it mean to investors?

At Betterment we are a community of savers invested in the broad stock market together. We provide tools such as peer comparisons to help each other make the right choices. You’ll be able to see for yourself how others like you (in your same age bracket, earning the same income, and with the same gender) are investing so you can compare and learn as you go. So if you aren’t alreadyâ”you’ll soon be an investing wiz.


Does Betterment offer training and education resources?

Our website provides a wealth of information about investing and why we’ve chosen the Betterment portfolio. If you aren’t familiar with ETFs, you can access our FAQ and get all of the information you need. Or perhaps you are an active investor who wants a little bit more knowledge about our portfolio. You can find a downloadable prospectus for each fund right on the website. Most importantly, we are always available to take customer calls and emails. We have a devoted customer service team, and we make sure that everyone at Betterment interfaces with our customers. If you have a question about your account, you might end up chatting directly with me!


What type of growth have you seen with Betterment and where do you see Betterment 10 years from now?

I am so happy with the growth Betterment has experienced thus far. We have more and more customers every day, and in just 6 months we have tripled the size of our team and quadrupled the size of our customer base! In 10 years I hope to see Betterment providing ideal investing solutions for tens of millions of people like you and me.


Jon, thank you so much for your time!  To end this interview, I have one last question for you.  What one piece of advice would you give my readers to be successful with their investments and retire without money worries?

Thank YOU, Jon. It’s a pleasure. The one piece of advice I can give your readers is to start now. Did you know that if you start saving for retirement when you are 25 instead of 35 you could end up with twice as much money?

It is important to focus on the long term, and if you want to maximize your investment returns and retire with cushion, invest in a diversified, liquid portfolio. Set it and forget it, and you will see your money grow.


Want to find out more?

I’m sure you’re super interested in what Betterment has to offer.  Who knows, you may even be starting the journey of saving for retirement and don’t know where to invest?  Betterment is the place to go if you’re feeling lost.  In fact, they are offering a $25 signup bonus right now just for singing up!  you can click the banner below to go straight to the bonus!

If you’d like to know more on their services, I wrote a review a while back explaining a little more in depth about what Betterment provides.  You can access that interview here.

Photo by TCDisrupt

Ultimate Guide to Grocery Store Savings

grocery store savingsWorking as a helper clerk at QFC for three years, I acquired a great deal of knowledge about the products sold inside of a grocery store. I also saw first-hand how people shop and the amount of money they spend on each trip, much of which was unnecessary. As a part of my job, I was tasked with stocking inventory on the shelves, which was directly connected to how well the product sold and what price it was at.

So, here are some tips for those of you who are looking to increase savings every time you go to fill up your pantry:


1. Read grocery store advertisements like businessmen read the Wall Street Journal

Grocery stores pay a lot of money to put their ads in the newspaper, and there is a reason for it. Some of them have great offers that are often overlooked. If you want to shop smart, you have to educate yourself, especially if you have several grocery store chains located within the same vicinity vying for your business.

Constantly check them and compare to see who is selling what and at what price. Don’t be fooled by the adjectives or adverbs they use to describe their prices. It’s pure math. Easier it’s less or more than another price.


2. Carry around coupons

Coupons seem tedious and more suitable for a petulant Baby Boomer, tearing them out of an ad or newspaper with a pair of rusty scissors. But coupons can help trim down costs. They’re the proverbial pebbles which fill up the bucket of water for the crow. But there are a few things to keep in mind so you don’t get irritated having to deal with it, because it can be painstaking at times.

One, you need to keep them organized. Stuffing them in a disorganized drawer in the hopes of being able to find that 50 percent off for a pack of beer the day it expires is not the approach you want to take. Categorize them by their expiration date and what product its for. Discard expired coupons, in the event that your 91-year-old grandmother finds it and tries to use it at a Bartell’s.

Two, read the fine print. I say again, read the fine print.  And trust your instincts. If the coupon or ad seems too good to be true, it generally means either it’s not true, or it’s in a hideously limited supply which has already run out by the time you’re finished reading the ad itself.


3. For bread and dairy products, look for the “Manager’s Special”

At QFC, one of my responsibilities was to go through the entire dairy section and look for items which were approaching their sell by date. Those items were then marked 50 percent off with a “Manager’s Special” sticker and code. The bakery employees also do this with their bread products.

If you’re looking for bread or dairy to eat within a day or two, this option is fantastic, especially with the rise in prices for dairy. When I first started working at QFC in 2005, yogurt was around 50 cents. Now, it’s around 60 cents, when it’s on sale. A few days ago, I was looking for something to buy for lunch, and I found a large tub of yogurt for one dollar and 40 cents on “Manager’s Special.”

In case you are worried about expiration dates, remember there are two types of dates; sell by and expiration dates. A sell by date is the day the store is required to sell the item. If it does not sell, then they must take it off the shelf, and usually it is donated to a local food bank. An expiration date is the day the item itself goes bad and is no longer healthy to eat. Usually, the store has both dates on the product and are roughly separated by a week.

So don’t worry about buying a “Manager’s Special” item for health concerns. Dairy item will be good for at least a week, though I would recommend you eat it sooner than that. Bread I would eat within a day.


4. Ignore the “buy five, get one free/half off” sales pitch

Unless you intended to buy a large quantity of the product regardless of the sale, you’ll end of spending more money than you intended to, making the whole savings concept pointless. The point is for you to save money, not spend more money just because you’ll save on spending you wouldn’t have done otherwise.


5. Wait for expensive items to go on sale, then fill the cart full

The best sales are the ones where the product is at least 20-30 percent off. 50 percent off is a gold mine. Clearance items are Fort Knox.

However, referring to what I said earlier, unless you actually use the item in question, don’t buy it. There is no point in buying something just because it is cheaper than it was before.

As a rule of thumb, if you like a product which continually gets more and more pricey, hold back until it goes on sale, and then stock up on it. I always hold back on my favorite soup, which is now $3.15 a can, and instead wait until it is four for six, or $1.50.


6. Give the generic/store brands a try

Depending on your financial situation and food preferences, generic brands are ideal because they’re generally the cheapest. At QFC, Kroger and QFC brand foods and products were always substantially cheaper than the regular brands. In some instances, this is not a problem, because the products do not have much of a difference.

Some, however, vary in quality, so it is a question of how hungry, or frugal, you are. For other national chains, Fred Meyer and Safeway both have store brands as well.


7. Big brand store chains are not always the least expensive

Going to college at Eastern Washington University in Cheney, Wash., I was a bargain shopper living on a tight budget. Therefore, I was very selective about where I did my shopping, and had grocery ads flooding my mailbox. I received all sorts of coupons from Macys coupons at Mypoints to penny saver ads with CVS coupons.  I was surprised to find that the Safeway did not actually have the best sales. Instead, it was the local trading company grocery store, which sold many items for half the price. Moral of the story; don’t simply shop. Do your homework beforehand.


8. To buy or not buy in bulk

I have spoken to a lot of people about buying in bulk from places like WalMart or Costco and the truth is it is not always the solution. These places definitely cut costs by selling en masse to consumers, rather than individual packages. The issue, however, is whether or not this will curb your costs are increase them. It can be ideal, because you can buy a large supply of food for much less than you normally would at a small local grocery store.

Yet, having shopped at the Issaquah Costco every day after church for years and years as a child, I believe most people tend to buy more than they need or intended to and, thus, spend more money. In a store that is, for all intents and purposes, really just a giant warehouse crammed with every desire of the human heart, there is a terrible temptation to buy everything you see and not realize the price once you see the number appear at the cash register. At that point, most people will be too embarrassed to bail items from their cart like cargo from a sinking ship.

I have not shopped at WalMart as frequently, but if you have ever watched South Park’s episode on it, you’ll understand what I’m getting at.


Go out and shop smarter!

Therefore, the question you have to ask yourself before shopping these places is “how much do I need?” as well as “do I have willpower to resist purchasing more than I need?” If you are buying for a group of five or more, Costco and WalMart are where you want to go for bulk food. Anything less, you might want to run some calculations to determine where you’ll spend the least.

Lastly, some grocery stores, like Safeway, have gas rewards programs for shopping inside of their stores. Money spent inside of the store goes towards points that can be redeemed for gas, ranging from 10 cents off to a dollar off per gallon. Membership at stores like Fred Meyer and QFC can be used to save 10 cents off every gallon at Shell gas stations. This gives big store chains somewhat of an advantage over local stores.

Best Gift Ideas for Men Under $100

gifts for menLet’s face it ladies: shopping for a guy is not always easy. In fact, depending on the individual, it can be an almost impossible task. No matter what the occasion, finding the right gift for the man in your life requires thought, especially if you want to keep it below $100. So what are the best gift ideas for men under $100? Here are a few suggestions.

Before you can being shopping you have to consider the man. Does he wear suits or jeans to work? Is he into polo or rock climbing? Does he prefer the outdoors or the indoors? This gives you a place to start from.

The white collar type:

 heated shaving foam dispenser
 cuff links
 gift certificate to a men’s clothing store
 gift certificate to a spa (yes, men go to spas, too)
 a nice pair of sunglasses

A great site for white collar gifts is Red Envelope.  With their wide range of gifts, you are sure to find something that works for your business man.  They offer everything from fancy sports memorabilia to watches.  You won’t be  disappointed!

The blue collar type:

 golf lessons
 a couple of new fishing poles or assorted fishing gear
 a nice pair of sunglasses

The rugged  outdoors man:

 a new backpack
 a sports watch
 a skydiving lesson
 a compact outdoor grill or a compete set of grilling tools
 time at a shooting range
 a rugged pair of outdoor shoes
 a pair of rubber waders
 a nice pair of sunglasses

The sports enthusiast:

 tickets to a favorite sporting event
 a year’s subscription to extra sporting channels
 a piece of sports memorabilia
 decorative pieces of their favorite sports team
 gift certificate to a sporting goods store
 a nice pair of sunglasses

The health enthusiast:

 gift certificate to an organic store
 gift certificate to a vitamin/supplement store
 a nice sports watch
 workout DVDs of something they are interested in (Tai Chi, Yoga, etc.)
 trial lessons at a marital arts studio
 you guessed it: sunglasses

If they like to work on things, get them tools. Any man who loves tools will tell you that you can never have too many of them. If you don’t know what they need, or want, or if you don”t want to try to figure it out, a gift certificate to a big box retailer will suffice.

Have they ever dreamed of driving a special type of car or truck, but have never had the opportunity to own one? Rent them one for the day. Let them experience what it’s like to cruise around in their dream car for a day.

Do they like the theater? Tickets to a special event will be well received. Who knows, they might even ask you to accompany them.

If he enjoys entertaining, give him an assortment of special beverages. This is something that he can enjoy for quite some time. Whether it’s a special occasion or just unwinding after a hard day, he will thank you over and over.

Regardless of his lifestyle or habits, every man would appreciate a nice portable iPod. Maybe have some of his favorite songs thrown in as an added bonus to get him started.

Three Tools to Teach Your Children Financial Responsibility

teaching kids financial responsibilityParents who find themselves relearning financial responsibility often have trouble passing down these new skills to their children. Here are three tools you can use to make sure financial responsibility doesn’t end with you.


Give Your Child an Allowance

I’m often asked if children are too young to get an allowance. Although each family needs to take actions that are best for their own family, I believe that children begin a fuzzy concept of money even before they can walk. They watch you exchange it for food, swipe cards for gas, and put coins into machines that return small toys. It only makes sense that to teach them to be responsible with money, they need to have money.

There are varying ideas about how to give your child an allowance. Some families pay for chores, and others only pay for extra chores.

Another method of giving out an allowance is to pay a portion of the parent’s salary to the children. This is usually tied to an understanding that they must cover their own activity fees and entertainment costs.

When my oldest daughter was a toddler, we collected aluminium cans in grocery sacks. At a very young age, she learned how to crush the cans and carefully store them. When we took the cans to the recycling center, the money we received was given to her as an allowance. As a result, grocery sacks are still called “allowance bags” in my home.

One word of caution when giving a younger child an allowance. They do not have the concept of time down very well. So if you are paying them for a chore, it should be paid out immediately rather than held over for the week or they won’t really understand why the money is being given to them.


Children Listen to Your Words

Even when you don’t hear your own words, your children do. A very powerful “aha” moment for me was hearing my son tell me he thought I should get a job. I didn’t understand where his words were coming from until he explained to me that I often turn down his requests for money or certain activities with the words “We can’t afford it.” It made sense to him that if we can’t afford things with me working from home, that I should try to get a job outside of the home trading dollars for hours.

In reality, we can afford many things but we choose not to use all of our funds in certain categories such as entertainment and dining out. Adults call this financial responsibility but our children might just call us “cheap.” A money coach,  Morgana Rae, gave me some wonderful alternative words to use. Instead of using the “c” word (can’t), I now inform my children (and any pushy sales people) “It is not a financial priority for me at this time.”


Peanut Butter Jars

This simple phrase proves to be very powerful financial tool in my household as it is really difficult to argue with priorities. Another tool that we use is a collection of peanut butter jars. These are great tools to use from the moment a child can pick up a coin.

Each child has three jars; one is labeled “Mine,” another is labeled “Mine for later” and the other is labeled “To Give Away.” Whenever they get an allowance or a gift of money, they put a portion of their money into each jar.

The actual percentages that your child puts into each jar depends on your family’s own financial priorities. One Mom I worked with taught her children early on to save 50% of their income and divide the other half between themselves and the church. Can you imagine what the world would be like if everyone developed the habit of saving half of their earnings?


(This has been a guest post by Brenda Trott.  She is a parenting coach who has worked with young children and their families for over 20 years. Her blog  is designed to enable parents with tools to feel organized and in control.)

Creating a Spending Journal: Tips for Budgeting

spending journalWondering where your bank account has gone?   Individuals and families who don’t do the best job in the budgeting department can arrive often move along through a vicious cycle of living paycheck to paycheck, because they’ve neglected to budget their money. If you’re wondering how your money seems to disappear shortly after each perhaps a spending journal could be the answer.


The Useless Budget

Your budget might be useless.   If you have no knowledge of how you’re spending money, where it’s going, and how your finances look by month’s end (budgeted amount vs. actual expenses) â“ you might be wasting your time with your current budgeting strategy.

A budget is something like a credit card statement, so to speak.   In other words, you should not just update your budget, fill in the expected category values with idea numbers, and then even fill in what you’re spending.   You have to put it into action: your budget should serve as a guide, a conversation❠of sorts between you and the numbers.

It may seem a little odd to explain it in that way, but it’s true.   If you aren’t engaged with your budget, looking through the numbers and seeing how you’re doing, you might be wasting your time.   The budget serves as a guide, giving you perspective into your income, expenses, savings, and furthermore.


Using the Spending Journal

Whether it is or isn’t part of a formal budget, a spending journal can give you that perspective.

Imagine if you wrote down anything that you spent money on â“ from your groceries to your morning visit to the coffee kiosk, and even your actual bills â“ all noted in your spending journal.   And add the option to attach a category onto the purchase, which would allow you to itemize and sort the payments.   What would that do for you?

At the end of the month, you would have a list of all the purchases you made, from the expected ones to the compulsive ones that undermine your budget. This is the idea of the spending journal; it is a simpler form of the budget⦠and it could be all you need if keeping track of income isn’t complicated.

As you look at your spending habits, you’ll be able to find areas of improvement.   Maybe you’re spending too much on coffee in the mornings, or eating out (always an area with potential.)   This is the type of tool that can keep your spending habits in check, and allow you to concentrate on your saving/investment goals, and whatever is pressing at the moment (debt, buying a home, etc.).



Well, of course you can keep the journal as a true journal.   Those that prefer the old fashion way of doing things can still log items in via the pen and notebook.

Technological individuals have a number of options.   You could keep your spending journal on a spreadsheet or get a free personal finance budgeting program. There are a number of free options online, or available through software you can install on your computer. If you have a smartphone, you could easily keep track of your expenses when you’re on the go â“ very convenient, as you can imagine.


It’s really up to you!

Regardless of how you keep a spending journal, this powerful tool can offer plenty of potential.   It’s up to you as to how useful it can be in your financial situation.

How do you plan your spending each month? Do you find that a set-in-stone budget is a must-have for financial success? Share your tips with us â“ leave a comment below!

(The following is a guest post by Lisa at  Wallet Watcher, an Australian personal finance blog created to help readers figure out how to save money and watch your own spending habits.)

The Trouble with Tithing

trouble with tithingAs Christians we’re called upon in scripture to be generous both to our churches and to those in need. That giving is often codified into the tithe, generally interpreted to mean 10% of your income. There are many open questions in regard to tithing, including should you tithe based on gross or net income or whether or not the contribution should extend to include an equal portion of unearned income, such as capital gains.

We can spend as much time as we like debating the finer points of tithing, but perhaps the bigger question is the tithe itselfâ”are we truly required to tithe and what troubles might be involved if that’s how we believe we need to handle our giving? Troubles? What kind of troubles?

Misinterpretations, first and foremost. That we’re to be generous in our giving is beyond questionâ”the issue is whether or not that giving takes the form of a legal requirement with very specific guidelines, as the tithe is thought to represent. From that we can and often do open the door to even greater misinterpretations that take us still farther from God’s intended purpose for our giving.

What are some of the tithing misinterpretations and what troubles may they bring?


Tithing is NOT a requirement for salvation

Notice that the issue of tithing doesn’t appear in the Ten Commandments, nor does Jesus make mention of it in the Sermon on the Mount. In fact, in the New Testament, where lessons on money and giving abound, there is no command to tithe. Where tithe❠appears, it’s usually incidental to another teaching. For example, in Luke 18:10-14, Jesus seems to be taking us in quite a different direction:

Two men went up to the temple to pray, one a Pharisee and the other a tax collector. The Pharisee stood by himself and prayed: â˜God, I thank you that I am not like other peopleâ”robbers, evildoers, adulterersâ”or even like this tax collector. I fast twice a week and give a tenth of all I get.’ But the tax collector stood at a distance. He would not even look up to heaven, but beat his breast and said, â˜God, have mercy on me, a sinner.’ I tell you that this man, rather than the other, went home justified before God. For all those who exalt themselves will be humbled, and those who humble themselves will be exalted.â

Clearly Jesus is telling us here that tithingâ”among other ritual actsâ”is not the key to salvation. The implication in the parable is that the tax collector didn’t titheâ”he didn’t do anything except throw himself on God’s mercyâ”and yet he went home justified before God.


We should never measure our standing before God by our giving

In prosperous cultures, there’s often a tendency to belief that money is the highest good, that we can gain access to what ever we need simply by writing a check for the proper❠amount. To a large degree that may be how things work in the world, but clearly the Kingdom of God works on different rules. From an eternal perspective it could be dangerous to assume that we’re walking with God mainly on the strength of a faithfully given tithe.

In Matthew 9:13, Jesus tells the Pharisees:

But go and learn what this means: â˜I desire mercy, not sacrifice.’ For I have not come to call the righteous, but sinners.â

Tithing is a form of sacrifice (giving something we value to God), but Jesus is making it clear that at a minimum, mercy is more important. This doesn’t mean that giving has no place in the life of the believerâ”it is stressed elsewhereâ”but it does mean that we have to be careful not to elevate it just because it holds a special place in the human realm.


10% may not be the right amount for everyone to give

It’s generally believed that tithing is the giving of 10% of ones income to the Church and to other Kingdom activities. But is this percentage set in Eternal concrete? For many poor and even working class people, giving 10% of their income may be an unsustainable burden. Conversely, for many of the wealthy, giving 10% would hardly qualify as sacrificial.

We have an example of this in Mark 12:41-44:

Jesus sat down opposite the place where the offerings were put and watched the crowd putting their money into the temple treasury. Many rich people threw in large amounts. But a poor widow came and put in two very small copper coins, worth only a few cents. Calling his disciples to him, Jesus said, â˜Truly I tell you, this poor widow has put more into the treasury than all the others. They all gave out of their wealth; but she, out of her poverty, put in everythingâ”all she had to live on.’ â

There’s an imbalance here that Jesus highlights as a message to his disciples and to us.


The corollary: Tithing is not some sort of God Taxâ

If we come to believe that the giving of a titheâ”of 10% of our incomeâ”is a Christian obligation, then we have effectively created a tax. Now in the Old Testament, that’s exactly what the tithe was, a tax to support the clergy and even other societal functions. However that was a time when mankind was under law, not grace, and acts of obedience and obligation were part of what defined the people of God. Is that still true post-Calvary?

The problem with elevating the tithe to a tax is that no one likes to pay taxes! If we see the tithe as a requirement, then we’re unlikely to be cheerful givers❠(2 Corinthians 9:7). Is this how the God who looks at the heart (1 Samuel 16:7) wants us to give?


We will not become prosperous because we tithe

There too many hints that prosperity can be had as a result of tithing. The danger here is that we might be tempted to tithe primarily for the purpose of personal gainâ”and we know that can’t be right. The scriptural basis for the prosperity interpretation comes from Malachi 3:10:

Bring the whole tithe into the storehouse, that there may be food in my house. Test me in this,❠says the LORD Almighty, and see if I will not throw open the floodgates of heaven and pour out so much blessing that there will not be room enough to store it.â

Now if we take that verse as a standalone declaration from God, the connection between tithing and prosperity is possible, but that’s not exactly what’s happeningâ”in fact that isn’t remotely what’s happening.

There are two obvious facts missing from the popular interpretation of Malachi 3:10. The first is that the verse itself is part of a chapter that deals not with the individual, but with the entire nation of Israel. As we know from the Old Testament, God is constantly trying to draw a renegade Israel back to Himself. He points out their sins and shortcomings (in this case a lack of generosity) and offers promises if they’ll repent and come back to Him. I believe that is the central teaching of Malachi 3, not any sort of promises or guarantees of personal prosperity if only we tithe according to Old Testament law.

The other point of contention is the promise, and what is it that God promises? Blessing. There’s no mention of riches! Blessings can be all kinds of things, including health, long life, large families and even favorable weather! In fact, in the very next verse, God defines some of those blessings as keeping away pests and vines that will not drop their fruit until it’s ripe.❠Now we can interpret that to mean prosperity in an agricultural society and perhaps it is, but nowhere are riches of any sort even implied.


We should never judge others by how much they give

If we consider tithing to be a command from on high, we can easily find ourselves sitting in the judgment seat, feeling superior to others who are less generous than we are. Conversely, if we aren’t able to give as much as others, we might be judged by them or even feel inferior to them.

In a twisted way, this is a process of elevating money to a higher position than it deservesâ”which itself is a form of idolatry. We have a commandâ”many of them throughout scriptureâ”to give and be generous, but when we assign a percentage benchmark we’re also creating a fixed standard by which to judge ourselves and others.


Giving can also be in the form of time and effort

Giving can be done in ways that don’t involve the transfer of money. In fact in biblical times people often had no money at all! We can give of our time and talents, and that can be even more sacrificial than writing a monthly check to the church. In Matthew 9:37 Jesus tells his disciples, “The harvest is plentiful but the workers are few.❠Jesus wasn’t calling for moneyâ”he was calling for workers!

That’s time and talent, and anyone can give those. There is no hierarchy establishing money as the preferred way to give, and by giving directly of our time and talent we can come that much closer to fulfilling a true command that is beyond interpretation:

Therefore go and make disciples of all nations, baptizing them in the name of the Father and of the Son and of the Holy Spirit, and teaching them to obey everything I have commanded you. And surely I am with you always, to the very end of the age.ââ”Matthew 28:19-20, The Great Commissionâ

What do you think about tithing 10% of your income? Was it an Old Testament law that no longer applies? Does it still apply today? What are your thoughtsâ”I could be all wrong about this!

10 Reasons Why I Blog About Personal Finance

personal financeI thought it would be cool to share a little more about me personally.  I would never want this blog to become so commercialized that you feel like a robot writes for “Free Money Wisdom.”  By the end of this article I hope you can  relate  with me on a more personal level…

It’s not that I have anything wrong with “selling out,” it’s more like I have a fear of letting profits drive this blog.  Yes, I make money from advertising, yada yada.  However, that comes with the territory.  I believe it’s possible to stay true to my vision here while making some money at the same time.

A great example is Crystal from Budgeting in the Fun Stuff.  She has grown rapidly, made tons of money and kept a personal touch on her blog.  I model much of what I do after her.  Another great example is Pat Flynn from Smart Passive Income.  Crystal and Pat are shining examples of what can happen when you refuse to lose focus and sell-out.  I love their attitudes and their drive to keep their blogs are personable as possible.

At the end of the day, I have a unique vision for this blog.  My vision isn’t to make you as rich as possible as fast as possible.  If you wanted that, you might want to go check out other blogs.  The vision here is a little different.  I want my readers to get out of debt, save money, and ultimately glorify the Lord with their resources.

If you didn’t know yet, yes, this is  Christian blog.  It’s probably one of the reasons I stuck with the blog before I was making any money.  When you have a passion for something that is greater than just money, it’s amazing what can happen.

You might be asking, “so Jon, why do you blog?”  Well, I’m glad you asked!  I would love to share with you my top ten reasons I blog and how it has changed my life:


1- Seeing financial lives changed

This one is huge.  I love getting emails from readers telling me about how one of my articles helped them transform their finances and get them back on track.  Now that is what I call inspiration!


2-Watching God transform my own finances

Since the inception of this blog, I’ve learned so much.  I’ve also been convicted of how I manage resources God has blessed me with.  God has flipped my view of money upside down.  Through this blog, I have learned how to manage my money well and make wise investment decisions.


3- I want this blog to be YOUR blog

I want Free Money Wisdom to be a blog that is bookmarked, shared, and talked about across the web.  I want my readers to come to this blog for financial wisdom and feel comfortable following my tips.


4- Mobile business model

Before I started this blog, I brainstormed businesses that were truly mobile.  I wanted to have a business where I could travel and work at the same time.  I wanted something like a Bank CD where my money was working for me instead of the other way around.   When I relax at the beach here in San Diego and have my laptop with me, I know I picked the perfect business!


5- Improve my writing

Look, writing has never come easy for me.  My Dad used to tell me, “son, if you want to be successful in the business world, become a good writer.”  This blog is providing a challenge to improve my writing skills and learn more about the English language.


6- Networking with like-minded individuals

You know how the saying goes.  If you want to be truly great at something, you have to surround yourself with like-minded individuals.  That’s where networking comes in.  Through this blog, I’ve met hundreds of like-minded individuals.  The biggest impact has been from the Yakezie network.  I would not be where I am today without the support of the blogger from that network.


7- Learn more about personal finance

I might know a lot about personal finance, but here is so much I still don’t know about!  That’s what’s exciting about personal finance blogging.  Although I consider myself somewhat of an expert, there is so much  information  out there I have yet to soak up.  I’m excited to learn more about one of my favorite topics.


8- Start generating passive income

I’m a huge fan of truly passive income.  My love for passive income probably stems from the fact that I have had hard labor jobs all through high school and college.  Grocery store loader, Pepsi loader, and even starting a moving business.  They have all been hard on my back involving lots of sweat!  This blog makes me money while I sleep.  I love that about this blog.  At the same time, I get to blog about something I love!


9- Keeps me accountable for my own finances

It would be  hypocritical  of me to give advice here and then do the direct opposite.  I’m not I could sleep at night if I did that!  This blog keeps me accountable and helps me manage my own finances by using my own advice.


10- Living out my passion

Lastly but definitely not least, I blog about personal finance because it’s my passion!  I have a passion to help others around me and get people on the track to early retirement so they can do other things besides work!  My free e-course “How to Retire a Millionaire” is a by-product of that. Check it out if you’re interested in learning more about what you REALLY need to know about retiring comfortably.  When your passion is to help people, it drives you.  I have no problem working long hours on this blog because I know what I’m about to write will impact someone reading it.


That brings us to a close.  Now you know what drives this blog and now you know a little more about me!  I hope you enjoyed this top 10 list of why I blog about personal finance.  If you’re a blogger and run a website, why do you do it?  Write up a post and share with the world why you do what you do.  I’m looking forward to seeing more of these types of posts in the near future.