Think Your Way to Wealth

If you're new to "Think Your Way To Wealth", get free updates on debt reduction, saving money, and building wealth by subscribing to the RSS feed or via Email . Thanks for visiting!

A problem I think many people have, and I know I do, is determining what to do next to take care of or improve your personal finances. If you are trying to get out of debt, increase how much you are saving, and spend less, it can be overwhelming to think about all of the things you need to do to get your financial life in order, and sometimes it can be hard to remember and keep up with all of the things you want to do, as well as all of the things that have to be done. Just like in David Allen’s Getting Things Done, I like to make a list of my next actions w/ my personal finances. I either leave it on my desk at home, or write it in the notebook I carry around, or both.

Here is a typical list from several months ago:

1. Review 401k asset allocation
2. Automate 529 account-set up electronic withdrawals
3. Set up separate online savings account for irregular expenses
4. Cancel gym membership
5. Pay all bills as soon as they come in -(recurring)
6. Make weekly payments on credit card-(recurring)
7. Plan next week’s menu-(recurring)

I like to prioritize, and place recurring items on the list at the bottom, which I may forget or put off if I don’t put them on the list. I try to do all of my recurring items on Friday (for example to plan next week’s menu so I can do any shopping over the weekend) so I get everything done before the weekend. Automating your finances can also decrease the number of things you need to remember on a weekly or monthly basis as well.

Filed under: Debt Reduction, Saving Money, Spending Money by RC - No Comments →

Even though many people use credit and debit cards for their day to day expenditures, cash is still king. Cash flow, that is. If your incoming cash flow does not exceed your outgoing cash flow, you are setting yourself up for trouble. There are several basic ways to generate a larger cash flow. You can work more at your regular job, work a 2nd job either full or part-time, or create passive income streams. You can also increase your current cash flow by decreasing expenditures. If you are looking for ways to pay off debt or invest more, available cash flow is the key. To maximize your usable cash flow, both increasing your income and cutting back on expenses will be the most effective . Here are several basic ways to increase your cash flow by increasing your income or decreasing your regular expenses.

Increasing Income

• Work overtime at your current job, if it is available.
• Moonlight- Look for work outside of your primary job, doing the same type of work you do in your primary job, that you can do on the side. Find out what your employer’s policy on moonlighting is, however, as some companies discourage it or even have policies prohibiting it, especially if it is work with a competitor.
• Get a part-time job- While you may not make as much per hour as moonlighting, it can be a great way to boost your income, even temporarily.
• Start a side business- Starting a side business is a great way to earn extra income. Do you have a hobby or skill you can use to make extra money? Do you want to start an eBay business? Try it out now.
• Sell things you already own- On eBay, Craigslist, or have a garage sale. You will declutter your house and your life, and make some money in the process as well. This will provide a temporary increase in your cash flow, depending on how much stuff you have that you can sell. If you can turn selling things into a steady eBay business, however, you have an additional income stream.
• Maximum the interest on your savings and investments- There is no reason you should be losing out on interest in your savings, so make sure you are using a high-interest savings account for you savings. Consider investing in dividend paying stocks, if you invest in stocks as well.

Decreasing Expenditures

• Examine your regular expenses and trim them- starting with recurring, non-essentials. Consider cutting back on your cable plan, canceling your gym membership, etc. Several small changes can start adding up to a significant boost in your available cash each month.
• Consider raising your deductibles, for car or home owner’s insurance, provided you have a well-funded emergency fund to cover your new, higher deductibles.
• Shop Smarter- Use coupons, look for deals on the internet, especially for large purchases, and think carefully about how you spend your money.
• Change your eating habits by cutting back on your food and grocery bills.
• Drive Less- Carpool to work, take public transportation, or walk anywhere you are able.
• Don’t take on new, recurring expenses. You decrease your available cash every time you add a new, regular payment to your financial obligations.

What are some other ways you can think of for someone to increase their cash flow?

Image by stopnlook

Filed under: Building Wealth, Saving Money by RC - No Comments →

Protecting your home computer is essential in this day and age. There are new viruses being created everyday with the intent of damaging your computer’s operating systems or files, and hackers are always looking to access your personal computer to get access to personal information, including financial info, passwords, etc. The two key pieces of software every computer user that connects to the internet should have are a good antivirus program and a good firewall. Fortunately, instead of spending up to $50 or more on each one, and paying a yearly renewal fee, there are two great programs out there that can provide this protection for free. Not too many things can be had for free these days. I know there are other free antivirus and firewall programs out there, but I have been using both the free version of the AVG antivirus and the Zonealarm firewall for over 3 years now, and have not had one problem. I am not a computer expert, so you may need something more robust. But if you are a fairly careful web user, I think these two programs probably provide all of the protection you will need.

AVG Antivirus

- The free version of AVG antivirus program is rated highly by many PC magazines and hardcore computer users. I have not had any problems with it slowing down my computer, which is a complaint of some of the popular antivirus programs out there. It provides protection against viruses, spyware, adware and identity-theft, and updates on a regular basis. Make sure you allow the option of the program to download the updates when they are available so you have up-to-date protection.

Zonealarm Firewall

-The free version of the zonealarm firewall provides basic firewall protection, blocking attempts to access your computer, and making your computer basically invisible to those online. You will get a pop-up when a new program tries to access the internet, which some people find annoying, but if it is a program you want to allow, you can click a box so it does not ask you again in the future. I don’t really find this to be a problem.

Filed under: Frugality, Saving Money by RC - 4 Comments →

I will be leaving this morning to join my wife and two small kids at the beach, they left on Monday but I couldn’t get away from work until today. Vacations can be a wonderful way to spend quality time with your wife and/or children and relax, but traveling costs have skyrocketed, so making the most of your money when going on vacation makes even more sense (or cents) than ever.

1. Make plans that require reservations far in advance to get good deals- The closer to your vacation you book your flights or hotels, etc., the higher you are likely to pay.You may find some last minute deals, but usually if you are planning a get-away you don’t want to risk not getting a flight or other reservation, so this strategy is not always attractive.

2. Save up the money to pay for the vacation ahead of time- This sounds like a no-brainer, and many people do it, but I would guess that just as many do not. I think that people are less likely to save up for shorter, “long-weekend” type trips because they don’t seem like such a big deal, but if you don’t save ahead of time you can spend a lot of money on a long weekend and end up putting it on your credit cards or getting into debt on your trip.

3. Stay with relatives or friends- A large portion of expenses for a lot of vacations can be lodging. By staying with someone, such as a friend or relative, you can eliminate that from your expenses. If you’re feeling really adventurous (and you are single), consider couch surfing.

4. Go at off peak times- Hotels and tourist destinations often slash their prices by 50% or more during off peak season. Plan you trip to the beach after labor day, and you may save a bundle.

5. If driving, drive when traffic is light- Avoid rush hour traffic when passing through cities, stop and go traffic can greatly reduce your fuel economy.

6. Stay somewhere you can cook your own meals- You can save a whole lot of money by cooking your meals and not eating out the whole duration of your trip. Find a hotel or condo with a kitchenette so you can do the cooking.

7. Get someone to watch your pets instead of boarding them- Boarding a cat or a dog can cost $15 to $20 a day. Asking a friend or relative to take care of your animals while you are gone can save you money.

8. Get someone to drop you off at the airport if possible- If you are flying, parking at the airport for a few days or a week can add up to a hefty sum in parking fees. Ask someone to drop you off and pick you up, you can return the favor to them when they travel as well.

9. If you are driving, prep your car with basic car maintenance and practice gas saving driving techniques for maximum fuel efficiency.

10. Also, when driving, map out your route to minimize the total miles you will be driving. Use online tools to find the cheapest gas prices anywhere in the country.

Image by rayced

Filed under: Saving Money, Travel by RC - 7 Comments →

A couple of weeks ago, I had to bring my wife’s vehicle to the mechanic, as her driver’s side window would no longer work. No only did it not operate, but the mechanism that held it up did not appear to be holding it any longer, causing it to fall into the open position while she was driving. While I normally like to attempt such repairs myself, this one seemed a little complicated, and I really did not have the time due to my busy schedule at work- I had a project with an upcoming deadline and I knew I would be working the next couple of Saturdays to get it completed on time. I also asked the mechanic to change the transmission fluid while I had it there as well. He gave me a very rough estimate of what it would cost, and told me he would call me later in the day with the final estimate. Shortly after lunch time, I realized he had not called me yet, so I called him up. He told me they were almost finished, and it should be ready in an hour or so. I mentioned to him that he had not called me back with the final price, and asked him what the total would be, and he told me it would be about $600 for everything. (from what he told me in the morning I was expecting in the $500 range, so I was not totally surprised.) I then asked him if he could do any better on the total price. Without hesitating, he told me he could knock off some of the labor charge for the window repair. When I went to pick up the car, sure enough, he knocked off about $150 worth of labor charges. All because I asked. Did I get that great of a deal? I am not really sure, it is hard to tell sometimes with services like car repair or services that are based on parts and labor charges. But I do know I paid less than I would have if I had not asked for a better price.

It never hurts to ask for a better price, the only thing someone can say to you is “No”. Obviously in certain situations, such as a retail establishment, where the price is clearly marked on an item it won’t work most of the time. But in situations where the price is not set or written down, it certainly won’t hurt to try.

Filed under: Saving Money by RC - 5 Comments →

I recently received a letter in the mail from a professional organization I belong to, telling me that if I signed up with GEICO for my car insurance, I would be eligible for a discount of up to 8% on my car insurance premiums.
Wait a minute, I already have my car insurance through GEICO! How did I miss this extra discount?

I am not sure how I missed this in the past, but apparently there are well over 100 “partnering organizations”, which, if you are a member of one, you may be eligible for a discount of up to 8% as well.

There are categories of partnering organizations, including:
Accounting Organizations
 Alumni Associations
 Attorney Organizations
 Credit Unions
 Educational Organizations
 Engineering Organizations
 Federal Organizations
 Financial Organizations
 Medical Organizations
 Military Organizations
 Professional Development Organizations
 Scientific Organizations
 Student Organizations
 Technical Organizations
 Other Organizations
That’s just the list of categories, it appears there are over 200 groups which are listed.

Check out the full list of Partnering Organizations to find out if you belong to a group eligible for a discount.

Looking around the GEICO website, there are several other discounts available that you want to make sure you are getting if they are your insurance company. Check out the main GEICO discount page .

There are other companies, such as most cell phone companies, which offer discounts if you work for a certain company or are a member of a certain group. Are you getting all of the discounts you are eligible for?

Filed under: Cars/Auto, Saving Money by RC - No Comments →

One of the great things about the internet is that everything is right at your fingertips. Instead of going to a mall or a bunch of different stores and shopping around for hours, you can search the internet, and in a matter of minutes, find a half-dozen places offering what you are looking for and comparison shop to find the best deal. There are several websites, such as the ones listed below, which aggregate the best deals on the net,  have people posting “hot deals”, or specialty sites that offer one really good deal a day. They list good deals at major online merchants from around the web, closeouts, coupon codes, how to stack coupons with sales both online and offline, where to find things the cheapest, and a myriad of tips and techniques on finding the best deals both online and offline.

Slickdeals

A forum type website where people can post their “great deal” finds from around the net. The site even has a “hot deals” section, which is supposedly the best great deals with items at a much lower price than can be found elsewhere, including free.

Fatwallet

Another forum type site, where people post their deal findings from around the net.

Deals of America

An aggregation site, listing the best deals to be found from merchants around the web.

Woot

A “deal of the day” website, one item is offered each day, usually at a good price, until it is sold out. The next item is not available until the next day.

One of the problems I have has in the past with these types of websites is that sometimes the deals seem so good that they are hard to pass up! I have, and I am sure others have as well, purchased things that I never ended up using or really didn’t need. It is very easy, when you see something on the internet at what you consider a ridiculously low price, to pass it up when you know it will sell out in short order. They can be useful, however, when you are looking for something in particular, or shopping for Christmas or other gifts, but you must be careful with the “double-edged sword” of these types of websites. You should also be careful with credit card usage with these types of sites, because even if you are getting a great deal, if you buy too many things your total amount spent can still be quite high-much higher than you realized.

Below are several ways to navigate online purchases to avoid buying things you don’t need, even when they are cheap:

Avoid browsing the websites for fun- Similar to avoiding going to the mall for fun, if you find yourself ordering things you don’t really need, try to avoid these on a regular basis. Recreational shopping, whether online or at a physical store, usually leads to buying unnecessary items.

Make a list- Make a list of things you really need or were planning on purchasing anyway, and don’t buy anything unless it is on the list. If you miss a super deal because that item wasn’t on the list, too bad.

Checkout the freebies section- Both Slickdeals and Fatwallet have freebie sections where you can get items for free, such as free samples or giveaways, both online and offline. Check these out to satisfy your hunger for a great deal. What’s better than free after all?

Wait- If you are unsure about a purchase, wait a few days. You will lose out on some of the deals, but not all of them. It will also help you deterimine if you really want something rather than making spur of the moment purchases.

Filed under: Saving Money, Spending Money by RC - 4 Comments →

 Finding cheap gas prices is no longer only for the frugal-minded among us, it is now becoming a necessity for everyone. It seems like prices have gone up $0.10 to $0.15 per week for the last few weeks.  The more you drive, the more you spend on gas, and the more important it is to find the lowest price possible. Even though I travel the same route to work everyday, I often find myself driving around town, and of course, I notice when a certain gas station has lower gasoline prices than others, and of course, I always seem to see a lower price right after I fill up! With prices changing so frequently, it is hard to find the station that is the lowest. Some change their prices at different times of the day, and even though you may go to a station that is usually the lowest, it may not be the lowest the time you go there. Even a difference of a few cents per gallon can add up of a period of time. I have used one of these websites in the past,  Gasbuddy, to look up prices, but the other,  Mapquest Gas Prices,  is new to me.

 Gasbuddy: Allows you to search by city, state, or zip and brings up list of the cheapest prices in your area. Gasbuddy also gives you an overview of historical prices, trends, and includes Canada as well.

Mapquest Gas Prices: Allows you to type in an address, intersection, or zip-code, and pull up the gas stations with the lowest prices in that area, all on the same map. Additional features include a gas price calculator, browsing by city and state, and alternative fuels such a E85 and bio-diesel. The map feature on mapquest is great, and it seems as though it would be very useful when travelling or on a trip.

While I like being able to see multiple stations on Mapquest Gas Prices, both sites are quite useful for finding cheap gasoline in your area or on the road.

image by a siegel

Filed under: Cars/Auto, Frugality, Saving Money by RC - 2 Comments →

Gas prices are have gone through the roof over the last few weeks, and food prices are rising as well.  Sam’s Club and even Costco are talking about rationing rice. There are quite a few ways to save money on gas while driving; here are 30 ways to cut your food bill and associated grocery shopping costs as well.

Your Eating Habits and at Home

Grow Your Own- No, that’s not what I mean ;). Grow your own vegetables and herbs (which are quite expensive if you go by weight), and fruit if you live in a place you are able to. Don’t have a big yard? Try building a square foot garden.

Drink less milk, soft drinks, and alcohol- You don’t have to stop drinking any of these, but try cutting back a little. Your waistline will thank you as well as your wallet.

Go Fishing!-If you live near water, try to catch your dinner. This can be a great activity to do with kids as well.

Try meatless meals- Cut meat out of your dinner lunch or dinner menu several times a week.

Eat breakfast for dinner- Make omelettes for the family one night during the week and serve everyone for a few dollars.

Skip a meal on the weekends- Have a large breakfast on the weekends, then have an early dinner, and skip lunch. It won’t hurt most of us.

Plan your meals carefully- Plan out your dinner menu ahead of time, and include the leftovers, if any, in your planning.

Plan your meals based on what’s on sale- Check out the ads for your local grocery stores before you plan your menu to incorporate the sale items.

Eat less junk food- Cut back on salty and sugary snacks, switch to fruits, vegetables, and other healthy alternatives, which are usually cheaper.

Don’t waste food-  Keep an eye on your perishables, and if you find yourself throwing out food, cut back on how much you buy or freeze things before they go bad.

Experiment with simple or exotic cooking- Buy a cookbook or two, and look for easy, simple meals which don’t cost much or have a lot of ingredients. Experiment with foods from other cultures, which frequently don’t use as much meat as we do here in the U.S. either.

Don’t use the vending machines- The cost of items in vending machines is usually 2 to 3x as much as you can get it yourself.

Bring your lunch to work- Brown bag it to work or bring leftovers. This can cut down on wasting food as well. Bring your own drinks from home, or drink water.

Split entrees with your spouse or significant other- When eating out, try splitting an entree.  Many restaurant’s portions are so big, you end up with leftovers.

Buy a freezer- Investing in a freezer can allow you to freeze things before they spoil, batch cook for future meals, and stock up on perishables such as meat and chicken when there is a good sale.

Before Shopping and At the Store

Make a list- Make a list based on what you need, and stick to it. You will spend less money by doing this.

Buy in bulk- Anything that won’t spoil before you use, buy in bulk. Be sure to check the unit pricing, but 9 times out of 10 it will be cheaper to buy in bulk.  If you can’t use it all when buying in bulk, try to split it with a family member or friend.

Buy what’s in season & local- This applies especially to fruits and vegetables, but can apply to seafood and other items as well, depending on where you live.

Shop the sales- Check out the weekly flyers for the best deals, and shop around if you don’t have to drive too far out of the way.

Buy whole cuts of meat- Buying a whole chicken or larger cuts of beef or pork are normally cheaper than individual cuts and smaller packages.

Don’t buy non-grocery items at the grocery store- Save your non-grocery purchases for trips to Walmart or the pharmacy, or other discount store. The markup on these items is usually high at grocery stores.

If you don’t clip coupons start- If you don’t clip coupons, start. By combining them with items on sale, you can get the most bang for your buck. Don’t use them for items you wouldn’t normally buy, however.

Search the net for coupons too-Search the Internet for online coupons at places like smartsource.com, as well as the myriad of grocery coupon sites.

Try generic or store brands- These are frequently quite a bit cheaper than name brands, and often taste just as good. Experiment with them to make sure you like them.

Stock up on sales- When you see a really good sale, stock up on that item for future use. Be sure you are going to use it all, of course.

Look for mark-downs- Check out the meat department for markdowns, where they lower the price on meat (and sometimes other items like dairy) when it is getting close to its “sell by” date.

Don’t go shopping hungry- We have all heard this one before, but it is true. You are more likely to buy more if you go food shopping hungry.

Don’t bring the kids-Kids are always going to want something, whether it is a toy, candy, or spider-man popsicles. This will keep you from buying things that aren’t on the list. (Spider-man popsicles are usually on my list though)

Watch the register- Keep an eye on the register while your groceries are being rung up to make sure you are getting the right price on the things you buy.

Check your receipt-Take a quick look at your receipt to make sure you didn’t get overcharge or double charged, or the store didn’t forget to put something in your basket.

What are your best tips for saving money on food and grocery shopping?

Filed under: Frugality, Saving Money by RC - 9 Comments →

The April 2008 Edition of Smart Money Magazine contains an article entitled “Under the Knife: Cutting Medical Bills”, by Angie C. Marek. The article describes how “haggling” for better deals on medical costs is on the rise, and similar to finding the best price for airlines and hotels, those who search out the best deals will get better rates than those that do not.  The article describes 6 ways to get better deals and lower your medical costs.

 Ask for it early- Ask for a price break before the procedure, not after the bill comes in. Surgeons may offer a discount on the surgery fee, or a “two-fer” if you are getting more than one procedure done, such as with  plastic/cosmetic surgery. The author was also successful in getting 8 out of 10 mental-health professionals to offer some sort of discount on therapy sessions by approaching them and asking for a break on the price.

Pay in cash up front- Not surprisingly, paying in cash was the number one incentive to offer a discount, according to doctors questioned.  Ask the doctor or medical care provider up front for a discount for paying cash in advance, you certainly have nothing to lose.  Another good reason not to use a credit card, I would think!

Do your homework- The article describes how it can be difficult to bargain when you are not sure of the real cost of something.  One web resource listed was www.nahdo.org, where you can search for medical care cost data by state.  Another technique I have used is to use my health insurance provider’s member website, which can offer prices for drugs and other services as well. Also, I have found a simple Google search can often turn up information.

Butter up the billing staff-It is the people in the back office, running the business side of things,  not the doctors’ themselves, who often hold the power to reducing your medical bills.  Just by speaking with the office coordinator and fretting over the bill, the author was able to get a 66% price break on a skin tag (small growth) removal procedure.

Go at an off-peak time- Go to a plastic surgeon after the summer bathing suit season, and you may be able to score an “off-season” deal.  Also, offer to fill in for a cancellation at the last minute, or schedule an appointment at lunch time and they may cut you a break as well.

Hire an advocate- Hiring a professional to review your bill and negotiate a better deal for you may save you money, even after paying their fee.  A “Health Care Advocate” may have experience in health care billing which may result in savings for you. Do your homework before hiring one though, checking references and with the Better Business Bureau.

In these times of soaring medical costs, it certainly never hurts to ask for a discount, especially if you are underinsured or do not have health insurance, and the more informed you are about any medical costs you may incur, the better off you will be. This past January I changed my family’s health plan to a high deductible plan with an HSA (which I will discuss in the near future) where I pay a the first $2500 in costs out of pocket up front, so over the past few months I have been trying to educate myself on medical and prescription drug costs.  I will certainly be trying out some of these tactics when the situation arises in the near future.

Filed under: Health, Saving Money by RC - 6 Comments →