Trying out LearnVest April 28, 2010

I saw an article in the New York Times about financial advice geared towards women.    The basic gist of the article is that even well-educated, successful women may not have as good a grasp on their finances as men.  The author discussed how a lot of writers and companies try to reach out to and teach women about finances.  Many recent books seem to be trying to “girly up” finances, to appeal more to women.  I suppose the article generalized quite a bit, but it did include some actual data/research to support the general claims.

One resource mentioned in the article was LearnVest.  It’s an online program that guides you towards your financial goals.  Unlike Mint or Thrive, which uses your imported account information to determine progress towards your goals, LearnVest guides you through checklists of brief educational/informative articles.  You start by answering a few questions about your current financial, education, employment, and family status, as well as some goals that you may have.  It then presents you with with topics that apply to your current situation and goals, which then organizes and spits out those checklists of articles I mentioned.  They also include a lot of calculators and tools you can use to figure out your budget or weigh financial decisions.  Many of the calculators/tools are actually from bankrate.com.

So, what do I think of it?  For me, I feel like I already know a lot of these ideas.  But I like going through it as a refresher, to remind me of tasks or ideas I may have missed or forgotten.  And if you’re just starting out, it’s definitely a good way to take control of your finances.  The checklist format combined with short articles and tasks makes it easy to do little bits at a time, meaning you wont get overwhelmed.  I know that this site is geared towards women (especially looking at the website design, including color scheme/style, images used, and tone of blog posts), but it had good advice and techniques that would be good for anyone, and at any age!

So go ahead and try it out.  Let me know what you think of it.  I think I’m going to go back and work through a few more checklists!

Today is Take Control of Your Finances Day! April 17, 2010

How do I know today is Take Control of Your Finances Day?  Because I just declared it so!

Presumably, you’ve already filed your taxes, since April 15th has come and gone.  Hopefully, you’re all set in that department.  But maybe you lost track of some of the forms.  Or didn’t realize how huge a tax bill you were going to be paying.  Either way, money (or lack thereof) is fresh in your mind.

That’s why I’ve decided that the Saturday (and Sunday…okay, the weekend) after Tax Day will be Take Control of Your Finances Day.  This is like a New Years Resolution, but way better.  You don’t have to pledge to lose 15 pounds or keep the refrigerator clean.  You simply have to pledge to stop and take a look at your financial standing, and to do everything in your power to improve it.  And don’t just SAY you’re going to do it…DO IT!

How can you start?

Track down all of your accounts, assets, debts.  You need to know where all your money is, and where you owe money to.  Make sure you know all your usernames and passwords for the credit cards, checking accounts, savings accounts, retirement accounts, investment accounts, student/auto/home loans, etc. that you can access online.  You should know what the balance is and how much you owe on every account you have.  It’s important to have all this information easily available.  If you want to keep better track of everything, you can import all your account information into sites like Mint and Thrive, to name a few.  Using these sites, or a spreadsheet, or a site like NetworthIQ, you can see what your net worth is, by adding up your assets and subtracting your debts.  You can use your net worth as an indicator for tracking your progress.  Hopefully, each month/quarter/year, your net worth will grow!

Educate yourself. Whether you like blogs, books, or seminars, you need to start learning.  Start from the beginning, if you have to.  There are plenty of resources out there.  For blogs, you can start looking at some on my blogroll (see the right hand side).  There are lots of books you can check out.  There’s I Will Teach You To Be Rich, books by Suze Orman, and many books that speak more in parable form, like The Wealthy Barber and The Richest Man in Babylon.  Find them at your local library!  Many employers (especially larger companies) offer free personal finance, investment, or retirement seminars.  Take advantage of them!  Learning is a life-long process, so don’t expect to know everything right off the bat.  But starting your path down educating yourself is very important for empowering yourself and making sure you make the right decisions.

Start an Emergency Fund. It’s important to have some money stashed away in case of emergencies.  It’s a lot better to use money you already have to pay for something than be forced to borrow (either through a loan or on a credit card).  You can start this fund with a small amount of money, and build it up over time.  I’ve found that setting up automatic transfers from my checking account (or direct deposit from work)  into a savings account makes this process pretty painless.  You don’t even notice it’s missing!  I opened up a savings account through ING Direct.  (Fun bonus with that was I got $25 extra dollars because I opened up the account through a referral.  If you’re looking for a referral link (where you’ll get $25 free, and I’ll get $10 free, fyi), shoot me an email at graduatedlearning@gmail.com.)

Track your spending. Using the websites I mentioned before (Mint, Thrive), or spreadsheets, or a site like walletproof, you can track how much you’re spending.  You may be surprised just how much money you’re spending on day to day expenses.   You will end up being more conscious of where your  money is going, and you can try to cut down on those expenses.

Make a plan to pay off your debt. Whether you do it all at once, or whittle it away little by little, you need to make a conscious decision to eliminate your debt.  And at the same time, you have to agree that you aren’t going to go into any more debt in the process.

These are just a few of the top things you should think about.  I encourage you to ask questions or alert me to topics that are missing.  I can add more links/advice that I may have forgotten.  I just wanted to get everyone to start thinking about what they can do today!

What are you doing to take control of your finances today?  Start now!

Blame the Parents April 14, 2010

Like it or not, we often end up a lot like our parents.  Whether it’s the genes they gave us, or the way they raised us, we’ve been molded into miniature bizarro versions of them.  To be honest, I’m 100% okay with that.

I love my parents.  Yep, it’s true.  I love my sisters, too, for that matter.  I’m not going to get all gushy about this.  Just wanted to lay that out there.  And here’s the thing:  my sisters and I are alike in a lot of ways.  But there are also a lot of differences between us (and compared to our parents, too).  But I think my parents have shaped my goals, views, and ideas, whether they meant to or not.

I’ve always been a saver.  In fact, when we were younger, I was the only one of the 3 girls that had extra money lying around in our piggy banks.  Allowance, gift money, etc. all went into my money jar.  I think my mother was the first personal finance guru I listened to.  She often picked up books on personal finance, investing, and similar topics from the library (and still does!).  And both my parents drilled those basic tenets of personal finance into my head.  Pay yourself first.  Save at least 10%.  Spend less than you earn.  They also led by example, saving and investing money for the long term, avoiding extravagance.  My mom gave me her copy of The Wealthy Barber to read, which started me on my way towards my own personal finance obsession!  And just today, she told me about a new personal finance book she was reading, and shared her advice.

This, of course, is only a small part of the ways that my parents shared their values with my sisters and me.   But I don’t want to get too sappy here!  So I’ll stop.

Where did you get your personal finance start?  Your parents?  A friend?  Your own realization that you need to change your finances?  What got you going down the path to financial freedom?