Money Management, Personal Finance Basics, Personal Finance Tips, Personal Finance

Personal Finance Blogs

2010-12-20T07:11:00.000-08:00

More and more personal finance blogs are popping up every day. Some discuss how they are going to make their first million dollars, others are about how to be frugal and save money, while others are more focused on paying down debt. It's great to see such an interest in personal finance, and it's fantastic to be able to be an observer and watch step-by-step how people take control of their financial situation.

One thing to conscious of as you read through personal finance blogs is that they are often not written by professionals in the field. In my opinion this has some strengths, as they are true accounts of strategies, products and systems that actually work for the author and it's readers. But that also means it is even more important for you to do your due diligence before acting on any of the information given on these sites, as it should be regarded as opinion rather than professional advice.

That's not to say there isn't very valuable information that can be found within the pages of these personal finance blogs. Many have been listed in Money Magazine's best personal finance websites, and listed in the New York Times and the like, so they do come with a level of credibility. Secondly, authors tend to do their very best at publishing accurate information in order to maintain their level of credibility and attract more readers.

The real gold, however, is often found deep in the comments section after each article found in the archives. Since most of these blogs allow anyone to leave a comment, it is not unusual to see people with competing views debate an issue, which is great for the readers. This is where you will often find certified professionals give their thoughts, argue points or include some additional background to help you make the most out of your financial situation. These comments allow you to see things from all angles so you can make the best decision based on the information at hand.

You probably don't wan to let these personal finance blogs be a substitute for professional advice, but rather help guide you to a starting point and give you some general background information. Each person's situation is slightly different, and what may work for one person may not work for everyone. However, the same fundamental concepts generally apply when working to pay down debt, manage money or accumulate wealth, so they are a great starting point.

Beyond that, you will often find honest personal finance software reviews, documents to help you stay organized, and general stories that will help you stay motivate and inspired to reach your goals.

With all of the personal finance bloggers out there, there is a wealth of information at your finger tips that can truly make you rich. Find the one's you can relate to the most, and add them to your RSS feed. That way you can easily read through the new content on each site in one place, making it easy to read all of the fresh material.

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Personal Finance Tips From One of Life's Financial Victims

2010-12-20T07:08:00.000-08:00

Good advice without strings is extremely hard to find nowadays, nevertheless, this is what I'm here to do. Yes, I'm offering personal finance tips that are both useful and practical, and what's more, free of charge. Some of my personal finance tips you may have heard from others, and some you may not. However, even if you've heard them before, many of them are well worth repeating. After all, good advice always holds its value and none more so than personal finance tips from one of life's financial victims. I'd even go as far as to say that not only do they represent sound advice, but these words are good enough to live by.

Always be Wary of Shoes

If you're a man and married, here's a peculiar and extremely useful personal finance tip I urge you to listen to. Strange as it may sound, please take note of the relationship between your wife and her shoes. Whenever you first marry, usually things start out quite innocently as simply just several nice pairs of shoes and, of course, some sneakers for wearing outdoor. But all of a sudden, it quickly turns out she'll need a new pair of shoes for every new outfit for work, despite that she may already have two pairs of black shoes. "Ah", she proclaims, "but none of my own shoes are like this new pair of black shoes". Before you know it, you are up to your knees in a sea of shoes just to try and get out the door in the morning. And the problem grows steadily worse. This tip is as much for your personal sanity as it is one of my personal finance tips. Trust me on this one!

Replace your Light Bulbs

Recently I decided to change all of my current standard light bulbs to the energy-saving bulbs that only use a fraction of the power of the standard, yet emit greater light. So I ask you, what makes this one of my personal finance tips?

This is indeed one of my personal financial tips as the new energy-savers cost $35 for the entire house, which I have ascertained will save approximately $50 and $60 per month on my home energy bill. The point being, if you find ways to save money in your home, ultimately you'll see a positive increase in the balance of your savings account.

Avoid High Interest Terms and Conditions

Credit is all very well, however, should you take the finance option to buy a $500 product, then with an interest rate of 25%, by the end of the finance period you'll have paid out just short of $1,500 for the privilege. Basically, what I'm trying to say is that if you can save the $500 cash needed to pay for the product, you'll save yourself almost $1000.

At all costs, try to avoid purchasing any item on a store credit card, as these tend to charge the greatest rates of interest. When it comes to personal finance tips, the best tip I can give you is to avoid high interest rates whenever you go on a spending spree.

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Financial Literacy 101

2009-11-06T03:24:00.000-08:00

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As a middle school teacher in Washington, D.C., Tarik Cranston, 29, was able to sock away only $20 to $30 each month after paying for rent, food, and other expenses. Buying a home—his dream—seemed impossible.

But after hearing about free financial education classes offered by DC Saves, part of the national America Saves campaign, he signed up. There, Cranston learned how to make a budget, set goals, and put money into an interest-bearing savings account. When he started tracking where his money was going, he realized that little expenses, like his cigarette habit, added up quickly. Now, he cooks at home more, brings his lunch to work, drives less, and no longer smokes—and he saves $300 a month.

More from USNews.com:

• Quiz: Test Your Financial Literacy

• Budgeting: Pay Yourself First

• Financial Literacy Resources

Financial educators say experiences like Cranston's demonstrate the importance of financial literacy, the lack of which has been blamed in part for this country's recent mortgage crisis. "There are probably millions...of households who have gotten themselves into mortgage products they never should have gotten themselves into. Most of them didn't understand what they were agreeing to do," says Alan Blinder, economics professor at Princeton University.

The current credit crunch, along with consumers' burgeoning debt loads, has led to a flurry of programs and initiatives aimed at promoting financial education, including the first President's Advisory Council on Financial Literacy, launched by the White House in January.

"We don't know any less than our grandparents—we just need to know a lot more now," says Dan Iannicola, deputy assistant secretary at the Treasury Department and federal coordinator for the president's council. Self-directed retirement accounts, easy access to credit, and complicated mortgage options all make the financial world difficult to navigate without some kind of education, experts say.

Research suggests that most Americans have extremely low levels of financial literacy. The Jump$tart Coalition for Financial Literacy tests 12th graders every two years by asking them practical money questions and consistently records an average score of 50 to 55 percent. Other research shows that about 3 in 4 workers don't know how much money they need to save for a comfortable retirement, and only about half of respondents in one study were able to correctly answer two simple questions about interest rates and inflation.

"The persistent finding is how pervasive financial illiteracy is," says Annamaria Lusardi, a professor of economics at Dartmouth College. She adds that the problem is widespread across all demographics, although it is especially acute among women, African-Americans, Hispanics, and those with low education levels.

It matters, says Lusardi, because research also shows that people who understand basic financial principles are better at retirement planning, accumulating wealth, and avoiding debt. In fact, she found that people who develop financial plans accumulate from 10 to 15 percent more wealth than those who don't, even after taking into consideration income and education levels.

To encourage savings and planning, dozens of private and public-sector initiatives target kids as well as adults. The National Endowment for Financial Education, for example, distributes a curriculum for high school students that covers budgeting, debt, insurance, career choices, and other financial decisions, reaching more than 800,000 kids a year. "It's important to give them a base understanding," says Ted Beck, chief executive of NEFE and member of the President's Advisory Council.

While the financial industry often points to financial education as the solution to consumers' debt problems, others are more skeptical, and for good reason—research suggests many of the lessons are not having their intended effect. "The very disappointing result...is that people exposed to financial education don't do any better," Lusardi says. One study followed up with graduates five years after they took a respected personal finance course; it found it had an insignificant impact on their behavior. There are a few exceptions: The lessons from an interactive stock market game appear to stay with students, Lusardi says.

One key, says Elizabeth Coit, executive director of the Networks Financial Institute at Indiana State University, is teaching the basic ideas of goal-setting and delaying gratification at a young age, and then constantly reinforcing those messages. Forty states now include some amount of personal finance education in their education standards, and seven states require high school students to take a personal finance course, according to the National Council on Economic Education.

Some experts suggest it is the financial industry itself that needs to change. Disclosures, for example, should be written in plain English so people can understand them, Blinder says. He also offers two other ideas: First, the mortgage industry could be penalized for selling products to people that don't make sense for them, just as stockbrokers are now under suitability standards. Second, banks could be required to keep a certain percentage of the mortgages they originate on their own books instead of selling them to third parties so they have an incentive to screen borrowers more carefully.

As it stands now, says Terry Connolly, dean of Golden Gate University's business school, "you really have a very severe differential between the extraordinarily sophisticated and highly leveraged instruments that are fine when traded between knowledgeable institutions. But when you apply them to everyday people...you have enormous trouble."