Spring Semester Book Update

I went online and found my book way cheaper than the Pitt bookstore was offering it for. I went to Alibris and found the book for $50. I paid another $7 and got the study guide. My grand total with shipping was $64 a savings of $16. Hey that's $16 bucks I can spend on something else. I'm sure I'll go online for books every semester since Econ books are so expensive.

Where oh where to spend my windfall?!?!? I'm sure I'll think of something : D

Books For Spring Semester

Pitt thinks they're slick. They wait until the last minute to put books up online so you'll have to buy them from the campus bookstore. There's a huge mark-up naturally. I'm only taking 1 class this semester so I only need 1 book lucky for me.

It's a paperback book with about 300 pages. Brand new is $105, used is $80.25. I'm about too do an internet search to see if I can find the book cheaper. Wish me luck!!!!!!

Feliz Navidad

I just wanted to wish everyone a very Merry Christmas and a Happy Holidays!

I'm home right now visiting family. Every once in a while I wonder why I moved away. Then I come home for a visit, and boy oh boy do they remind me. My family is jacked up! Issues out the wazoo! I'm actually leaving today to go home and it's not a moment to soon. But I still love and miss them and after all, you can't pick your family.

It's all love. Peace and enjoy!

My Duh Moment

Have you ever watched Carlos Mencia? Well I definately feel like the "dee-dee-dee". I had a loan payment due to my credit union. If you belong to a credit union, you know that there is usually only 1 office. Of course the office closes at 4:00pm and I get off work at 4:45 so stopping by the office is not an option.

So I decided to put my payment through the mac machine. I went to the machine, put my card in and started looking for the loan payment button. There wasn't one. So I had to mail my payment in. Luckily it was 3 days before the payment was due so I knew it would be on time.

Fast-forward 2 days later when I go to the mac to get money. While looking on the screen under deposits it says ...... PAYMENTS. Big as day. How did I miss it? My dumb ass was straight looking for LOAN payments!

Go ahead and laugh. I know you are anyway. All I can do is shake my head and wonder in amazement at my goofiness.

The Man Can't Hold My Blog Down

By the time I get home from work everyday, I am entirely too tired to blog. After staring at a computer screen all day, I'm leery about staring at one at home. So my blog suffers and I only post entries every 2 weeks if I'm lucky.

The IT administrators at work have blogs and newsgroups blocked so I couldn't check my blog. BUT.... I just found out that I can actually write and submit my posts. Hot damn I'm back in business! So now I will be blogging at least once a week. Woohoo!

Stew on that IT guys!

I Love Southwest!!!!!!!!

I thought I was going to have to pay an arm and a leg in order to go home over the Christmas holiday weekend. I just went to the Southwest website and booked a round-trip ticket for less than $100 including tax! I went to a competitor site just to make sure it was a good deal. Cheapest ticket on that site is $250 and I would have to travel either early morning or late at night on Christmas Day. I plan on spending at least half of the day with my family. Southwest is awesome!

Arghhh...Just Let Me Register Already!!!

Ugh, it took me forever to register. I get to Pitt to register and I had a feeling that I should stop in student accounts to make sure they applied my payment. Nope. Not only did they not apply the payment I sent 2 weeks prior, they didn't even know where the check was!! WHAT?!?!? My account is now delinquent because the payment was late. Meaning no registration because they have a hold on my account.

After arguing and throwing a temper tantrum they admitted that the person who was handling my account was on a leave so the payment was probably on her desk. So they tell me to come back in an hour. Great, except my registration appointment is in 20 minutes. I talk to my advisor and explain what happened. We set up a new appt. for Friday at 5:45pm.

I still have to pay my bill before the hold can be taken off. A quick call to my credit union and they tell me that I can put a stop payment on the check for $26 and they'll give me a new one. Ok, so I can get to the credit union and back in a little over an hour and have the hold off today.

I pace around in circles for 20 minutes, then go back to student accounts. As soon as I walk in, the lady handling my account looks up and says "oh, we found your check. You can register now." Did I mention that I used a vacation day from work for this so now I'm super ticked because the day was wasted?

On my way to the elevator I decide to stop back up at the advisors office and see if she can squeeze me in. The receptionist pulls up Ms. M's schedule and tells me she's booked for the rest of the day. But....her 11:00 hasn't gotten there yet. I run (yeah I literally ran) down the hall to her office. I ask if she can squeeze me in. She tells me that she can see me but if her 11:00 shows up, they take precedence. Ok by me. I sit down and give her the class code that I wanted. She types it up and prints it out. As I'm signing the paper, her 11:00 knocks on the door. I'm done I say to her as I stand. Sweet victory.

With registration in hand, I head to the Panther Center to get a new student id. I even took time to look presentable. I curled my hair (rare occurrence), and put on some lip gloss. I give the guy my drivers license. Oh, spring registration can't get a new id until after December 1st. But they're open 24 hours and give out id's until 10pm. Friday is December 1st so I'll just head over after work. Mission almost accomplished I head home. Now I just have to find out what books are required for the class.

You're An Advisor?

My advising appointment was a joke. I already know what I want my major to be and the classes that I want to take so there wasn't anything my advisor could tell me. She was like well here's the major sheet. I had that and a copy of my transcript so I knew what classes I needed. All she could say was "oh, well that's your advising appointment". Great, and I have to go through this every semester. I have another appointment in a week and a half to register.

I'm looking at 1 class on for 3 hours per week. I can handle that. It still gives me plenty of time to study. Since my gpa is so low I want at least a B in every class. Hopefully I can still pull a B- for an overall gpa when I'm done. Wish me luck!

Why Do So Few People Vote In The U.S.?

Check out this article from aol on voting. Only about 40% of the voting population votes in a nonpresidential election year. According to the article: Participation, paradoxically, is highest in states where making it to a polling station can be misery on a wintry day. Minnesota, Alaska, Maine, New Hampshire, South Dakota, Wisconsin and Wyoming are among states that lead the nation in getting voters out.

Let your voice be heard! Vote Tuesday November 7th.

Get Out And Vote

It's that time of year again. Tuesday November 7th is election day. There are state senate seats and governors races that are very close. Some of them will be decided by a few thousand votes.

How many times have you heard someone say what a poor job an elected official was doing but then add that they didn't vote because "it's only one vote" or "my vote doesn't really count"? Now multiply that by all of the thousands of people who say the exact same thing. Hundreds of thousands of people miss voting. These people could have possibly changed the outcome of the election.

It doesn't matter what your political affiliation is or who you plan to vote for. Just get out there and vote. Let your voice be heard.

Reinstatement Completed

My reinstatement was approved for the spring term. Since I work full time the I need a night advising appt. The first available appt is 11/13. I go in and talk to an advisor and then get scheduled for a registration appt. I will probably use a vacation day at work for this since I will have so much to take care of that day.

I'll have to pay my back bill, register, get a new id and scout for cheap books for the class that I'm taking. I'll probably order the book online since I'll have over a month to get it. I also need to go to the financial aid office and see if there is anything that I qualify for. I doubt it since I'm only taking 1 class and you usually need at least 2 to qualify for aid. But it never hurts to ask, right?

Later......

Hooray Free Money...Boo Fine Print!

So I get a letter from Allegent Community FCU, my local credit union. They just changed their name so to celebrate they had a bunch of promotions going on. One was to open 2 accounts and get $50 bucks free. I already have 2 accounts so I decided to take advantage of their cd special. $2500 minimum deposit for a 1 year cd with a 6.00% rate.

I took a look at it and thought "hey great rate" so I started the paperwork. Then I read the fine print. The promotion was only good for money not already on deposit at the credit union. Well, I have the opening deposit but I don't have that much in another bank as well. Sheesh!

Well, I found a vacation club that I could open with a $5.00 minimum deposit and still qualify for the $50. It should be credited to my account within 3-4 weeks. Sweet!

Lesson learned: When you see a great deal or promotion, read the fine print first. Or you could miss out on the deal.

Back To School Time!

Well, I finally did it. I went to Pitt to apply for reinstatement. It's been so long since I've been in school that they have to totally rebuild my academic record. I had to write my high school and have them send a copy of my high school file as well.

That's crazy, I know. I'm as old as Methuselah going back to school. Well, not quite that old. Maybe as old as the late great Strom Thurmond. lol. That's the answer to every trivia question. You can't go wrong with good ole Strom as the answer.

One of my friends asked me if I was scared to go back to school. Nope. Anxious. Yeah. I can't wait to start and get it over. I just wish I had more money to able to take more classes. The first semester I'm only taking one class. Then two classes every semester including the summer. The last semester I'll have three classes. It should take me two years. My major is Economics. I'm not sure about my minor. I have enough credits for it to be several things. I only need 9 Econ. classes, one English Lit. class and two math classes. Yuck! I did everything in my power the first time around to get out of math and now I need two. Business Calculus and Statistics. They will probably be the worst classes I take.

I'll keep you updated on my advising appointments and the registration process. It should take between two and three weeks for my reinstatement to be completed then I can move on. Oh and I get a new id. Great, a new picture to take. My favorite thing in the whole world. Not!

Till next time...

Pittsburgh Bloggers

So I found another new site Pittsburgh Bloggers. It's a social organization that brings local bloggers together. Both online and in person. It's available for all blogs in the Greater Pittsburgh vicinity.

Not only can you get more readers to your blog, but you can connect with local people while doing so. And you can find some cool blogs to boot. Check it out and let me know what you think.

Blogshares Is Addicting!

I found a new and addicting website Blogshares.com. You can buy and sell shares of your blog or others blogs. It lists blogs by industries and rankings. Imagine my surprise when I went to the profile for Free Money Finance and saw that my blog was listed in his top 100. #81 to be exact ; ) That just blew me away. I mean he has over 300 incoming links and my relatively new baby blog still made it into his top 100.

You can check all of the sites that you link to and see who links back to you. There's also the ability to earn chips and karma points. What's I like most about this site is that you can see where your blog ranks in the grand scheme of things. It's also a great way to get your blog out there. So sign up and have fun!

Disclaimer: The above link is a referral link and will give me 5 chips if you sign up under me. Feel free to go straight to the site and sign up.

Find The One - Credit Card That Is

Did you know that there are more than 30,000 credit card programs among the five major brands (Visa, MasterCard, American Express, Discover, and Diners Club)? There's an excellent article on Fool.com discussing how to pick the best card for you and your spending style.

The article is broken into 4 categories:
1. Have a balance you are trying to pay off.
2. You never carry a balance, always pay on time, and make complete stops at every stop sign.
3. You occasionally carry a balance, spread your spending across a number of cards, or pay cash.
4. You have little or no credit history, or have one that is riddled with blemishes, and can't seem to qualify for any credit card.

Under each category is a list of things to look for in that card, as well as a list of things to watch out for. Each type of card has its pros and cons so be sure to look for the card that works best for you.

Moochers

So my mooching cousin called me this week. Yeah you. You know who I'm talking about. No I'm not putting your name out there. I'm so ticked, I don't even wanna think about your name.

I get home from work and there's a message on my machine. After the usual sucking-up and I haven't talked to you bull, he goes "oh I don't need money or anything I just haven't talked to you in a while." Well no you haven't. That's because the only time you call is when you need money! And is there anyone out there who falls for the old I don't need money line. If they mention not needing money, they want money.

I ain't giving you a nickel. Nope, not one thin dime. Don't call. This bank is closed, no more withdrawals for moochers.

1 and 3

Are you kidding me? I stayed up to watch this. I'm glad I kept my money and decided not to pull a Pete Rose and bet on any sports this weekend. First the Yankees now this. I'm glad I'm off work today. I need a moment. Sad, just sad.

Long Time No See

I know, I know, I know... I promised updates more often and I haven't delivered. I have good reasons, I promise.

First I've had a really tough time lately. Stuff I really can't get into on the internet. It's personal and not really pleasant to talk about. I'm dealing with it the best I can.

Then, as if that's not bad enough....My computer died!!!!!!! It took me 3 weeks to get a new computer. I was going crazy. I can't access the site from work. They block out any kind of blogs or message board type sites. So now I'm the proud owner of a new Compaq laptop. My first new computer in 7 years. I'm not too good at typing on the laptop yet, so bear with me and any typos.

Updates more often, I promise....

Pittsburgh Steelers Tickets Vent

Ok so this is not exactly money related but bear with me. So, I didn't get any tickets this year. I got my check back with the note sorry blah blah blah, oh yeah preseason games are available. Well yeah I bet they are. I don't want to go to a preseason game. It's just a televised scrimmage where the starters play at most half the game but usually only 1 quarter.

This bites. I mean really. Tickets are really hard to get unless you know someone who's not going to the game or willing to go to a scalper. The only way to buy tickets is through the team. You can't go to ticketmaster or anything like that. Most of the tickets are for season ticket holders. Ok fair enough, can't argue with that. The rest are first-come first-served type of deal. By the time they got my order form all games were sold out.

Yeah I know I know...Super Bowl champs blah blah blah. These tickets are always hard to get. Tickets are always sold out. And you know what? Turn on any game throughout the season and look at all of the empty seats. People that don't show up or leave the game early. Better luck next year.

Grrrrrr!!!!!!!!! Ok vent over!

Updates

Wow, wow, wow. I can't believe it. It's been over 2 months since I updated my blog. I really haven't thought much about it. I didn't think anyone was even reading it. Well, I was wrong.

A couple of friends have emailed me asking me why I haven't kept my site up to date. I have to say I was pleasantly surprised. As I said, I didn't think anyone was really reading it. They told me that they liked some of my articles and to please continue writing. Nothing like good old flattery to get the juices going again!

I'll try to get in here at least once every two weeks for an update. Sometimes more often, sometimes less often. I have had a hectic time as of late, so the updates may be sporadic. But I will make a more concentrated effort to post something, anything. So keep reading, and I hope you're enjoying the articles I've written.

Feel free to leave comments or email me with feedback. Also, if there are any subjects that you would like to see me cover, let me know.

See ya soon!

Drivers Switch to Public Transit to Avoid Costly Gas

What are you doing to combat high gas prices? According to an article in todays USA Today, Public transit systems across the USA are seeing an increase in ridership.

You can read the entire article here: Drivers Switch to Public Transit to Avoid Costly Gas

Popular Cars - Most Expensive To Insure

America's most popular vehicle, the Ford F-series pickup, is also the most expensive to insure according to a report released by the insurance website Insure.com. The least expensive - the Chrysler Town & Country minivan.

Insurance is the third largest cost of owning a new car, after depreciation and fuel, according to Insure.com. Insurance premium costs, now averaging almost $900 per year, have risen 27 percent since 2000, according to the report.

See the top 20 cars here: Popular Cars: Most expensive to insure

Of Course It Works

Would you be willing to buy used electronics for a substantial discount? That's what people who buy refurbished products do everyday. A refurbished product is one that may have been damaged during shipping. A production defect or even a scratch can send an item back to the company. All items sent back are tested and repaired by the manufacturer. After they pass the quality assurance team, they returned to the market place with a discount and the "refurbished" label.

So should you buy a refurbished item? Well, here are some points to consider before you do.

Price - Make sure the price of the refurbished item is discounted enough to take the risk. A similar new item may cost the same. In this case it would make more sense to go with the new item.

Brand - Stay with brand name items. These manufacturers are more likely to stand behind their product.

Warranty - A refurbished item should still come with a manufacturers warranty.

Refurbishing Policy - Read the fine print to find out exactly how the item is refurbished. Make sure it is subject to final inspection. And make sure all manuals, software, cables, etc. are included.

Return Policy - Adhere to the return policy in terms of length and the conditions that it comes along with. You want to be able to thoroughly test the item before you find out that you only had 7 days to return the item.

Refurbished items can save you lots of money, but be sure to do your homework and buy from a reputable vendor.

Till next time...

Best ways to spend your tax refund

Personally, I'm using my refund to buy some new clothes for work. And I'm getting no where near the estimated $2400 average refund.

Here's an article from CNN Money on the best ways to spend your tax refund.

Companies Target Your Tax Refund

Click here to read all about the sneaky ways companies try to get their hands on your money.

Companies Target Your Tax Refund

Audit Anyone?

According to a recent article from CNN Money, there are certain red flags on your return that makes you more likely to be audited.

But with the tax agency auditing 1.2 million individuals last year and the IRS ramping up its enforcement spending in recent years, experts say it might be worth taking a look at your return to make sure you aren't making yourself a target for the tax man.

Read here for the entire article from CNN Money.

Tuition Is How Much?

MOST EXPENSIVE COLLEGES Here's a list of the most expensive tuition bills for 2005-06, according to the Chronicle of Higher Education. The figures do not include room, board or other costs of attendance. College 2005-06 tuition

1. Landmark $37,738
2. George Washington U. $36,400
3. U of Richmond $34,850
4. Sarah Lawrence $34,042
5. Kenyon $33,930
6. Vassar $33,800
7. Trinity $33,630
8. Bennington $33,570
9. Simon's Rock College of Bard $33,364
10. Hamilton (NY) $33,350

So the next time Junior mentions wanting to get into Harvard, keep these schools in mind and Harvard will seem downright cheap.

$241,000 Strip Club Bill Settled

New York strip club "Scores" has settled a $241,000 bill racked up by a former telecom exec.

Read the article here: $241,000 Strip Club Tab Finally Settled

All I can say is that's a whole lotta lap dances!!

PlayStation 3 Delayed

The bad news - Sony Corporation has announced the delay of its PlayStation 3 console. The release date has been pushed back to November because of delays in finalizing its next-generation optical disc technology.

The good news - the November release date will give you something to look forward to for Christmas.

Read the full article here: Sony Delays Release of PlayStation 3

Great News For The Class Of 2006

With a strong recruitment push, higher salaries and in some cases, multiple job offers, all signs are pointing up for the class of 2006.

Recruiters are reportedly fighting for space at campus career fairs, according to college career offices. Several schools have also reported that they have had to turn down recruiters because of space limitations. And employers are expected to hire 14.5 percent more graduates this year, according the National Association of Colleges and Employers (NACE).

The hot fields this year are engineering, accounting and finance, and computer science. But liberal arts majors take heed. You are in demand because of your communications skills, your ability to think critically, lead or adjust to the demands of the job.

The top ten jobs and their starting salaries are:

1. Chemical Engineering $55,900
2. Electrical Engineering $52,899
3. Mechanical Engineering $50,672
4. Computer Science $50,046
5. Accounting $45,723
6. Economics/Finance $45,191
7. Civil Engineering $44,999
8. Business Administration $39,850
9. Marketing $36,260
10. Liberal Arts Majors $30,828

Paying Bills By Text Message

Here's an interesting article I found on CNN Money about Paypal. The article starts off with:

PayPal is getting back to its mobile roots.
Back in 1999, when the company first launched as a tiny startup, it had designed software to beam money between handhelds and cell phones. It rapidly abandoned that plan when it found that buyers and sellers on eBay (Research) preferred to use a Web-based version of its payment service to settle auctions.

They also have some competition in this area from another company called TextPayMe.

The process for sending a payment with TextPayMe is simple: Users text an amount and the recipient's cell-phone number to TextPayMe, which then sends a text message to the recipient. To collect the money, the recipient later visits TextPayMe's website to register bank-account details. It's not unlike how PayPal's e-mail payments work today.

I can't wait to see these companies marketing strategies. I think I'll give them a look-see before jumping in. What about you? Do you like the idea of paying bills by text message? Leave me a comment and let me know.

Till next time...

Should You Charge Your Tax Bill?

In a nutshell, the answer is no. In 2005 1.5 million taxpayers put their bill on credit. More than double the previous year according to an article in USA Today.

Enhanced rewards from credit card issuers are making the idea even more enticing. Some card issuers are offering double rewards on tax bills paid with their cards. And to use a credit card to pay taxes, you'll have to cough up a fee usually 2.49 percent of federal or state taxes paid to third-party companies that process the transaction. The two companies authorized to accept credit card payments for the IRS are Official Payments and Link2Gov.

It's never a good idea to use a credit card to pay when you can find some other way. Especially considering you'll have to pony up an extra 2.49% just for the convenience.

An Ideal Budget

What does your budget look like? Do you spend first and save later? Nothing left to save you say. Well I found a great budgeting tool. The simplest way to budget is known as the 60% budget. Written by Richard Jenkins at MSN Money it goes like this:

Monthly committed expenses should be at or below 60% of your gross income.

Examples of committed expenses are:
Essential Housing Expenses - Rent, mortgage, utilities, insurances and taxes.
Food and Clothing Expenses
Insurance Premiums - Health, homeowner, and car.
All Bills - non essential utilities such as cable, cc debt, transportation, student loans, etc.
All Taxes
Charity

The other 40% should be broken into 10% chunks like this:
Retirement Savings - 401k or IRA contributions.
Long Term Savings - Liquid cash on hand usually for emergency fund.
Short Term Savings - To be used for irregular expenses such as: new car, new appliances, birthday or holiday gifts, vacation fund, etc.
Fun Money - Dinners out, movies, plays, etc.

Right now, this budget may seem impossible for some people. The idea is to use this as a guideline to make the best use of your money. Follow this budget, and you'll start to have a lot of money left over at the end of the month.

Car Lease Or Fleece Part II

In the last installment I discussed the pros to leasing a car. In this issue I will discuss the cons. Are you thinking that there can't possibly be a downside to leasing a car? Well I'm about to show you some of them.

Cons
1. You pay for excessive wear and tear on the car. What defines excessive wear? Anything for a scratch, to a ding or a big dent in the side door. You pay for the repairs to the car at lease end.
2. The car must come back to the lessor in its original condition. If not you pay to have it restored. This is not the same as #1. Suppose you want a CD player with a detachable face-plate, if you add this to the car you must remove it when you turn the car in and replace it with the original equipment.
3. The lessor owns the car, as the lessee you are just renting it until the end of your contract.
4. The lessee still has to pay for general maintenance (oil changes, etc.), any tickets incurred and insurance.
5. You usually pay a higher amount for insurance for a leased vehicle.
6. You pay any and all excessive mileage fees. An example of this is a 2006 Chevy Cobalt 3-year lease with 36000 miles with .25¢ per extra mile. Drive 40000 miles andthat'ss 4000 miles over. A hefty extra $1000 at lease end.

Bottom line is leasing is right for some people and not for others. Take all the pros and cons, apply them to your individual situation and make the right decision for you.

Some Common Lease Terms:
Closed-end Lease - with this type of lease, at the end of the contract you can walk away from the car and owe nothing more except for wear and tear and excessmileagee.
Disposition Fee - fees accessed at lease end for selling expenses or disposing of the car.
Gap Insurance - The difference between what you owe and what the car is worth in the event that it is stolen or totaled in an accident. This insurance pays the balance after insurance pays off.
Lessee - you, the person leasing the vehicle.
Lessor - the financial institution leasing the vehicle to you. Open-end Lease - at the end of the lease, if the cars appraised value is less than the amount stated in the contract, you the lessee must pay the difference. Generally not to your advantage.
Residual Value - Resale value of the car at lease end, as determined by the lessor.

Car Lease Or Fleece Part I

Is leasing a car the right option for you? Well, it depends on a lot of factors. Would you like a new car every two to four years? How about a lower payment? In the next two installments I will go over the pros and cons of leasing a vehicle so you can see if this is right for you.

Pros
1. You can drive a new car every two to four years. This is the most common reason people pick leases. The idea of a new shiny vehicle is a powerful inducement.
2. Lower monthly payments because you only pay for the amount time you use the car.
3. Since the monthly payments are lower, on average one-third less than buying a new car, you can get more car for your money. Goodbye Chevy Cavalier, hello Baby Beemer. It's estimated that between 45% to 55% of new BMW's on the road are leased.
4. Most leases require low or no down payment.
5. If you have a "closed-end lease", at lease end, you can pay any charges due, turn in the car and walk away.
6. Your security deposit is actually the last payment. Just like when you rent an apartment, the company want to ensure that you will take care of their property and return it when the time comes.

There are plenty of good reasons to lease. However, in the next installment I will discuss the downside of leasing.

Ways To Improve Your Credit Score

There is no quick fix to helping you fix your credit score. Some companies will charge you mega bucks to offer a quick solution. But in the end, all you have is a worthless booklet and a smaller bank balance. Here are some tips from the myFICO website on improving your credit score.

Payment History Tips:
Pay your bills on time. Delinquent payments and collections can have a major negative impact on your score.
If you have missed payments, get current and stay current. The longer you pay your bills on time, the better your score.
Be aware that paying off a collection account will not remove it from your credit report. It will stay on your report for seven years.
If you are having trouble making ends meet, contact your creditors or see a legitimate credit counselor. This won't improve your score immediately, but if you can begin to manage your credit and pay on time, your score will get better over time.

Amounts Owed Tips:
Keep balances low on credit cards and other revolving credit. High outstanding debt can affect a score.
Pay off debt rather than moving it around. The most effective way to improve your score in this area is by paying down your revolving credit. In fact, owing the same amount but having fewer open accounts may lower your score.
Don't close unused credit cards as a short-term strategy to raise your score.
Don't open a number of new credit cards that you don't need, just to increase your available credit. This approach could backfire and actually lower score.

Length of Credit History Tips:
If you have been managing credit for a short time, don't open a lot of new accounts too rapidly. New accounts will lower your average account age, which will have a larger effect on your score if you don't have a lot of other credit information. Also, rapid account buildup can look risky if you are a new credit user.

New Credit Tips:
Do your rate shopping for a given loan within a focused period of time. FICO® scores distinguish between a search for a single loan and a search for many new credit lines, in part by the length of time over which inquiries occur.
Re-establish your credit history if you have had problems. Opening new accounts responsibly and paying them off on time will raise your score in the long term.
Note that it's OK to request and check your own credit report. This won't affect your score, as long as you order your credit report directly from the credit reporting agency or through an organization authorized to provide credit reports to consumers.

Types of Credit Use Tips:
Apply for and open new credit accounts only as needed. Don't open accounts just to have a better credit mix - it probably won't raise your score.
Have credit cards - but manage them responsibly. In general, having credit cards and installment loans (and paying timely payments) will raise your score. Someone with no credit cards, for example, tends to be higher risk than someone who has managed credit cards responsibly.
Note that closing an account doesn't make it go away. A closed account will still show up on your credit report, and may be considered by the score.

Now that we know what a FICO score is, what it is not, how it's calculated and how to improve it, let's all strive to be at least the median of 723 or higher!

What A FICO Score Is Not

FICO scores use a lot of information to determine your score. Some information that they do not use includes:

1. Personal information such as race, color, national origin, sex, or marital status.
2. Whether you receive public assistance.
3. Your age.
4. Where you live.
5. Your salary, occupation, title, employer, date employed or employment history. The lender may use is information however. Especially if you have a fair score (620-659), but you have a stable job history.
6. Whether you have participated in consumer credit counseling.
7. Any information not contained on your credit report.

In the next issue I will discuss ways to improve your credit score.

What Is A FICO Score?

Lenders use your FICO score to determine your credit risk. The higher your score, the less of a risk you pose. To see the chart of FICO score see my post What's Your Score?.

So how is your score determined. The percentage that Fair Isaac uses is:
35% payment history
30% amounts owed
15% length of credit history
10% types of credit used
10% new credit

The percentages break down like this:

Payment History - 35%
Account payment information on specific types of accounts (credit cards, retail accounts, installment loans, finance company accounts, mortgage, etc.)
Presence of adverse public records (bankruptcy, judgments, suits, liens, wage attachments, etc.), collection items, and/or delinquency (past due items)
Severity of delinquency (how long past due)
Amount past due on delinquent accounts or collection items
Time since (recency of) past due items (delinquency), adverse public records (if any), or collection items (if any)
Number of past due items on file
Number of accounts paid as agreed

Amounts Owed - 30%
Amount owing on accounts
Amount owing on specific types of accounts
Lack of a specific type of balance, in some cases
Number of accounts with balances
Proportion of credit lines used (proportion of balances to total credit limits on certain types of revolving accounts)
Proportion of installment loan amounts still owing (proportion of balance to original loan amount on certain types of installment loans)

Length of Credit History - 15$
Time since accounts opened
Time since accounts opened, by specific type of account
Time since account activity

New Credit - 10%
Number of recently opened accounts, and proportion of accounts that are recently opened, by type of account
Number of recent credit inquiries
Time since recent account opening(s), by type of account
Time since credit inquiry(s)
Re-establishment of positive credit history following past payment problems

Types of Credit Used - 10%
Number of (presence, prevalence, and recent information on) various types of accounts (credit cards, retail accounts, installment loans, mortgage, consumer finance accounts, etc.)

Now that we know what your credit score is, in the next installment I will tell you what it is not.

What's Your Score?

Credit score that is. The fact is, the higher your credit score the lower the interest rates you qualify for.

Scores range from 350-850 using the traditional FICO method. FICO being the Fair Isaac Corporation which is the score most often used by lenders.

Scores of:
750-850 Excellent
660-749 Good
659-620 Fair
350-619 Poor

The median FICO score in this country is 723 which is good. How can a few points affect what rates you qualify for. An example of mortgage rates from myFICO are:

For a $216,000 30-year, fixed rate mortgage:
If your FICO® score is: Your interest rate is: ..And your monthly payment is:

760 - 850 5.92% $1,284
700 - 759 6.14% $1,314
680 - 699 6.32% $1,339
660 - 679 6.53% $1,370
640 - 659 6.96% $1,431
620 - 639 7.51% $1,511

The rates are valid as of 2/24/2006 and are updated daily. The are also national averages, you local rates may vary.

The difference between the median score or 723 and a fair score of 620 is $197 per month. I'm sure we can all use an extra $197 in our pocket every month.

Be sure to come back for my follow up posts on how your credit score is determined, what your score is and is not, and how to increase you credit score.

Karyn's Been Saved

Anyone remember the girl who set up a website a few years ago called Save Karyn? The premise of her site was as follows... She was in credit card debt over $20,000 from buying life's necessities. You know, things like a new laptop, clothes, shoes and expensive sunglasses. All the things a fashionista in NYC needs. So she created her website and asked everyone reading it to send her $1.00 to help get her out of debt. And wouldn't you know it, people did it. There was outrage over her site. People wondered how anyone could be so bold and brazen. Her link was passed around like hotcakes. Usually with the accompanying question, "can you believe this?".

Apparently most people did and sent her money. Over the course of 20 weeks she was able to pay her debt completely off. To her credit, she did auction off some of her goodies on eBay. So what's Karyn up to now?

Well she has a new book coming out in July called 20 Times A Lady. The premise of the book is pretty good. A woman wakes up one morning and realizes that she has hit the maximum number of men she is willing to sleep with in her lifetime, in this case 20. Since he is not the one, she has to go back to her past men and make it work with one of them. There are also talks of a movie deal.

Pretty bold moves coming from Karyn, but it worked and I say good for you. Check out Karyn's blog for more on what's going on with her.

Till next time...

Spare Change

Do you have a container of change just sitting around? According to Coinstar, there is more than $10.5 billion in loose change is sitting idle in American households. Over 60% of Americans own piggy banks or some other means of hoarding change (jars, bottles, cookie tins, buckets, etc.).

I own several piggy banks. Among them: a blue plastic pig, two small porcelain pigs, and two glass jars. One of the porcelain pigs is for foreign change only. If I come home from vacation with a coin or two, I drop it in the bank. Or if I get a Canadian coin or two in change it goes in. This happens frequently and at the rate I'm going I'll be able to fund a Canadian vacation in the next year or two.

So what do you do with your change? Hoard it, cash it in, use it to splurge on something expensive. If you roll your change, make sure to contact your bank to find out their procedures before turning the change in. One of my banks just requires the coins to be wrapped. Another wants my account number on the roll - I don't turn coins in at this bank!

You can turn your change in at a Coinstar machine. Be aware that they charge a fee for this service. The processing fees are as follows - 8.9% in the U.S., 9.8% in Canada, and a 7.9% fee in the U.K. However, if you turn the coins into a gift card you can skip the fee. Starbucks, Amazon.COM, Borders, Linen N' Things, Pier 1 Imports, and Hollywood Video participate in this program. Check out the website for more info.

If your lucky enough to have a bank that provides this service, go with it. I know Commerce has their own machine in the lobby that you dump coins in. It then gives you a receipt that you take to the teller. Deposit it or take the cash. But the best part about it is, it's free!

So continue to save that change and let me know what you do with yours.

Till next time...

Tax Time!

Does the thought of doing your taxes strike fear in your heart? Take heed, there is plenty of free advice out there. Just go to the IRS website for help.

You can also go to Free File Home to find a website to file your taxes free. Some of the site have restrictions for gross income or filing status, so be sure to read each one to find the site that will work best for you. Make sure you use the link from the IRS site otherwise you may incur a fee. Also most of those free sites don't include your state taxes. Don't pay them a fee, usually about $14.95. Go to your states' website and file free. For example I would go to pa.direct.file.

If you are plain scared to death there are people that will do your taxes for you. Check in you local phone book under "tax preparer". You can choose from large companies like H&R Block or local CPA's. Just be sure to make an appointment early (everyone usually waits until a week before the deadline when these guys are under the gun) and bring all of your supporting documentation. Things like: W2's, interest, dividend and mortgage interest statements, etc. You can also have volunteers do your taxes. Check out VITA for more information or call 1-800-829-1040 to find the site closest to you.

Remember the filing deadline this year is Monday April 17th. (The 15th is a Saturday so we get a couple of extra days)

Good Luck!

What constitutes an emergency?

So you're surfing Priceline.com or your favorite discount travel site and you see the deal of a lifetime to paradise. Ah, the tropical drinks, sandy white beaches and all the umbrella drinks your heart desires. You want this trip, you need this trip. But you haven't set aside any vacation money at all. But there is that emergency fund just sitting there gathering its piddly interest. You could swipe it and put it back later. Your job is stressing you out, surely this qualifies as an emergency right? Wrong. Don't touch that emergency fund.

What an emergency fund is:
1. There for an emergency. Flat tires, appliances that have died and the like.
2. Three months of your salary in case of job loss. You said your job was stressing you out. This is money to tide you over when you get that new job. Don't forget, these jobs may be on different pay schedules and you might skip a check or two.
3. Co-pays for sudden illnesses. Or a new pair of glasses because the old ones broke.

What an emergency fund is not:
1. Vacation money. You should set up a new fund solely for this purpose.
2. A new pair of Gucci glasses because they're all the rage.
3. A big screen tv because the big game is coming up.

In short leave that money there for what its intended for, to tide you over in case of an emergency. If you want to take a vacation or go on a spending spree, open up a new sub-savings account. This way, what ever is in this account is fair game and can be used for whatever you heart desires. And hopefully, with any luck, you won't have to ever touch your emergency savings.

Till next time...

Emergency Fund

The rule of thumb in money management is to have at least three months' salary available in case of emergency. You know, an emergency like the furnace going out in winter, a flat tire or having an appliance suddenly die. The fact is at one time or another, we'll all have some kind of emergency that will call for us to tap our savings. "But what savings?" most of you are asking. That's what this edition is all about. But three months worth of salary? For most people this seems like a daunting task, especially if you have very little already in savings. So how do you get it?

Well first, you have to save it. One of the oldest tricks in personal-finance is to pay yourself first. This is a painfree way to save. The easiest way to achieve this is to have a set amount automatically deducted from your check each pay period. Get your last paystub and look at the net pay. Either take a percentage of this or a set dollar amount and have it transferred into your savings each pay period.

I know some of you are saying "Well yeah, but there's nothing left to save". That's why is so important to pay yourself first. Even if it's only $5 or $10 dollars per pay period. Have you ever heard the expression "Making mountains out of molehills"? Well, it doesn't have to only have a negative connotation. Turn those molehills into mountains of cash.

If cash is tight or you're living paycheck to paycheck this seems impossible. But it is possible. Each pay slip $1 or $2 dollars to the side. Do this faithfully every pay. Then, when you get your next raise increase that amount if only by another couple of bucks. Over time your reserve will be bursting at the seams.

I know it seems challenging but you can do it. Start of small if you have to, but do it! Don't be discouraged when by the small amounts that you may start with. Do this each pay, and before long those amounts won't be small anymore!

Just Save!

Till next time...

Pay Down That Debt

The U.S. savings rate is at an all time low while debt is steadily rising. Most people will be receiving an income tax refund within the next few months. My advice use at least part of this money to pay down debt.

I know you want to use the money for your summer beach vacation, or that new pair of Manolo Blahnik slingbacks, or a flat screen plasma. The list goes on, but unfortunately sometimes so does the debt. So lets strike a compromise. Use part of the money for debt repayment. No it doesn't have to be half. That would be optimal, but I know for most people its highly unlikely. Where should you put that money? Let's discuss.

The first debt you should try to repay is high-interest credit card bills. With the rules changing and minimum payments doubling this is the best way to go. When you pay your credit card bill every month, the majority of your payment goes to interest. So it only makes sense to pay this off first.

If you have no credit card debt, then I would suggest you look at personal loans and/or car loans next since these types of loans generally have a higher interest rate. Since mortgage interest is deductible for some, and student loans are deductible for everyone, I would save these for last.

Point is, take some of that money and pay off that debt!

Till next time...

Welcome

Welcome to my world of money madness. My job is to help you navigate the scary world of personal finances. I will help start you in the right direction as far as personal finances go.

Most of my friends come to me with their money questions. Now I'm no Suze Orman, but I do my fair share of research and can answer most of their questions. That's when I decided to start my own finance blog. I realized that there were tons of people out there who thought personal finances where scary. They start reading the financial section of newspapers and their eyes start to glaze over. People want information broken down into an easy to understand format. That's where I come in.

So sit back, grab a cup of Joe and enjoy. Always remember, money is a powerful tool. Use it wisely.