festival of under 30 finances - June 1, 2007

Welcome to the June 1, 2007 edition of festival of under 30 finances.

H.S. Ayoub presents biotech stocks, news, commentary - BioHealth Investor posted at BioHealth Investor.

Sagar Satapathy presents How To: Pitch Your Company for VC or Angel Money posted at Business Fund.com.

Henry presents What Does Your Investment Portfolio Look Like? posted at Binary Dollar!.

Ruby presents 10 Things You shouldn?t do in the name of frugality posted at Frugal Aussie, saying, "You need 5mn USD to be rich: if you have this much money, you don't need to worry about working. You might not necessarily be able to buy all the private jets your heart desires, but you will enjoy a very comfortable lifestyle and never need to worry about working or providing for your loved ones."

Alex Z presents FU Fund - The Old Kid On The Block posted at Funds Zine, saying, "Emergency funding explained"

Big Cajun Man presents Top 5 Investing Regrets In My Life posted at Canadian Financial Stuff, saying, "My top 5 investing regrets, with a hope that others can learn from my mistakes."

Tim Ramsey presents 2 Debt Tips for Improving Your Credit Score posted at My Debt Relief Blog.

Tushar Mathur presents Move your checking account to Bank of America and get $75 posted at Life of a Resident Alien....

pfodyssey presents Sometimes You Just Have to Laugh « My Personal Finance Odyssey posted at My Personal Finance Odyssey, saying, "The lighter side of personal finance?"

Erik presents Your Options For Paying Back Your Student Loans posted at Money Crashers.

David Weliver presents First Time Home Buyer’s Mortgage Checklist posted at Money Under 30.

FIRE Getters presents Free Cell Phone & $100 Free Money With Sony Ericsson W810i Phone! posted at FIRE Finance.

FitBuff presents How to Legally Get Your Cable and Phone Bills Paid for Free! posted at FitBuff.com's Total Mind and Body Fitness Blog.

Super Saver presents How Much is Needed to Be Wealthy - THE NUMBER posted at My Wealth Builder, saying, "My post answers your question."

Olga presents How much money do you think you need to be considered rich? posted at Finance of a Russian Girl, saying, "I am aware that festival of under 30 finances is aimed at American students and young professionals, but the question seems interesting to me and I want to contribute to the festival. I'm sorry for all possible mistakes is my English and I hope they are not crucial."

Silicon Valley Blogger presents The Economics of Cosmetics: Should You Invest In Your Looks Or Skimp On Makeup? posted at The Digerati Life, saying, "To answer your question: I feel that I would need at least $10 million to consider myself as "rich". The reason for this is that I tie this target number to the idea of becoming financially independent. In order to quit my job and still be able to afford the lifestyle I so desire, I believe I'll need $10 million to achieve all that. With a household of 5 people, that's probably what it takes to be financially independent. Wish me luck!"

Alwitt Xu presents CSS Tools Collection posted at Prosperity Achiever.

KRG presents $5,000 Scholarship For Minority Accounting Students posted at FIL-AM WORDS, saying, "Scholarships for minority accounting students"

Tushar Mathur presents Financial Planner: Do I need one ? posted at Life of a Resident Alien....

Uni presents Make money from your website using ADBRITE! posted at You Deserve More, saying, "looking for an alternative to adsense...?"

Uncle Leo presents In Your 20's: Money Matters When Time is Your Friend posted at Uncle Leo Rumbles, saying, "You are rich when you have enough money to afford all the things you really need or want, and some of the things you kind of need or want. Beyond that, more money may not mean more happiness, so you aren't necessarily richer even if you have more money."

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http://blogcarnival.com/bc/tb_10718.html
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http://www.businessfund.com/2007/how-to-pitch-your-company-for-vc-or-angel-money/trackback/
http://fundszine.com/14-fu-fund-the-old-kid-on-the-block/trackback/
http://pfodyssey.wordpress.com/2007/05/18/sometimes-you-just-have-to-laugh/trackback
http://www.moneycrashers.com/your-options-for-paying-back-your-student-loans/trackback/
http://www.fitbuff.com/blog/2007/05/24/how-to-legally-get-your-cable-and-phone-bills-paid-for-free/trackback/
http://www.thedigeratilife.com/blog/index.php/2007/03/29/the-economics-of-cosmetics-10-reasons-why-you-should-invest-in-your-looks-or-skimp-on-makeup/trackback/
http://www.ProsperityAchiever.com/webblog-design-tips/css/css-tools-collection/trackback/
http://www.filamwords.com/5000-scholarship-for-minority-accounting-students/trackback/
http://youdeservemore.info/make-money-from-your-website-using-adbrite/trackback/

Little things kill.

It is not the major purchases that cost you (your house, car, education) these purchases are usually well thought out in advance and made with good judgment. It is the little impulse purchases, the gizmos and gadgets, impulse buys here and there while running errands that take all your money without you even noticing. I am writing down what I spend my money on, every purchase for a month and will see where it is going. Think before you buy: is the item a want or a need, can I live without it, is it worth buying now or better to be free of debt? Remember little things add up.

Keep it simple. Stay on track

If a million dollars seems like an unreachable goal. Set yourself up with short-term and midterm goals. Break it down to saving $100 a month or even $20 a week. Once you reach your short-term goals continue until you are able to reach bigger goals. Celebrate reaching savings milestones, but don't celebrate by going on a shopping spree that would defeat the purpose. My current goals include saving an extra $100 a month to fund an Roth IRA and investment account. I would also like to build up my savings by $24,000 each year. That would mean saving at least $2000 dollars a month. It may take a few years before my savings account start to build a lot of interest. My midterm goal is to have at least twice my current yearly income in savings ($120,000) by the time I reach 40. I think I'll have about $30,000 in my 401k by 30, and hopefully ($120,000) by the time I'm 40. Then I'll be able to cruise into my 50th not having to worry about retirement.

You can save a million for retirement

If you are motivated you can do anything. I will save 1 million dollars for retirement. I read an interesting article today on Yahoo Finance (a great site for financial information) titled How to Save $1 Million for Retirement It talks about saving 2x your annual salary. When you reach that, you are home free. I have 20% saved to reach the 2x salary goal only 80% more to go. I plan to make it within the next 10 years.

I'm hosting the Festival of Under 30 Finances Next Week

Join the fun the question to answer is "How much money do you think you need to be considered rich?" Submit an article to the carnival to have it published on this page.

Oxymorons in advertising

Sometimes advertisements don't make any sense at all. Stores commonly use the line "the more you spend the more you save." I personally hate this saying because it is a lie. When you are spending money, you are doing the opposite of saving money. Thus you can't save money by spending it. People are brainwashed into thinking that they need to reach $100 in order to save an extra 10% (a measly $10) or whatever the deal is. Unfortunately many fall victim to this trick and spend extra money in order to reach the prize of (extra savings). They don't realize the extra spending they are doing in order to "save money". When you go shopping, know exactly what you're getting, don't get distracted or side-tracked by the glitz and glam of sales.

Top 5 ways to Save Money on your Wedding

For Lacey,
The author of Saving for a Wedding asked me to add a link for her. Done.

Fast Facts
The average age of a bride is 26
The average age of a groom is 27
The average cost of a wedding in 2006 $28,736
Amount of money spent on the wedding industry last year $2.1 billion dollars.

How to save money on your wedding

1. Elope - most resort locations will give you a free ceremony and other perks, or just walk down to the local courthouse. Have the after party at your house.
   
2. Be your own DJ - Setup a playlist on your iPod plug it in to some nice speakers and get your groove on.
   
3. Don't invite everyone you know, make it more intimate, cut the guest list down to those people you truly care about, forget your long lost cousin twice removed
   
4. Buffets are much more affordable than paying for meals by the plate, have your mom make spagetti, pasta is cheap, easy, and filling
   
5. BYOB or cash bar, don't pay for your friends and family to get sloshed

Call in friends and family to help - call in favors, if someone has a nice digital camera ask them to be the photographer, if someone has a nice flower garden ask them to help with the flowers, you get the idea. There are many ways to save money on the wedding these are just a few suggestions. It doesn't have to cost a lot to be a wonderful, beautiful event.

Take home message: Don't turn your BIG DAY into a BIG DEBT!

Update: Step by Step guide to Saving Money on your Comcast High Speed Internet

Debt Hater here it is:

Save money on your Comcast High Speed Internet, or any other service that uses a cable modem.

1. Find out what cable modem you are currently using. I had a RCA DCM315R Digital Cable Modem DOCSIS 2.0.
   
2. Go to Ebay.com and purchase the same type of modem. I found a refurbished one selling for $0.99 shipping cost me $10 for a total of $10.99.
3. Receive modem and install it. For those that are technologically challenged unplug the one you have, taking note of where the wires are connected and they put the new one in.
   
4. Call Comcast and explain that you bought your own modem. They will ask you for Serial Number and the Mac address (both numbers are on a sticker on the bottom of the modem). Make sure your internet works.
5. Take back the original modem to your local Comcast and tell them to take off the rental charge that appears on your bill every month.
   
6. Voila! You're done. Now you've just reduced your monthly cable bill by a few dollars (I'm saving $3 a month)
   

Exteme Makeover - Blog Edition

In the following months you will notice some major changes with this blog. I gotten off the topic of How to Make a Million Dollars numerous times. I've become consumed by trivial facts and statistics. I've become an Adsense Junkie, addicted to the few pennies I get when hapless searches click on the advertisements. Most of the advertisements on this site are not even helpful for those people who are really here to find the formula to make a million dollars. There is no get rich quick scheme that is legitimate and effective. Anyone who tells you that you can make a lot of money with little to no experience in a week, a month etc. is a scam artist. Creating wealth takes hard work, persistence and patience. There are ways to make a lot of fast money but they are not legal. I will continue to share ways that I've been able to save money, and how I invest for retirement. I will also share links to sites that I believe will benefit readers. I will try my best to make this site more user friendly. Juan Mill from Millionster mentioned that I should add an about page to give you and idea who I am and what I'm about. I will also do my best to censor advertising that I believe will lead users to lose money rather than make it. I want to set up better navigation and make it easier to post comments. I like feedback good or bad. If you don't like something, disagree, tell me. I regret that I haven't responded to Debt Hater about the way I saved money on high speed internet. How to Make a Million Dollars 2.0 will be more organized, more user friendly, easier to use, and help you make the most of your money.

Save money on the Top 5 Most expensive things in your life

TOP 5 Most Expensive things in your life.

1. Children - the average child costs $448,422 not counting college tuition
2. House - you will use most of your money to pay the mortgage over 30years averaging $350,000-$550,000 not counting repairs.
3. Car - you will pay roughly $300,000 on cars, gas, and repairs
   
4. Food - you will spend an estimated $300,000 in your lifetime on food
   
5. Health - you will spend an estimated $500,000 on your healthcare in your lifetime

Assuming you are an average middle class person living in America you'll have 2 kids, a 3-bedroom house, 1 car, live for 76 years and probably die of cancer or heart disease in a nursing home or hospital. Total comes to $2.6 million dollars that you'll pay for your top 5 expenses.

How to save money on these expenses:

1. Raise smart kids, push sports, teach the importance of a good education - they'll be choosing your nursing home, (hope they get scholarships). Go with good public schools, private schools aren't worth it.

2. Get a modest home you can easily afford. Hopefully you'll be able to buy during a "buyers market" and lock in a low interest rate, adjustable rates are crap go for a fixed rate, refinance once if interest rates drop lower than 1% below what you have, don't pay down the principal balance, wait until you can switch from a 30year mortgage to a 20, 15, or 10 year mortgage (you'll save thousands). Use a stepping stone if you can't afford a home, rent until you can afford a down payment for a condo, then wait until you build up some equity and use the sale of the condo as leverage to purchase the house.

3. Pay for a used car in good condition in full (look for a cheap Honda Insight 60miles/gallon), try to share one car in the family or get rid of a car altogether if possible. It helps if you live within walking distance to your job, or on a bus route, or carpool etc.

4. Pasta and rice, make shopping lists, use coupons, buy in bulk (only if you'll use the food)

5. The best and cheapest health care is prevention. Eat right, and exercise. Short and sweet, simple and effective.

Spiderman 3

This past weekend I saw Spiderman 3. It made about 148 million dollars in it's opening weekend. I would recommend the movie, especially if you like action. The special effects are phenomenal. Picked up a free movie comic courtesy of Target, I might try to sell it on Ebay.

How much does a baby cost?

Finally someone named Thomas Bey has done a good job calculating a rough estimate of how much it costs to raise a child from birth to college. The grand total comes out to around $300,000-$400,000 depending on a number of variables. Check out the article it's called "Financing a Human Being" Moral of the story is if you want to be rich, don't have kids.

401K doing well

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I noticed that my 401K has recently crossed the $11,000 mark. My short-term goal is to have at least $25,000 in my 401K November 2009 when I turn 30. I am currently on track for that goal.

My mortgage

I recently went over the large packet of papers from my mortgage company Chase. I read that I'll be paying more than half a million dollars for the $250,000 I borrowed. So over the 30 years I'll pay Chase $504,000. I find this to be ridiculous, but I guess that's how it gonna be for now. I am very happy that we were able to lock in a low interest rate of 6.0%. Also the points we paid into the loan, paid off during tax time.