Monday, June 3, 2013

Final Post

Well, it's been fun gang, but I've come to the conclusion that this will be my final post for this blog.  Why you ask?  Well, I've achieved what I've wanted from this blog and learned a bunch along the way. Here is a brief list of just some of the things I've taken away from running this blog:

1.) Allowed me to better understand a multitude of financial related topics: you know the old saying that if you really want to better understand something, you should teach it to someone else?  That's what exactly happened here with, and I was able to force myself to learn much more in order to better portray this information to my readers.

2.) This post marks 1 year of post.  If my count is correct, than this post is number 156 which would provide for 3 posts a week for one year.  My 1 year goal was more to see if I could have the discipline to do something of this nature for that long.  I have to admit that some posts were better than others, but the important thing to realize is that I did achieve my initial goal.

3.) Running a blog is hard!  Let no one make you think otherwise that it's easy keeping up with a blog.  It is a very intellectually taxing endeavor.

4.) I'm now distracted.  With the onset of my first born children, I no longer feel as motivated to keep up with this blog, and know for certain I will have no time when they come along.

Overall, it's been a great run, and I thank you for reading!  Good luck with your own Illusions!

Last Wonderful Moment of the Day: Getting the chance to write for you.

Friday, May 31, 2013

How can a Bank Make Money on 0.9% Interest

As someone who works in the lending field, I often find it shocking that financial institutions can make any sort of money with interest rates as low as 0.9% (I’m thinking car loans here).  Intuitively, this doesn’t make any sense.  If your interest rate is lower than the inflation rate (usually between 2-3%), how can you make any money off your loan?  Well, banks are smarter than you think.
First, consider how a bank makes money; it takes your checking and savings deposits for essentially free (you get the guarantee that your money is safe), and it loans out your funds to people who need mortgages, car loans, etc.  This is a pretty nice little game of arbitrage here.
The second interesting thing to think about is how a fully amortized loan is structured.  If you have a fixed loan, you pay the same amount each month, however the way a bank structures the payment varies throughout the life of the loan.  Your monthly payment is almost entirely interest the first couple years and almost entirely principal the last couple.  Think about this example:  you take out a $20,000 car loan for 60 months at 0.9%.  In the first year, you will pay $432.86/month, but your total interest portion for the year will be $2,005.20.  If you divide this total interest by the average monthly balance, you have an average interest rate of 10.8% for the first year.  Now say, year two comes along, and you decide to pay off your loan: the bank gets its money back and loans it out again all the while making 10.8% interest the first year.  This is why banks eventually encourage you to prepay your loans.  Inflation will eventually catch up to the payment. 
So, what should you do as someone with a car loan?  Well, there is not much you really can do?  If after 12 months you decide to pay off your loan, you will have essentially paid $21,921.77 in today’s money (assuming a 3% annual discount rate) for the privilege to borrow $20,000.  If you went through the full term of the loan, you would have paid $24,089 in today’s dollars.  Borrowing money has a price to it, so the best advice would be not to get into debt in the first place.  The contrary point is that if you can’t get to your primary source of revenue, because you don’t have a car, then the cost of inaction is far more than the debt load.
Whatever you choose, it’s important to realize what you are getting yourself into and how the bank is going to make money off of you.  You will then be able to make smarter life decisions if you are armed with this knowledge.
Wonderful Moment of the Day: The smell of fresh cut grass makes me believe that summer is finally here.

Wednesday, May 29, 2013

What’s a Jumbo Mortgage?

Believe it or not, but the economy is actually getting better.  Property values are increasing and mortgages rates are starting to go up.  In fact, home prices in some areas of the country are increasing at such an alarming rate that it is reminiscent to the pre housing crash of 2008.  Nevermind that for now, because I want to focus on an interesting problem for those of you thinking about buying a new house in these newly expense housing districts.
An interesting thing happens to mortgages when they cross the magical threshold of $417,000, they gain the title of Jumbo.  What does this mean?  Well, here are some things to take into consideration if you decide to obtain a jumbo mortgage.
-          Jumbo mortgages have higher interest rates than non-jumbo mortgages.  If you think about, mortgage companies are taking a big risk by giving you a whole bunch of money with the hopes of you paying it back over time.  We won’t even discuss the concept of interest rate risk.  With that in mind, if a mortgage financer gives you even more money, you are now considered even more risky, so interest rate increases are inevitable. 
-          The next issue with jumbo mortgages is that they are harder to get.  A $416,999 mortgage is much easier to obtain than a $417,000 mortgage, and because of this arbitrary dollar cut-off, you’ll likely have a much harder time convincing a bank to loan you that high amount of money.  You will need a higher credit score, and most likely a much lower LTV on your home. 
Unfortunately, this classification can really harm people who just happen to live in higher cost of living areas.  Places like DC and NYC often have regular 2-3 bedroom homes well north of this dollar amount, and so those of us looking to own our home will have a rougher go.  With that in mind, do everything you can to get your mortgage below that $417,000 threshold.  The easiest way is to pay a larger down payment up front.
Wonderful Moment of the Day: While being new to this whole baby thing, I’ve found the resources online to be invaluable.  It’s actually made my research very enjoyable.

Monday, May 27, 2013

When to Splurge???

Notice the asymmetric design?
Sometimes you can be too good at saving.  In fact, you start to reach a point where you get so fed up with your saving that you need to spend it on something.  This phenomena called "the splurge" is usually used as a destructive term and can do havoc in your finances if you are not careful.

Before we get into the concept of what's a "good splurge", we should first realize what the point of money is.  By itself, money is essentially useless, but it is purely a means of acquiring something else.  With that in mind, the use of money should have some goal behind it just like saving money should come with some goal.  Recently for me, my car needed new tires; in fact it just barely passed the state inspection because of this issue.  Tires for me are my splurge, and I've always been good at saving so that I can 1.) Retire early, and 2.) buy things that provide safety for my family (like good tires).

For me, a good set of all weather tires can revolutionize your car driving experience.  My personal brand of choice is Nokian, but a high quality Firestone, etc... is probably also good.  Let me tell you, those tires came in handy over the long weekend!  I had a wedding to go to, and it was over 400 miles of solid rain driving.  It even snowed on the wedding day in May!  Thanks to my new Nokian tires, I never had a problem with stability or felt like my family was at all in danger.  Safety is one of my chief concerns, and splurging on quality tires is a "good splurge".

What's important to you, and what is the goal for you to use your hard earned money?

Wonderful Moment of the Day: Happy Memorial Day!

Friday, May 24, 2013

102 Thrifty Ways to Save

My Frugal LifeIn my quest to provide you with personal Finance and smart money-sense guides, I've scoured the Internet looking for some helpful household tips.  This site called "Thrifty Fun" has an interesting article on 102 tried and true ways to save. The list includes a whole slew of simple ways to make your dollar go that extra distance.  Below is a sample of my favorite tips from reach category:

Laundry Room:
- Pre-treat stains as soon as you notice them - why have to throw away your nice work shirt when a little scrubbing can save you big bucks.  Another helpful tip is to keep a "Tide Pen" at work in case you spill there.

- Re-use bath towels - You really need to only use about 2 towels per person per week if you are just drying yourself with them.  Just make sure to keep them hung up in a way to fully dry out.

Kitchen and Pantry:
- Learn to cook - It's amazing how much you can save by cooking your own meals versus buying out, not to mention how much healthier it can be.
- Bring leftovers to work for lunch - I do this every day, and not only do I eat better food, it's also way cheaper.

Bedrooms and Living Areas:
- Buy the highest quality sheets, furniture, etc. you can afford.  They will last for years.  In today's IKEA culture, this may not be widely though of.

- Use your library for books, movies, music, and books on tape.  This is such a great and under-utilized source.

- Make a list for everything you need to purchase.  This will prevent all those impulse buys.

- Put on a sweater when you are cold.  My house is never more that 65 degrees F in the winter.

- Buy items on sale AFTER the holidays.  This requires a little more planning and forethought.

- Save your scraps and combine for interesting projects.  This is a really good option especially if you have kids.

- Clean your own carpets with a rented or borrowed machine.  Really, how many times a year do you wash your carpets; once?  Renting a high end carpet washer will do a better job and cost less in the long run.

You can see the types of easy information that can make you into a handy, frugal, and overall better person.

Wonderful Moment of the Day: The sound of rain on your roof at night.

Wednesday, May 22, 2013

Listing Your Projects

I think it's pretty obvious from my writings that I'm a planner when it comes to life.  Everything doesn't need to be detailed out, but I like to be aware of what's coming down the road.  With that said, I often battle the same urges to procrastinate as anyone.  One of the best ways I've found to combat procrastination is to start with a list.  By seeing the projects named out before you, you will be more inclined to get started and finish your tasks.

With all that in mind, here are my projects for the year:

1.) Realign bricks around flower beds
2.) Re-paint stairs/hallway down to basement - this actually looks scary with dirty finger and hand-prints all over the place.
3.) Paint laundry room windows
4.) Paint side windows of garage
5.) Fix the outlets in the office and living room
6.) Start getting the house ready for babies - This one will be more work than I think I realize

Needless to say, I think these goals are pretty doable and will make things look rather nice around the old household.  If we apply the S.M.A.R.T. system to these goals we can make them more Specific (kind of already did this), Measurable (I can obviously know when they will be completed), Attainable (these are goals that can be done), Relevant (they make sense in my overall life goals), and Time-Bound (I want all these finished by the end of this year).

Now that I've seen these goals and have an action plan, actually completing them won't seem so hard.

What projects do you have for the year?

Wonderful Moment of the Day: Petting my cat while he rolls around in the grass.

Monday, May 20, 2013

Benefits of a Hard Day's Work

It's that time of year again; as the sun stays out longer and the days get warmer, Spring temperatures and the labor that comes with it are in full circle.  Whether it's Spring cleaning, yard work, or construction projects, you're sure to be doing more physical labor in the coming months than you probably did over the winter.  With that in mind, I wanted to examine for a little while the benefits of a hard day's labor.

The first benefit to a hard day's labor is the sense of accomplishment after its all over.  Recently, over the weekend, I spent about 8 hours doing yard work from planting this year's garden to mowing, and laying 24 bags of mulch.  After it was all over, the property looked really nice and I was rather proud of the work I did.  You might not be getting too many sources of accomplishment in your own job or daily routine, so a hard day's labor can be a welcome opportunity to really receive some positive reinforcement.

After your sense of accomplishment, you can be reassured that your results are physical proof of your hard labor.  I like to think about this as if I were a construction worker, the epitome of hard labor.  After all those rough weather days and hard labor, I can look up at the building my team just constructed and feel good knowing that we created something great.  The same thing can be said for a day's labor.  You will see the result, and if done with passion, can be quite proud of it.

Physical labor can also be considered great exercise.  You have to be careful here though that you aren't breaking your back over the labor.  Lifting improperly can put a damper on your future quality of life, but if you're just moving around all day you will definitely get your daily exercise.  That mild soreness you get the day after working hard can almost be pleasurable at times.

Working out on a job doing hard labor can change your perspective on things.  You might hate your cubicle job, but after a day outside doing tough work, you might appreciate not having to do that every day for the rest of your life.  Also, I usually find hard monotonous work soothing since I can let my mind wander and think about anything that's going on in my life.  Your brain needs time to process and analyze things in your life; what better time than when you are mowing.

Finally, I think one of the often overlooked qualities of hard labor is that you will genuinely feel discomfort and that's a good thing.  This may sound strange, but in today's comfort driven lifestyle, we try to ameliorate anything that might cause us a little pain.  By experiencing this pain every once and awhile, we can be reminded of how good we have it and appreciate even more the comfortable times.

I wouldn't want to make a career out of it, but every now and then a little hard work is good for the mind, body, and spirit.  It's a humbling task that can allow you to explore other aspects of your life.  If you're feeling a little lost, why not let your mind wander and do a project?

Wonderful Moment of the Day: Got all my Spring yard projects complete!

Friday, May 17, 2013

Hope for Millennials?

I was recently inspired by this article highlighting the future planning tendencies of the millennial generation, a generation in which I find myself in towards the upper echelon.  The article explains how the millennial generation is turning out to be much more forward thinking in terms of finances than their parents, and are at least planning for retirement now.  With all the hate from TIME Magazine, it’s nice to see some bright spots about my peers. 
Some encouraging stats from this article indicate that a full 91% of millennials with jobs earning at least $50k contribute to their employer’s 401k plan.  Since this is essentially free money, I was shocked to think that 9% don’t.  What is even more shocking is at that age and demographic, only 40% of Baby Boomers were contributing to their 401k!
I think there is a couple things going on here that might explain this situation.  The article touches on one of them, and that’s that this generation has lived through 2 big economic crashes which leaves a lasting impression on individuals just entering the job market.  Watching their parents go through some despondent times can make one want to be a little more careful with their hard-earned funds.  The second theory I have is that Baby Boomers were always lead on to believe that their company’s pensions would take care of them just like their parents.  As globalism kicked into full steam, many were shocked and horrified to see their pension plans dissolve.  Millennials were never brought up in a world where a pension was even an option.  On top of all that, social security might not even be available, or at least not in the robustness it currently stands at.  Millennials therefore have to save on their own if they are going to have any sort of future retirement. 
A healthy savings rate is crucial to the stability of any economy.  I hope that if you are currently not participating in your employer’s 401k plan that you would reshuffle your budget and start contributing now.  You are leaving free money on the table.
Overall, this article left me hopeful for the future, and I hope it did for you too.
Wonderful Moment of the Day: Lying in the grass.

Wednesday, May 15, 2013

Home Owner's Shenanigans Conclusion!

Finally, it's all over and I can continue with my life!  If you are not familiar with the slightly dramatic saga of my home owner's insurance policy, then feel free to read here and here.  Needless to say, it was quite a bit stressful and I finally got my act in gear to get everything taken care of.

If you recall from my earlier posts, I had a series of fixes that needed to occur on my property in order for my insurance company to renew me for another year.  Not wanting to have to go through with the burden of finding another insurance company again at the nice price I currently had, I decided that it would make sense to follow through with the fixes.  Besides just complying with the insurance company, the fixes seemed reasonable and were probably needed anyway.  Well, in my blunderous nature, I mistook the due date that these improvements had to be completely as the date that my insurance policy would be canceled.  I actually completed all these requests about a month ago and thought I had until July 1st to get the paperwork in.

Then I got the letter in the mail; "Your policy is being canceled for failure to comply".  Panicked, I called the insurance company, informed them of my situation, and was promptly told that I needed to mail in proof of these repairs ASAP.  At least this type of work is where I excel.  I took some pictures, copied receipts, and put together a 3 page PowerPoint detailing the repairs.  I then expedited the mailing and just received notice that the Insurance company has forgiven me and will renew my contract.

In all this hustle and bustle  I've learned two very important lessons; the first being to read a little more careful, and the second being to never underestimate the power of organization and human intervention. Believe it or not, there is usually a person behind every bill you pay, and it's worth it sometimes appealing to the human side of the company.  At least now, I can sit back and relax knowing that in case of fire, my financial life is not destroyed.

Wonderful Moment of the Day: Got out of work 2 hours early!

Monday, May 13, 2013

Happy Mother's Day Plus Twins

Even though it's the day after Mother's Day, all you Mother's out there should get another greeting since you went through so much raising your children.  With that in mind, I have my own special news in that my Wife and I will be expecting our first children come December!  When I say, children, I found out a couple weeks ago that it is actually twins!  You can imagine my surprise.

As you can believe, I'm the planning type, and with this special news, it throws all my plans around like a brick in a dryer.  Needless to say, I think some of my skills will come in handy over the next 6-7 months.  Foremost, are my research skills; I've already started scoping out the best strollers, car seats, and so forth.  I feel that when the time comes, I'll know as much as possible on the subject.  Secondly, my planning will come in handy for financial means.  Two added mouths and all the stuff we will need to purchase will put a whole bunch of pressure on our wallet.  Luckily, we've got an emergency fund, and there is enough time for me to start saving for all this expense.

With all this in mind, we'll see how everything goes.

Wish me luck!

Wonderful Moment of the Day: Do I need anymore?

Friday, May 10, 2013

Rolling with the Punches and Dealing with Stress

What stress’s you out? When you think about your life, and all your experiences, what is the one or many instances in which you were so stressed, that you wanted to scream at the top of your lungs?  Some people might list such events as fighting with your spouse, kids, getting into a car crash, or especially having to call the cable company.  Whatever it might be, learning what stresses you and how to deal with it is a skill that is easy to learn but takes a lifetime to master.

It’s funny how my Wife and I have such different ideas of what makes us stressed out.  For her, it’s the big things in life.  A few years back, she was side-swiped in a car accident which caused her some very stressful nights.  Other things include paying the bills and financial management.  Luckily, I don’t mind most of this stuff and gladly manage it for our family.  It’s these large (and hopefully rare) disasters which stress her out the most.  I can totally understand where this is coming from, but for some reason, I don’t usually get too bothered by these.  She has even commented to me in the past “Why are you so calm about this?”  In my mind, these type of disasters are largely unavoidable; there is nothing you could have done to not have this situation happen.  For me, stress is all about woulda, shoulda, and coulda.  I could have studied a little harder for the test.  I should have cut that tree branch down before it fell on the house, etc…  In cases like a car crash, there is very little you could have done to make the situation safer and change the other driver’s habit. 

What stresses me out to no end are the little things in life like leaving the kitchen counter dirty.  These things just grind at your soul and are completely avoidable; there is no reason to ever have to worry about this stuff.  All this is a character flaw of myself and I acknowledge it.  What is important is that I don’t lose perspective in these situations.  What you are complaining and raging about is really a minor problem in the scheme of life.  Bumps and hiccups will come along the road of life, and what truly defines you as a person is what you do and how you handle yourself in these difficult situations. 

Whenever you are stressed to no end, take a mental step back and look at the big picture.  Does your problem seem that important now? 

Wonderful Moment of the Day: Happy Graduation Weekend to all you college graduates out there!

Wednesday, May 8, 2013

Getting Focused

With all the possibilities that life holds for you in your future, one of your biggest enemies in your quest for greatness is closer to home than you may think.  Procrastination is a terrible problem that if left unchecked will deny you from living to your potential; promotions will be passed over you, and opportunities will be missed.  With that in mind, here are some ways I've managed to maintain focus in my own career.

1.) Vary the assignments: You've been working on this big report for the past two hours and now feel drained.  For some reason, you just can't seem to get around to finishing it.  It's quite possible that you're just bored from working on the same thing for so long.  Instead, try mixing things up for a bit and work on another assignment for 30 minutes or so.  This will allow your brain to switch gears and hopefully get that much needed kick start so that you can return to your original assignment with verve and vigor.

2.) Get up and stretch: If you have the privilege of working in a sedentary job, then you might be forced to sit at a cube all day.  May sure you get up and stretch at least once every hour.  You need to get blood flowing back into your legs and other extremities, otherwise over time you could develop blood clots.  One way to give yourself an excuse to get up is to drink a whole bunch of water which will make you go to the bathroom.  Hopefully your bathroom is on the other side of the building.

3.) Listen to some music:  Sometimes your work environment can be distracting with the noise of multiple conversations, computers humming, printers printing, and telephones ringing.  This can cause a type of dissonance in your mind which may be very distracting.  Try listening to some music (preferably via headphones).  Music will not only cut out the cacophony, but will allow you to focus more on just one noise.  This often clears my mind and lets me focus on the task at hand.

4.) Take a walk: Finally, when all else fails, I need to take a walk.  A walk is a chance to literally and figuratively take your mind away from the situation at hand.  It gives you a chance to contemplate your problems before you and explore solutions that you might have not otherwise thought of.

Don't let procrastination rule your life.  Try some of the above tactics next time your having problems with getting things done.

Wonderful Moment of the Day: Playing with my cat in the yard.

Monday, May 6, 2013

Causes of Trouble When Starting a Business

If you ever think about starting your own business, well then I salute you good sir, because you are an enterprising individual!  Often times, entrepreneurs don't understand the common causes that may give them trouble in the near future.  When assessing your opportunity for a future business, it helps to know the issues that could cause problems in the future.  With that said, here's a pretty exhaustive list of potential ways entrepreneurs can get in trouble:

Strategic Issues:
1.) Misunderstand market niche
2.) Mismanaged relationships with suppliers and customers
3.) Diversification into an unrelated business area
4.) Mousetrap myopia: Starting a firm around an idea instead of an opportunity
5.) The big project: Company gears up for a big project without first examining the cash flows of the initiative
6.) Lack of contingency planning

Leadership Issues:
1.) Lack of leadership skills, experience, and know-how
2.) Weak finance function
3.) Turnover in key management personnel
4.) Big-company influence in accounting: focus on accruals instead of cash

Poor Planning, and Financial Controls:
1.) Poor pricing, and over-extension of credit
2.) Poor cash management
3.) Poor management reporting
4.) Lack of standard costing

As a potential business starter, its important for you to foresee these issues and approach them head-on.  If you do, your enterprise is far more likely to succeed and may even thrive.

Wonderful Moment of the Day: Spring tulips

Friday, May 3, 2013

Sell in May and Go Away

The old stock market adage of "Sell in May and Go Away" has its roots in the idea that many wall street traders and other money managers will usually take a vacation in the Spring/Summer months and therefre returns are far less in that time frame than the November to April returns.  With the advent of automated trading and discount online brokerages, this saying is far less true, but there are some aspects that should "go away".

One way to approach the concept of May is to "Go Away" from all the investing and financial planning you ususally do.  What I mean by this, is that you should pretty much have your retirement planning on autopilot, and shouldn't have to do much in this regards besides the occasional portfolio rebalancing.  With that in mind, it is definitely harder to stay indoors when the weather is nice out.  So, wait until November to rebalance your portfolio or make a bulk contribution to your IRA. 

All work and no play will leave you drained.  Everyone tries to take a vacation when the weather is nice, but intead of asking yourself where you want to go, think of a vacation that will provide the least amount of stress.  Booking airfare, traveling, and seeing family can all be great sources of stress to different people.  If you are living an active and busy life, finding time to unwind and de-stress is a rare opportunity.  Instead, think of a vacation that will leave you reenergized and ready to come back. 

Summer time is also the perfect time for our teenager or child to start to learn about the working world.  Many times, parents will leave their teenager to their own devices to find a summer job.  These kids have never had to find a job, and usually don't know the first thing on whether there are good opportunities out there.  You should take the time to help your child find a good job or internship.  It my seem like a mild source of improvement now, but it will pay off later in life.

Whether you go away in may literally, financially, or even mentally, the late Spring and Summer weather gives plenty of opportunities to reenergize your life.  Think smart, focus on a couple, and improve your life!

Wonderul Moment of the Day: Just bought a rope chain saw, and am excited to cut down some high over-hanging branches.

Wednesday, May 1, 2013

Home Buying Programs

The Spring time is not all just about chirping birds and the renewal of life back to the earth.  There is also another rebirth, and that is of the housing market.  Chances are, the next time you will be looking for a home (whether it be your first or seventh), it will be in the Spring.  There are a 101 different aspects of your home you need to think of before you buy, but allow me to suggest one you may not have thought of: buyer programs.

Most people are not aware of this, but many towns and municipalities offer home buying programs to incent enterprising families to move in their districts.  The long term goal is to reap the benefits of their income and property taxes.  When making your home buying decision, try looking at the different towns in your area and see if they offer any kind of incentives.  The easiest way to find out this information is to go to each town's website and doing some simple digging around.  If that doesn't turn anything up, try calling the town office and talk to someone who might know.  You'd be surprised of the many programs available.  In one of my neighboring towns, there are home buying programs that offer big discounts and incentives on buying a home.  In this particular case, it had some stipulations that you had to remodel a dilapidated home and then live in it for at least 10 years.  It also had to be your primary residence.  For some enterprising families, this would be a great idea.

If the town or city you live in does not provide a good incentive, then usually a community bank of creit union offers home buying programs; especially if you meet certain income requirements.  For my Wife and I, we met one of these requirements and through our bank, were able to get a free $7,500 with a pro-rated 5 year live-in requirement.  This money was more than enough for all the closing costs, and really helped us get situated.  All we had to do was attend a couple basic personal finance classes. 

If you're not taking advantage of your area's home buying programs then you could be leaving money on the table.  Do you due diligence and research all your possibilities, and you should come out ahead.

Wonderful Moment of the Day: 70 degrees and sunny!

Monday, April 29, 2013

Getting Back to Gardening

With the approach of summer and the days getting longer, you can probably guess what time of year it is again....that's right, it's gardening time!!!

If you've read some of my historical posts, you probably might already know that gardening is one of my favorite hobbies.  The ability to watch something grow from a seed all the way to producing wholesome and delicious food is such a great positive reinforcement.  Even better is that this all takes place within the span of 1 growing season, so you can definitely see the rewards of what you sow.

If you currently don't have a garden, now is the perfect time to set one up.  The start-up costs can be a little pricey, especially if you have to construct raised garden beds, but over time, your renewable costs will be minimal.  My Wife and I practice composting so most of our fertilizer comes directly from the veggie scraps we didn't eat throughout the year.

With the start of May right upon us, here are some things to be doing right now:

1.) Till the garden bed you plan on sowing.  Now is the time to start loosening the soil and getting a last bit of composting in before you full on plant.

2.) Start planting colder weather crops.  If you are in a high frost risk zone such as where I live, you can still start planting some colder weather crops.  Lettuce, chard, and radishes can all be planted a couple weeks before the last average frost giving you the chance for two or even three crops throughout the year.

3.) Start setting up your square foot markers.  If you practice the square foot gardening method, you need to start getting your garden ready for planting and it makes things much easier if you have your garden all squared off.

4.) Plan what you want to plant.  Now is the perfect time to finalize your planting list, and figure out where everything is going to go.  You might want to do a crop rotation if you have a bigger garden and take advantage of the nutrients certain plants provide and take, or you might want to think about companion planting.  Basil and tomatoes grow great together.  Also, make sure to only grow food items that cost a whole bunch in the store.  If you're trying to get the most bang for your buck out of this garden, then growing potatoes isn't really going to help out very much.  Instead, grow the items that cost much more like sweet peppers, herbs, and tomatoes.  These will pay for themselves and more.

Hopefully this little list will get you started and excited for your garden adventures ahead.  Here's to happy planting!

Wonderful Moment of the Day: Having friends come over, want to use your grill, and make dinner for you...can't beat that!

Friday, April 26, 2013

Becoming an Angel Investor

Recently, I've been fascinated with the idea of becoming an Angel Investor and the potential career path that might lead.  An Angel Investor, otherwise known as an accredited investor, is someone with a significant amount of wealth/income who has been registered with the SEC and has the ability to invest in start up companies. 

The trick to becoming an Angel Investor is the whole concept of obtaining accreditation from the SEC.  The general guidelines for such an accreditation are no easy feet and generally require a net worth (excluding the value of your home) of over $1 million, or a salary over $200,000 for the last 2 consecutive years.  It's a little more relaxed if you through in your spouse as well, but nonetheless, you will still need a significant amount of wealth. 

I am by no means anywhere close to this kind of wealth, but I have to admit that it sounds like an interesting career choice.  Generally, Angel Investors are people who have started their own company and in turn want to invest in the early stages of a start up in order to potentially reep big gains at some point in the future.  They take an early stake in the start up and often have to invest both time and money into its future growth.  It sounds particularly interesting to me since it would expose an individual to all sorts of companies and experiences.  On top of all that, it just seems like an exciting experience.

If you have the wealth to become an Angel Investor, you might be in the position for a significantly exciting career path.  If not, well then you have something to shoot for.

Wonderful Moment of the Day: Woke up spooning my cat this morning.

Wednesday, April 24, 2013

Things to do Instead of Spending Money

If you're trying to keep a strict budget, one of the chief problems that can throw your whole life out of balance is that of boredom.  You might be saying to yourself "that's not such a bad problem".  In fact, some people might even consider the lack of having to do anything as a major luxury.  In our fast paced and busy world we live in, this can often be true, but if you are bored too often, this could spell a disaster for your finances.

Let me elaborate:

Often times, boredom is a rather unpleasant state we find ourselves in.  We try to find ways to avoid being bored, and we usually have "go to" methods for at least doing something.  If you're not careful, your "go to" boredom fix could be something very expensive such as eating out, going shopping, or other entertainment venues.  Before you know it, you find yourself spending way more money than you should have.  So how do we relieve our boredom in a fugal way?  If you're a home owner like myself, there are always an innumerable amount of tasks that should be done, but sometimes I like a little spice in my life.

This blog here suggests at least 56 things you can do that cost very little to nothing.  Most of them are pretty good ideas, however I would argue that they are not all cheap.  Entertaining friends can be pretty expensive if you're not careful.  That said, it's at least a good start to having you think outside of the "proverbial box" and come up with some different ideas.  For me, writing this here blog is often a nice hobby and keeps me thinking.  If I was a better writer, it could even be a source of income.  Either way, look to your own environment for some entertainment, and you'll be surprised at what you find.

Wonderful Moment of the Day: My impatiens seedlings have all sprouted and will be ready to plant soon enough!

Monday, April 22, 2013

Less Accounts to Manage = Easier Saving

I mentioned it briefly here that having only one credit card makes it easier to track your expenses and balance your budget, but the concept can be expanded upon more than just your credit cards.  Consolidating all of your accounts into just a few with one financial institution will make it easier for your to manage your finances, balance your budget, and track your financial future.

Does this sound familiar to you?  To pay my bills and check my account balances, I first log into my account to see how much I have in my checking account, then I go to my paper account register and see if any checks are pending.  Next, I pay a few bills by hand writing checks from one checking account.  I then go online, check my other bank account, and pay some online bills through that bank.  Next I pay 2 of my 6 credit cards by checking the online statements and paying with a variety of checking accounts.  Finally, I log into my brokerage and see how my retirement funds are doing.

Wow!  That seems like a whole bunch of work.  No wonder why personal finances can seem daunting an people can get in trouble.  Well, here's a little trick that I use which has been great for my financial future...use just one bank for all your financial needs.

One of the keys towards getting your financial life together is to have all of your accounts and money in one spot.  This way, you'll know exactly how much you are spending and saving.  To do all of this, you will need a bank that provides all of the following services; checking, saving, lending, and brokerage accounts.  My own personal favorite bank is Schwab.  On just one page, I can see all of my savings, borrowing, and investing.  The only thing I have with a separate company is my credit card, and they only reason why it is with another company is that Schwab sold off its credit card business line to Bank of America about 2 years ago.  If they offered another credit card, I'd probably go back.

If you have many accounts in a multitude of places, the best way to start your financial plan may be to consolidate or close some of your accounts.  This will give you a firm foundation to get the rest of your financial life in order.  Check to see if your financial institution provides all of the aforementioned services, and if they do (for a good price), keep them and get your financial life in order!

Wonderful Moment of the Day: My flower seedlings are just coming up and are currently about an inch high.  I'm starting to get excited for the garden season to come back.

Friday, April 19, 2013

Cost of Living Comparison

NumbeoSometimes in life, you need to just pick up and start over in a new city.  Whether it's a new job, a new love, or just the need for a change of scenery, moving can often be a scary endeavor.  You could almost think about it as a leap of faith.  One of the most overlooked concepts when moving to a new city is it's cost of living.

Cost of living can be easily thought of as purchasing power for the basics of life.  If two cities have the same average $ value for a wage, and it costs $1.39 for a gallon of milk in one and $1.89 for a gallon of milk in the other, you could assume that it's cheap to live in the first city.  It might be far to say that the first city has a lower cost of living.  With that in mind, I found a nice site that lets you easily compare the cost of living in major cities around the world.  Site here.

A simple comparison between NY City and Washington DC will provide a varying array of results from consumer prices, rent, restaurants, groceries, and overall purchasing power.  In this particular example DC was lower than NY in all category except Consumer prices.  This type of tool is especially useful if you are going to compare a job opportunity in another city.  Say you are currently making $40,000 and you get a job offer for $45,000 in another city.  This would constitute a 12.5% increase in pay, however the city you are moving to has a 20% increase in the cost of living making your real wage go far less than when you were in your first city. 

Wages and costs are relative just like much of everything else in this world.  Don't accept absolute values, but instead, find ways to compare them and make an informed decision.

Wonderful Moment of the Day: Hitting the 70 degree F weather now!

Wednesday, April 17, 2013

6 Words of Advice on Investing

Over the course of my reading and analysis of different financial techniques, I've found 6 easy pieces of advice that will convey the heart of investment wisdom.  They are as follows:

On Earnings: Never depend on a single income source.  Make investments to create a second source.

This is the concept of diversifying.  You increase your potential returns while also reducing your overall risk.

On Spending: If you buy things you do not need, soon you will have to sell things you do need.

Keep a budget, and stick to it.  Do not go over your means.  This is the fundamental step towards wealth accumulation.

On Savings: Do not save what is left after spending, but spend what is left after saving.

In other words, pay yourself before you pay the bills.  If you make a habit of saving first, your expenses will fall in line.

On Taking Risk: Never test the depth of a river with both feet.

This concept has you understanding how much risk is involved with an investment.  Don't go all in, and if you are investing in new territory, consider testing the waters before committing.

On Investment: Do not put all your eggs in one basket.

Once again, this is all about diversifying your investment across asset classes and also within asset classes.

On Expectations: Honesty is a very expensive gift.  Do not expect it from cheap people.

One could interpret this along the lines of you pay for what you get. 

What bits of advice could you provide a future investor?  Often times when you think about it in terms of you teaching someone, you'll better understand your own deficiencies.

Wonderful Moment of the Day:  I'll leave you with this bit of wisdom "At the end of the game, the King and Pawn are placed in the same box".

Monday, April 15, 2013

Traveling Where the Water Might Not Be Good

An example of a Grand Tour
If you are lucky enough to have been born in a country with clean, running water, then you already have a better life than at least half of the rest of the world.  My Wife is coming back tomorrow from a 16 day  medical mission trip in Southern Egypt.  Whereas, there are far worse places in the world, this trip has served a purpose of exposing her to how most of the people on the planet live.  Clean water is not guaranteed, so it can make life pretty hard at times.

Back when I was in college, I approached my guidance counselor about the chance to study abroad for a semester.  When she asked me where I wanted to go, I mentioned maybe England or Australia, because I lacked the foreign language skills.  She gave me one look and said "Absolutely not"!  I'll never forget how shocked I was at this statement.  I pressed the issue and she explained to me that a study abroad trip is a once in a lifetime experience, and you need to go somewhere were the water isn't clean to see how the other half live.  I'd have plenty of time in my life visit these other places, but I needed to be exposed to some harsh advice.

Well, she was not wrong, and I thank her for her stern advise.  Since one of my majors was European studies, I found a way to go to Southeast Europe.  The experience was eye-opening, and I would not trade it for anything.  I did come home with a new-found respect for all the things I had.

They used to have something like this back in the 1600-Late 1800's called the Grand Tour.  It served as a right of passage for a young man to experience the rest of Europe.  Well, in today's world, travel is easier, and there are many more places to see.  If you have the ability, I highly suggest you go somewhere were the water isn't always clean and take it all in.  You'll find that it does change you.

Wonderful Moment of the Day: Only 1 more day until my Wife comes back!

Friday, April 12, 2013

It's Easier to Save as you Get Older

We all know that saving for retirement is an important part of life, and that the slow wealth-building tactic of investing a small amount of money each month is a great way to accomplish this task over time.  If you're just starting out of school or college and find saving and investing very difficult, I'm here to tell you that it does get easier with time.  Here are a few reasons why I believe this:

1.) Less 1 Time Expenses - Think of all the money you had to spend when you first started out on your own.  You had to buy a bed, TV, kitchen supplies, a car, or even a new couch.  Chances are, when you hit your 30's you will not have nearly as many of these expenses. 

2.) The Benefit of Living with a Spouse - Hopefully as you age, you'll find someone you want to spend the rest of your life with.  An added bonus is that you can get an almost economies of scale experience by pooling your expenses together.  Food, living, and commuting expenses are less per person since you have 2 incomes with only marginal increases in expenses.

3.) Knowledge Increases - As you age, hopefully you'll start to better understand a whole slew of life skills.  Not only will you know how to better manage your money and savings, but you you'll most likely know how to cook more, or fix your car a little bit, or even just knowing whether you are getting a good deal.  This knowledge will help prevent far more mistakes than you made when you first started out on your own.

4.) Pay Increases - Generally speaking, as you age and become more experienced at your job/career, you'll likely have a higher pay than the inflation rate.  This will only add to your ability to save. 

5.) Good Habits Become Routine - This one only works if you made a habit out of investing when you were younger.  If you were disciplined enough to do this in your younger days, then you should be on automatic in your later years.  You'll also find that you will not miss your saved income, because you've already been living without it.

There are two things that can through all these previous points out of balance, and that's living above your means and children.  No matter how much you make, if you spend more than you take in, you'll have serious financial problems.  Likewise, depending on when you have children will also significantly impact your finances.

Sometimes you might get frustrated with your finances, and understandably so.  Just know that if you have a good head on your shoulders, and stay disciplined, it will only get easier.

Wonderful Moment of the Day - Coming home to a warm house.

Wednesday, April 10, 2013

Why I Only Have 1 Credit Card

Owning your own credit card is one of those milestones in any young person's life.  It creates a sense of pride in an individual.  To think that a bank would trust me enough to temporarily loan money is often one of the first experiences one has with lending.  If not managed properly, these little pieces of plastic can be quite problematic, however, if managed properly, they can provide a whole slew of benefits.  With all the credit card options on the market, and seemingly every store offering their own version, it would be enough to make anyone confused.  In this article, I talk a little bit about why I have chosen to stick with 1 credit card instead of many.

Managing Your Credit Score:
People often wonder what goes into their credit score.  Well, the newly created Consumer Financial Protection Bureau (CFPB) has a nice concise explanation.  Generally, how much credit you have, how active you are in using it, how many accounts you have recently opened, and whether you pay off those accounts are the main factors.  If I were to open many card accounts, I'd probably take a ding on my credit score.  That said, it is a little more difficult to increase your credit line with just one card which would improve your overall score.

Low Maintenance:
Keeping inventory of your many credit cards can be quite a hassle, especially if you are trying to maximize benefits.  Do I get 5% cash back at supermarkets on this card, or is it 10,000 points at gas stations if I spend $2,000 in the first 3 months on that card?  All this can get very confusing if you're not a financial pro.  The added benefits to me are simply not worth the hassle and work involved with keeping up with all these accounts.  It would seem very easy to accidentally miss a payment, and now much of the benefits you reaped or taken away in the form of late fees and increased interest.  It is just much easier to pay off your card each month through using 1 card.

Keeping Track of Spending Habits:
With multiple cards, it is much harder to keep track of your spending habits, unless you are religiously recording every transaction.  With just one card, you have all your credit spending in one place and can easily budget accordingly.  It becomes increasingly hard to know what you spent in a given month if you're looking at 3 or 4 different statements.

Potential Fees for Not Using:
Some cards have fees if not used for a certain amount of time.  Therefore, you have to keep balancing whether you used your card in 60 days or so.  This can get annoying after awhile.

There are some downsides to having only one card.  My Wife and I experienced this a little while ago when our card information was stolen and some fraudulent charges were paced on it.  It took us about a week to get a new card, which could have been a problem since we had no other credit cards.  Overall, though, I think the benefits outweigh the risks.

Wonderful Moment of the Day: Finally starting to get some Spring weather.

Monday, April 8, 2013

Maximize Your Life Through Breakfast

If you want to succeed in life and maximize your potential, then the first thing you can do immediately  is to eat a healthy breakfast.  The simple act of feeding yourself in the morning with a nutritious meal has lasting effects throughout your day, and over time, can be the difference between you succeeding and reaching your goals, or failure.

We all know the old saying that "breakfast is the most important meal of the day", but what does this mean?  Studies have shown that eating a healthy breakfast can have the following effects:

1.) A more nutritionally complete diet
2.) Improved concentration and performance
3.) More strength and endurance
4.) Lower cholesterol levels

I would like to put a note of caution on the 4th point.  It depends on what you eat.  If you're chowing down on bacon and pancakes everyday, your cholesterol might not be too good.  Overall, eating a healthy breakfast has a whole slew of benefits that are too simple to pass up.

Another important feature of eating a good breakfast is that it gets you started in the morning with a good routine.  I know that sometimes in our life, routine can sound like a bad word, but there are reasons why it can be helpful.  Routines allow us to focus on more important parts of our lives, and the comfort they provide can allow us to focus our time and energy on other events that may not be routine. Eating a good breakfast allows your brain to process the events that will likely occur for the day.

Finally, eating a good breakfast can be a nice way to spend time with your family.  Whenever guests come over to my house and spend the night, we try to cook a big and deluxe breakfast as most families don't usually do this.  Not only is this seen as a nice treat, but it is also a great setting for spending time together.

If you're not eating a healthy breakfast everyday, maybe you should rethink your routine.  As far as quick hits go, this is so very easy, that you'd be foolish to pass up.

Wonderful Moment of the Day: Just watch this clip.  It will warm your heart!

Friday, April 5, 2013

Is it Worth Having Both Parents Work?

Every new parent goes through this same difficult question.  Should one of us stay home and raise the child or should we both go to work and pay for daycare?  It's a difficult discussion in it's own right, and it is almost entirely based on the financial rewards for such a proposition. 

I was inspired by this article from the NY Times which talks more about the tax implications of women with childcare expenses.  Basically, a person married to someone who earns much more then them will have their own income taxed at the same level as the higher parent's income.  Couple this with the high cost of childcare, and the actual take home pay might not be as enticing as once thought.

Take for example the case presented in the article.  A parent with an income of $45,000 married to someone making $90,000 will be taxed at a higher marginal tax rate of about 25%.  Their take home pay after taxes, social security,medicare, and any other withholding will most likely be around $30,000.  Now the average daycare expense in NY State for a child is $14,000 leaving the parent with $16,000.  I'd also like to add in some further expenses the article doesn't talk about.  How about having a second car ($1,000 for insurance, $2,000 gas, $750 for service, parking $1,440)?  Subtract this from your take home expense and you are now looking at a take home pay of just $10,810.  All this expense just to get you to work and have someone else take care of your child.

Now we are at the crux of the real question here; is spending your time with your child worth an additional $10,810?  Many people might make the decision that an additional 10 grand isn't really worth it, and I wouldn't blame them! 

Deciding who or both parents should work is a very personal issue, and it requires some tough critical thinking.  Make sure you do your homework, compute the math, and factor in the intangibles and you should have a much clearer picture of your decision.

Wonderful Moment of the Day: Finally starting to look like Spring.

Wednesday, April 3, 2013

Taking a “News” vacation

This past Easter weekend was filled with family activities, physical labor, and great memories.  Even more importantly, there was hardly any time to use a computer, check the internet, or even watch the local news.  Throughout this weekend, I realized that I did not even miss learning about what’s going on around me, and I found myself even more relaxed.  I’ve come to affectionately call this a mini news vacation.

When you think about it, the news is filled with all sorts of negative information.  After all, is it really news worthy if it doesn’t threaten me in some way?  Listening to this negative material day after day will have an effect on your mental state even if you don’t immediately realize it.  Over time, you may even start to feel afraid of the outside world.  Trouble in the Middle East, a murder on the south side, or even local neighbor disputes can give you the impression that you live in a hell hole if that is the only source of information you have about a region. 

Don’t get me wrong; the news has its place within our modern lives.  The information it provides can be very useful and if efficiently disseminates information no matter how negative that info might be.  I’m not suggesting you eliminate this information from your life completely.  What I am suggesting is for you to take a news vacation.  Cut it out of your life for at least a week once and awhile.  This includes newspapers, TV, radio, and the internet.  After experiencing this for myself, I started to feel more connected to my immediate surroundings.  After all, if you don’t hear about it, what do I care about problems in Korea when it’s nowhere near me?  Problems and obstacles in life seem far more minor and manageable. 

If you are feeling overwhelmed and facing some tough obstacles, then try cutting the news out of your life for a while.  This opportunity will give you the time and clarity to examine the more important problems in your life.

Wonderful Moment of the Day: Roast beef leftovers

Monday, April 1, 2013

Deciding on an IRA

Happy April Fools and I hope you also had a great Easter Sunday for those of you who celebrate.  As for me, I had a full weekend of family, food, and garage roof reconstruction (I'll write a more in-depth article on this later).  But for now, I'm tired, and need some time to catch up, and for that I apologize for such an incomplete post.

Instead, I've found a really good infographic on which type of IRA you should choose and whether you even qualify: located here.

Enjoy, and I hope you have a great Monday!

Wonderful Moment of the Day: Finally completed my garage roof project!

Friday, March 29, 2013

What do I do with my Tax Refund?

With all the curses and frustrations that come with filing your taxes this time of the year, there also comes a blessing (at least for some of us) in the form of a tax refund.  With that in mind, your tax refund can be quite a benefit to your finances if handled appropriately.  It's easy to say that you now have the money to purchase that TV you've always wanted, but it's far wiser to put it towards benefiting your long term financial situation.  Here are my own suggestions:

1.) Adjust your deductions - If you're receiving a refund of more than $500, you should probably adjust your weekly deduction so that you are receiving a little more money throughout the year.  There are better uses of your money such as paying down credit card debt and saving for your future than letting the government take it.  That said, from a budgeting perspective it's always better to receive a refund than having to pay more.  It's a fine balance that you will only really master over time.

2.) Pay Down Credit Card Debt - Now is a perfect time to pay down your credit card debt and get that burden off of your shoulders.  With some interest rates around 20%, paying off this debt will mean more net income for you and your family throughout the year.

3.) Pay Down Other Debts - If you mortgage, student loans, private loans, etc... have interest rates of more than 4%, it probably makes sense to pay these off more quickly than contribute to a retirement account.  You could use your money to make an extra payment on your mortgage.  Over time, doing this every year could reduce the timing on your mortgage by a couple years.

4.) Make a Catch-up Contribution to your Retirement Accounts - If you are not maxing out your 401k contributions to $17,500/year, or your IRA contributions at $5,500 per person, then here is yet another opportunity to improve your future financial situation. 

5.) Make Home Repairs - Besides being mostly likely your biggest asset, your home is where you spend a vast amount of time in so it makes sense keeping it working and in top shape.  Use your money to repair a window, reinsulate a room, and put a new paint job on.  If you plan on moving soon, you might even get a small return on your investment.

6.) Finally, if you've done all this stuff and are in a good financial situation, you should take the family out for dinner and celebrate each other.  Too many families don't acknowledge how special each other are, and a tax refund is a good opportunity to do this.

Try to take the emotion out of your spending habits, especially when small windfalls such as a tax refund come into play.  If need be, give yourself a week to think about the money before spending it.  You'll likely make a wiser financial judgment with some time under your belt.

Wonderful Moment of the Day: Happy Good Friday!

Wednesday, March 27, 2013

Straight Razor Shaving

Over the weekend, my Wife and I had dinner with a coworker and good friend of hers who has the interesting hobby of shaving with a straight razor.  I have to admit that the idea of holding a large and razor sharp blade to my throat seems a little discouraging to me, and therefore I’ve never attempted it.  However, when I pressed him on why he decided to shave like this, he gave me a number of reasons first of which was the cost.

I’ve praised DollarShaveClub for the affordability of their disposable razors, and have enjoyed using them.  I was in disbelief that there was something cheaper out there other than not shaving.  The basic straight razor shaving kit is comprised of a razor, whetstone (or hone), a strop (piece of leather and canvas), brush, and shaving soap.  A simple Amazon search for these products of mid-range quality yielded the following estimated prices:

Razor = $50
Whetstone = $80
Strop = $26
Brush = $7
Soap = $12
Total Cost = $175

Right off the bat, this seems like a pretty large startup cost just to scrape the hair off my face.  Let’s look into these investments a little more closely.  First, you’ll want to take into consideration whether these purchases are 1 time or recurring.  The mid-level razor is probably good for about 4 years or so, the whetstone will last for life, the same with the strop and brush, and the soap might have to be purchased once a year.  The 4 year cost of shaving in this style is $211.  With DollarShaveClub, I upgraded to their mid-level razor and pay $6/month.  Over 4 years, this will have cost me $288 which also assumes they don’t increase the price.  

Conclusion: It definitely seems cost effective in the long run to shave with a straight razor.  Our friend also mentioned the non-tangible benefits such as creating a morning ritual out of the routine and connecting with his own masculinity.  Either way, I don’t think I’ll be shaving this way anytime soon, especially since my wife walks into the bathroom from time-to-time while I’m shaving and she has some pretty quick arm movements.  Heaven forbid I’m shaving the Adam’s apple during that time!

Wonderful Moment of the Day: Spring has finally arrived!

Monday, March 25, 2013

Financial Tips for Traveling Abroad

Within the next week, my Wife will be traveling to Egypt for 2 weeks on a medical mission trip.  This whole experience has been a good exercise on the financial steps necessary for a longer stay in a foreign country.  Here is a short list of some of the steps we took to prepare her financially for this trip.

1.) Contact your credit card and debt card companies - Make sure you contact your bank and credit card company in order to let them know that you will be traveling abroad, the country, and the dates of your travel.  With modern day fraud protection, your bank might block your card if it sees a whole bunch of strange charges in a foreign country.  I have actually had this happen to a friend while I was traveling with him and I had to loan him some money until he could contact his credit card company.

2.) Work with a bank that has no ATM fees - This is more of a long term decision, but I currently use Schwab for most of my checking needs, and one of the perks is having no ATM fees.  This is especially useful when you first arrive in a foreign country as you can use an ATM as your currency converter.  Just simply withdraw the appropriate amount of the local currency, and the ATM does all the conversions based on the day's exchange rate.  I find this to be the best and most efficient way to exchange currency.

3.) Stay current on the currency conversion - Before you go on your trip, check the currency conversion rate so you know how much you will need and what your currency is going for.  If you need to use one of the private money exchange kisosks, you'll be much more informed on whether you are getting a good deal.

4.) Acquire travel insurance - I actually didn't know about this insurance until recently, but have developed a new-found love for it.  Most insurance plans will not cover you in foreign countries and that's precisely when this insurance kicks in. Travel insurance will cover all your medical needs, potential losses, or even travel supplies in some cases.  I believe they'll even pay for the shipment of your body back to your country in case of death.  It only costs about $50-60 and save you from a real headache in case something disastrous happens.

5.) Only carry a minimal amount of cash on your person - Depending on where you go, this rule is more applicable than in other places.  You do not want to have a whole bunch of cash on you in case you get robbed.  This is all around a good rule no matter where you go.

Once you take care of all this stuff, you should relax and enjoy your trip an take ease knowing your financial house is in order.  Just don't spend too much on souvenirs.

Wonderful Moment of the Day: My Wife is eating all her favorite foods before she goes on this trip, so we've been eating really well the last few days.