Personal Finance: Saving Money and Digit

I support frugal and intelligent ways to save money especially for those that have a very difficult time doing so.

Digit is a comprehensive tool for saving money for problem savers. It analyzes your expenditures and calculates how much you should contribute each month. At first glance I was quite impressed.

However, with the advent of Digit, saving money has now become a way to steal money from people and sell their personal information.

I came across an article on Yahoo! News and Digit was being explained. What was more revealing was the information it left out.

First, the stealing. How Digit works is you give Digit a certain dollar amount per month (or however you set it up) and it makes a deposit for you at one of their bank affiliates like Wells Fargo. The interest is paid to Digit NOT you. But you saved money that you would have otherwise spent, goes the logic.

Second, the selling of personal information. To maximize profits Digit (will most likely) sell your personal information to credit and advertising companies. Google’s interest in Digit sort of seals the deal with that as once Google starts investing in such a company it is only a matter of time until they acquire them entirely.

We are all too familiar with how Google makes money off of selling personal information to advertisers and their use of Carrier IQ to spy on you by logging all of your keystrokes on ALL devices as mentioned in one of my previous blogs.

It makes more sense to me to be more dedicated to saving by setting up a separate account and automatically depositing $50-$100 each month and not touching it. This is what we call DISCIPLINE.

I have done this off and on for a long while now, though, being married it is a little more difficult to do, but still I manage.

My primary check is bi-weekly. I deposit $50 every check for a total savings of $100 per month. At the end of the year I have a nice chunk of change that can either be applied to a family vacation or annual outstanding debt.

Do not misread, I am NOT debt-free…yet. It is something I continually work towards.

This method allows me to observe my bills and pay them according to either highest interest rate or easiest bill to pay off first.

Like Dave Ramsey, I prefer the snowball method…which would only work if my wife would stop charging the cards.

I take a payment to a small value card I paid off and apply it to the next larger value card and so on until I am left with the largest of cards. I’d like to pay that card off in the next three years.

The argument that you are paying more in interest over the long run is true. It does cost more, but it makes all of your debt manageable and that large card at the end of it acts sort of like a debt consolidation loan, if you will, in that all of your debt is now owed to a single creditor with one (very) large monthly payment that would otherwise have taken twice the number of years to pay off than what you are at with only the one card.

One day I will put this into a diagram. Until then Dave Ramsey has a few you can peruse.

The key is learning to do without. If you do not absolutely NEED something, don’t buy it.

The difference between needs and wants is not that hard to decipher. There is that gray area that an item could/would strongly improve your life or fiscal situation. Good! Keep that in mind…for when you can afford it.

Nobody is going to discipline you, but you, and only you.

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Buy Nothing Month

This is a re-blog of an article I read years ago as well. It isn’t difficult at all not to purchase something that is not a necessity. The difficulty comes when media and advertising slap your face with it day in and day out.

Write a list of monthly recurring necessities. Yes, necessities are those pesky things you literally cannot function without. For example, depending on where you live and where you work, a car may or may not be a necessity. You will have to be honest with yourself. There is not one to cheat but you.

C/O AskMen.com

Chances are good you wouldn’t mind a little extra cash in your savings account. No matter your reasons, improving your financial position is an admirable goal for anyone. And while you could build your savings over time, this article is focused on one of the more dramatic steps you can take to save money: the “buy nothing month.”

A buy nothing month is simple: buy nothing that’s not a necessity, and simplify your spending on necessities as much as possible. That means spending zero dollars on going out and, barring a rip in your work pants, you won’t buy any clothing either. You can buy groceries, but groceries means the food your body needs, not splurging for a T-bone steak every night. Add in gas for your car and that’s about it.

If this sounds a bit extreme, it is. A buy nothing month is hardcore personal finance, but if you’ve been struggling to get your money in order, it’s time to turn off the spending altogether. You’ll learn a lot about your relationship with money when you’re constantly feeling the urge to spend and having to resist it. Learning to free yourself from the urge to spend is genuinely rewarding, so don’t be surprised if you emerge from your month with a new perspective. Take the example of Mark Boyle, a UK man who set out to buy nothing for a year as an experiment. Boyle found it suited him so well that he’s now continuing to live moneyless indefinitely. While we don’t want to go to that extreme, and don’t think you should either, the point is that learning a bit of self-control and a healthier perspective on money may well be a bigger reward than all the money you’ll save. If you want to build your bank account and learn some financial discipline, well, welcome to the fast track.

Read on for our advice on cutting the most common expenses. And hold back the tears, champ: it’s only buy nothing month for 30 days.

Groceries

If you normally spend lots of money on going out to eat each month, this will be one of your biggest money savings, and also the biggest challenge. Stocking up on frozen entrees isn’t an option: they’re full of sodium and aren’t very nutritious. You can, however, have a few around for the days when work goes late and you come home utterly exhausted. Beyond that, it’s going to be you and your kitchen taking care of the meals — and without Starbucks to make your coffee for you, you’ll be up early taking care of breakfast. A little bacon and eggs in the mornings has more flavor than that drive-through breakfast sandwich you normally fuel up with, and costs pennies compared with fast food prices. And if you’re the type who sleeps to the last possible moment, a quick breakfast smoothie can be ready in less than a minute — plus it’s easy to take in the car.

For dinner, why not try some new recipes? If you’ve never cooked your own food, bust out your cooking utensils — it’s time to learn. Dying for that one dish your favorite restaurant serves? Make it yourself — if you’ve never looked one up before, you’ll be shocked to learn that most restaurants’ “signature dish” recipes have been figured out by foodies and posted to the web. So, you don’t need to go without your P.F. Chang’s lettuce wraps — a quick Google search and a few minutes in the kitchen will cure your craving, and for a fraction of the cost of eating out.

Entertainment

Since you won’t be going out this month, you’ll need to focus on entertainment that doesn’t cost anything. That doesn’t mean you need to be a social leper, but hitting the bars isn’t in the cards this month. What you can do, however, is have people over to the house, make dinner for some friends and play some board games. If you already have the gear, activities like fishing and camping make a great choice. And you should still catch the big game, but watch it on somebody’s couch instead of at a sports bar.

In your alone time, be sure to spend a few minutes reflecting on your month. If it helps, you can jot down notes about your experiences to reflect on later. And reading should be at the top of your list of entertainment activities — it’s good for your brain, makes you a better man, and you’ll finally be tackling all those books you’ve bought but never read. If you’re the rare man with no unread books in the house, head to the library for a lifetime’s worth of free reading, and grab some CDs and movies while you’re there.

Bills

Consider the role bills have in your life. Know any friends who have a gym membership they never, ever use? It’s wasteful, and cutting that expense would save them money every month. So, go through all your subscriptions, bills and fixed costs, and suspend everything that can be paused or “turned off” for the month. Even though you may not get rid of the bill by suspending it for a month, you’re cutting through all the financial noise in your life, and the simplicity of this month will help you realize what’s actually worth keeping and what’s just fiscal clutter. If anything is more costly than it is useful, get rid of it. So, if you’ve been enjoying your Netflix, keep it, but if you’re not getting value from it, maybe you’re better off without it after all.

Bills and memberships are a special case with the buy nothing month: you can’t cancel your subscription to a magazine for a month and some memberships can’t be suspended for a month. They still get reviewed this month, though: use this time to review all of these costs, and decide whether or not they actually add value to your life.

Exercise

This could have fit into the entertainment section as well, but getting exercise is an excellent use of your time during a buy nothing month. Your gym membership is out, so you’ll be using the equipment you have around the house and getting out into the fresh air and the great outdoors. Get together with friends to shoot some hoops, throw the Frisbee or play a little soccer. And if you’re trying to build your muscles, not having a gym membership for the month is no excuse — ask any serious fitness buff and they’ll tell you that body weight exercises alone are more than enough to get you ripped. If your location permits it, riding your bike to the store or work will save you money on gas, and let you strike one more “necessity” off the list of things you’re going without for a month.

Taking It To The Extreme

The buy nothing month is an extreme exercise, but it can make all the difference in both the amount of money you have, and how you use it. When the month is over, spend a bit of time getting back to normal. A great first step would be to invest a little time in thinking about your relationship to money and how much of your enjoyment in life is directly tied to money. What expenditures did you miss the most? What were you surprised to find you barely missed at all? (Pro tip: you can probably stop spending money on these for good).

It’s also important to make sure that all that money you saved goes to something useful. Don’t just leave it in your checking account to disappear a little at a time: save it, invest it or pay off some bills with it. Finally, it’s tempting to spend lavishly once the month is over. With the pressure of living so frugally finally off, many people go on a spending spree and undo all the saving they just did. So don’t “treat” yourself to something; just go back to your old spending habits, unless your old habits suck. Allow yourself a pat on the back for achieving your goal, then spend within your means and enjoy the nest egg you built up in record time.

http://ca.askmen.com/money/investing_300/342_buy-nothing-month.html

6 New Careers That Are Coming of Age

I have not been able to determine the identity of the Chris Kyle who wrote this article in 2010. It could be the famed sniper or a financial analyst. If anyone could help out with this venture I would appreciate it.

This may be an older list, but it is still true today. We could add Virtual Assisting to the list as well.

Of the six careers he mentions the ones that stick out most to me are Social Media Strategist and Email Marketing Manager. In a time where we all prefer a more flexible schedule, with the right employer these jobs can easily be done at home.

Performing these duties at home requires a very responsible individual to stay motivated and on task to see a project through.

This also requires an employer to trust an employee much more than usual as the employee will not constantly be under thumb. On the upside this does save on overhead and frees up a workstation at work.

By Chris Kyle

Every generation has its own music, its own fashion and…its own jobs.

Case in point: These days there is an exciting fresh crop of careers that are coming of age that combine new uses of technology with some tried and true skills.

Want to get in on the ground floor as these careers grow up?

Check out our list of 6 hot new jobs that are coming of age in 2010, and find out what you need to do to jump into one of these exciting jobs…

Hot New Career #1 – Social Media Strategist

Do you love Twitter? Why not get paid to tweet? Seriously! Social media strategists figure out optimal ways to get messages out to the masses using the latest community tools online. This involves blogging, tweeting, and using sites like Foursquare and Facebook to find and communicate with customers.

Related Degrees:
Business Administration
Marketing
Public Relations
Web Design and Development

Average Salaries:
Bloggers: $32,000
PR Writers: $58,740
Social Media Strategists: $61,000

Hot New Career #2 – Homeland Security

If you are looking for a challenging career with high stakes, consider Homeland Security. The Department of Homeland Security, which was formed as a result of the September 11 attacks, is responsible for everything from cyber security to border protection. As just one example of this career’s growth pattern, in August 2010, President Obama signed a $600 million bill that pays for 1,000 new Border Patrol agents.

Related Degrees:
Criminal Justice
Homeland Security
Information Systems Security
Paralegal

Average Salaries:
Executive Branch Paralegals: $58,540
Federal Criminal Investigators: $73,170
Customs and Border Protection Agents: $92,558

Hot New Career #3 – Forensic Accounting

Who knew that a calculator could be this powerful? Though the FBI and IRS used forensic accounting to convict Al Capone in 1931, the field arrived in a big way in the form of Will Ferrell in the hit movie The Other Guys. Forensic accounting as a career path also got a boost during the recent scandals that shook accounting firms and Wall Street.

Related Degrees:
Accounting
Finance
Business Administration

Average Salaries:
Auditing Clerks: $32,510
Forensic Accountants: $73,000
Financial Analysts: $73,150

Hot New Career #4 – Online Video Game Designer

To give you an idea of just how big online video games have become in 2010, an estimated 200 million people – 200 million! – play video games online each month, according to a report from the University of California at San Diego Extension. Studying graphic design is one way to get started on a career in this booming business.

Related Degrees:
Animation
Graphic Design
Programming and Applications
Video Game Design
Web Design

Average Salaries:
Graphic Designers: $42,400
Multi-Media Artist and Animators: $56,330
Video Game Designers: $57,000

Hot New Career #5 – Email Marketing Manager

Companies big and small use email marketing to reach current and potential customers. Although it’s more cost-effective than using the U.S. Postal Service, it’s still a relatively new method, which means email marketing managers are still working out the kinks. Getting your MBA is a great way to position yourself for an email marketing managerial job.

Related Degrees:
Business Administration
E-Business/E-Commerce
Marketing
MBA

Average Salaries:
Email Marketing Managers: $69,000
Advertising Managers: $80,220
Marketing Managers: $108,580

Hot New Career #6 – Home Health Aide

While not exactly a new profession, home health aides are seeing increasing opportunities. Not only does the population continue to grow, but healthy retirees are now living longer and often need a part-time or full-time home health aide to take care of them. Nursing training programs can help you gain a foothold in this coming of age career track.

Related Degrees:
Licensed Practical / Vocational Nursing
Nursing Certification
Nursing (ASN, BSN, MSN)

Average Salaries:
Home Health Aides: $25,000
Licensed Practical and Licensed Vocational Nurses: $39,030
Registered Nurses: $62,450

5 Big Budget Mistakes to Avoid

From time to time I save articles that have impacted me or made me think about certain aspects of life. This financial article is both a combination of mistakes and possible solutions dating back to 2010. There is no one-size-fits all solution to every little task life throws at us, but guides are useful when we take an unexpected hit.

C/O US News

By Kerry K. Taylor

Do you know where your money went? If you just got paid but your bank account is empty, maybe it’s time to rethink your budgeting skills. Fixing the big budget blunders is not hard to do–you just have to want to do it! Here are five reasons why your budget is broken, and the ways to fix it.

Mistake 1: You don’t have a system. Is your filing system a mess of envelopes scattered throughout the house? When your budget is blowing from room to room and you’re confusing last year’s grocery receipts with this month’s food bill, it’s time to try a better system.

The Fix: There are numerous ways to build a better budget. There are spreadsheets, software, and mobile phone apps to get the job done with less pain and more success. Download this free budget spreadsheet or check out these 6 Free Budget Software Choices for Everyone and pick your favorite option. You may just find your fortune.

Mistake 2: You don’t honestly track your spending. You spent how much at the mall last week? If you’re fudging your numbers before entering them in your budget, it’s impossible to make everything balance.

The Fix: Tracking the money you spend and earn may sound like work, but it’s easy to do when you save all your receipts and paycheck stubs. When you’re on the go, enter your expenses in a mobile device, or carry a notebook. The idea is to track your cash, credit card, and debit card purchases to identify the costly culprits.

Mistake 3: You don’t make it a habit. Old habits are hard to break, right? Well, ditching your budget after a few tries is a surefire way to fail. Building a solid household budget takes practice, and giving up after a week is a common reason for failure.

The Fix: To get back on track, give yourself the chance to succeed by setting aside time each week to track the flow of money into and out of your life. Only after several weeks of practice will you get into the habit and be able to update your accounts quickly.

Mistake 4: You don’t have an emergency fund. There are exceptional people out there who never get sick, never lose their jobs, and never need a car repair. Lucky ducks, but I bet you’re not one of them. When bad things happen to good people, chances are you’ll need money to get through the tough times. And maxing out your credit cards or running up your credit limit can put you in a bad financial situation, leaving your budget broken.

The Fix: Add some wiggle room to your budget by starting a modest emergency fund. You probably don’t need to save tens of thousands of dollars to protect yourself from life’s gotchas — a modest amount should keep you safe and prevent you from tapping your plastic when times are tough. See How to Start an Emergency Fund on any Budget for some helpful hints.

Mistake 5: Your spouse hates budgeting. Do you argue about money with your partner, spouse, or significant other? You’re not alone. Fighting about money is a common practice in households across America, and can lead to bitter breakups that bust the bank.

The Fix: When he’s a spender and she’s a saver (or vice versa) it’s time to calmly chat together. Set aside 15 minutes each week to discuss the current money situation and work together to set a few financial goals and to calculate your net worth. Lay no blame and make a commitment to work together to get through the mess. Download these free 3 Financial Goals Worksheets and try this simple Household Net Worth Spreadsheet to get on the same page with your spouse.

http://money.usnews.com/money/blogs/my-money/2010/11/04/5-big-budget-mistakes-to-avoid