Success is More Than Dreaming

One of my long time dreams has finally come true. Even though, some of my readers, friends and acquaintances don't think it is a good move. For them it may not be. For me, however it is. For many years, I have wanted the position of Assistant Manager, in fact for nine years. For the past, 3 or 4 years I have been actively seeking it. Every manager, I have worked for, those 4-years has known of my interest. Some, have even known of my interest to own my own store(s). That is the case, of the manager and owner of a store in a small town. A manager, who even though, I left employment with him some 9-years ago, I have kept in contact with. It is because, of this dream, that I am motivated to get debt-free so that one day, that dream can come true also.

A friend of mine, recently mentioned a book, he seen in the library. A book, entitled "How come that idiots' rich and I'm Not" by Robert Shemin. It reminds me, that I must remember that the only way to achieve my dreams, whether it be promotion, owning my own business, or simply being debt free is hard work. I haven't read this book, but after looking up the authors website, I can quickly see that is the jest of what he is teaching. Which, is what personal finance guru's, Dave Ramsey, Larry Wingett and John Cummuta teach also.

I cannot say how long it will be, before I will see my dreams become a reality. However, I will continue to work hard, to see those dreams become a reality. Yes, it may mean 50 or 60 hour weeks, but it is something I am willing to do, to accomplish my dreams and make myself more valuable.

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Fantastic Live Event Was Largest Ever

On Saturday May 3 (2008), I drove to Kansas City. My purpose was to attend financial guru, Dave Ramsey's Total Money Makeover Live Event. The day started eventfully. To start, before getting out of the driveway, I realized, I had forgotten the directions to Kemper Arena. Once, I was on the interstate and barely past the last free exit, I realized that I had forgot my ticket and camera. So, I had to take the next exit, which cost me 30 cents to get back into Topeka.

Now, with everything I needed I was on the road again. Seventy-five minutes later, I was pulling into the parking lot at Kansas City's Kemper Arena (45 minutes before the doors opened).

Last years Live Event sold 10,000 tickets, making it the largest Live Event in Dave Ramsey history. That record stood until this past February when the Dallas Event sold 11,000 tickets. However, Kansas City, once again regained the title of the largest Total Money Makeover, by selling 12,000 tickets.

When Dave came out on stage, he said that everything he teaches, he stole from God and his grandmother. As last year, I thoroughly enjoyed the event. As I have over the past 2-years, I will continue to compare him to other financial guru's.

To those that I met at the event, and who are reading this blog, perhaps for the first time, welcome. If you were at the event, please leave a comment and share your thoughts. If you have attended any of his Live Events, please feel free to comment and tell us your thoughts as well.


Finally, once again, here is the video of the Saturday Night Live skit, that Dave plays every year during his Live Events.


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Financial Literacy and Children

I recently received an email, suggesting I talk about teaching children financial literacy. That is something I view as very important, the younger they learn the better off they will be, when they grow up. However, it boils down to being the parents responsibility. If the parents doesn't teach them, their inaction will speak louder then anything the kids learn in school. Let's face it, kids learn by watching what their parents do. I am a great example of that. I knew from school and church the right way to handle money, but seeing my parents bad habits spoke louder then the head knowledge I was given.

Everyone knows that young people are pros at spending money; millions of dollars are spent annually on advertising aggressively directed towards them. They know how to use ATM machines to take money out. But, in these uncertain economic times, do they know how to save it? And do they know how to think long-term – beyond the weekend – about their finances? What about credit card debt? Or investing for the future?

The National Council on Economic Education (NCEE), a nationwide organization that serves to promote financial literacy with students and their teachers, has this to say on its website: “NCEE surveys show that nearly half of our young people don't understand how to save and invest for retirement, nor how to handle credit cards, don't know the difference between inflation and recession, nor how government spending affects them. If we fail to act now to improve economic literacy in this country, our children will be at risk for crippling personal debt, costly decisions at work and at home, and lack competitive skills in a fast-paced global economy.”

- Education.com

Even Robert Duvall, PhD, President and CEO of NCEE, agrees. In the above article he says, “We know that the skills of managing your money well, are not skills that you’re born with. It’s learned behavior.”

So what can parents do?

1. First and foremost, set a good example. Because kids, as I said above, watch everything their parents do. It doesn't matter what a parent tells their kids, it's what the kids see their parents doing.



2. Start saving – at any age. The earlier a person starts building their savings, the better off they will be financially in their future.



3. Budget sense. The article suggests including the kids in on the budget discussions with you and your spouse. This way the kids get a better understanding of their families financial situation and how to handle money properly.



4. Make it a long-term conversation.

   Financial matters can get complex pretty quickly. But kids who learn basic principles of earning money and saving it, of what things cost and how to budget for their expenses, will be in a much better position as young adults to understand the more complex issues of mortgages, credit cards and interest rates. Parents who introduce their kids to solid financial principles early on are providing an important part of their children’s preparation for the "real world."




5. Shop Together. This is the perfect time to talk finances. It allows the kids to see and understand the prices of things. Why does this item cost 50 cents more than the other one? What does that extra 50 cents buy you? Is it worth it?

April was Financial Youth Literacy Month, which means it's as good a time as any to start talking to kids about money. Lori Mackey, the "Money Mama" and author of "Money Mama & The Three Little Pigs," a read-aloud book that teaches the basics of sound money management, visited "Good Morning America" to explain how to teach kids about saving and spending.

In an article that ABC aired in 2007, Mackey discussed kids and money.

Mackey said it's never too early to start talking to kids about money.

"It's never too late, but if you can start early, you teach them to give, invest, spend and save wisely, they learn the habits of wealth," she said.

One of her first suggestions is to teach the kids the 10, 10, 10, 70 rule.

10% Charitable giving

10% savings

10% Invest

70% Spending

And their are money banks (aka piggy banks) that are designed to do this from various organizations. Off hand Crown Financial Ministries as such a bank that they sell. In addition, if memory serves me, Dave Ramsey does as well. Perhaps, one of his staff members (like Chris) that reads this blog can confirm this. I have also seen other organizations promotes such banks, but the names of those organizations escape me at this time.

Mackey also suggests playing such board games as Life or Monopoly as tools to teach kids about money. These games can helps kids learn about investing and stocks and even how money compounds and grows in a fun and entertaining way.



Photo courtesy of Shirleys-Preschool.com
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Dave Ramsey in KC Tomorrow

Filling up the gas tank last night was a pain. I paid $3.49/gallon. With gas prices that high, I wonder, if I can even afford to drive to Kansas City tomorrow for the Dave Ramsey live event. The $20 of gas I put in the tank only brought the the tank to 3/4 full. If I remember from last year, it will take me about half a tank to make the trip. Of course this year the arena, he is in will be about 2 miles closer, which means I would save about 8 miles. Last year, I drove to to the arena, found where it was then drove to Wendy's for a late breakfast. The Wendy's is accross the street from this years event location.

The event is an awesome time. At least it was last year, and I expect it to be again this year. However, can I really afford to make the drive? Do I really need to go? I certainly could use the money elsewhere. Perhaps, the $300 dividend check will arrive today.





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Dave Ramsey is Coming

Good morning. I just looked at the calendar, as I was sitting down to write the new schedule for work and realized next Saturday (May 3) was fast approaching. What's so special about that Saturday? Well, that is the day when Dave Ramsey will make his 2nd visit to Kansas City, MO. A city about 75 miles from where I live. I again have a ticket for the Live Event that day. Last years event was at Municipal Auditorium and was sold out. It was according to the Dave Ramsey folks, th largest Live Event in Dave Ramsey history. This year, they have moved the event to Kemper Arena. Kemper, is the stadium where the Kansas City Kings played, before they moved to Sacramento. From what i last heard they have sold 9,000 tickets thus far.

The Total Money Makeover LIVE in Kansas City is only a couple of weeks away and already close to 9,000 people have bought tickets! Why don't you join them? Come be a part of the largest event on personal finance in the nation where you'll learn a lot and have fun at the same time! Learn, laugh and live...debt free.
- from an email sent by Dave Ramsey

I am looking forward to this event. When I took my last vacation, I didn't take a full week, so I will put in for a vacation day on that day. That will leave 2 more weeks that I will have to take at some point. But, that's another story.



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Worshiping At The Altar of the FICO

This past weekend, the Today show on NBC, had a story entitled, "7 ways to improve your credit score." It is clear from not only the title, but also their guest that they are worshiping at the altar of the FICO score.

So what are the 7 tips?

1. Fix your credit report
   

The fastest way to raise your score is to fix errors on your credit report. Go to www.annualcreditreport.com to get a free report from each of the three credit bureaus every 12 months. It’s important to fix mistakes on all three credit reports. You have a separate credit score based on each bureau’s report, so your scores could be very different if one report contains errors.
- Kiplinger’s Personal Finance magazines, Kimberly Lankford on NBC's Today Show


I personally agree that if there is errors on your credit report, they need to (and must) be removed. I am a big proponent of checking all 3 credit reports once each year.



2. Pay your bills on time
   

   About one-third of your credit score is based on your payment history. If you’re having trouble paying the total balance, pay at least the minimum by the deadline. Making that deadline is more important to your score than the amount you pay (although the more you pay off, the less interest you’ll owe). If you do miss the deadline, pay up as soon as possible, the later you are, the more you’ll hurt your score.
   - Kiplinger’s Personal Finance magazines, Kimberly Lankford on NBC's Today Show
   

   This is a commonsense no brainer. If you are late paying your debts, utilities and other bills, it is going to negatively affect your credit. Always, let me say that again, always pay your bills on time.
   
   
   
3. Keep your balances low
   

   Another big part of your score is the share of available credit you’ve used. Lenders get worried if it looks like you’re maxing out your cards. Keep card balances below 25 percent of the credit limit, 10 percent is even better. It’s the amount you charge that counts, even if you pay the balance in full every month.
   - Kiplinger’s Personal Finance magazines, Kimberly Lankford on NBC's Today Show
   

   If we are going to be debt free, why do we need to keep low balances? This is one area, where this lady and the banks are trying to keep you in debt, by trying to tell you closing the account will negatively affect your credit. The only reason banks want you to keep any balance at all, is so they can relieve you of your hard earned money and make themselves richer.
   
   
4. Don't close old accounts
   

   Keeping old accounts with a good record can help because the age of your oldest card and the average age of your cards are key elements of your score. Closing accounts also lowers your overall credit limits, which makes it look like you’re closer to maxing out your available credit. If you do want to close some accounts, especially ones with high annual fees, close only one every few months and don’t close any accounts within six months of applying for a loan.
   - Kiplinger’s Personal Finance magazines, Kimberly Lankford on NBC's Today Show
   

   I pretty much answered this one in my last response. As Dave Ramsey has repeatedly said on his show, the only thing a good FICO score shows is that you love debt. If we are going get out of debt, we don't need a score at all. Plus, if you want to get a mortgage and don't have credit, you can still get that mortgage. Mortgages being the only debt Dave Ramsey, backs away from being critical on, can be obtained by using a mortgage broker that uses manual underwriting.
   
   
5. Pay off old debts
   

   Even a small library fine or disputed electric bill can crush your credit score if the debt goes into collection, dropping a high score by as much as 100 points. Now that more municipalities and utilities are sending small, old bills to collection agencies, I’ve been hearing from many more readers whose scores dropped significantly because of a very old bill for less than $100. Even if you pay off the bill after it’s gone to collection, the damage is already done. Negative information generally remains on your credit report for up to seven years, but the impact on your score lessens through time. Don’t lose track of small charges that can come back to haunt you, and pay the bills off quickly before your score suffers.
   - Kiplinger’s Personal Finance magazines, Kimberly Lankford on NBC's Today Show
   

   Yes, I agree. Going back and paying off debts that may have gone to collection is not only a legal obligation but us a moral one, because we are to honor our agreements.
   
   
   
6. Order your credit score
   

   You can’t get your score for free, but you can order it when you get a free copy of your credit report at www.annualcreditreport.com. Or you can go to www.myfico.com and get your score directly from Fair Isaac, which created the popular FICO score. Some credit bureaus also offer their own versions of credit scores, which can give you a general idea of how your record stacks up, but most lenders use the FICO score when setting your rates.

   
   
   I have even heard Dave Ramsey talk on his radio show about going to www.myfico.com and checking his FICO score. In his case it is 0 on all three credit bureaus. Meaning he doesn't have an "I love debt score," because he doesn't.
   
   
   
7. Don't ignore your score
   

   Buying or refinancing a house is the biggest reason to be concerned about your score. But your credit score also affects your credit-card rates and terms, car-loan rates and auto and homeowners insurance premiums. Insurers found that people who have low credit scores are more likely to have insurance claims, and your score can have a big impact on your premiums in most states. Potential employers and landlords may also check your record. Don’t worry about micromanaging your score, you’ll usually look good with anything above the high 700s. But your score can affect your personal finances at any time.

   
   OK, I have gave my thoughts on this. Unless you are going to make the banks richer and go into debt again, I strongly urge you to ignore your score. You can get a mortgage by using a manual underwriter rather then a bank that leans purely on the FICO score.
   
   With that said, I do know my scores. Last Month, the last month WaMu checked my credit from the old Providian Credit Card that i just paid off, they put me at a 688 with TransUnion.
   
   However, on April 14th of this year I logged into and got all 3 FICO's. I must say there is quite a bit of difference and I haven't been late on anything recently nor have I applied for any new debt.
   
   *** TransUnion 619 *** Equifax 550 *** Experian 624 *****
   
   Two of the three did however, have a public record on them that even though it was paid and the lien released had not been removed from my credit reports. In fact, the state actually just sent me the court papers dated some 3-years after they were to have been filed. Go figure.
   
   

Finally, Suze Orman who most recognize as a person who worships at the altar of the FICO score, has a product called, the Suze Orman FICO Kit Platinum that is available when you sign up with myFICOscore.com. The video below is from VideoCreditScore.com, and is an intereting review of the product. While I certainly to hold to the belief of fixing your "I love debt score," unless you want to put yourself into debt further (or again as the case may be), it is certainly worth viewing.






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Paying Debts, Productivity and Organization

How you pay your debts can be viewed in your productivity and organizational skills. Part of that is panning ahead for the unexpected. That is the focus of the Money Monk, who wrote about saving and paying your debts recently.

That has been the topic in someway of a number of bloggers recently. Saving Advice, recently posted 44 ways to improve your productivity. Below is part of Jeff's list and my comments on them.

TV - Jeff suggests watch very little TV. His advice is perfect. If you turn the TV off and get up off that couch (or easy chair) you can focus your attention to actually being productive.

Carry a pocket notebook - This something Jeff suggests, so he can write down ideas, when the thought hits you. Again a great idea, especially if you are a blogger. It doesn't mean, that you have to be a reporter and write everything down. However, when you get an idea, just write it down so you remember to research and write about it when you get home.

Lists - Like Jeff, I love lists. They help me to remember what I have to do, and I can check it off as I finish each task. It is invaluable to me at work as well. Remember, making a shopping list is the best way to shop, when on a budget.

Another blogger, known online as Money Monk, wrote Paying off all debts before saving is foolery.

The monks opinion is that saving is boring, but necessary. He suggests that it is foolery (Dave Ramsey would agree) to pay off your debts first. For me, I am so eager to get rid of my debts, I have focused more on the debt repayment, then I have my emergency fund.

What would happen, if my car were to break down? Or my water heater were to blow up right now? Answer, I would be in a world of hurt, because I haven't been proactive of building my savings. That is the danger of not saving. We can make all the excuses in the world that we want to, but that's what they are, excuses.


I have to be better about saving. I have to be prepared for the unexpected. Which really isn't unexpected, because we know that eventually they will happen. I do like to see my debts getting smaller, but I also need to get excited about seeing my savings grow as well.

Finally, I and a number of my readers need to be better organized. A person who is organized (everything has its place) and has a clean abode and car, will also have an organized financial life. Not only that, but the savings and productivity will also fall into place because they are all part of being organized.

Larry Winget says that he can bet these people he sees on those "clean my home," type programs that their finances are also a wreck. Especially, those people whose homes can't be gotten through, except for the small path in the room.


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Dave Ramsey ,the Presidential Campaign and Taxes

I have been hearing a number of people (even had visitors searching the search engines on this topic) asking who Dave Ramsey was endorsing for President. So, I decided to make a call to Brentwood, TN and ask the source directly.

Beth Tallent, Director of Public Relations, said that Ramsey, typically stays out of politics unless it deals directly with finance.

When asked, what his opinion of Mike Huckabee's Fair Tax was, she said that he hasn't addressed Huckabee's Fair Tax, although he has addressed the "Fair Tax" long before Mike Huckabee ever was a candidate. She then promised to get me a quote from Ramsey on the issue.

Below is Dave Ramsey's thoughts on the Fair Tax:

“I love the idea of the Fair Tax. The beauty of it is that by in large it’s a voluntary tax. If you don’t want to pay the tax, don’t buy something. I bought a car not long ago, and there’s a tax on that car when we record the title in the state of Tennessee where I live. And if I didn’t want to pay the tax, I didn’t buy the car. But when I bought the car, I knew the tax went with it. And that’s part of the thing. But it’s a voluntary tax and I like that part of it.”

So there you have it. No endorsement from Ramsey, but he does seem to like the idea of the Fair Tax.



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The 10 Steps To Live on Less

Frugal for Life recently wrote an article that she called "11 Simple Steps to Living on Less." The article was a very good, but brief explanation of some of the very simple things you can do to get your spending under control.

As she so elegantly stated, "Debt is outcome from living beyond our means and wanting it all now. But if you are serious about getting into the black and living a life that makes you happy, there are some simple ways to get back on track."
It is a message that I have said repeatedly on both of the personal finance blogs that I write.

1. Make A spending Plan..
This is the number one thing. You must spend every dollar, every cent on paper at the very beginning of every month. There can be no exceptions, you must do it. If you don't plan your "Fun" money around your monthly obligations, then you will be in a financial pinch when the late fees start adding up.


2. Pay Yourself...
One the things that most every financial expert agrees on is "pay yourself first." Savings should be a line on your budget as if it were another bill. Once your debts are paid off, move those funds to your savings line. This will allow you to save up for those big purchases. Save for your next car, so that you can pay cash for it. Don't forget to save for your retirement to. You don't want to spend your golden years working at the golden arches for failing to plan.


3. Examine every single purchase...
One thing we must do every time we make a purchase, no matter how big or small is ask ourselves, "do I really need it." If it is a big purchase, we must not only compare prices, but if we are married, we must talk it over with our spouses.


4. Follow every Cent...
It is important to know where every little cent goes that we spend. It is the little things that can really blow a budget. 60 cents for a candy bar or can of pop may not seem like a tot but they can really add up. Just buying 1 candy bar and 1 can of pop each day at work from the companies vending machine at 60 cents will cost $20.
It isn't enough just to balance your checkbook, but to keep a spending diary of those little things you spend "pocket money" on.


5. Pay your bills when they come in...
What more can I say. Pay your bills on time and you will avoid the late fees. The best way to do this, and it is something that I need to improve myself, is to pay the bills when you get them. Don't let the bills set idle on your desk. Of course, this may mean getting the debts paid off, before you can actually be in a financial position to do this.


6. Cut your expenses...
Be honest with yourself. If you can't afford something, evaluate your need for it. Do you really need your cable or satellite TV? It doesn't matter how much you want it, if you can't afford it, you need to cut it out. The money you are spending on that service can be applied to your debts, so that you can become debt free sooner. The sooner you are debt free and can build your emergency fund, the sooner you can "enjoy your money" again. As long it is done within your budget.


7. Find free alternatives...
There are a number of things you can do or get for free. Instead of buying (or renting) books, videos/DVD's and music borrow them from the library. Instead of running out and buying a new piece of furniture, look on FreeCycle for whatever you may be looking for. I have given away a few things on the site, and I have received some bar stools by putting out a request on there.


8. Cut up your credit cards...
This is very important. Both John Cummuta and Dave Ramsey suggest this. If you think you are going to build wealth by using your credit card(s), then think again. Look at where you live, then look at the homes of the credit card companies. Multi-story buildings of glass and steel, pretty impressive, huh? Think you are going to have something that nice? Not if you keep giving them your hard earned money.

Now look inside. See all that nice furniture. It's yours! They bought it with the money they stole from you.


9. Remain Focused...
To help you remain focused on getting debt free, make a goal. Write it down and post it on your mirror or refrigerator. Someplace you will see it every day, to remind yourself of why you are getting debt free.


10. Set priorities...
Finally, you must prioritize! If you really want to be debt free, you must live on less then you make. It doesn't matter if you make $19,000, $30,000, or $60,000 you must live on less then you make. You must decide what you really need and what you don't. Eliminate all nonessential bills.

Would you invest in Yourself?

The other day I was reading 1 Million and beyond, who was asking would you invest in You, Inc. The concept is similar to what Dave Ramsey when he asks, if you worked for You, would you fire you? I knew the answer for Dave Ramsey's question was a yes, but lets take a closer look at my financials and look at myself from the viewpoint of an investor.

Debts
$400/month car payment ($10,900)
$75/month 2nd mortgage ($990)
$25/month credit card ($590)
$25/month Fingerhut ($1,000)
$??/month Black Gold Insulation ($180)
$0/month ($3,795)
-------------------
Total Monthly Debt $550 / Total Debt $17,455

Utilities
$80/month Electric
$80/month Gas
$70/month cell phone
$30/month Internet (cable)
$60/month Satellite TV
$30/month Water
$15.50/month Trash Service
----------------
Total Monthly Utilities: $351.50

$60/month Auto Fuel
$40/month Groceries

With a monthly income about (from various sources) $1000 (take home) I am to burdened with debt. Not enough cash flow. So if I was a business, I would be leery of investing in myself. I would be concerned that a business as financially burdened as myself, would file bankruptcy.

The simple fact is, I must cut my debt and increase my savings. A plan I have been addressing since March 2006. My current figures are to have the credit card, black gold and 2nd mortgage paid off before the second blog-aversary of this blog in March. A tall order considering my financials, I know, but I think with some gazelle intensity and a lot of fortitude it can be done. I am tired of being a prisoner to my debt and want to have the freedom to have some fun again. This time within a budget.

So what about you? What does your financials look like? Would you invest in You?

Do ya ever have any fun?

From time to time I get naysayers on one of the blogs that I write for saying something like,

Do ya ever have any fun?

They usually follow that up with something like,

but what about now. If you die tomorrow, you've missed out for over saving.

Of course Dave Ramsey says, if people don't make fun of you, then you must not be doing something right. I usually try to tell them you don't have to put yourself in the poorhouse to have fun. Still though, they come back to the "I want it and I want it NOW" statement that has put us all into debt. People we all must learn how to live within our means. There is a reason that this country has a negative savings rate for the first time since the great depression. It is because we are all spending and living off our credit cards rather then saving part of our money. If we had all listened to our grandparents and great-grandparents then we wouldn't be in this shape. Which in turns we could have money to budget for "fun."

But, because we didn't spend wisely, we now must tighten the reigns and for a time, not have all the fun, so that we can dig ourselves out of this mess. Everything, I discuss here is pretty common sense stuff that our grandparents and great-grandparents told us when we were kids. Of course like kids everywhere we thought we knew better and put ourselves in debt. I for one don't want to live a life in the prison of debt. Instead, I want to enjoy the freedom of being debt-free, and I will soon be there if I stick to my plan. Oh sure I have had a few set backs (because of my own stupidity) and I may have a few more before I am completely in a position to have a savings for most of my emergencies, but I will get there by the end of 2009 and in my hopes by the end of 2008.

With that, I would like all of you to think of fun things that can be done without an additional strain on the budget and share them here.

Awaiting to hear read all your comments as always.

Tip You For What?

I pulled a Dave Ramsey no, no. Those of you who know who Dave Ramsey is, knows that he advises his listeners to avoid credit at all costs. He also says that when you are in debt, you can't afford to eat out. Well Sunday, I ate out. Even though, it was a bad financial decision on my part, I am going to discuss the place I ate at.

It was one of the buffet places. You know one of those places, where you serve yourself and eat as much as you want. I paid better then $11 to have the opportunity to eat some turkey. I just love turkey. This buffet's turkey isn't as good as Old Country Buffet was before they left town, but it was turkey. For $11, I could have bought a turkey breast, potatoes, corn and fixed my own and still had left overs for another meal or two. The part that really bugs me though is a practice that I see at all the buffet places.

That practice; that I begin seeing in recent years, of asking you to tip the "wait staff." I wonder what wait staff. The person that sits a few extra plates on my table? I mean they certainly don't wait on me. I get my own food. What service am I really paying for when I leave a tip.

Now don't get me wrong. When I go to a restaurant and order from the menu, I leave a tip. In fact, I generally will leave a tip in excess of the 20%. I will even get upset, if someone in my party, says they aren't going to leave a tip, because everyone else is leaving a bigger tip. When a waitress (wait person) does an excellent job and is friendly they should be rewarded. However, as I said before, what service am I paying for at a buffet place?

The worst place for this tip thing was at the former Old Country Buffet at Westridge Mall. I would go in there and get my plate of food, then go get my drink and sit down. Then a young lady would come over to my table, and say, "Hi my name is ... and I will be your waitress today." On more then one occasion I wanted to push my plate aside and say, "Oh, I'm sorry was I suppose to wait on you. I will have ..." OCB's food was better than any of the places that remain in Topeka, but their wait staff were less wait staff than the place I visited Sunday.

I have never understood the logic of paying for an overpriced meal and then being asked to tip someone for not waiting on you. It just doesn't make since to me. I will continue to tip at sit down restaurants, where someone actually is serving me, but at a Buffet, where I serve myself, I have a hard time giving even serious thought to tipping there.


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Who I Want To Emulate - Part 2

Welcome to part two of who I want to emulate. Last time we took a look at Warren Buffett, the world's second richest man. It is important (to me anyway) to point out, that I have not personally met any of these men (or women), but would like to. Today, we are going to look at another wise man. Someone who is a millionaire, but as far as anyone knows, has not joined the ranks of billionaire. Someone who millions of people turn to for advice on their finances. This man, if you haven't already guessed is none other then Dave Ramsey. The author of the best selling book Financial Peace. As well as th host of the daily radio program, "The Dave Ramsey Show," and beginning Oct 15 a new television show to be hosted on a brand new television network (Fox Business Network) also launching the same day.

Ramsey made his first million(s) before he was 23. He then lost it all when the banks holding his real estate loans was sold and the new bank called his notes. After he filed bankruptcy, he learned how to live within his means. As he learned he begin teaching people what he learned. Through the process he rebuilt his wealth without going into debt. One may think all of his money comes from teaching people simple common sense things that we all should already know. But, they would be wrong. He did reenter the real estate market with a number of rentals, all of which he paid cash for.

I like this guy, one because he built his own wealth, with out using someone else's money. He busied himself and earned every penny he has in his bank account. What he teaches, makes sense (if you will stop and actually listen) and is something that I want to put into practice.

This gentleman, as with all the people I write about in this series, is one of the people I most want to meet face to face.

***** side note: despite what Cox Cable says, the Fox Business network won't only launch in the Northeast, Time Warner will have it in Atlanta and Kansas City as well as a number of other markets. Direct TV will carry the channel on 359, and will carry it nationwide. Dish Network is still in negotiations.


---Other Posts in Series---
Who I Want To Emulate - Part 1

Take a look at Life Insure, if you are in the Market for New Insurance

Are you considering switching insurance? If you are, then one site that you may want to check out is LifeInsure.com. The site allows you compare term, universal and whole life. Of course, if you have read my blog with any regularity and listened to Dave Ramsey, you know that I don't like whole life. So I would strongly suggest that you avoid that portion of the site.

Why? Because you won't get the extra money that you pay. If you die, then your heirs will only get the benefits of the policy and not a dime of the savings that you added to it. If you cash it out early so that you can get that savings, well the interest is not what you would get in a good mutual fund. So again, I implore you, don't buy whole life. If you already have whole life, sell it, buy term and invest the difference in a good mutual fund. Never, buy annuities or other investments from your insurance company, they just aren't the best rates.

LifeInsure.com will let visitors from all 50 states compare rates between various companies. So if you are in the market for new insurance, then give LifeInsure.com a look see.

Credit Counseling and Consolidation?

Debt Consolidation Care is an online credit counseling service. They help people with debt consolidation, debt consolidation loans, credit card debts, debt settlement, collection agencies, payday loans, creditors and budgeting.

They do this through their Credit counseling and debt consolidation services. Their financial counselors will give professional and confidential one on one consultation to families and individuals (like you) in debt to further educate them how to find financial freedom.

Their mission statement, on their website reads:

Debt Consolidation Care mission is to get their clients out of debt quickly, and educate our clients so they stay out of debt. We want to give our clients a fresh start so that they can enjoy financial freedom for the rest of their life. We hope that you will now join our other clients on the path to financial freedom

As I looked at this site, I wondered if they could help me reach my goal on the ambitious goal that I have set for myself. I realize Dave Ramsey advises if a firm such as this is used, to use a non-profit Consumer credit Counseling Service. Still, the thought is there and unlike other privately owned counseling service, this one is not owned by the creditors.

So can they help this 39 year old single guy from Kansas? Do I have to many secured debts and not enough unsecured debt to be helped by such services? How much do they charge? Maybe I should continue on my own with gazelle intensity to get the rest of my debts paid off. Then again, lower interest rates could possibly get them paid off faster. hmmmmmmmm

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Ever since the mortgage loans have been introduced, home mortgage has been the most common of all. Whether getting a short term insurance policy like travel insurance or making a big investment like life insurance, one needs to consider all options. It involves a time-consuming process of gathering insurance quotes and making comparisons. However, much of time can be saved through online processing if you can manage to pay with credit card.

Now I Have Heard It All...!?!

When it comes to personal finance, I thought I had seen everything. That was until today. Today as I was getting ready to go to work (yeah, I had to miss church today) an infomercial came on. I usually turn these off, but I had to hear what Academy Cars was giving away as their "free gift," for just a "test drive." I just couldn't believe my ears, when I heard it the first time. They set it up some like peoples court or something, with people going before the "Automotive Credit Judge." A loan office, was the prosecutor, telling the judge why the "defendants" should be denied. Of course in every case the judge ruled in the "defendants" favor.

So what was the "free gift?" They were giving away the New York best seller, "Financial Peace," by Dave Ramsey. Yes, in an infomercial so full of credit, credit, credit, they were giving away a book that tells you to avoid credit at all costs. Perhaps the folks at Academy Cars (of Lawrence, KS) needs to read the book themselves. The program even discussed having credit cards to help "build" one persons credit. The entire program they never talked about the need for these people to save and buy their next car with cash.
Again, I think they need to read Dave Ramsey's book, before they give it away.

Fox Business Network & Dish

I just got off the phone with Dish Network. The reason for my call is to ask if they would be carrying the new FOX Business Network, when it launches Oct 15. According to the lady I talked on the phone with, the new channel currently is not in the line-up. As a fan of Dave Ramsey, I want to make sure he will I will be able to see him, when I am not working.

As such I am requesting that all my readers take a minute or so to fill out the contact form and let Dish know that people want to see this new channel by clicking Here. Preferably in America's top 100 or 200.

Thank you for your help, and if you don't have Dish Network, don't forget to contact your own satellite or cable provider as well. Let's work together to make sure every major satellite and cable provider carries the new channel beginning on day 1.

If You're A Saver,You'll Earn Less

When I seen the headline in this morning's online version of the news paper, I was worried. By the time I read the first paragraph, I was relieved.

Savers will earn lower returns on their money market and certificates of deposit as a result of the Federal Reserves decision Tuesday to cut the federal funds rate, a local banker said Wednesday.

The Fed's decision likely will weaken the U.S. dollar against world currencies, but on the other hand, certain borrowers may find a bit of relief in their interest rates.
- Topeka Capital Journal

Not very good news if you use these sources to save. However, that is exactly why Dave Ramsey advises avoiding Certificates of depression deposits. Instead, it would be better to save your (and mine) hard earned money in a good mutual fund with higher returns. Sure there will be down years. However, as Dave explains, if you do your homework and invest in a GOOD mutual fund, then even the down years will bring in more then these low interest payments.

There is some good news in the article though. If you have a wealth draining loan, specifically one that is tied to the prime rate, then you will see your interest rates go down.

Borrowers whose loans are tied to prime rate will see their interest rates decline following Tuesday's decision to cut the federal funds rate to 4.75 percent from 5.25 percent.

Bank of America and several other of the nation's largest banks cut their prime rates to 7.75 percent from 8.25 percent.

The prime rate is the rate that banks charge their most credit worthy borrowers and is a benchmark for pricing car loans and adjustable rate mortgage loans.
- Topeka Capital Journal

That is good news. However, again Dave Ramsey says to avoid Adjustable Rate Mortgage's (ARM's), for the very reason we have seen in the news in recent months. When the prime went up, many of the owners of these type of loans (those tied to the prime) found that they couldn't afford the loan payments any longer.

All in all, loans are bad anyway. They serve no purpose, other then to drain the wealth of those, with the attitude, "I want it and I want it now." They also make the banker rich, while draining your wealth. The better way, is to be patient, yet aggressive, with your savings, so that you can buy the item with cash.

If you borrow to buy a car, over the course of the 5-year loan you WILL pay twice as much, then you would have, if you had just paid cash. The same goes for a home (30-year) mortgage. In fact Dave believes a mortgage is the only type of loan anyone should get as long as it's for no more then 15-years. However, the more you save for that home the better, because it will keep more of your money in your pocket, when it comes to those interest payments.

The Fed's action will translate into a lower value of the U.S. dollar, experts said. The U.S. dollar has been falling the past six years from 90 cents for a euro to $1.38 for a euro Wednesday. The dollar isn't only weaker against the euro and the British pound, but it also is weaker at home as consumers are paying more for food, gasoline and other goods.

About the only thing that hasn't gone up in price this year is computing power, said Todd Reeves, portfolio manager with Capital Portfolio Management, Topeka.

"Milk is way more expensive, college is more expensive, computing power is cheaper, but everything else went up," Reeves said.

Reeves said the half-percent cut by the Fed was good for the stock markets because it will pump more liquidity into the markets.

The interest rate cut gives such banks as Citi, Washington Mutual and Bank of America more liquidity to deal with the subprime mortgage crisis, Reeves said.

"But it decreases the value of the dollar," Reeves said. "This may compound the inflation problem down the road. I don't think cheap money is necessarily the answer. There needs to be some reckoning. The mortgage industry got way too loose, way too easy, people were getting mortgages who five years ago wouldn't have qualified. These were people who had no business buying a house."

Financial experts said they didn't expect the rate cut to turn around the sluggish housing market.

Nor do I.

"We've got a long ways to go in the housing sector," Greg Fankhauser, president and chief executive officer of Heritage Bank in Topeka, said.

While in Lawrence (Kansas) on Monday, Sheila Bair, chairwoman of the Federal Deposit Insurance Corp., said the subprime mortgage crisis was far from over. Another 2 million adjustable-rate mortgages are scheduled to reset by the end of 2008, meaning homeowners' monthly payments will rise from low introductory rates.

Reeves said he likes gold, which is up 15 percent so far this year, now around $715 per ounce.

He expects big financial stocks to also do well this year.

While I am intrigued by a desire to own a bar of gold, I often wonder, if I did ever buy one, where would I sell it, when it came time to say retire.

Bankruptcy - Why Not?

Today, I thought I would take a look at Bankruptcy. While each state differs slightly, there are some common ground laid down by Federal law, that all states must follow.

Some think it is so easy to file bankruptcy, but as Dave Ramsey points out many times on the air and his website, it is not.

Bankruptcy is a gut-wrenching, life-changing event that causes lifelong damage.

Bankruptcy is not something to take lightly. Very few people who have been through bankruptcy would tell you that it is a painless action, wiping the slate clean, after which you just go off into your new future to start fresh, without a care.

No, that is not what happens. I have been through bankruptcy (in 1991), and it is not something you want to do, or think about.

There are 3 types of Bankruptcy, which fall in to two categories. Only 2 types apply to personal bankruptcy:
Chapter 7
Chapter 7 bankruptcy is when the court appoints a Trustee who may liquidate or sell some things that you own to pay your creditors. Most of your debt will be canceled, but you may choose to pay some creditors, usually to keep a car or home in which the creditor has a lien.

Chapter 13
Chapter 13 bankruptcy is when your debt is reorganized into a single monthly payment. The payment will continue for 36 to 60 months. In no case may a plan provide for payments over a period longer than five years. You do not have to repay all of your debt. You pay only as much as you can afford, but the minimum payment may be affected by property you want to keep. When you complete the payments, debt not paid is discharged.


Chapter 11
Rehabilitation or reorganization, used primarily by business debtors, but sometimes by individuals with substantial debts and assets.

Of course there are others like chapter 9 for municipalities. Chapter 12 for farmers and fishermen and chapter 15 for international cases.

The thing is with proper help most bankruptcy cases can be avoided. Think I am crazy? If you are contemplating bankruptcy, instead of contacting an attorney, why not contact Consumer Credit Counseling, Lutheran Social Services or a quality financial counselor in your area. Better yet, get financial counseling and take Dave Ramsey's Financial Peace University as a supplement to the counseling for your Total Money Makeover (as Dave Ramsey would call it). It may involve painful amputation of stuff you own, but it will be less painful then bankruptcy. If you thoughtfully take the two steps back so you can get on solid ground again instead of looking for quick fix (like bankruptcy), you will win more quickly and easily. Besides, there is no quick fix. You must learn to change your spending habits. I know personally the pain of bankruptcy. I do not want to do it again, I've been there, done that, got the t-shirt, and it is not worth it.


Bankruptcy and Tithing
By the way, there is one more thing to consider and that is one of the big down sides to bankruptcy is that the law forbids tithing and charitable donations. Of course, scripture, which encourages believers to tithe, also discourages such things as bankruptcy anyway.

"This is also why you pay taxes, for the authorities are God's servants, who give their full time to governing. Give everyone what you owe him: If you owe taxes, pay taxes; if revenue, then revenue; if respect, then respect; if honor, then honor.
Let no debt remain outstanding, except the continuing debt to love one another, for he who loves his fellowman has fulfilled the law."
- Romans 13:6-8

In another words, if someone was going 100% with the Bible in their finances, they would both pay off all their debts and tithe. They would would not file bankruptcy. Now, with that said, I have heard Christians who filed bankruptcy, and then paid off the debts that were discharged later on. They did this because they very strongly believed that God wanted us to pay off our debts in full.

"Christian Money Management" Verses Secular Money Management

Anyone who has been reading my blog for any length of time, knows that I hate credit and am a follower of Christian or somewhat Christian money management systems. Especially since, I am a churchgoer.

What Is Christian Money Management?


Christian money management consists of training people to manage their money better, using Christian principles. This is an effective way to reduce misery, save marriages, and even prevent spousal abuse.

It is also of great spiritual importance because how you use your money is how you express your choices in all areas of life, not just church activities.

For example, if you can train yourself to wait to buy something you want, you are also more likely to wait for sex. IE: you are less likely to participate in premarital or extramarital sex.

There are two people or organizations that are considered leaders in Christian money management. A third person is much more about the money and doesn't offer any free information on his website. Of course all three sell their books and tapes as well as seminars, but the two big ones offer "free" advice via their radio programs and websites.

The original idea of financial training at church was vigorously promoted by the late Larry Burkett, whose Crown Financial Ministries is still the leader in the field. Dave Ramsey also has a loyal following; he is a bit more of a financier, and less of a spiritual adviser, than Burkett.

The third, Ron Blue is the founder of the largest Christian CPA firm in the world, who retired in 2003 and started what is now known as Kingdom Advisers.

How is "Christian money management" different from anybodyelse's money management? To a large extent, it's not. What works, works. However, four Christian doctrines loom very large:

God owns everything and we are just His stewards - Put simply, all of our property isn't really our own.

Higher standard of Honesty - We are held to a higher standard of honesty because God is always watching. Ethics isn't just whatever you can get away with.

Marriage is a permanent commitment - I know this doesn't sound like a financial issue, but it is. Secular counselors such as Suze Orman often advise couples to break up when they disagree strongly about money. For the Christian, that is not an option. Nor can marriage be viewed as temporary in the first place

Money does not buy happiness - There is much to be said for the old-fashioned virtue of contentment, the art of realizing that if you aren't happy now, you still won't be happy if you simply acquire more money or possessions.


Who Are the Secular Money Management People


There are a large number of advisers that would fall into this category. However, there are some leaders. Two of which have radio or TV shows (Suze Orman and Clark Howard). One which sells his tapes via radio commercials (John Cummuta). Another, that might be considered a leader, has appeared numerous times on Oprah. His name is David Bach.

All of these people teach reducing your debt load. In addition, they also all teach saving for retirement. However, there are some big differences.

The ones that tend to be Christian all tend teach paying cash for everything. Even business debt is to be avoided by the Christians. One of the secular teachers, John Cummuta, teaches this for personal debt but not business debt.

I personally like Cummuta and his teachings because they so closely resemble Dave Ramsey's. However, as I said there are some differences. Cummuta for example teaches debt reduction mathematically. IE: largest interest rate first.

Whereas, Dave Ramsey teaches that if we were thinking mathematically, we would never have gotten into debt in the first place. It is this reason, that he teaches a psychological method of paying the smallest debt first, regardless of the interest rate. The reason is paying off a debt relatively quickly will motivate you to move on towards your next debt. Both teach paying as much as you can on the first debt, then adding that payment to the