Hello, My Appreciated Readers,

I’m going to make this short and sweet, particularly as you may not be able to see it until tonight when things wrap up.  If you spend much time online, as I do as a personal finance blogger, you might have heard about the Stop Online Piracy Act (SOPA) in the United States House of Representatives (and its companion bill in the Senate, Protect IP Act (PIPA)).  In case you haven’t, or want more information about what these bills are and why they have so many people riled up, check out this story to determine just what is happening.

To protest these bills, numerous sites are going to be blacked out today, from Wikipedia and Reddit, massive sites that dominate the internet, to much smaller sites, including, well, me.  Yes, I will going offline at eight a.m. EST today, and will not be coming back until eight p.m. tonight (assuming that my sometimes not the best understanding of my blog allows me to do so successfully…).  My participation is because, well, I can see how these laws, although I believe they are well-intentioned as laws tend to be, could be misused by future (or even present) Justice Department officials to censor parts of the Internet, regardless of whether they are directly doing anything wrong, opening up the possibility of wide-spread censoring and legal actions that could drive new websites out of business.

So, for the next twelve hours, my blog will be down.  Hold back your tears, I will be coming back soon, and when I do, here’s hoping that it will be to a world that is more willing to consider the side effects of legislation being considered.  Have a safe SOPA blackout day!

Roger Raby

Let me start out by saying that for the most part, I am happy to be a grad student.  I like being able to learn more on a daily basis, being able to expand my mind and add more knowledge to the ol’ noggin.  I like the classes I’m taking, I love being able to teach students, and as frustrating as my research has been at times (if I had a dollar for every time I’ve run into some sort of problem with my research, I’d probably double my grad student income), I do enjoy being able to add to the sum of human knowledge, if only in some small way.  All in all, I like my position as a grad student.

That said, it does have its downsides, as well.  Research alone could be a full time job, as I frequently have to stay late to get everything done.  My studying and teaching duties, which add up to more than twenty hours a week, even a slow week, mean that I’m frequently putting in sixty hour weeks.  When it’s time for tests to come around, as they have this week (I am only taking two classes (one with a six hour a week lab session included), but they have their tests only a day or two apart), I can frequently find myself with barely enough time to sleep, let alone finishing all of my ‘side hack’ work here on this very blog, amongst other places.

All of this is my roundabout way of saying, at the moment, I’m finding myself more than a little bit stretched on time.  I have no intention of stopping publication here on The Amateur Financier, but for the next eight months or so, until I graduate with a shiny new Masters’ Degree, I am likely to be (even more) scattershot in my publication than ever before.  I ask that you please bear with me, as I am quite devoted to rebuilding (and building up) my blog, and I hope that you are willing to stick it out with me.  As the expression goes, the best is yet to come.  Thank you to all my loyal readers, and here’s to a fine future together!

P.S. If you’d to learn more about the pain in the rump that is the life of a grad student (and have a good laugh at those of us who do this voluntarily), please check out PhD Comics.  While I’m not technically a PhD student, trust me when I say that the comic is more correct than incorrect, even for us humble Masters’ students.  (I’m particularly struck by how well Jorge articulates the joy of the days spent in research, going from before sun up to after sunset.  I have gone days without seeing the sun, I’m sad to say.)

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I’m not dead, although you’d be forgiven if you thought that might be the case.  No, the story of why I haven’t been updating is fair more mundane, and luckily, nonlethal.  The new semester has started, and this week, both of the graduate level courses I’ve been taking (Instrumental Analysis and Advanced Organic Chemistry I, if you were curious) had their first tests of the semester.  Add in the typical mix of grading undergrad papers, writing my own papers, and running my lab sessions, and there was barely enough time to get everything finished.

For that matter, even when I did have some ‘free’ time this week, I had to spend it trying to get my research work up and running.  I’ve had so much trouble with the research project I’ve been working on that I’m actually further behind in my research progress than I was at this time last year (yes, I’ve managed to go backwards this year, which is almost an accomplishment itself).  Combined with my academic work, and I barely made it back to my apartment before dark most of the days this week.

In short, sorry for the lack of new posts this week

All of this is my elaborate way of trying to explain why I haven’t done much (or, say, anything) in the way of posting new articles this week.  Thank you for your understanding, and here’s to a much more productive (and hopefully, informative) week during this coming week.

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I like to think of myself as pretty knowledgeable about money.  After two and half years writing this blog, and even more time spent following other blogs, reading personal finance books and magazines, and generally keeping myself pretty well educated in the ways of money, I think my financial knowledge level is well above that of the typical American (given how little the average American seems to know about money, that’s not saying much, but I’ll still take it).

The problem is that, no matter how much you THINK you know, it’s still possible to make some foolish money decisions.  This has been the case for me throughout this summer.  If you check my Net Worth Updates for the past several months (as I just did), you can see a rather depressing pattern.

Yes, this blog entry's only going to get sadder from here.

In May, I was doing pretty good, cutting down my credit card debt and generally doing pretty well financially.  June was less successful, as I started to add on more credit card debt, and July was more of the same, as I added nearly five thousand dollars in credit card debt.  By the start of this August, I had nearly maxed out both of my credit cards, and have been doing pretty badly at cutting down the amount owed.

How Did This Happen?

Well, I’ve mentioned at various points (usually during the above mentioned Net Worth Updates), it’s been a surprisingly expensive summer; between helping my fiancee pay for her dental work and trying to get the air conditioning in my car back in working order, I’ve spent thousands more than I would have otherwise.  Add in the lower pay I’ve been making over the summer months (and graduate student pay rates aren’t exactly fantastic in the first place), and it’s been tough to keep my head above water, let alone make progress in getting my finances in order.

But the real fault lies with me.  While there were plenty of unavoidable expenses (or at least expenses that were quite tricky), there were also plenty of spending that I could have gotten under control if I wanted.  I have gone out to dinner quite often this summer, I’ve taken several trips (even if most were only for a night or two), and I haven’t been very frugal with my food and other general spending.  I told myself, ‘Well, I’m adding to my credit card debt, but I will be getting student loans at the end of the summer (August 19th, to be exact), and then I can pay off most of my (student-related) credit card debt.  Everything will be fine in the end.’

As I’m sure most of my regular readers are probably already assuming, the 19th has come and gone, and I still do not have any student loan money.  You see, the faculty at YSU (my graduate school) are in discussions about their pay (and may strike), and until the university knows for certain whether there will be a Fall 2011 semester (or at least, when it will start), they maintain that the US Department of Education won’t allow them to release the student loan money to me, or any other students.  (I will admit, I do wonder whether that’s really the case, or whether the university is withholding student loans as a way of adding pressure to the professors in the form of students begging them to resolve their issues.  Since I’m not getting student loan funds until the issue is resolved, regardless, I suppose it’s a moot point, though.)

The Lesson

I’m not writing all of this to get pity.  I’m not writing it to pull at your heartstrings.  And I’m definitely not writing it to try to get you to send me money, or anything of that nature.  No, I’m simply writing it to note that sometimes the best laid plans get thrown off for reasons well outside your control, and that it’s important to consider such events, and try to prepare for them.

How could I have prepared for this strike?  Well, I could have saved more money from my last set of student loans, so I’d have something available in an emergency fund for this situation (or any other situation where my expected cash flow was lower than I had planned).  I could have controlled my spending, particularly my credit card spending, so that I would have some credit available now.  I could have done more work in building alternate income sources (my blog is nice, but all the money I’ve earned through it to date would barely cover my expenses for a month).  Most of all, I could have made contingency plans so I wasn’t caught so off guard by this situation, and didn’t have to depend so heavily on others for my own financial needs.

All of this is to say, sometimes, life will get the best of you.  The best way to get the best out of life is to be prepared for the negatives that might affect you.

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I have plenty of bad habits.  I tend to use my credit cards without thinking of how I will pay off the debt before interest starts to be charged, I don’t keep much of an emergency fund, and I don’t shop around enough when making major purchases (or really, most any purchases).  And those are just my bad financial habits; if we get started on all my other bad habits, we’ll be here all day just listing them.

As with any bad habit, it’s hard to break bad financial habits once they get established.  When you already have a substantial amount of credit card debt, it becomes much easier to mentally justify adding even more.  If you haven’t been investing for most of your life, it’s all too easy to just keep on the same path.  Once the habit is established, it takes much more effort to break it than to keep up the habit, even if it is hurting you.

Case In Point...

All of this means that if you want to improve your life, whether that means doing more with your money, cutting down reckless spending, or otherwise getting yourself on a better financial footing, you need to put in some work to get it done.  I know, I know, it’s going to be tough; I feel your pain, particularly because I’m going through the same pain.

Luckily, there are some steps that we can take in order to change our habits, if we’re willing to put in the work.  While there is no single ‘#X-Step Plan to Defeat Your Bad Habits’ that will work for every bad habit, or even for all the bad financial habits, but there are some common steps that should help you to get your financial life back in order:

1. Define your problem: Before you can make any progress, financially or otherwise, you need to define your bad habit, and figure out how you would defeat it.  You also need to make sure that you can tell when you have accomplished your goal, by making it precise and measurable; ‘less stupid spending’ is pretty vague and unmeasurable, but ‘spending less than $100 on frivolous items each month’ is a decent goal (presuming you have a decent definition of ‘frivolous’, of course).

2. Publicize your goal: Now, by ‘publicize’, I don’t mean that you need to buy a billboard to advertise that, for example, you are deep in credit card debt.  (Particularly because doing so will only get you in more debt.)  No, you should try to share it with those close to you, your friends and family.  Assuming any of them have the same problem (and unless your habit is truly unusual, it’s likely that you have at least one or two people in your circle with the same financial problem), you’ll have a ready source of support, encouragement, and possibly even suggestions to help you deal with your problem.  (You could also consider sharing your financial issues on a blog or similar forum, at least if you comfortable doing so and trust those who are likely to read about your bad habits.)

3. Replace your bad habits with good ones: Trying to break a habit without a replacement habit is going to leave you with a feeling of emptiness, which you’ll end up trying to fill with…well, the old comforting bad habit.  To break the bad habit, you need to find something that you can do to help satisfy that urge, while being better for you (and your wallet).  If you spend too much on books (like me), for example, you can replace trips to the book store with trips to the library to get that same feeling of looking through hundreds of books you’d love to read (with the advantage that you won’t have to pay anything to take some of them home).  Trips to a new clothing store could be replaced by trips to the thrift store (preferably with a collection of your own clothes for donation).  It doesn’t take much to build up a new, healthier habit.

4. Don’t let yourself slip…: I know, it’s tough to keep up and avoid slipping up.  The problem is, if you don’t take a hard line approach, if you let yourself slip back into your bad habit ‘just this once’ or ‘only in this situation’, it’ll be that much easier to slide back into doing it more and more often, and before you know, it’s a bad habit again.  Be firm with yourself (and allow anyone helping you accomplish your goal to be even firmer), stick with your goals, and if you do slip…

5. …And figure out what happened if you do slip up: Things happen, and plans, however well intentioned and useful, get thrown awry.  Chances are, you WILL slip at some point in your attempt to defeat your bad financial habits.  When it does, though, rather than berating yourself for your failure (or worse, deciding that you just can’t do it and giving up), try to find out what went wrong.  Did you put yourself in a situation where temptation was all but unavoidable?  Was there an unusual circumstance that you didn’t foresee, and therefore, hadn’t prepared for?  (With financial bad habits, this is particularly relevant; unlike, say, smoking, there are situations where you might NEED to add on more credit card debt in order to, say, get your car fixed or handle a medical bill.)  When you see what went wrong, you’ll be able to adapt your plan to take similar circumstances into account, and avoid making the same mistake again.

There you go, a simple plan for keeping those bad habits under control.  It’ll be tough (believe me, I know how tough it can be), but if you keep up with it, you’ll end up in a much better place financially.  Good luck!

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When you get right down to it, there aren’t too many things that personal finance writers (myself included) can agree on.  Oh sure, for the truly basic of the basic ideas, there’s pretty high consensus: spend less than you earn (doing it the other way around is one of the surest routes to financial trouble), keep an emergency fund (because things do happen and you want to be prepared), invest what you have left, be careful about what debt you take on, all are pretty universal.  It’s hard to find anyone in the personal finance field who doesn’t support doing these actions in one form or another.

It’s when you go on from here that things start to get more complicated.  From the relatively small disagreements (How many months worth of spending should you keep as an emergency fund?) to the big arguments (How should you invest your money?  How much debt (if any) should you be willing to take on?  How quickly should you try to pay it back?), there’s a whole range of opinions out there in the personal finance sphere.  Some advisers suggest saving up a storm, others recommend putting as much money as possible into investments, still others prioritize paying off debt as soon as is possible.  When it comes to the types of investments suggested, there’s even more disagreement; ask ten different personal finance writers what the perfect investment (or even combination of investments) happens to be, and you’re liable to get one hundred different answers (along with a handy guide to deciding which option is best for you, at least from the more well-prepared writers).

Sometimes money disagreements lead to arguments; but not nearly often enough to make CNBC a replacement for Jerry Springer

‘What’s going on?’, you may ask, ‘How can there be so much disagreement on the subject of money?  Shouldn’t intelligent, reasonable people be in agreement on how to handle money?”  Well, in answer to your questions (in order): First, reasonable people can disagree, even on big, important issues (contrary to the impression you may get from many political commentators).  Second, as with many important things in life, everyone has had experiences with money and has their own opinions on the subject.  Lastly, while there is some agreement on the subject of money at the most basic level (see the few things personal finance professionals agree on listed above), there’s so many options available nowadays for how to use and spend your money, so people can disagree on how best to use your limited financial resources while still being responsible, reasonable sources of information.

Handling Multiple Sources of Money Advice

The end result of all of this is that there are numerous different approaches to personal finance currently floating around out there.  What’s the best approach to take towards all of them?  Well, as you might guess, there’s plenty of disagreement on that front, as well, but here’s my suggestions on the subject:

1) Familarize Yourself With the Adviser: In the modern era, there are so many ways to learn about a particular adviser’s approach to money and personal finance.  If you hear about someone from friends, family or any other source, someone who sounds like their advice could be helpful to you in your current situation, search for them on the web or find one of their books in the local library and see what their money philosophy is all about.  If you think their attitudes towards money jive with your own, you can go deeper in depth in your research and learn more about what they’d recommend to someone in your situation.  Of course, using only one source of information can sometimes give you a distorted view, so…

2) Get a Variety of Perspectives on the Advice: It’s always good to step back and try to look at the bigger picture.  Not only should you have an idea of what a given adviser recommends, but you should try to understand other alternatives and learn what other financial professionals think about their recommendations.  Sometimes you can learn a great deal from the critical writings or commentary from others.  (Note: There is a difference between respectful, informative disagreement and insults and mockery; learning to spot that difference and only use reasonable sources of disagreement is a major trick to gaining perspective on the advice you are considering.)

3) Consider Only Taking Some Advice: Many personal finance writers will lay out a full guide to personal finance throughout your lifetime.  This is fine as far as it goes; many people like having a comprehensive guide to their money, and having a (reasonable) plan on how to manage your money is better than no plan at all.  But just because a writer or speaker provides comprehensive advice doesn’t mean you have to take it.  You can (and probably should, in many cases) take some advice from one source, other advice from another source, and perhaps further advice from even more sources.  If you like one author’s views on paying off debt and another author’s view on the best investment portfolio, why not use the parts that are best (for you, at least) from each?  (There are some pieces of advice that are mutually exclusive, of course; you can’t utilize leverage and stay completely debt free at the same time, for example.  Other than such obvious contradictions, however, mixing and matching different advice can help you build the best plan for your own needs.)  While we’re on the subject of shifting advice…

4) Don’t Be Afraid to Change Your Approach As Your Circumstances Change: There is a tendency for people to look down on others as ‘flip-floppers’ if they change their opinion.  I don’t know why this is; as John Maynard Keynes noted, ‘When the facts change, my opinions change.’  It should be the same for you when it comes to money management.  The advice (and adviser) that you used to get out of debt may not be the best advice to keep following when you are out of debt and trying to build up your investments for retirement.  Re-evaluating your situation periodically (doing so annually is a reasonable minimum) and making changes to your financial plan if you feel it is necessary given your current circumstances will help you to stay on top of your money and manage it to the best of your abilities.

There you go, some advice on, well, advice.  Hopefully this will help as you try to go through the process of trying to determine the best way to manage your money.

Readers, How do you handle the abundance of financial advice available?  Do you follow one adviser’s recommendations pretty exclusively, or do you mix advice from multiple sources?  Has your approach to money changed as you gained more knowledge or your situation changed?

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On Thursday, I woke up to find a message on my phone from my fiancee Sondra.  This was a bit odd; neither of us is really a morning person (I would, if my classes and other obligations allowed me to, stay up to 4 or 5 am and sleep in until noon every day), and she usually didn’t call me before the afternoon, when her schedule allowed her to call me at all.  But I knew that on Thursday, she had some work to do that required her to go into her college’s studio early, as in pre-dawn, so I figured that she was calling me on a break from her work.

Upon listening to the message, though, it was a much different (and much worse) situation.  Apparently, she had left for her college, as planned, but hit a patch of black ice on the way and went off the road, and… that was all she said.  Nothing on her state of health, what state her car was in, where exactly she had gone off the road, what she wanted me to do…

As you might imagine, I was worried, to put it mildly.  (To put it less mildly, I was a bit panic-stricken, in spite of the lack of concern or worry in her voice or any requests for help.)  I tried to call her back, to no avail.  Without knowing for sure what was going on, I went to my university to run a few lab sessions.  Things went well enough, I suppose, although it was hard to focus.

Finally, by afternoon my fiancee called me back.  She did go off the road, and one of her windows got broken in the process, but she was unharmed, and she was able to drive away without a problem.  Given the number of steep drop off points along the road she drives, to say nothing of other cars and vehicles on road that she could have hit (or vice versa), it was something of a miracle that there wasn’t more damage done to her or the vehicle.

All of this has just made me start to think of how lucky I am with everything that is going right in my life.  My fiancee is wonderful and loves me completely, I have my health and my mind, and my income, while not huge, still provides me with enough money to keep my rent paid and my pantry filled without having to take on too much new debt.  On top of that, I’m lucky enough to live during one of the most comfortable times and most modern countries in history, a time when I’m able to spend my days expanding my mind and sharing knowledge with my readers.

In short, life is good, and I’m doing my best to count my blessings.  I suggest that everyone try to do the same.  Things happen in life, and it’s best to remember everything that is going well in your life.

You never know when it will be gone.

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Today, I thought I’d take a little break from the normal zigs and zags of managing your money, and use a few moments to tell you about an event that happened that made me quite happy and appreciative of the good in people this weekend.  It all started when I lost my wallet…

Wait, What?

Alright, let’s back up a little bit.  I was out shopping for food for the next week, as I do about once a week, and was getting ready to check out with the food products that I had gathered.  After I took out my wallet and rustled through it for coupons, I found a coupon for buy two, get $1.00 off on one of the items I was buying.  Given my fondness for said item (one of those drinkable, pro-good-bacterial yogurt multi-packs, in case you were wondering) and the fact that I only had one currently in my cart, I made my way back to the dairy aisle to grab another.

As I was pushing the cart, I held my wallet, the coupon, and my store membership card in one hand, using my other hand as the main director for the cart.  By the time I had gone across half the store to get back to the dairy section, I was getting a bit frustrated by trying to push and hold everything at the same time, so I slipped the wallet, card, and coupon into my coat pocket, grabbed another container of yogurt, popped it in my cart, and went on my merry way.

Oh, Shopping Cart, my old nemesis...

(You can probably see where this is going, but just in case…) I got back to the check out area, pulled out my card and coupon (but not my wallet) and started to check out at one of the self-service checkout kiosks.  (Which are both a blessing and a curse, but that’s a topic for another day.)  When I was about halfway through checking out, I heard a woman paging me to come to the service desk.  I looked over, and she was making the announcement about five feet away from me.

As soon as she stopped speaking, I raised my hand (what else do you do when someone is calling your name?) and told her that I was the Roger she was looking for.  She let me know that someone had found my wallet, and turned it in.  I was shocked, as up to this point, I hadn’t even realized it was gone.

She told me to go see the security officer who was walking towards me, and who checked that I was in fact the owner of the wallet.  I thanked him, thanked the fellow who turned it in, and generally tried to show my appreciation for the people who helped me out.

The Moral of the Story

So, why am I sharing this story with everyone on a Sunday, rather than spending my time studying for my big Biochemistry test on Wednesday?  Well, partially because there’s only so much studying a man can do before his brain feels like it’s going to melt (and after trying to start the cramming yesterday, I feel pretty near that point myself).

But more to the point, there is a tendency for us as individuals and as a society to assume the worst about each other.  There’s any number of reasons for this, and you could blame it on everything from our increasing anti-social society (or perhaps more accurately, increasingly social via technology society) to a media that has discovered that pain and suffering is a good way to keep listeners and viewers tuned in and their own ratings (and advertising rates) high.

If you look closer and give people a chance, though, most of them are genuinely kind and would rather help their fellow man than cause them pain (or even allow them to go without help).  Don’t get me wrong, there are bad people out there, some of whom do downright evil things.  There are also others whom get caught up in a bad moment and do things they later regret; there is a wide spectrum of reasons why people end up doing bad, even downright evil things to each other.

When you get right down to it, though, the good in the world seems to outweigh the bad.  For every person who would have simply walked off with my wallet (or at least pocketed some of my cash or maybe one of my credit cards), I think there were at least ten who did what the gentleman who found my wallet did, turn it into the proper authorities, try to help find the owner, and even wait around to ensure that it wound up in the hands of the proper person.  I didn’t even learn his name, and wouldn’t know him from Adam, but he took the time and effort to help me out when I needed some assistance.  It’s somewhat heartening, particularly when the news seems to only remember the negatives and evil actions of people, to recall that there is good in the world, and as time goes on, the good will win out.  (Provided we do what we can to help it along, of course.)

Have a nice Sunday, and I hope that everyone who finds themselves in trouble has someone to come to their aid.

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For the most part, I’m a pretty fortunate fellow. I have a loving fiancée, a good (if not high paying) job advancing the science of biochemistry, and a nice apartment. Yup, all in all my life is pretty nice, which is why when things go wrong, they seem to really go wrong.

My Tale of Adventure

First, let me set the stage.  It’s around six o’clock on Friday evening.  I’ve finished up the last test I need to run, to determine if the bacteria I’ve been forcing to produce my protein of interest have actually done so.  (They have, in case you were curious.)  I’ve cleaned up, put everything away and gotten into my car to swing by my apartment, to pick up a few things before I go to visit Sondra.  So far, so good; nothing to complain about yet.

It was on the road where I had a weird encounter.  At a stop light as I was driving to my apartment, I had a woman in the car next to me gesture to me to roll down my window.  After I did so, she shouted over that both of my headlights were out.  I tried flicking them on and off, but no avail; they weren’t lighting up.  I hadn’t noticed because all of my driving to that point had been in the city, and with all the street lights, the road in front of me was adequately lit even with my headlights out.

I yelled back my thanks, grumbled, and flipped on my hazard lights as I took a detour to the nearby Wal-Mart and its auto center.  By now, it was after seven, and since they closed at eight, the fellow at the desk told me they might not be able to get to my car in time.  So, I spent the rest of the hour reading a copy of Inc. magazine in the waiting room, hoping that I’d be able to get my headlights fixed.

When the repairman came to get me, there was bad news, and there was good news.  The bad news that whatever was causing my lighting problem was an electrical issue, something going on in the internal workings of the car, and couldn’t be fixed by them.  (The Wal-Mart center was a tire/oil change place, not a full service garage or anything.)  The good news: although I hadn’t realized it, the brights weren’t affected by whatever was crippling the low lights, so as long as I didn’t mind being a bit of a jerk and keeping my brights on the whole time, I could drive with my lights on, after all.  As a nice little bonus, Wal-Mart’s mechanics didn’t charge me anything for the time they took to check out my car and determine that it was a problem beyond their ability to fix (or at least, what Wal-Mart would allow them to do).

I drove back to my apartment using my high beams, without getting any angry honking or other adverse reactions (an advantage to having a low set car is that even your high beams aren’t that high).  When I got into the apartment parking lot, I played around with the lights a bit, seeing if I couldn’t get the low lights to work.  I discovered to my amazement that they went on, if I turned them on and then flicked my high beams.  Problem solved, it seemed.

I gathered my things from my apartment, and set out toward my fiancée’s apartment.  Everything went fine for first three quarters or so of my trip; my low lights worked fine, and it was a pretty uneventful drive…

...Even though the scene out my windshield looked like this much of the time...

…Until I got on the last highway taking me to my fiancée, when I noticed the lights flicker.  I tried to flash the high beams, and the low lights went out leaving me in darkness.  I was surprised, but undeterred; I figured I could just use the high beams like I had planned originally.

When I tried turning on my high beams, though, they didn’t come on either.  At this point I was getting worried; I tried flashing the high beams again, and noticed than when I pulled the high beam bar towards me, the high beams came on, even though I couldn’t get the lights to come on any other way.

I ended up driving the last twenty miles of the trip with my hazard lights on, holding the high beam bar with my left hand as I drove.  Luckily for me, I was nearly at the end of the trip, the snow had stopped, the road was clear, and the traffic was light; otherwise I would have stopped and not tried to push my luck.  (I am far from being a big risk taker, at least when my life is on the line; if there seemed to be a risk to continuing, I would have stopped.)  I made it there alright, although later than I had planned (much later; if we include my detour to Wal-Mart), and with a rather long story to tell (as you’ve just read).

The Lessons I Learned

Well, relaying that story took much longer than I was expecting (although, if you think it took a while to read, just think of how long it took to live through).  In the spirit of making lemonade from the lemons that life hands me, here are a few lessons I drew from my experience:

-Try to Help Out Others: Had those friendly people not pulled up next to me and pointed out that my lights were out, I might have gotten all the way onto the highway without knowing about my car’s troubles.  Had I done so, I would have been in a much worse position that I was otherwise.  It was very nice of them, and I certainly intend to pay it forward and try to help out someone else, as well.

-Keep on My Car’s Performance: I’ve been trying to keep up with the maintenance on my car, particularly given some of the issues I’ve faced in my past.  But, I still need to improve my observational skills; I honestly don’t know when my lights first went out.  (Most of my driving last week was from my apartment to the university, all city driving during the daylight; I haven’t used my lights since last week.)  Making a point of checking my lights and fluids once a week or so (perhaps when I stop to get gas) would be a good plan.

-Being Helpful can Increase Your Business: Not so much a lesson for myself, but because of their willingness to check out my car (and not charge for the service rendered), my local Wal-Mart managed to endear themselves to me, and ensure more future business.  If you (or your employees, as the case may be) treat customers well, you can expect repeat business; it’s a good lesson to keep in mind.

So there, a few good lessons I got out of this whole ordeal.  I hope everyone else had a less harrowing drive home last Friday.

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I try to share as much of my personal life with those of you who read this blog as I possibly can, particularly when it comes to my finances.  Besides being useful in illustrating the broader points I  try to make, it also helps, I like to think, in building a connection with you, my readers.

With that in mind, there’s something I haven’t been sharing which I feel I should: I have credit card debt.  Not just ‘a few charges on the card, which I will pay off at the end of the month, allowing me to collect bonuses from the credit card companies for free’ debt, but an unpaid (if still relatively small) debt that is accumulating interest as we speak.

How Did This Happen?

If you’re a long term reader of this blog, you might remember that I lost my job back in November; that was the starting event.  Given my extended period of unemployment before that point and the short time I was employed, I hadn’t managed to accumulate much of an emergency fund to that point.  Luckily for me, Pennsylvania has a pretty generous employment program, which, thanks in part to the numerous extensions passed by the federal government, I was still eligible to receive benefits, which provided me with an income stream roughly half the size I was previously receiving.

Unluckily, or more accurately, unwisely, I was still spending money as if I was getting my previous full income.  In fact, I actually ended up spending more, in large part because upon losing my job, I soon moved out to live with my fiancee.  While I adore being able to see her everyday and spend time with her, it did make a major dent in my bank account.  Besides the increased number of date nights that we went on (thanks to no longer living 330 miles apart), I went from living essentially for free in my mother’s basement to contributing a sizable amount of my unemployment to bills and food expenses.  (The trip to Philadelphia for NCECA, while fun, was probably also ill advised given the state of my employment and finances.)

What happened shouldn’t be a surprise to anyone who’s done much reading in the personal finance sphere.  I started dipping into my savings accounts to cover the credit card bills; when those funds were gone, I was dependent on getting my unemployment benefits in a timely manner to cover the expenses.  Before long, trying to beat the clock caught up with me; as of May, I didn’t have enough to pay off the bill in full when it came due, so I paid the minimum and starting floating the balance on the card.

The bane of my existence

I was still pretty confident, though; by that point, I had gotten my current job at Wal-Mart, and with that income combined with the continued unemployment benefits, I was sure that I could quickly wipe out the remaining debt and even start to accumulate savings again.  (Since I’m not working full time at Wal-Mart, Pennsylvania’s unemployment system allows me to keep drawing unemployment benefits in addition to collecting my pay from work.)  It was working pretty well for a while there, too; only about $150 of last month’s bill needs to be paid (although, the charges for my spending in May are due soon, as well).

Unfortunately the bottom has fallen out of that plan; while filing for my latest set of benefits, I discovered that I’ve exhausted what the Pennsylvania unemployment system is willing to provide for me.  I’ve gotten my last unemployment check, which was much smaller than I was expecting, to boot.  My Wal-Mart income, about one quarter what I was earning at my previous job, will not allow me to pay off my debt for at least a few months.  In other words, all my attempts to keep unemployment from interfering with my fun and enjoyment have blown up in my face, leading to a hunk of money sitting on my credit card bill, just taunting me.

The Lesson

I’m not sharing all this to win any pity; given that most of the people who comment on my blog are fellow personal finance bloggers, I’d expect more recrimination and ‘What were you thinking?’ comments than pity, anyway.  I’m sharing this because I hope it can serve as a warning; it’s easy to delude ourselves into thinking that we have everything under control, even as it starts to get out of hand.  Had I stopped to notice what was going on, or had the courage to really take myself to task for my increasingly bad money habits, I might not be in this situation now.

Here’s my advice to all those who find themselves in similar situations to the one I was in since November: Be realistic, even pessimistic, about how long it will take to get a new job, how much you earn from that new job, and how much you can really afford to spend.  It’s easy to tell yourself that you’ll get a job soon, that unemployment will see you through, that you don’t need to make any changes to your lifestyle now that you have less money coming.  If you fall into that trap, though, you’re just going to end up hurting yourself.  A much better, although admittedly less fun, method is to treat unemployment or any other bad situation with all the seriousness it deserves, and act accordingly: decrease your spending, cut out any vacations or other large, optional expenses, and do your best to keep your costs under control.

As for me, I’m doing my best to take care of this credit card debt as fast as I possibly can, and then a bit faster.  I’m doing most of my spending with cash, rather than cards, and am closely monitoring that to ensure I have plenty of money left over to cut down my debt.  (I haven’t gone as far as cutting up my credit cards, at least not yet; if I don’t see enough improvement on my debt in a few months, though, it’s into the shredder (or at least, into a huge block of ice in the freezer) for them!)  I’ll have that debt gone in no time, you can count on that; and then it’s back to more personal finance goodness in the coming weeks!

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Well, well, well, it’s that time of year again.  Yes, I am another year older, and presumably, another year wiser.  Certainly, I’ve been learning a lot about personal finance, investing, and money management over this past year.  One advantage of writing a blog is that you tend to do lots of research into your subject matter, and as a result, I’ve had the opportunity to read more about personal finance in the past year than I did in my previous twenty-six (which makes me 27 now, in case you were wondering).

Of course, aging does have problems of its own.  One of my biggest problems with birthdays as I’ve been getting older is that I no longer know what presents I should request.  There isn’t too much I want, and frankly, what I do want, I can easily afford on my own.  I didn’t have any good suggestions for possible presents from my family, although it would be nice to go out to dinner.  (It’s official; I’m the father in an old sitcom, a fate I always figured would happen eventually.)  Admittedly, this isn’t exactly a horrifyingly devastating problem, but that’s all I’ve really been worrying about this birthday.

So, in lieu of expensive presents or doodads I’ll play with for a little bit and then forget, all I really want for my birthday is to learn a bit more about my fellow bloggers.  Please feel free to leave a comment listing your birthday, so I can add it to this post and have a reminder for when it rolls around next year.  Hopefully, all your birthdays in the upcoming year will be as happy as mine (and less busy; I had to work last night and I’m working again tonight, even coming in early for a monthly meeting).  Have a great October 27th, everyone!

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Contrary to what you may have been led to believe, I wasn’t always a mildly crazed, mid-twenties geek; at one point, I was actually an eleven or twelve year-old, mildly crazed geek.  Even then, though, I was learning some of the basics of economics, whether I realized it at the time or not.  After all, even as a child, you still have to deal with things like supply, demand, and distribution of goods, even if you don’t fully realize it at the time.  Here’s one story of what I gleaned from a Christmas decoration project during my elementary years.

First, a little background.  I was part of the gifted program during my school career, from the time I was in elementary school on.  In my school district, the gifted program focused on providing us ‘gifted’ students with added challenges and opportunities in school, to help us learn and grow.  In junior high and high school, this meant primarily getting extra assignments that we were expected to finish in order to graduate (not exactly the most rewarding situation for a young person), but back in elementary school, the gifted program was fun.  We’d get out of class early on Wednesday afternoons, meet in the art room, and do fun activities that ranged from solving puzzles to making a short film (which, back in the pre-webcam and YouTube days when I was an elementary student, was a much bigger deal than it might be now).

One of the activities we did was to make and sell Christmas ornaments.  As an introduction to marketing, manufacturing, and sales, it served pretty well.  We got to see some of what goes into creating a quality product and how to sell it to other students.  I gained quite a bit of knowledge about how to make Christmas ornaments, and learned that young students spending their parents’ money were willing to buy home-made ornaments.

A Well-Decorated Tree

One of my biggest coups during my ornament creation career was when one of the other students left school before the sale.  I was able to acquire his inventory (and just look at some of the vocabulary I picked up) for the cost of the supplies, and thus was able to sell more ornaments than I would have been able to make on my own.  I learned that increasing your supply of salable materials can increase your profits.  (Although, had my sales been worse than I expected, I would have been deeper in the hole than most of the others in the program, so it wasn’t a risk-free transaction.  That’s an even more important lesson: taking added risks with the anticipation of higher rewards can sometimes back fire on you.)

One of my bigger regrets, looking back on the opportunity I was given, is that I did not attempt to advance my entrepreneurial ambitions beyond these yearly sales.  I didn’t try to set up my own business or create a product to sell.  If I had gotten an earlier start thinking about my money, and how to make more of it, perhaps I could have gotten in on the first internet bubble.  Alas, I didn’t think to create this site ten years ago and make a fortune before I turned twenty, but it’s never too late to relearn old lessons.  Especially those that involve brightly colored ornaments.

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“R-E-S-P-E-C-T
Find out what it means to me
R-E-S-P-E-C-T
Take Care, TCB”

-Respect, by Aretha Franklin

As you might guess from today’s opening lyrics, today we’re going to talk about, well, respect.  That is, holding the people and things around you in esteem, treating them as if they have intrinsic value, and showing courtesy and good behaviour to the people around you.

What does this have to do with personal finance, you ask?  Well, on the surface, perhaps not much; but respect really underlies every aspect of the monetary system.  If you don’t respect the companies that issue stock, why should they expect to get any of your money?  If your investment advisors don’t respect you, what’s to stop them from taking your money and running (a la Bernie Madoff)?  And of course, if other countries stop respecting America and trusting in our ability to pay our bills, just think of what will happen to our currency and standing in the world.  In short, respect is an important part of lives, and there are many people and things of which we should be respectful.

Whom Should I Show Respect?

Your Family – Treating the members of your immediate and extended family as valuable, important people is an excellent place to start.  If you genuinely respect your relatives, regardless of their choices in life, you help to form stronger, more durable connections to them and have them much more willing to help you in future, should the need arise.  (Not that such an ‘emergency plan’ should be your primary motivation for respecting them, of course; it’s just a nice bonus.)

Your Coworkers – If you want a work environment where your stapler doesn’t suddenly disappear on you or your lunch gets eaten right out of the company fridge, it all comes down to respect.  Do your best to treat those around you respectfully, and hopefully, your sentiments will easily be returned.  While strict enforcement of company policies can help to decrease the problems of a workplace with disrespectful people, there’s no substitute for having coworkers that return your courtesy towards them.

Your Company – By the same token, you should treat your company and the area you work with respect.  Don’t make a mess, behave inappropriately, or treat your boss shoddily.  You’re just going to make things less pleasant for your coworkers, and possibly bring your boss’s wrath down upon yourself.

Your Significant Other – I wish I didn’t have to say this, but here goes: if you don’t respect your partner, things will not go well in your relationship.  If you are just using your significant other to meet your own needs, whether physically, emotionally, or financially, the best case is that they will quickly tire of you and move on.  The worst case ends with a huge court proceeding that drags on foever, and makes you seem like a massive jerk.  Just avoid either one by showing respect to your romantic counterparts.

Yourself – Lastly, but perhaps most important, respect yourself.  If you don’t respect yourself, nobody else is going to, either.  Then, since you aren’t getting respect, you’re not going to give it to anyone else either.  Break this circle, find out what about you is good and deserving of respect, and treat others with the respect you now feel.  (But don’t go too far in the other direction; there’s a surprisingly thin line between healthy respect for yourself and egotism.)

That’s all I have to say on the concept of respect.  Remember, respect yourself, respect others, and respect will come back to you.  Now, be safe and respectful to each other, all of you out in reader land!

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