This is some hard advice that you might not hear a lot.
With the current economy, youth see high levels of unemployment.
The last time I was unemployed, I was out of work for about 7 months. During that time, I went to about 15 different job interviews.
After several rejections, I was getting very discouraged. After 5 or 6 months, I was about ready to start working for minimum wage.
During one job interview, the interviewer asked me what I expected for a salary. I first said the market rate for the position but then I said I would be willing to work for the salary I had with my previous job which was 20% less than the market rate.
Two months later, I found I was awarded the position with my discounted salary.
I came to the realization that with the job market the way it is, it might be necessary for potential employees to accept lower wages/salary just to have a better chance at getting the job.
This makes sense regarding economics. There is a market for your time/labor. If your services are not desired at a certain price (salary), you can make yourself look more valuable by lowering the cost of your time/labor.
I know this is very discouraging advice but this is the economic reality that we face.
Back in college, they really emphasized networking to find jobs. I didn't realize how important this was until actually searching for the position I wanted on various databases.
Back in 2010, there were only 5 positions open that I wanted.
I had to apply to all sorts of stuff I didn't want just so I could have a chance to make some money and create a future for myself.
Traditional advice will encourage you to negotiate your salary up but realize that if you want to negotiate, you have to be in the position to negotiate.
Fresh out of college, you are in a terrible position especially if you have lots of student debt and are desperate to start working.
To have any position to negotiate, you have to be in a position where you don't need the job they offer. The conundrum is that you are only in that position if you already have a job.
So, when you need the cash, you should just find any job to take care of yourself. Once you have that, you have the chance to keep going with the job search and upgrade with the opportunity comes.
Saturday, May 31, 2014
Tuesday, May 27, 2014
Keep track of your progress by writing everything down
When it comes to financial goals, or any goals in particular; it is very important to find out where you are now and where you want to be.
In between that, you want to make sure to keep track of your progress by keeping good records of everything you do. This way, you can see if you are on track or falling behind your goals. This will help you make useful decisions on the margin. By seeing your progress, you know what you should or not be doing.
I started running in 2012 after watching the movie Run Fat Boy Run.
I kind of wondered how close I could get to running a marathon.
As it turns out, I only got as far as running 5 miles, but I've never known if I could do it because I'd never tried before.
I only did this because I had a stopwatch and I ran a consistent distance with each run. I knew what distance I was running every time and I could keep track of my time. I wrote everything down in a notebook.
I could challenge myself for a new time with every run. Try to get a personal best every time.
Over the course of 2012, I ran over 50 miles. I ran more than I had ever run in the previous 5 to 10 years put together.
The same principles can be applied to something else like quitting smoking or drinking.
I really like beer but I've been trying to cut back on the beers for the last couple years.
So for the year of 2013, I kept track of all the beers that I drank. It came out to be 45 beers.
Since I knew where I was, I could set a realistic goal for myself. For 2014, I would try to cut down the amount of beers I would drink to 40. Each year following, I'd try to cut back a little more.
As of today, I've drank only 17 beers. I can have 3 more beers between now and 6-30-14 to stay on track.
This is a much better strategy than setting a ridiculously difficult New Year's resolution like giving up alcohol for an entire year and holding it only for a month and a half.
When people do this, they usually give up the goal entirely once breaking it.
In between that, you want to make sure to keep track of your progress by keeping good records of everything you do. This way, you can see if you are on track or falling behind your goals. This will help you make useful decisions on the margin. By seeing your progress, you know what you should or not be doing.
I started running in 2012 after watching the movie Run Fat Boy Run.
I kind of wondered how close I could get to running a marathon.
As it turns out, I only got as far as running 5 miles, but I've never known if I could do it because I'd never tried before.
I only did this because I had a stopwatch and I ran a consistent distance with each run. I knew what distance I was running every time and I could keep track of my time. I wrote everything down in a notebook.
I could challenge myself for a new time with every run. Try to get a personal best every time.
Over the course of 2012, I ran over 50 miles. I ran more than I had ever run in the previous 5 to 10 years put together.
The same principles can be applied to something else like quitting smoking or drinking.
I really like beer but I've been trying to cut back on the beers for the last couple years.
So for the year of 2013, I kept track of all the beers that I drank. It came out to be 45 beers.
Since I knew where I was, I could set a realistic goal for myself. For 2014, I would try to cut down the amount of beers I would drink to 40. Each year following, I'd try to cut back a little more.
As of today, I've drank only 17 beers. I can have 3 more beers between now and 6-30-14 to stay on track.
This is a much better strategy than setting a ridiculously difficult New Year's resolution like giving up alcohol for an entire year and holding it only for a month and a half.
When people do this, they usually give up the goal entirely once breaking it.
Saturday, May 24, 2014
Generation Y bother
I've talked to several people in my age group.
One thing that depresses me is that most of generation Y has no idea what they want out of life, where they are now, where they will be in 5 years, or how to get further in life.
A couple of my friends, when asked what they were up to, respond with "I'm just trying to get my life together."
Several of my friends have thousands of dollars in student debt. It is characteristic of most of generation Y.
I've seen people party and drink all weekend and do this for several weeks in a row. Most Americans probably don't even have at least $1,000 in savings.
I've thought that generation Y should try to set financial goals to find a purpose in life.
So I encourage as many of my peers to save up a large amount of money like $50,000.
Giving a man this goal will force him to evaluate his own situation. Find out how much money he currently has and how much debt he has.
He can take a look at his monthly expenses and see how much money he saves or loses each month.
At that point, he can start looking into the future. How long will it take him to achieve his goal of $20,000, $50,000, or $100,000.
This goal will encourage discipline and rigor. A man will look at his month expenses and see if there is anything he can cut out of his monthly expenses or find cheaper substitutes.
Finally, achieving this goal / working towards this goal will build up a man's self confidence and feeling of self worth.
Seeing your progress is encouragement. At $45,000, a man can buy a kilogram of gold. How many American's can say they can afford that?
But if you can, doesn't that make you feel special?
You made good decisions, you put in the hard work, you practiced discipline.
By God, you achieved something.
I'd figure, if a man can save $50,000, he has the ambition, desire, and will to accumulate larger sums of cash like $100,000 and further.
Read this, and see if you can make a plan to save up $50,000.
One thing that depresses me is that most of generation Y has no idea what they want out of life, where they are now, where they will be in 5 years, or how to get further in life.
A couple of my friends, when asked what they were up to, respond with "I'm just trying to get my life together."
Several of my friends have thousands of dollars in student debt. It is characteristic of most of generation Y.
I've seen people party and drink all weekend and do this for several weeks in a row. Most Americans probably don't even have at least $1,000 in savings.
I've thought that generation Y should try to set financial goals to find a purpose in life.
So I encourage as many of my peers to save up a large amount of money like $50,000.
Giving a man this goal will force him to evaluate his own situation. Find out how much money he currently has and how much debt he has.
He can take a look at his monthly expenses and see how much money he saves or loses each month.
At that point, he can start looking into the future. How long will it take him to achieve his goal of $20,000, $50,000, or $100,000.
This goal will encourage discipline and rigor. A man will look at his month expenses and see if there is anything he can cut out of his monthly expenses or find cheaper substitutes.
Finally, achieving this goal / working towards this goal will build up a man's self confidence and feeling of self worth.
Seeing your progress is encouragement. At $45,000, a man can buy a kilogram of gold. How many American's can say they can afford that?
But if you can, doesn't that make you feel special?
You made good decisions, you put in the hard work, you practiced discipline.
By God, you achieved something.
I'd figure, if a man can save $50,000, he has the ambition, desire, and will to accumulate larger sums of cash like $100,000 and further.
Read this, and see if you can make a plan to save up $50,000.
How to decide between gym memberships or buying your own equipment
Keeping in good physical shape is very important to me. In my case, the workouts I do are weight resistance which require heavy pieces of metal.
When I was in college, my tuition gave me access to the recreational center. Two to three times a week, I was there lifting weights. Over the course of 4 years, I spent hundreds of hours there.
While there, I did the following exercises.
Bench press
Pull ups
Arm curls
Lateral pull downs
Shoulder flies
Seated rows
Sit us
Running
Squats
That was a pretty good 4 years when I think about it now.
After graduating, I didn't have that much money so I decided to just buy my own equipment to keep strength training.
I spent $300 on an Olympic bar and a bench to keep doing bench press.
I spent $150 on a power tower that would allow me to keep doing pull ups and leg lifts to work out the core.
I spent $50 on a 40 pound weighted vest to make pull ups and running more challenging.
Another $50 was spent on weights to do arm curls.
All total, I spent $550 on fitness equipment during 2011.
Today, I can bench press more than 260 pounds.
I can do pull ups with 40 to 60 pounds attached to me.
Without any weights, I can do 22 consecutive pull ups.
50 consecutive push ups is not difficult for me.
I can run 3.4 miles in 32 minutes.
I can curl a 50 pound dumbbell in my left hand and a 50 pound dumbbell in my right hand.
Keep in mind, I've been strength training since I was 14. I didn't achieve all this in 3 years.
The $550 is all the money I spent on fitness equipment in the last 3 years.
The cost of this equipment comes out to be $15.27 per month (550/3/12).
Much cheaper than the current comparable rate of $30 a month at a place like LA Fitness close to my house. Over a 3 year period the cost of the membership would total $1080. Over a 5 year period, the total would equal $1800.
Gym equipment is pretty durable, so the longer my equipment lasts, the cheaper the average monthly cost comes to be.
After 5 years, the month cost comes out to be $9.16.
I would recommend buying your own equipment if you don't plan to move location very much, have the space for it, and you don't need all the extra luxuries some gyms include like swimming pools, basket ball courts, tennis courts, fitness spas, or nutrition cafes.
When I was in college, my tuition gave me access to the recreational center. Two to three times a week, I was there lifting weights. Over the course of 4 years, I spent hundreds of hours there.
While there, I did the following exercises.
Bench press
Pull ups
Arm curls
Lateral pull downs
Shoulder flies
Seated rows
Sit us
Running
Squats
That was a pretty good 4 years when I think about it now.
After graduating, I didn't have that much money so I decided to just buy my own equipment to keep strength training.
I spent $300 on an Olympic bar and a bench to keep doing bench press.
I spent $150 on a power tower that would allow me to keep doing pull ups and leg lifts to work out the core.
I spent $50 on a 40 pound weighted vest to make pull ups and running more challenging.
Another $50 was spent on weights to do arm curls.
All total, I spent $550 on fitness equipment during 2011.
Today, I can bench press more than 260 pounds.
I can do pull ups with 40 to 60 pounds attached to me.
Without any weights, I can do 22 consecutive pull ups.
50 consecutive push ups is not difficult for me.
I can run 3.4 miles in 32 minutes.
I can curl a 50 pound dumbbell in my left hand and a 50 pound dumbbell in my right hand.
Keep in mind, I've been strength training since I was 14. I didn't achieve all this in 3 years.
The $550 is all the money I spent on fitness equipment in the last 3 years.
The cost of this equipment comes out to be $15.27 per month (550/3/12).
Much cheaper than the current comparable rate of $30 a month at a place like LA Fitness close to my house. Over a 3 year period the cost of the membership would total $1080. Over a 5 year period, the total would equal $1800.
Gym equipment is pretty durable, so the longer my equipment lasts, the cheaper the average monthly cost comes to be.
After 5 years, the month cost comes out to be $9.16.
I would recommend buying your own equipment if you don't plan to move location very much, have the space for it, and you don't need all the extra luxuries some gyms include like swimming pools, basket ball courts, tennis courts, fitness spas, or nutrition cafes.
Wednesday, May 21, 2014
Easiest $50 I've ever made
In the last several months, I've collected more than a thousand dollars by collecting promotions from banks and credit cards.
The most recent promotion I found was the easiest promotion to get.
The most recent promotion I found was the easiest promotion to get.
Tuesday, May 20, 2014
Benefits of living with your parents
The most obvious benefit to living with your parents is the cost. Not having to pay for housing will save a man several hundred dollars each month.
The largest disadvantage to living with you parents is that society will look at you like a loser that could never achieve anything with his life.
I guess every high school or college student fears become 30 years old and still living with his parents.
Why is 30 that magic number? Is 30 the magic number when a man starts to get old?
Society tells you to gain your independence as fast as possible. Make it on your own.
Would a 29 year old man who lives with his parents feel completely okay until his 30th birthday and then get horribly depressed?
Would a 30 year old man feel great renting a studio apartment for the last 10 years, paying for everything on credit, and living paycheck to paycheck? Probably not.
You're living conditions doesn't necessary define your success in life. You're net worth is a much better measurement of success.
If a 30 year old man still lived with his parents but had a net worth of $100,000, would society judge him to be a loser?
Maybe.... maybe not. And even if society did judge him to be a loser, why should he care? He has $100,000 net worth.
Don't always do what society tells you to. If your parents are fine with you living with them, do it and save as much of your money is possible. You can better prepare for your future when you eventually do make it on your own.
Living with your parents helps you save money by not purchasing extra housing. You share it with your parents. If you have a good relationship with your parents, they may even enjoy your company.
Simply by living in your parent's house, you do not make their rent/mortgage/property tax/homeowner's insurance more expensive.
By living in your parent's house, you only cause them to forfeit potential rental income if they would have otherwise rented your space to someone else. If you're parents would not have done that, then you don't cause them any lost potential rental income.
By living in your parent's house, you don't have to pay for your own set of utilities. By staying there, you may increase their utilities a little.
Another big benefit is that you don't have to buy your own set of durable goods. You can use their tv, refrigerator, oven, washing machine, dryer, or appliances.
I've determined that if you are single (not pursuing relationships) and work 40 to 60 hours a week, it makes very little sense to rent an apartment.
I've been working as an accountant for the last year. Each morning, I wake up at 5:30 am and head out of the door at 6:30 am. I reach the office at 7:30 am and work until about 7 pm at night. When I arrive home, it is usually 7:45 pm by the time I get home. I have 3 hours to myself until I fall asleep at 11 pm.
For 5 days of the week, I spend more time outside of the house than inside it. Monday through Friday, I only get to enjoy the house for three hours a day.
Of course, on the weekends, I have the whole days to myself.
However, If you are in the same position that I am, working 55 to 60 hours a week, please don't waste your money on rent. If you don't have very much time to enjoy your house, try not to pay for it.
Don't buy any more housing than you need.
The largest disadvantage to living with you parents is that society will look at you like a loser that could never achieve anything with his life.
I guess every high school or college student fears become 30 years old and still living with his parents.
Why is 30 that magic number? Is 30 the magic number when a man starts to get old?
Society tells you to gain your independence as fast as possible. Make it on your own.
Would a 29 year old man who lives with his parents feel completely okay until his 30th birthday and then get horribly depressed?
Would a 30 year old man feel great renting a studio apartment for the last 10 years, paying for everything on credit, and living paycheck to paycheck? Probably not.
You're living conditions doesn't necessary define your success in life. You're net worth is a much better measurement of success.
If a 30 year old man still lived with his parents but had a net worth of $100,000, would society judge him to be a loser?
Maybe.... maybe not. And even if society did judge him to be a loser, why should he care? He has $100,000 net worth.
Don't always do what society tells you to. If your parents are fine with you living with them, do it and save as much of your money is possible. You can better prepare for your future when you eventually do make it on your own.
Living with your parents helps you save money by not purchasing extra housing. You share it with your parents. If you have a good relationship with your parents, they may even enjoy your company.
Simply by living in your parent's house, you do not make their rent/mortgage/property tax/homeowner's insurance more expensive.
By living in your parent's house, you only cause them to forfeit potential rental income if they would have otherwise rented your space to someone else. If you're parents would not have done that, then you don't cause them any lost potential rental income.
By living in your parent's house, you don't have to pay for your own set of utilities. By staying there, you may increase their utilities a little.
Another big benefit is that you don't have to buy your own set of durable goods. You can use their tv, refrigerator, oven, washing machine, dryer, or appliances.
I've determined that if you are single (not pursuing relationships) and work 40 to 60 hours a week, it makes very little sense to rent an apartment.
I've been working as an accountant for the last year. Each morning, I wake up at 5:30 am and head out of the door at 6:30 am. I reach the office at 7:30 am and work until about 7 pm at night. When I arrive home, it is usually 7:45 pm by the time I get home. I have 3 hours to myself until I fall asleep at 11 pm.
For 5 days of the week, I spend more time outside of the house than inside it. Monday through Friday, I only get to enjoy the house for three hours a day.
Of course, on the weekends, I have the whole days to myself.
However, If you are in the same position that I am, working 55 to 60 hours a week, please don't waste your money on rent. If you don't have very much time to enjoy your house, try not to pay for it.
Don't buy any more housing than you need.
Sunday, May 18, 2014
How to decide if you need collision insurance
In the last few months, I was thinking about saving some money on my car insurance by dropping collision insurance.
Collision insurance will cover you if you incur damages in a collision up to the fair market value of your car minus the deductible.
Since the fair market value of my car is only about $1,600, the most the insurance company would pay me is $1,100 because of my $500 deductible.
I've driven for more than 3 years without an accident and the amount of premiums that I've paid the insurance company has exceeded the fair market value of my car.
This fact is completely irrelevant.
Accidents are accidents. You never expect them.
To see if the risk is worth taking (dropping the coverage), I decided to check my policy to see how much collision insurance cost me.
Currently, collision insurance costs me $41 a month.
I decided to do a calculation and made the assumption that the fair market value and cost of insurance will stay constant (for simplicity). These values should consistently decrease over time.
The most my car insurance company would pay me is $1,100.
The cost of collision insurance is $41 a month.
I would have to go more than 26.83 months (1100/41) without crashing my car into something to save money by dropping collision insurance.
By dropping collision insurance, I would be in a really bad situation (suffer great losses) if I crashed my car in 2 or 3 months. The risk goes down the longer you go without having a collision.
If I had an accident at 20 months, I would still have lost money by dropping the coverage, but the loss would not have been as great.
However, if I make it 30 months without having an accident, I will have saved money by dropping the coverage.
Where I am right now, I think that $41 a month is a pretty good deal to keep the coverage. I've always been a very risk adverse person.
As the fair market value of my car decreases and gets closer to the $500 minimum deductible, dropping the coverage will be much more reasonable. Though at that point, I can imagine that the cost of collision insurance will also decrease considerably.
If you have a new car with a high fair market value, make sure that you have it fully insured. Its way too risky not to.
Collision insurance will cover you if you incur damages in a collision up to the fair market value of your car minus the deductible.
Since the fair market value of my car is only about $1,600, the most the insurance company would pay me is $1,100 because of my $500 deductible.
I've driven for more than 3 years without an accident and the amount of premiums that I've paid the insurance company has exceeded the fair market value of my car.
This fact is completely irrelevant.
Accidents are accidents. You never expect them.
To see if the risk is worth taking (dropping the coverage), I decided to check my policy to see how much collision insurance cost me.
Currently, collision insurance costs me $41 a month.
I decided to do a calculation and made the assumption that the fair market value and cost of insurance will stay constant (for simplicity). These values should consistently decrease over time.
The most my car insurance company would pay me is $1,100.
The cost of collision insurance is $41 a month.
I would have to go more than 26.83 months (1100/41) without crashing my car into something to save money by dropping collision insurance.
By dropping collision insurance, I would be in a really bad situation (suffer great losses) if I crashed my car in 2 or 3 months. The risk goes down the longer you go without having a collision.
If I had an accident at 20 months, I would still have lost money by dropping the coverage, but the loss would not have been as great.
However, if I make it 30 months without having an accident, I will have saved money by dropping the coverage.
Where I am right now, I think that $41 a month is a pretty good deal to keep the coverage. I've always been a very risk adverse person.
As the fair market value of my car decreases and gets closer to the $500 minimum deductible, dropping the coverage will be much more reasonable. Though at that point, I can imagine that the cost of collision insurance will also decrease considerably.
If you have a new car with a high fair market value, make sure that you have it fully insured. Its way too risky not to.
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