It’s extremely secure and safe and this is an excellent tool. Now, instead of logging into 5+ different banking sites to see where I’m at, I can just use Yodlee. I would recommend everyone check it out.

In addition, Fed chairman Bed Bernanke delivered his semiannual testimony to Congress today. These speeches can have implications on the interest rate and gives insight into how the Fed is approaching changes in inflation and economic growth. Bernanke basically said that interest rates will stay unchanged - for now. Gas prices continue to rise and the housing market is struggling.

The market has been excellent lately. Last week, the Dow had its biggest percentage gain in 3 or 4 years and the S&P had a huge 1-day point gain as well.

If you’ve got extra cash that’s just sitting in an account somewhere, stick it in a high interest-bearing online savings account (such as FNBO Direct) or start investing. I’d recommend some S&P index funds or Total Stock Market index funds to get you started on the road to financial freedom. Vanguard’s a good place to start.

Enjoy this Wednesday!

Simply put, pay off your highest interest rate credit card first, even if that one does not carry your highest balance. By doing this, you will reduce the amount you pay in interest and have a lot more money left over to apply to other credit card payments, or even better, invest or save.

To make things even easier, try not to carry balances over on your highest interest rate credit card if possible. For large purchases which you know you will take several months to pay down, try to charge them on your lowest interest rate card.

In addition, you can sometimes do a balance transfer, where you move the money owed on a higher interest credit card to your lowest-interest rate card. Be careful juggling this though, you can get in over your head quick and owe a lot of money.

I hope most of you have been putting your money into liquid online savings accounts as I have suggested before. Rates keep rising and are to the point where you can invest in a totally safe and insured liquid savings account that earns a better interest rate than a Certificate of Deposit.

For instance, FNBO Direct has a savings account that is currently earning 6% APY until September 28, at which point it will drop back down to 5.25% or above, rates that are equivalent to and often better than the current CD rates available. In addition, this money is total liquid, making it a great place to stick your savings or rainy day fund.

I hope everyone is staying on top of their finances and paying down their credit card debt. The sooner you get that paid off, the more interest you can earn, and the richer you will be in the future.

So, get yourself over to FNBO Direct, or ING Direct, or any of the other number of online savings accounts and start making $$. Email me or post a comment if I can help in any way. These savings accounts will earn you much, much more than anything you will get at a big, traditional bank, and they are perfectly safe and insured and link to your current checking accounts. Good luck!

What to Do When you Lose your Wallet

Hope everyone is doing great.

Hope everyone is doing well and congrats to anyone graduating this month.

Vanguard Total Stock Market ETF (symbol: VTI) - very solid fund, gives you great diversification.

Vanguard Primecap Core (mutual fund) (symbol: VPCCX) - the original Vanguard primecap fund, (VPMCX) has been closed to investors for years. Probably because it averaged 13.8% over the last 20 years. This core fund is a new fund that is supposed to be very similar to the original.

iShares MSCI EAFE Index ETF (symbol: EFA) - tracks international markets, also a great fund to have for diversity.

Go out and research some of these!

http://www.simplejoe.com/article-david-berky-personal-finance-101.htm

Make some sound financial decisions this week guys, and I hope your taxes are done.

There are a number of reasons that budgeting is a great idea, and the #1 reason is fairly obvious: it saves you a ton of money. When you are acutely aware of exactly how much money you are spending, you start to realize it’s probably too much and back down. You can also efficiently buy what you want in the exact quantities you will need based on how much you have been using in the past and how much you predict to use in the future.
Yes, this is a lot of work, and it is impractical for most people to have an itemized, line-by-line budget of their spending, but a little organization helps. Find the midpoint that works for you. Once you begin budgeting and stick with it for a few months, you will see the results and will continue to have some form of a budget, whether mental or written down, and it will help you in many facets of life.

Another big plus of budgeting is that, while automated payments and bank drafts and the like are very, very convenient, they are set up by people, and people make mistakes. Often times you are overcharged, or not charged at all, and this impacts your finances very negatively if you aren’t paying close attention. Budgeting and keeping a close eye will let you know when something is not in its projected range, and gives you a chance to investigate further and determine the cause. People make mistakes again, so make sure you watch those automated payments very carefully.

Again, start out small. Make a list of all your expenses, daily. Start tomorrow. Write down everything you pay for, from a $25 dinner to $0.25 candy bar from the vending machine. Use this piece of paper for the entire week, tracking your expenses daily and review it at the end of the week, seeing how much you spent on various things. Then, either mentally or with a physical note, determine what you want to be/should be spending on certain categories, and stick to this budget plan as much as reasonably possible. Also, write in your income too.

Make sure you distinguish between needs and wants in your budget. This is a very important distinction and lets you know if you are spending too much money on some things you can live without. Living within your means is the key to financial success, and the earlier we all learn this, the better. It’s OK to go over budget sometimes too, but at least this way you know you’re going over and you can work to correct it.

Google around for personal budget templates to get an idea of categories to include. Once you get more comfortable with the whole process, you will add and modify your own categories, and these that are personalized by you, for you will be the most accurate tools for you.

If you begin budgeting today, you will save money. If you save money, you will be able to put more money away in savings. If you put more money away in savings earlier, you will be rich when you retire. This is a fact and one you should take comfort in. I sure do!

Matt

Emergency funds! I’ve alluded to these important stashes of cash (figuratively speaking) in several posts, and now I feel it is time to expound on them a little more.

An emergency fund, or rainy-day fund, or whatever your personal favorite phrase for this may be, is a fund that should only be used for emergencies. This is often overlooked and extremely important.

This fund should only be used for emergencies.

Only you can know how much money should be in your ER fund, but I can give you an idea by telling you about mine. It’s enough to pay 2-5 months worth of rent, utilities, and unavoidable expenses (food, water, etc.) Most people think they don’t need a fund, but the truth is, everyone does. Again, I hate to give figures, but I’d say from $2000-$4000 would be sufficient for a college student or recent graduate, to start. Once you gain more financial assets and freedom, you can stash away more.

Examples of emergencies include a layoff from your job, serious injury, home damage from natural disasters, car accidents, etc etc. No matter how careful you are, you can’t plan to avoid some of these things. It’s best to have some money stashed away just in case, and you will be extremely happy that you did.

The average American will charge their way out of an emergency and bury themselves in credit card debt. This is not fiscally smart planning. We’ve already discussed the ludicrous interest rates credit card companies charge, so it would be very prudent to avoid this unpleasant fate of charging your way through an emergency.

Now, regarding where to keep your money, the best option available right now (in my opinion) is an online high-yield savings account, such as ING Direct, Citibank’s e-Savings account, HSBC Direct, or any of the other numerous ones. These earn good interest as we discussed before, and are a convenient option when it comes to transferring money back and forth between accounts.

Everyone needs an emergency fund. Don’t learn the lesson the hard way by not having one the first time an emergency rears its ugly head.

Also, ING Direct is now offering an Electric Orange checking accountwith a 4.0% APY that is an interesting and lucrative option to a normal checking account. Check it out if you are so inclined.

Back to regular updates! See you soon, Finance U.