It’s my way of giving a more public nod in recognition of blogs that may be more overlooked by some readers.

For this inaugural post in the Personal Finance Blogs I Read series, I have chosen WorkSaveLive. WorkSaveLive.com is run by Jason, and he has taken issue with the way many Americans think about money.

Jason doesn’t like the fact that 70% of Americans live paycheck-to-paycheck, 65% don’t have enough savings to cover a single month’s of expenses and 45% over the age of 55 have less than $25,000 saved for retirement.

He thinks Americans should strive for more than simply keeping their heads above water, and retiring on Social Security.

That’s something I can really get behind.

That used to be me, but then I reached my financial tipping point and went off that beaten path, so to speak.

Jason had a similar experience, only his involved debt collectors and payday loans.

He turned his situation around, as many do, with the sudden realization that more money was not the answer. He realized he had to change the way he thought about money. Now he’s sharing his success with the rest of us on his blog. He writes about money, career, and blogging (among other things).

In his own words:

” My goal is to help one person, every day, take a step in the proper direction. My hope is to help people overcome the reign that money has on their lives.”

I encourage you to check him out, give his blog a read and maybe even add his feed to your reader.

Related Posts:

• No Related Posts

Personal Finance Blogs I Read: Work Save Live. Copyright © Simple Debt-Free Finance

Before we get into that question, let’s step back and take a look a closer look at the unemployment problem for recent grads.

College grad unemployment/underemployment is bad, real bad.

The news has been awash in horror stories about recent college graduates not finding work. Many more are able to find work, but not in their chosen field.

“More than half of America’s recent college graduates are either unemployed or working in a job that doesn’t require a bachelor’s degree”.

This according to the article, 53% of Recent College Grads Are Jobless or Underemployed—How? from The Atlantic.

The Atlantic (as most other sources I’ve seen) doesn’t break the number down, so it’s difficult to tell how many college grads are actually unemployed, vs. how many are considered underemployed.

This is an important question because I think it highlights a big problem in education in America today. It’s easy to point to grads who seem unwilling to take low level jobs that are available and say they’re lazy or have a sense of entitlement, and in some cases that’s certainly true, but there’s also a very real financial reason at play – namely, student loan debt.

But things are different now, and it’s a lot harder to pay off $30,000 in student loans when your working the line at a fast food restaurant.College degrees are more expensive than ever, and students have piled on the debt. There was a time when this was a smart move because the higher level of education would help you find a good paying job, and the debt was affordable over time.

This doesn’t just lead to higher college grad unemployment rates though. This also causes systemic problems in the economy since those highly educated grads are taking low skill jobs that could go to others. Those jobs would traditionally go to less educated workers.

Economy and the job market to blame or just useless degrees?

All of this sounds bad, hopelessly bad. But not all doors lead down College Grad Unemployment Row.

According to this article, Half of recent college grads underemployed or jobless, analysis says , from the AP:

“…students who graduated out of the sciences or other technical fields, such as accounting, were much less likely to be jobless or underemployed than humanities and arts graduates.”

It sounds like going to school for math and science based degrees does still pay off in the end, so this begs the big question:

Is the college grad unemployment problem because the job market stinks and the economy has fundamentally changed? or is it simply due to useless degrees?

It used to be said that going to college was simply paying your dues and doing your time for a fancy piece of paper. Cynics would say that the paper didn’t mean much, but it opened doors because so many jobs were only available to those with a college degree -any college degree.

Times have changed.

It appears that you not only need that fancy piece of paper, but you also need the skills to do the job.

Here’s another quote from that AP article:

“I don’t even know what I’m looking for,” says Michael Bledsoe, who described months of fruitless job searches as he served customers at a Seattle coffeehouse. The 23-year-old graduated in 2010 with a creative writing degree.

They don’t go into how much student loan debt Michael has, but I’d bet it’s a lot – more than he’ll be able to manage on his coffeehouse job. But what was he expecting?

What good is a creative writing degree?

Don’t get me wrong, I admire writers and creative writing is not something many people can do well. It takes a certain innate ability and creativity that can be cultivated but cannot be taught. Not everyone gets to be Stephen King.

I’d say that Michael, and others like him, would be extremely fortunate to get a job somewhere making $30,000 a year with his degree, but what do you want to bet he has that or more in student loan debt?

A simple truth that no one seems to want to discuss is that for some degrees, debt doesn’t make sense.

I ask you, what would full employment be for a graduate with a degree in creative writing and do enough such jobs exist for the number of graduates seeking employment?

As Mish points out on his blog post, 53% of New Graduates are Jobless or Underemployed; Rude Awakening for Class of 2012; Useless Degrees; Who Benefits From Student Aid?:

“Just what job does someone majoring in Political Science, English, History, Social Studies, Creative Writing, Art, etc., etc., etc., expect to get?

Arguably, graduates in those majors (and many more) should be thankful to get any job. … those who do land a job should therefore be considered fully employed, not underemployed.”

Is college education simply less valuable than in the past

I think the college grad unemployment issue raises the bigger question of whether college education is simply less valuable now than in the past.

A few years ago, I asked the question Who Are the Unemployed? The answer I found was largely those without a college degree.

But now it seems that we are seeing the effect of a bubble in college degrees.

When there were fewer graduates, a generic college degree used to be a valuable credential. Now that the market is flooded with applicants holding Bachelors degrees, those degrees count less, and specific skills count more. The result? – High college grad unemployment.

According to the Census (Educational Attainment in the United States: 2011 – Detailed Tables – U.S. Census Bureau),

“the number of Americans under the age of 25 with at least a bachelor’s degree has grown 38 percent since 2000. “

The job market has not been able to keep up with this glut in the highly educated workforce, and this has led to falling wages and college grad unemployment we see today.

Lower student loan rates are not the solution – that only encourages even more debt.

The message here is clear: parents should encourage useful college degrees, or none at all for their children.

It doesn’t take a degree to be an entrepreneur, or the next Stephen King or Picasso. Either follow your passion and make it work, or get a useful degree to fall back on. The free ride is over for college grads.

Related Posts:

• Who Are the Unemployed?
• Unemployment Rate, Cities With Highest and Lowest Growth (Infographic).
• Don’t Look Now, But The Wheels Just Fell Off The Recovery Wagon (With Charts!)
• Is This Why College Costs Keep Rising?
• Why College Tuition Keeps Rising. (video)

College Grad Unemployment and Useless College Degrees. Copyright © Simple Debt-Free Finance

Here is an example of how they discuss this asset in the  Lear Capital commercial:

This asset is up over 100% since 2008 and Morgan Stanly predicts it could rise another 30% for 2012!

Is your curiosity whetted?

If not, the ad department at Lear Capital does their best to do so.

This one asset is not a stock, and not a bond… Call Lear Capital to learn more about this one asset that has returned 18% per year for 11 years… Call Lear Capital to get a special report and video on this “special investment”

This “special asset” is of course gold. Lear Capital is a gold dealer and they’ve been aggressively pushing the precious metal for some time now. I have to say that they do a good job of piquing interest where other gold dealers usually resort to all out fear to sell gold. This Lear Capital commercial doesn’t avoid the fear angle altogether though. They have plenty of elements targeting uncertainty (and rightly so).

Tired of losing money in the bank? …Artificially low interest rates and high uncertainty have helped this one asset out perform all other investments. You can continue to live with market volatility or invest in a secure asset that’s kept its value.

This  Lear Capital commercial certainly does their best to make gold seem like the “One asset to rule them all.” Over the past 10 years, it has been, but there’s still that line about gold being a “secure asset that’s kept its value” that implies it won’t lose value.

If there’s a bubble in gold, then a lot of people are going to lose a lot of money. The question of course is whether gold is a bubble.

To answer that, you have to consider what has been driving the rise in gold prices, and whether those factors will continue.

What is driving the price of gold?

Gold is typically used as an inflation hedge, and there has certainly been a lot of concern over inflation in the past few years, but prior to the numerous rounds of government “stimulus” and quantitative easing, fear of inflation was not the reason for gold’s rise. Uncertainty was. The War on Terror and general threat of terrorism created great uncertainty in the early half of the 2000′s.

Since the financial crisis though, the fear and uncertainty have revolved around the so called debt bomb of massive public debt and devaluation of the dollar due to the many “stimulus” programs.

What does the future hold for gold – has anything changed?

As an investor in gold, I think you need to ask yourself whether these factors are likely to persist, increase or abate. Is the U.S. government likely to significantly reduce its spending and reign in the deficit? The increase in national debt of 50% in the last 4 years suggests this is not likely.

Another factor at play here is the U. S. dollar as the reserve currency. While this is true, the U. S. government will be able to “monetize” its debt – that is decrease the value of the dollar through inflation and pay the debt down with less valuable dollars.

But what if the dollar is no longer the currency of the world?

Interest rates on the debt would spike and the U. S. government would no longer be able to print its way out of its debt obligation. Think Greece, Spain, Portugal, Italy and all the other bankrupt nations in Europe.

Don’t think it can happen? Check out Is the yuan the new dollar? from MSN Money. China would love to supplant the U. S. currency with its own. If that happens, the price of gold would probably rise greatly.

Is buying gold the right move? I don’t know. I’m no expert, but there certainly seems to be enough reason to at least hold some gold.

Given the reasons outlined above, conventional wisdom would suggest that gold is a necessity to preserve your wealth. Then again, conventional wisdom is often wrong in the end.

Related Posts:

• Rosland Capital – U. S. Gold Eagle Coins in Your IRA.
• U.S. Debt Comparisons (infographic).
• How (and Why) I Added Gold to my IRA.
• To Buy or to Sell Gold?
• How to Survive (and Possibly Thrive during) Stagflation.

Lear Capital Commercial Pushes Mysterious Asset, but is it the One Asset to Rule Them All? Copyright © Simple Debt-Free Finance

Rising rent prices and rental rates across the country

Rental rates rising across the country and prices are expected to increase 3.8% this year and 4% projected for 2013. That’s an average for the nation, which means the rise in rent prices could be much higher in cities with high rental demand.

In NYC for example, the rental vacancy rate is just above 1%. Demand is so great that renting often requires the level of paperwork usually reserved for mortgage applications! Rising rent prices have made the rental market so hot that it’s attracting serious investor capital with returns of 6-8%.

This is good, because it will drive rent prices up as more people get in the game.

How rising rent prices are good.

“How can rising rent prices be good?“, I hear you ask.

It does defy common sense up to a point. I mean, higher rent prices mean more of a financial squeeze on renters, leaving them with less disposable income. But this is a short-term view.

In the long term, this is how markets should work. Rent prices rise to point of excess as investors pile in. Higher rental prices make it more affordable to buy a home than to rent one. Especially when the amount of paperwork required to rent is on par with that required to rent.

It doesn’t take Warren Buffet to do the math at this point. When you’re paying very nearly as much for rent as you would for a mortgage, and you need to meet much of the same requirements to rent that you would to buy, it just makes more sense to get the mortgage.

This is of course assuming your lifestyle is suited to being a homeowner. It still doesn’t make sense to buy a home if you travel a lot or don’t expect to live in it more than 7 years. But if you’ve got strong roots in the community and foresee no geographical changes in your future then higher rent prices may be the nudge you need to get you moving.

This is a great time to buy a house – provided you use it as a long term shelter and aren’t looking for a quick profit.

But don’t just take my word for it, here’s a video from BankRate.com:

Related Posts:

• New Home Sales Down 7.6% In December.
• Is Your House More Important Than Your Family?
• Mortgage Refinance Trends: New Wave Spurs 6-Week High Demand.
• U.S. Mortgage Refinancing Applications Rose in the First Week of 2010.
• Worst Foreclosure Rates Found in 4 States – Can You Name Them?

Are Rising Rent Prices in 2012 Good for the Housing Market? (Video) Copyright © Simple Debt-Free Finance

3 Ways To Negotiate a Credit Card Debt Settlement Yourself.

The first thing you need to consider is what kind of arrangement you are going to seek. Let’s be honest, you’d like your credit card company to forgive all your debt and pretend it never happened, but short of bankruptcy, that isn’t likely to happen.

Once you’ve accepted the reality that you will need to pay something, you need to determine what that something will be. Here are 3 possible debt payment solutions to offer to your credit card company when you make the call.

I. Lump-sum settlement.

This is by far the easiest to understand and to sell to your credit card company, but it’s often the hardest to carry out, because you need a large sum of money available.

Since most credit card issuers aren’t going to negotiate until you are behind, one strategy is to stop making payments to the credit card company and put that money (and as much extra as you can afford) into a savings account for a few months.

This is what many debt settlement companies do for you, or at least it’s what they say they will do for you. In many cases, they hold the money and let the credit card company come after you for the full debt owed anyway. It’s a big reason why debt settlement is not a good idea in many cases.

If you have access to a chunk of money, they you can make an offer to your credit card issuer for a 1 time payment that is less than the full amount you owe.

WARNING: This technique will likely hurt your credit score, but then again so will having a high debt balance and not paying it off…

II. Workout arrangement.

This is a much easier option to carry out than the lump sum. The Workout arrangement is when the bank agrees to freeze your interest payments and late fees while you payback your balance. This is also the most ethical solution in my opinion, because you’re telling the credit card company that you will meet your obligations and pay back what you owe, as long as they agree to stop pushing you back under while you do it.

WARNING: You will most likely no longer be able to use your credit card, since the bank will probably lower your limit. This is a good thing in the long term though, since it will keep you from racking up even more debt. However, the lower credit limit will increase your debt-to-income ratio, and lower your credit score.

III. A Forbearance Program.

This one is probably the easiest solution to sell to the credit card company, but not the best for your bottom line. A forbearance program is an agreement by the bank to pause your payments and interest fees while you get your finances back on track. This is like taking a timeout to gather your resources for the next play.

The next play though is usually getting back on a payment plan in which you agree to pay the full amount owed and any interest and late fees accrued – forbearance is not forgiveness.

Final thoughts.

Whichever solution you choose, keep in mind that these are tough times for everyone – credit card companies included. They can’t get blood from a stone and they know that. Credit card holders still have a lot of leverage and everything is negotiable. Job loss and negative home equity have put the squeeze on banks trying to collect full payment.

You can use one of the debt solutions from above as a starting point, then see what else you get bargain down in the process. For example, you might get the bank to forgive all late fees and interest fees and give you a forbearance if you agree to pay the full principal. It all depends on your situation, and is up to the individual creditor.

Regardless of which solution to choose, be sure to get your credit card issuer’s agreement in writing before you send them any money.

Also, be sure to read How to Negotiate Your Credit Card Debt for more detail on the actual process behind making the call.

…and for your own sake, stop living beyond your means or you’ll find yourself back in the same place further down the road. It’s the number 1 reason why Debt Settlement And Loan Consolidation Don’t Work.

Related Posts:

• 10 Credit Counseling Tips.
• How to Settle Debts On Your Own.
• Balance Transfers – Simple Solution or Debt Enhancer?
• Congress Takes Aim At Debt Settlement Scams.
• How To Negotiate Credit Card Debt.

3 Ways To Negotiate a Credit Card Debt Settlement Yourself. Copyright © Simple Debt-Free Finance

It all began with our hotel room. It was a renovated riverside hotel from the 1800′s, with a curious mix of old and modern. The floor boards were the wide, plank floor boards common in 19th century construction, while the bathroom featured a state of the art Jacuzzi.

This is what our shower looked like, only ours had no shower head.

The decor was sparse, yet modern too. There was a flat panel television and one piece of post-modern art on the wall that consisted of one-quarter of an old tire, a piece of chicken wire mesh, and various other castaway everyday items all fused together in a loosely triangular shape and painted black.

But what really made an impression was the shower.

It was a standing rectangle large enough for a single person and was comprised of an Italian marble wall on two sides, and glass on the remaining two sides. It was, quite simply, a beautiful shower and elegant in its minimalism. Until I tried to use it, that is.

Once I stepped inside I realized just how minimal the design truly was. There was no shelf for holding soap or shampoo, and the faucet control only turned one way, from lukewarm to hot. There was also no showerhead. The water simply fell from a perforated plate in the ceiling. I had no place to stand out of the way of the water to lather with soap or shampoo.

It was at this point that I thought, minimalism is one thing, but what good is it if it’s not useful too?

This is when I realized I really favor simplicity over minimalism. Our modern lives have become so clutter and full or noise and distraction that there truly is a psychological benefit from simplify our lives. There’s also a financial benefit too.

Here are a few financial benefits to simplifying your life.

• One retirement account means less fees and less time spent managing various options. It also means that all your available funds are better focused, which magnifies the effect of compounding interest and dividends.
• Fewer retirement funds in a single retirement account means even less time managing the account, less fees and more focused returned.
• Fewer savings and checking accounts means less overhead and time in managing them and keeping track of your money. It also means your money is more focused and earning even more compound interest.
• Rolling all your insurance needs into one provider makes tracking your policies easier, and usually gives you a multi-policy discount on the premiums.

Are you sensing a theme here?

Generally speaking, simplifying your life makes you more efficient and frees up more time to do what you love.

Many people seem to be focusing on minimizing their lifestyle, standard of living, etc.. but that may be missing the point. I think it’s far better to streamline and simplify your life – make it easier to do the things you really want – than it is to simply downgrade your life.

Related Posts:

• When Saving Money Can Cost You.
• Is Pet Insurance Worth The Cost?
• 7 Tips for Cutting Spending and Putting Cash Back in your Pocket. (video)
• 5 Small Sacrifices to Save Big.
• How I Cut My Cable Bill By $40 A Month!

Minimalism vs. Simplicity – Are You Missing the Point? Copyright © Simple Debt-Free Finance

What would you do with an extra $900 in your pocket this year?

Aside from saving money, you may find you have more free time as well. Cable television feeds the viewer a constant stream of programming. This leads many to plan their lives around when their favorite shows are on, and spend the remainder of their time channel surfing in the hopes of finding something to fill the void.

Cutting the cord changes your life. It does so because alternative providers don’t provide content in the same way – they provide it more like a menu of available shows. Not quite a la carte, but closer than cable. It’s a bit of a mind shift, but it puts you in control of your life again.

Since cutting the cord, my wife and I find we watch tv when we want, and when there is a show we’re interested in. The rest of the time we used to spend channel surfing we now spend talking, reading or just plain living.

I know many others who report a similar phenomenon. I hope that you can experience it too.

Now, without further ado, here’s how to cut the cord on cable t.v., save hundreds of dollars doing it and learn to live again.

Step 1. Determine your “must see” t.v. shows.

Every cable television customer I’ve ever spoken with admits they only watch a handful of channels or shows, yet pay for a tiered package of hundreds of channels encompassing thousands of shows. Most of their television watching time amounts to simple channel surfing and complaining that “there’s nothing on”.

Alternative television options don’t work like that. Aside from the Dish Network, or DirecTV, you don’t get a one-stop provider that will give you everything you get with cable t.v.. Of course, going with one of those other content providers won’t free you from large monthly bills either.

Since the point of this operation is to replace your existing cable with alternative providers but at a lower price, we need a list of shows you consistently watch. Mark the “must see” shows in your list, and start with those.

Step 2. Find out where you can watch your shows online.

Once you have your list of shows, it’s time to figure out where you can watch them. Netflix and Hulu are 2 wildly popular streaming content providers. Amazon is another. The trouble is, none of them has all the shows available. Many shows are only available on one or the other – not all.

You may be lucky and find that everything you watch is available through Netflix, or you may be like my wife and I and realize that most of what you watch is on Netflix, but one or two of your “must see”s are only on Hulu.

For a more in depth look at various providers, read: Where to watch online content streamed to you television.

Step 3. Determine how to stream online content to your t.v..

Once you have your list of shows and verified they are available from alternative sources, you’re ready to proceed.

In this 3rd and final step, you need to determine what kinds of hardware, if any, you will need to make the magic happen.

Unfortunately there’s really quite a bit of information to impart for this step, and I don’t want this post to go on forever.

To that end, I have shared that information here: How to stream online content to your t.v..

Good luck and happy cord cutting!

A word of caution

I feel I should offer a few words of caution as an addendum to this post, to help you avoid being burned one last time by your cable provider. This has happened to some cord cutters – don’t let it happen to you.

Some cable providers charge less if you bundle your cable and internet services together and will charge a higher rate for just internet, so be sure of your provider’s policies before you drop the cable t.v. service.

If you are unlucky enough to have such a cable provider, you can find other high speed internet providers in your area. As a rule of thumb, you want at least 5mbps download speeds, but higher is better.

Related Posts:

• How To Stream Online Content To Your T.V..
• Where To Watch Online Content Streamed To Your Television.
• How I Cut My Cable Bill By $40 A Month!
• Alternatives To Pet Insurance (Tips For Doing Without Pet Insurance).
• 7 Things People Spend More Money on Than They Should (and Tips to Stop Doing it).

How To Cut The Cable Cord And Lower Your Tv Bill (In 3 Easy Steps). Copyright © Simple Debt-Free Finance

Streaming programs to your television.

The first thing you need to determine is whether you can stream programs straight to your television, or if you need an additional device to get the stream to your television.

Many HDTVs sold in the few years are “smart t.v.’s” -televisions that connect to the internet, so it may be as simple as plugging the internet cable into your television.

Even if you have a traditional t.v., you can still watch full episodes of your favorite shows from the internet on your t.v., however, if your television does not have an HDMI input you will have a more difficult time.

For the remainder of this post, I will focus on watching streaming t.v. shows on a non-Internet ready television.

Pick a device.

There are a host of devices that connect to the internet and/or home network and let you stream online content to your television.

Inexpensive Blue-ray dvd players, like the Sony BDP-S580 Blu-ray Disc Player (which currently retails for $112) provide internet access to Netflix , YouTube , HuluPlus , Pandora , and more. That’s just one example, there are many internet ready Blue-ray players on the market.

Some are wi-fi ready, and others aren’t. Just be sure that if you’re going to buy a new player for streaming t.v. content that you get one that suits your situation. In other words, don’t get a player that’s not wi-fi ready when you have no means of getting an internet cable to connect to it in your living room.

Besides the internet enabled Blue-ray players, there are other HD streaming media player devices like The Boxee Box by D-Link and the many flavors of Roku. And of course, there’s the Apple TV for all you mac lovers out there.

I wasn’t sure what to get or even if this whole experiment to cut cable was going to work when I set out to try it, and I didn’t want to drop $150 or more on a device I wasn’t going to use. Instead, I went with the Roku 2 HD Streaming Player, for $69. I had a $50 Amazon gift card from Christmas, so I felt a little better about the purchase. Even so, $69 is a small price to pay to free yourself from the cable beast.

I have to say that I am very impressed with the Roku. It’s tiny -I mean “fit in the palm of your hand” tiny. It’s so light weight that the HDMI cable weighs more! But the performance is quite good. Not as good as the Sony Blue-ray player we have, but that’s a hard line into the internet and just a better device overall. This is also due to this Roku being the 720 HD version. If I was going to rely solely on only my Roku for streaming content, I’d probably upgrade to the Roku XD 1080p Streaming Player.

But I use the Blue-ray as my primary Netflix and Hulu Plus device. I use the Roku for everything else, like PlayOn.

If the device you’ve chosen is wireless, as I suspect is the situation for most people these days, you may need to upgrade your network to get the best quality and performance.

How to stream online content to your t.v..

Television programming from the internet can be sent over your wireless network to your t.v. or through a traditional Ethernet cable. If your device or television accepts direct connection via Ethernet cable, then it’s as simple as plugging it in. However, if your device requires wireless internet then you will need a router.

If you already have a wireless home network you may be ahead of the game, but if it is more than a few years old you may need to upgrade to get the best performance. This was the situation I was in. My home network router was about 6 years old and provided what I needed for basic internet use, but it just could not keep up with streaming HD video.

Here are the Best 5 wireless routers recommended by CNET Reviews:

• Clear 4g Hotspot(Apollo)
• Amped Wireless High Power Wireless-N 600mW Gigabit Router (R10000G)
• D-Link Systems HD Media Router 2000 (DIR-827)
• Linksys Maximum Performance Dual-Band N900 Router (E4200 v2)
• ASUS Black Diamond Dual-Band Wireless-N 600 Router (RT-N56U)

I went with the ASUS because it was on sale for $119 and I found a promo code to drop it to $109, but that was a rare alignment of sale and promo code. It’s also a dead sexy device.

Spending over $100 on a new networking device seemed like a lot since we’re trying to cut our cable bill and lower expenses, but once we realized that it’s a 1 time expense and we will be saving that much in 3 months without having a cable t.v. bill, it quickly became a justified expense.

Streaming live t.v..

Streaming live t.v. shows from the internet can be done with additional services, like PlayOn.tv. Basically, services like PlayOn run on a computer in your home that is connected to your network, and takes live shows from the internet and streams them to your network device like Roku or Boxee to your t.v.. Live streaming is most important with sports. Most other shows can be watched only a week later over the internet, and would behave like watching a show over DVR.

It’s also important to note that some television shows are not available on Netflix, or Hulu Plus. Some are only available on Hulu basic or on the network website. CBS shows are a good example of this. One of my personal favorites is NCIS. You cannot watch full episodes of NCIS anywhere except the CBS.com website. I have no idea why CBS doesn’t license the show to Hulu, but they don’t. So the only way to watch NCIS (and some other current CBS shows) is to use a service like PlayOn, or connect your pc directly to you television.

Final thoughts.

Cutting the cord is a trade off. you’re swapping some channels and options for a lower monthly bill, or possible no monthly bill. Much of the costs described in this post are 1 time expenses, unlike your cable bill.

Once you cut the cord, and purchase the necessary equipment, there are no rental fees, broadcast fees, miscellaneous fees or any of the other hidden charges cable companies love to stick you with.

Just be sure to get your ducks in order before you cut the cord, because getting all your shows in one place is not as simple as it is with cable. Many of the devices and/or hardware can be purchased piecemeal too. You can try Netflix and Hulu Plus for 30-days free. I recommend doing so before you cancel cable. That way you can see if those providers are going to work for you.

Also, keep in mind the minimum internet speeds for movie and television quality:

• 5 mbps for 720p HD
• 10 mbps for full 1080p HD
• 10+ mbps for 3-d HD content

You can check your current internet speed at Speakeasy Speed Test.

Happy cord cutting!

Related Posts:

• Where To Watch Online Content Streamed To Your Television.
• How I Cut My Cable Bill By $40 A Month!
• How To Cut The Cable Cord And Lower Your Tv Bill (In 3 Easy Steps).
• 7 Tips for Cutting Spending and Putting Cash Back in your Pocket. (video)
• Minimalism vs. Simplicity – Are You Missing the Point?

How To Stream Online Content To Your T.V.. Copyright © Simple Debt-Free Finance

There are a variety of providers who make popular television shows – past and present – available to stream to your computer or your television. Here are a few of the more prominent ones that will save you money on your television bill.

Hulu vs. Hulu Plus

There are actually 2 services offered by Hulu – basic, and “Plus.” Each flavor carries different shows. Hulu (basic) is free, while Hulu Plus will cost you $8 a month. The basic Hulu service is targeted toward pc users, while the Hulu Plus service targets “smart t.v.” watchers.

That makes sense to me, but I don’t understand why they don’t offer the same shows on Hulu Plus that are available for free on Hulu. I’m hoping that Hulu will someday hire an exec with a brain who can figure out they’d get many more subscribers to the Plus version if they only rolled the free content into the Plus package.

To watch Hulu free content on your t.v., you need another provider called PlayOn. See below for details on that.

Netflix vs. Netflix.

There are also 2 different versions of Netflix: the DVD provider, and the streaming t.v. provider. Each service costs $8 a month, and provides a different set of content. This is an important distinction. When checking the availability of your shows on Netflix, make sure you’re checking only the streaming option. Unless you want to pay for both, then it really doesn’t matter. But then you’ve just doubled your Netflix bill.

Amazon Prime vs. Amazon Instant Video.

Amazon Instant Video has a vast collection of streaming content, but all of that is pay per view. Amazon Prime is a subscription based service that provides free 2 day shipping on Amazon orders and access to their Amazon Prime video streaming selection at no additional cost.

The problem is that the Amazon Prime selection sucks. The selection on Amazon Instant Video on the other hand is excellent, but it’s about $2.99 per video/episode. You do the math on a whole season of just one of your favorite shows and you’ll quickly realize it’s more expensive than cable t.v.!

Like Hulu and Hulu Plus, I just don’t understand Amazon’s decision on this one. If they combine their television content from Instant Video and Prime and offered all videos at the Prime subscription rate, they would easily dominate the streaming television market. Instead, they are content on losing that market share to Netflix and Hulu. I’m hoping they will someday figure this out, and non-cable paying television watchers everywhere can rejoice.

PlayOn.tv

Most set top devices (Roku, the Boxee Box, many internet ready Blue-ray players , etc..) provide access to a Hulu Plus account, but not the basic Hulu account. In order to watch content available on Hulu on your t.v., you either need to connect your pc directly to your television (via HDMI or similar cable), or use another service like PlayOn.tv.

PlayOn is a program that runs on your computer and takes the internet stream from Hulu or CBS.com (ESPN, Comedy Central, Spike,Nick, SyFy, TBS, Cartoon Network, NHL and many others) and relays it to your set top device over your home network. The service is not free however. It currently runs about $4 a month. Still cheaper than cable, but each PlayOn subscriber watching Hulu is a lost Hulu Plus subscriber. (Are you listening, Hulu?)

How to watch CBS shows online.

CBS is not a team player. They don’t want to provide their content to either Hulu or Netflix, yet they provide it for free on their website. This makes no sense to me. They would make more money selling their content to Netflix, and it would be easier for customers to watch if they did so.

The problem with the free website is that it’s inconvenient to watch on your t.v.. To do so requires either a direct connection from your computer to your television or an additional service like PlayOn (described above).

This was a particular problem for me because my wife and I love NCIS, which is not available anywhere but cable/dish/etc and cbs.com.

Life without DVR.

One of the major mindshifts my wife and I had to make was life without our DVR. Most people I’ve spoken with about the subject of cutting cable raise the specter of living without DVR like it’s on par with be told by their doctor they only have months to live and they’ll never get to take the European vacation they’ve always dreamed about.

It’s understandable. After all, the DVR puts the television watcher in control. They can watch when they want to, and skip through commercial breaks while doing so. Here’s the thing though – watching online content over Hulu or Netflix (or a similar service) is like DVR by default. You choose when you want to watch your show, and in many cases the commercials are already stripped out of the show for you! Even shows that do contain commercials are significantly shorter than their broadcast counterparts. We’re talking 43 minutes for an hour long show with the commercials.

Conclusion

As you can see, dropping your cable television currently requires you to replace them with a patchwork collection of alternative providers based on the shows you watch.

Streaming internet content to your television is still a fairly new technology and I believe that as the business model matures and more people drop cable, we will see services like Netflix, Hulu and Amazon offer more shows in common and viewers will not have to create such a patchwork in the future.

Related Posts:

• How To Stream Online Content To Your T.V..
• How I Cut My Cable Bill By $40 A Month!
• How To Cut The Cable Cord And Lower Your Tv Bill (In 3 Easy Steps).
• 7 Tips for Cutting Spending and Putting Cash Back in your Pocket. (video)
• Minimalism vs. Simplicity – Are You Missing the Point?

Where To Watch Online Content Streamed To Your Television. Copyright © Simple Debt-Free Finance

Of course, if you use TurboTax then you don’t have to worry about these since the software will find them for you

State Sales Taxes

Makes the most sense for tax payers in states that don’t collect a state income tax. For most of us unlucky enough to live in the rest of the country, you’re likely better off deducting the state and local income tax unless you bought a lot of high-ticket items this past year.

Reinvested Dividends

If you sold a stock or mutual fund which you had reinvested the dividends during the time you held it, don’t forget to factor those dividends in to your cost basis. It will lower the capital gains tax when you sell.

Out-of-Pocket Charitable Deductions

Out of pocket costs include such things as ingredients for casseroles you prepare for a nonprofit organization’s soup kitchen and stamps you buy for your school’s fundraising mailing count as a charitable contribution. You’ll need the receipts and written acknowledgement from the charity to document the services though.

Student Loan Interest Paid by Mom and Dad

If you’re not claimed as a dependent, you can qualify to deduct up to $2,500 of student loan interest paid by your parents. However, they cannot also claim the same interest deduction so be sure to check with them.

Job-Hunting Costs

If you were out of work and looking for a new job in the same profession last year, you can deduct some of the costs, provided they total 2% or more of your adjusted gross income (AGI).

Moving Expenses to Take Your First Job

If you had to move 50 miles or more to get your 1st job, then you may be able to deduct the cost of the move. To find out if you qualify, see: Tax Topics – Topic 455 Moving Expenses.

Military Reservists’ Travel Expenses

If you’re a National Guard or military reservist, and you travel more than 100 miles from home and are away from home overnight you may be able to deduct the cost of lodging and up to half the cost of your meals. Plus an allowance for driving your own car to get to and from drills.

Deduction of Medicare Premiums

If you’re self employed and qualify for Medicare, you may be able to deduct the premium payment for Medicare Part B and D as well as the cost of supplemental Medicare policies (a.k.a. “medigap”). You cannot claim this deduction however if you are eligible for employer-subsidized health coverage offered by your employer (if you have another job).

Child-Care Credit

You can qualify for a tax credit worth between 20% and 35% of what you pay for child care while you work – unless your boss reimburses your costs. See: Tax Topics – Topic 602 Child and Dependent Care Credit for details.

This is a big one because it’s a tax credit instead of a deduction, so don’t pass this up if you qualify!

Estate Tax on Income in Respect of a Decedent

If you inherited an IRA from someone whose estate was big enough to be subject to the federal estate tax, it can save you a bunch of money. See : TaxAlmanac – A free online tax research resource and community – Income in Respect of a Decedent – IRD for more.

State Tax Paid Last Spring

If you paid state taxes last year, don’t forget to claim that on this year’s taxes or it could cost you twice!

Refinancing Points

If you refinanced your mortgage with a new lender and paid points, then you may qualify to deduct the points over the life of the loan. Here’s an example: If your mortgage was a 30-year loan, you can deduct 1/30th of the points each year (or $33 for every $1,000 of points paid). Not much, but it all adds up.

Jury Pay Paid to Employer

Some employers require that you fork over your jury pay if you serve, but the IRS requires that you claim that pay as taxable income. If your employer takes your jury pay, they you can deduct that pay from your taxable income, to balance things out.

American Opportunity Credit

This could be a big deal. You can deduct up to $2,500 of tuition and school related expenses for the year – and if you already owe $0 in federal taxes, you’ll get this credit as a refund. It will help this year, but it won’t do much for the overall student loan debt burden. :-/

Baggage Fees

“Baggage fees? ” I hear you say. Yes. Baggage fees. It turns out that if you’re self employed and traveling on business those baggage fees are a deductible travel expense. Who knew!?

Energy-Saving Home Improvement Credit

This credit is worth 10% of the cost of any qualifying energy saving home improvement up to $500. There are a host of caveats though (like you can’t have claimed it in the past 6 years), so check with your tax pro.

Additional Bonus Depreciation

Business owners can deduct 100% of the cost of qualified assets placed in service during 2011. This deduction only applies to new assets with recovery periods of 20 years or less. Computers, machinery, equipment, land improvements and farm buildings all qualify.

Sale of Demutualized Stock

Eh? What’s this?

Demutualized stock is “stock that a life insurance policyholder receives when the insurer switches from being a mutual company owned by policyholders to a stock company owned by stockholders.” The IRS used to state that such stock had no tax basis, and so the taxpayer owed tax on 100% of the proceeds of the sale when the stock was sold. But after a long legal struggle, a federal court ruled in 2009 that the IRS was wrong.

The court didn’t say what the basis of the stock should be, but many experts think it’s whatever the shares were worth when they were distributed to policyholders. If you sold stock in 2011 that you received in a demutualization, be sure to claim a basis to hold down your tax bill.

Home-Buyer Credit

This is the famous (or infamous, depending on your view) home buyer credit of 2010, but extended for a select few. If you are a member of the uniformed armed services, the foreign service or the intelligence community who were on extended duty outside the United States at least 90 days during the period after December 31, 2008, and ending before May 1, 2010 then you may be still eligible for this credit.

Source.

Related Posts:

• Tax Time: Kiplinger’s “Do It Yourself Pay Raise” (Video).
• Are You Prepared to Pay $3,598 More in Income Tax for 2012?
• How to Get Your Tax Refund Now!
• Tax Time: How to Claim the Making Work Pay Credit on Your Taxes.
• How to Get Free Help With Taxes!

Tax Time: Last Minute List of Overlooked Deductions. Copyright © Simple Debt-Free Finance

If you’re like me, and think a pet is a wonderful thing but you prefer to not live a life of debt for him, here are some tips for limiting the vet bill while skipping the insurance.

Seek out low-cost vet clinics for routine shots. Many vets offer them once or twice per year. You can also call your local chapter of the The Humane Society of the United States. You may even get information from your local animal control department.

Get a second opinion for non-emergency conditions. You might even want to check out the Merck Veterinary Manual online for detail about your pet’s condition and treatment possibilities.

When it comes to medication, shop around and ask for samples. Many vets have small, sample size packs of medication that may suit your pet’s need, or at least cut down on the total bill. Also check around on the Internet at sites like Discount Pet Medicines.

Don’t ignore long-term factors either. Cutting costs today on cheap pet food can mean big bills down the road. I had a cat when I was younger who went into full blown kidney failure on a Friday. It being a weekend, our regular vet was closed which meant going to an animal hospital. (read “big money!”)

Anyway, it turns out that the cheap food we had been giving him for years was loaded with “fillers”, like clay. Over the years this led to kidney and urinary tract problems. All told, my parents spent close to 4 figures on that incident and the cat lived for another 8 years or so but we all could have saved a lot of time and money had we known to skip the cheap food.

Also, research breeds and pets before you decide. Dogs make twice as many trips to the vet as cats, and there are a host of chronic problems and hereditary diseases that plague specific breeds. At the very least, you should know what you’re getting into.

Related Posts:

• Is Pet Insurance Worth The Cost?
• When is it Ideal to Drop Collision Auto Insurance?
• How to Check Insurance Companies for Complaints.
• Life Insurance: What kind should I buy?
• Life Insurance: How much do I need?

Alternatives To Pet Insurance (Tips For Doing Without Pet Insurance). Copyright © Simple Debt-Free Finance

Now, the owner is often placed in the difficult position of placing a dollar amount on the life of their pet.

Americans spent $12.2 billion on veterinary care in 2009 alone, according to the American Pet Products Association (APPA). Insurers are advertising through with American Kennel Club and Petco Animal Supplies, and companies like Google and Office Depot provide pet coverage as an optional employee benefit.

Veterinary Pet Insurance, one of the oldest insurers, reported an average annual rate of revenue growth of 26.8% since 2008, and had $149 million in sales in 2007.

The cost of pet insurance over the life of the average pet can run as high as $6,000, but that’s a small price to pay for the peace of mind for many pet owners.

Deciding whether pet insurance makes sense for you is a personal decision. If you’re the type of person who sees your pet as an extension of yourself and an integral part of your family – one for which you would go to any cost (literally) to save, then pet insurance should be a consideration.

Here are some tips for buying the best pet insurance if you decide it’s the right move for you and your family.

Pet insurance comparison and shopping around.

Shopping around is a must, just like buying anything else – competition is your friend, when you’re the customer. Policy coverage and premiums can vary greatly, so look at the whole package and not just the premium.

Compare pet insurance policies by the following:

• monthly premium/annual cost
• deductibles
• coverage
• payout caps
• co-pays

Watch for payout caps that are limited by year or life of the pet. You could easily end up paying for a policy which you’ve already maxed out. That would leave you with no means to provide care for your pet and having to pay premiums – the worst of all possibilities.

Ask about multi-pet discounts.

Check with your employer to see if they offer any discounts or pet insurance as an employee benefit.

Pet insurers should also be registered with your state regulators, so you can check up on their legitimacy.

Related Posts:

• Alternatives To Pet Insurance (Tips For Doing Without Pet Insurance).
• Is Pet Insurance Worth The Cost?
• Minimalism vs. Simplicity – Are You Missing the Point?
• Save Money on Insurance – Skip These Insurance Policies You Don’t Need!
• Notice of Mortgage Protection Insurance, a Scam.

Tips for buying the best pet insurance. Copyright © Simple Debt-Free Finance

Is pet insurance a good idea?

Treatments and diagnostic routines that were previously only available to humans are now available for pets. Conditions that were once fatal are now possible to treat, albeit at costs that run into the 1,000s.

The cost of Pet Insurance can be as high as $6,000 over the life of your pet, but chances are that you would never claim that much in reimbursement costs.

A few years back, my wife and I experienced our 1st financial tipping point which was triggered by a trip to the veterinary hospital for our cat. While that experience prompted us to take a long, hard look at our finances and eventually started us down the road of financial overhaul and debt-free living, we never once thought that health insurance for our pet was a solution.

After careful consideration of pet insurance this time around, we’re taking a pass on it but there may be cases where it makes financial sense. Here’s why it might make sense, and why it’s probably not worth the money.

When Pet Health Insurance Might be Worth it.

If your pet is at high risk to suffer from expensive diseases and the thought of having insurance gives you peace of mind, then you may sleep better at night knowing that you would be covered in such an event.

If that’s you, then you want to be absolutely sure you understand the terms and conditions of the policy and be positive you are getting the coverage you need.

Why Pet Health Insurance is Typically Not Worth the Cost.

Pet insurance is typically not the money saving proposition it seems once you factor in deductibles, co-pays and reimbursement caps. Pre-existing conditions and hereditary conditions are typically excluded from coverage. Some insurers do cover such things, but expect to pay a higher premium due to the increased likelihood of payout. Coverage for older pets carry higher premiums or are sometimes not available. Some insurers simply refuse to cover pets older than 9 years.

Read this cautionary tale from Wise Bread to see one case when pet health insurance is not really worth it.

If your pet is not a purebred, and not subject to an increased risk of serious and costly disease, then you are probably better off skipping the insurance, and saving the amount you would be putting toward a premium. Take that money and automatically save it every month in a savings account (such as the ING Direct savings account ). It will be like paying the premium but you get to keep any interest from the bank and in the very likely case that you wouldn’t file a claim, you get to keep the money too… perhaps for your next pet. Think long term.

Bottom Line: Is Pet Insurance Right For You?

The choice of whether to purchase pet health insurance is a personal one. You have to determine just how far you are willing to go for your pet. If you’re the type of person who would “do anything” to save Fluffy – no matter what the cost – then you may seriously consider health insurance for your pet. This is especially true if the alternative is going into debt.

However, if you’re a more pragmatic sort of person who is willing to provide good, basic care for your pet but find yourself thinking, “it’s only a cat/dog, and he’s had a good life” when faced with the prospect of a 4 figure vet bill, then you’re best off by taking a pass on the pet insurance.

Related Posts:

• Minimalism vs. Simplicity – Are You Missing the Point?
• Alternatives To Pet Insurance (Tips For Doing Without Pet Insurance).
• Is Gap Insurance A Good Idea?
• Tips for buying the best pet insurance.
• Save Money on Insurance – Skip These Insurance Policies You Don’t Need!

Is Pet Insurance Worth The Cost? Copyright © Simple Debt-Free Finance

As a result, this blog has been in existence for about 4 years now but is nowhere near the level of visibility of similar blogs of that vintage.

I know that much of it is due to a haphazard approach on my part. After all, this is still a hobby of mine. I’m not a professional blogger by any stretch, and I still maintain this blog by myself in my spare time. I have a day job, and this is not it. Because of that, I don’t expect to be on par with the A-list bloggers in this niche – blogs like Consumerism Commentary, Financial Samurai (Honorable Personal Finance), Len Penzo dot Com, Free From Broke (A Personal Finance Blog for Regular Folks) and many other great blogs out there.

Still, I have decided to make a concerted effort to improve the quality and visibility of this blog. I have recently re-launched Simple Debt-Free Finance with a new theme that focuses on readability and emphasizes simplicity.

I will no longer be accepting “guest posts” from companies pretending to be bloggers.

(This was the result of many late-night moments of desperation, when I was tired from a long day at work and felt I “needed to keep the content flowing.” Whether it was written by me or some marketing department didn’t matter. It matters now. I am still accepting guest posts, but only from real bloggers now. no more businesses looking for cheap marketing and free link love.)

Another major part of this new effort is joining the YAKEZIE ALEXA RANKING CHALLENGE.

I’ll be honest, I have no idea where the name Yakezie originates and I have no particular hang up about my Alexa ranking. However, I am open to trying new venues and am always up for a challenge. Besides, the YAKEZIE CHALLENGE is ultimately about community and helping others succeed as well as yourself and I can definitely get behind that.

For those who may be interested in taking the challenge themselves, here are the guidelines from the challenge site:

TO JOIN THE YAKEZIE ALEXA RANKING CHALLENGE
1) Install the Alexa toolbar if not already and comment what your current Alexa ranking is, so we can keep track.

2) Write consistently 2-4 times a week on your own site and consider guest posting around the community including on Yakezie.com to raise your profile.

3) Install the Yakezie Challenger Badge.

4) Announce on your blog that you have joined the Yakezie Challenge.

5) Selflessly promote others and build relationships.

6) Stay committed and consistent over the next 6 months! Whether you are a huge blog or a start-up, everybody most go through a 6 month Challenge period to ensure that we build the best relationships possible.

7) Come introduce yourself on the Yakezie Challengers Forum and get to know your fellow Challengers and Members.

Once the 6-month challenge is over, let us know how far you’ve come in the forums, on your blog, and via an e-mail. If you’ve developed good relationships, broken 200,000 in Alexa, and are ready for the next step, we will invite you to submit a form and write your Yakezie Member Post and become an official member.

At this time, my ranking is 731,734. I hope to at least crack the 200,000 level in 6 months. Wish me luck!

Related Posts:

• Easter Roundup, 2011.
• Carnival Roundups – March Madness Edition!
• Facebook Can Put You In Jail!
• 2009, year in review.
• Learn From My Mistake – Go to Web Hosting Geeks First!

Challenging Myself With the YAKEZIE ALEXA RANKING CHALLENGE! Copyright © Simple Debt-Free Finance

Well, if you read her story it makes a lot of sense.

Basically, she went from working at home to a full time office job and once she totaled the change in her spending she realized she was making about $7.50 per hour.

Here are some of the things she attributes to lowering her effective income:

• Commuting costs – increased wear and tear on her car, the cost of gas, etc…
• Childcare expenses
• Eating out more – less time to prepare meals at home means eating out or buying take out more frequently, which is more expensive.
• Increase in clothing and personal care expenses (i.e. hair and nail care, proper office attire, etc..)
• Coping with stress by spending more on vacations, or entertainment.. buying more wants than needs.

Her change in lifestyle brought about a change in spending with no increase in saving. It happens to a lot of people and it’s not always easy or even possible to fix. She could do some things differently. She probably doesn’t need to spend $40 a week on clothes, and she could plan ahead to prepare more meals at home, but that takes work too.

This is the kind of situation my wife and I work very hard to avoid. We avoid debt whenever possible to keep as much of our income as possible. I work hard to secure a steady income, and she works hard (sometimes harder) to make that income go as far as possible.

She’s the coupon clipper and meal planner. She’s turned comparison shopping into a competitive sport. She scours thrift shops and consignment stores for children’s clothes, and puts a healthy low cost meal on the table every day of every week all year long.

It’s not easy, but it’s cheaper than if she went back to work full time. And we believe it’s better for the family. Living on a single income is not easy, but it is possible and I believe better in most cases for families. The key is twofold: 1) limit expenses as much as possible, and 2) increase income.

It’s really no different than what most people should be trying to do regardless of their employment situation, but as the Yahoo! article makes clear, it’s so much easier to lose control of your spending when both people work out of the house. Those little money leaks turn into an effective loss of income over time.

Related Posts:

• Living on a Single Income: 7 Years and Counting.
• Bottled Water Out, Tap Water In.
• Living on a Single Income – You can do it! Here’s how.
• What To Do With Found Money, or a Windfall.
• 7 Tips for Cutting Spending and Putting Cash Back in your Pocket. (video)

When a $50,000 Salary Can Feel Like Minimum Wage. Copyright © Simple Debt-Free Finance

Many insurance policies sold today are simply unnecessary in most cases. Knowing which policies are needed and which aren’t will go along way toward arming yourself with the knowledge needed to protect yourself from less honest agents.

1. Private Mortgage Insurance (PMI).

First up on the hit parade is the onerous PMI. Many homeowners only become aware of this after they buy a home an see their monthly mortgage payment has this extra fee included. PMI has nothing to do with protecting you or your home. It’s insurance for the bank to insure against the possibility that you default on your mortgage.

You didn’t expect the bank to pay for its insurance, did you?

Private Mortgage Insurance is required for loans with less than 20% equity – either a refinance for more than 80% of the value of the home, or a mortgage with less than a 20% down payment.

PMI can only be avoided in the initial opening process of the loan, after you’ve got the loan you have to wait until you have at least 20% equity in the home. This can be due to appreciation in the home’s value, which is unlikely in the current housing market, or by paying down the loan. Homeowners can accelerate this process by making extra payments – just make sure they are principal only payments.

(check out Why A Mortgage Loan Without PMI Is A Bad Idea.)

2. Extended Warranties.

An extended warranty is basically insuring against a breakdown of the product outside what’s covered by the basic warranty. That may mean a breakdown after the basic warranty has expired, or a breakdown of something not covered by the basic warranty.

Unless you’re purchasing a high-ticket item, the warranty is likely to cost almost as much as a total replacement. I paid $115 for my first lawnmower. At the time of check out, the sale clerk tried to upsell me on a 3 year extended warranty. I would “only” cost me 30 bucks a year. That would have been $90 in total – for a $115 lawnmower!

The dirty little secret on most warranties is that they only cover the things that rarely go wrong to begin with. So in most cases, you’re better off playing the odds that it won’t break. This is especially true if you save up the entire purchase price of the item before buying, and don’t buy on credit. Also, waiting for prices to come down helps too. I might be tempted to get the extra warranty on a $5,000 new flat screen television, but a $700 one? Not so much.

But then, the thought of spending so much on a “want” makes my frugal self revolt.

3. Automobile Collision Insurance.

Collision insurance is meant to cover the cost of repairs if your vehicle is involved in an accident. This isn’t necessarily useless. It depends on your financial situation and your car. I drive old cars that I can either pay for entirely or pay for mostly, leaving me with a lower loan amount.

Banks typically require you to carry collision insurance, so if you have a loan you will likely get stuck with this bill. But after the loan is paid off, the car is likely worth less that the insurance premiums you’re paying (are darn close)! In which case, you’d be better off putting that money into a savings account for car repairs (should they arise) or a new(er) car.

4. Rental Car Insurance.

People buy this?

Apparently they do, but they probably shouldn’t. Most people rarely need a rental car while their car is in for repairs, and if they do the cost is far cheaper than what they would pay in premiums. Personally, the few times my car has been in the shop long enough to need alternative transportation, the shop has provided either a loaner car or paid for the rental car.

5. Flight Insurance.

I’m not sure what this is meant to cover. I gather it’s meant pay your survivors should you die in a plane crash, but your life insurance would do that anyway.

6. Water Line Coverage.

Ah, now we’re getting to the really fringe insurance types.

This policy would cover the repair costs of the water line that runs from the street to your house. The likelihood that this would ever become a problem is slim – especially in new neighborhoods and given the relatively short distance covered in most suburban neighborhoods.

7. Life Insurance for Children

Life insurance is meant to cover the income of the insured in the event that they die prematurely. Children don’t have dependents to worry about. Some agents try to sell this kind of insurance as an investment for the child’s future. This gets to the Term Life Insurance vs. Whole (or Universal) Life Insurance debate. (see Life Insurance: What kind should I buy?) The same is true in this case – skip the whole life policy and invest the money that would go toward a premium in a Roth IRA for the child. (See Secret # 2. Make Your Grandchild a TAX-FREE Millionaire!) It will perform better with less fees and he’ll have access to the contribution amounts for his first home, while the rest will continue to snowball toward retirement.

8. Credit Card Loss Insurance.

This is meant to cover your expenses if someone steals your card or makes fraudulent purchases. It’s a complete waste because you’re only liable up to $50 by law, and most credit card companies wave that for good customers.

9. Mortgage Life Insurance.

Mortgage life insurance pays off your house in the event of your death. This is useless, since it’s the purpose of Life insurance to begin with , only life insurance will pay off the mortgage, and your children’s college expense and anything else you need.

10. Unemployment Insurance.

With government unemployment benefits lasting over a year, you’re far better off building an emergency savings account and using that to supplement the unemployment checks. If you can make Unemployment Insurance premium payments, you can make contributions to an emergency fund.

Check out the inspiration for this article and 5 more unnecessary Insurance Policies.

Related Posts:

• Cheat Sheet: How to Buy Life Insurance (Infographic).
• When is it Ideal to Drop Collision Auto Insurance?
• When To Switch Car Insurance.
• Is Gap Insurance A Good Idea?
• What Not To Tell Your Insurer.

Save Money on Insurance – Skip These Insurance Policies You Don’t Need! Copyright © Simple Debt-Free Finance

Here’s how to turn that refund into a raise:

Related Posts:

• How to Get Free Help With Taxes!
• TaxTime: 2010 Tax Law Changes.
• Tax Time: 4 Big Tax Changes for 2011.
• Tax Time: Last Minute List of Overlooked Deductions.
• Are You Prepared to Pay $3,598 More in Income Tax for 2012?

Tax Time: Kiplinger’s “Do It Yourself Pay Raise” (Video). Copyright © Simple Debt-Free Finance

One other thing stuck out to me – no PMI. Not because we had a 20% down payment; we couldn’t afford that at the time. I had thought at the time that my bank was just better than other banks. See, this was a local bank. A small, home town bank – not one of those big evil banks that would catch all the headlines and hate from the public when the bubble burst years later.

It turns out that my sweet hometown community bank wasn’t doing me any favors by offering me a home mortgage with no PMI. PMI is insurance for the bank to cover their loss in the event that the borrower defaults on the loan. Instead of charging me a PMI premium with my monthly mortgage payment, they rolled this premium into the loan itself.

Is PMI included in the APR a good thing?

On the face of it, things looked great. I had a lower monthly payment without the PMI included. But over the long term, it’s more costly to the borrower because that PMI premium adds thousands to the principal of the loan, which in turn adds thousands in interest over the life of the loan (usually 30 years).

Banks love doing this because it juices their return since you’re paying this premium far longer than you would if it were added to the monthly payment.

Here’s a quick example.

Assume a home value of $200,000, with 5% down. This gives us a mortgage of $190,000. Using the CNN Money PMI calculator with these numbers gives us a monthly PMI of $80.

Since the value of the home is $200,000, and PMI is required until there is more than 20% equity ($40k in this case) this means that the outstanding value on the loan needs to be less than $160,000 (200,000 – 40,000).

Next, using the Mortgage Calculator at Bankrate.com, assuming a loan of $190,000 and an interest rate of 5% (currently high, I know, but historically low) and selecting the “Show Amortization table” option shows that it would take roughly 9 years of mortgage payments before the value of the loan would drop below $160,000.

9 years of mortgage insurance payments is: $8,640 (108 payments of $80)

Rolling the premiums into the loan lowers the monthly payments by $80, but adds 8,640 to the overall loan.

$177,185.99 total interest for base loan of $190,000 and $185,243.29 total interest if PMI is added to the loan amount.

That’s a difference of $8057.30.

Add that to the original amount added to the principal:

$8,057.30 + $8,640 = $16,697.30.

So, the bank wants you to think that you’re saving $80 a month by rolling the PMI into the loan, but you’re really spending an extra $8,057.30.

Caveats.

This is a simple example, but I think a compelling one. It assumes that the borrower is keeping this loan for the full 30 years. If you took out this sort of loan and refinanced or moved in 7 years, you’d come out ahead. But then again, you can’t always refinance – as millions of homeowners who owe more than their homes are worth now realize.

Traditionally, a healthy housing market would have some appreciation involved, which would also shorten the time before that magic 20% value is reached, but that would make the PMI included in the APR even worse.

The bottom line is that you never really know how long you’ll have the loan for or what your home will be worth in 10 years time. It’s my opinion that planning conservatively is best. Be at peace with the idea of holding the mortgage for the full term, and don’t count on rising home values to bail you out. That way, you can weather the storms and anything else is gravy.

Related Posts:

• Save Money on Insurance – Skip These Insurance Policies You Don’t Need!
• What Is a Bad APR?
• Notice of Mortgage Protection Insurance, a Scam.
• Will Refinancing My Mortgage Save Me Money?
• 4 Tips For Applying For a Mortgage

Why A Mortgage Loan Without PMI Is A Bad Idea. Copyright © Simple Debt-Free Finance

I was reading through an old copy of Eat the Rich: A Treatise on Economics by P. J. O’Rourke and came across this page which pretty much sums up view of the OWS crowd and many of their supporters…

The book was written in the late 1990′s, so it struck me how current and relevant this section is today.

In lighter times, I would have thoroughly enjoyed the above passage but in the current economic and political climate I felt a twinge of unease. It’s a reminder of how far off the rails the country has gone that this has become common discourse and even seems to be the basis of much of the recent State of the Union address.

Perhaps this excerpt should serve as some small consolation because it shows that the Occupy mentality was prevalent in the Universities even in the late 1990′s, when the economy was booming, and that it only has a voice now because of the times.

I suppose it’s always been an undercurrent, and we can hope it returns to that status quickly. Of course, if it truly is indicative of the majority view then we’re in for a much longer time of economic unease, uncertainty and non prosperity. I guess we’ll find out in November….

Related Posts:

• Participatory Economics and Why The Occupy Movement Was Destined To Fail From The Start.

Eat the Rich: From Beatnik to Business Major Back in Fashion Again? Copyright © Simple Debt-Free Finance

* Note: Kiyosaki discusses 5 aspects of Financial I.Q. in his book, but I’m just going to focus on this one, general concept here.

The learning discussed in the book is not a formal education. In fact, that’s one of the mistakes that many people make – amassing huge amounts of debt going to college in the hopes of “finding a good job” and their place on the financial treadmill, only for some it’s more like a hamster wheel.

So what does “focus on learning” mean if not the traditional, middle class mantra “go to college to get a good job”?

It means taking risks and chances while you’re young, and always learning from your mistakes as well as your successes. People come into money all the time, sometimes mass amounts of it only to lose it all later. Think of lottery winners, famous athletes and performing artists. Suddenly rich, then suddenly broke. Why? Because they didn’t increase their 2nd financial I.Q. after mastering the 1st. They simply did what they loved doing and fell into their riches, but never learned how to manage and protect their wealth.

The first two financial I.Q.’s in the book are :

1. earning more money.
2. learning how to protect that money.

In the example of the star athlete or lottery winner, they mastered I.Q. #1 but failed horribly at I.Q. #2 – protecting their money.

Protection can mean many different things, and is usually referred to as “security” by many people. They may want to be secure in the knowledge that their savings are safe from loss, or maybe they want to protect their savings and assets from legal action. Whatever meaning you take, once you’ve earned it you must get educated on how to keep it or risk losing it all.

But even losing it all isn’t the end.

There are many well known moguls, like Donald Trump, who have built vast financial empires and lost it all only to come roaring back again. Why? Because they learned from their experience and were not afraid to fail.

” Those who cannot remember the past are condemned to repeat it.”
-George Santayana

If you do not learn from your mistakes, you will keep making them and make little or no progress in life.

I’ve always thought it’s important to learn from your own mistakes, but it’s also important to learn from other people’s mistakes as well.

Here are a few resources to help boost your financial I.Q.:

• Tips to avoid losing money to these common investing mistakes .
• Educate yourself at tax time to avoid common tax mistakes and save more money.
• Get educated on credit cards so you can know how bad credit mistakes can be and avoid even basic credit card mistakes that cost thousands.
• And if nothing else, learn from other people and avoid even basic money mistakes whenever you can.

Related Posts:

• Robert Kiyosaki Plays Loose With His Math in Financial I.Q.
• Who are The Rich in America Today? Introducing The Frugal Rich.
• MyFasterPC Review (Why It’s Not Worth the Money).
• Minimalism vs. Simplicity – Are You Missing the Point?
• Alternatives To Pet Insurance (Tips For Doing Without Pet Insurance).

Want to Build Wealth, and be Secure? Focus on Learning Instead of Earning! Copyright © Simple Debt-Free Finance