So now that we’ve outgrown the whole “filing away receipts into folders” because we’re all extremely tech savvy, haven’t we found it a little annoying to just scan in our receipts and still have to manually sort them into our programs? Well I found this little handy dandy device and thought to post it on here. It will come in handy if you work in the accounting or finance field- or even if you’re just a super compulsive OCD organizer who is on top of their game.

This machine, Neat Receipts, will not only scan your receipts in, but it will pull the information from the receipt and attempt to help you categorize it.

You can create expense reports, searchable PDF files of any printed document, and IRS-accepted copies of your receipts so you can have an organized library of all your important information. And at less than one pound, NeatReceipts works wherever you do.

Enjoy!

First and foremost, before you attempt to handle anything regarding money, you should set your priorities. You need to know what ‘money drains’ are most important. IE: High interest cards & loans, outstanding payments, monthly bills etc. Paying off high interest cards & loans first will make your final payment smaller in the long run. Think about it… sacrifice- give up a little money and bite the bullet to pay more on your principle each month, or pay small amounts for the rest of your life. Seriously. You’ll probably be paying forever. Forever.

Lesson 2: You need to make a budget that keeps you on track for your short and long term goals. Having extra money in your budget and offering yourself some padding will save you from a serious money headache. The kind of headache that is worse than a caffeine headache. It’s the kind of headache that gives you physical pain as well as lingering annoying thoughts filled with dollar signs. Being a student I have a permanent lack of money and am constantly strung out on caffeine. I should know which one hurts more.

Lesson 3: Learn the ins and outs of your banking system and all that it can offer you via services. Nothing is worse than waking up one morning, after not checking your account balance, and realizing you’ve been charged for an overdraw fee. Over and over for a week. Those fees can get hefty- sign up for online banking, and even better! Online bill pay! It will save you time and give you instant gratification when you need to check to see if you have enough cash to grab that yummy mcmuffin or Starbucks on the way to the places you frequent during the morning.

Lesson 4: Learn the basics of investing. Nothing is better than planning for your future, and it’s never too early to start! Understanding stocks, bonds and mutual funds is fun! I swear!

Lesson 5: Invest in some stocks… just make sure you don’t put all your savings into it. That can get nasty real quick.

Lesson 6: Lose all your money in the stock market!…. Just kidding, don’t do that.

Lesson 6 (The real one): Invest in mutual funds and create a nice portfolio.

Lesson 7: Investing in bonds, study them well and understand them.

Lesson 8: Buying a home is an extremely nerve racking investment, but it WILL turn out to be the most rewarding. It is also something you need to walk in to prepared and on your toes.

Lesson 9: Controlling debt. Credit works in funny ways. Sometimes paying off all your credit cards and closing your accounts may SEEM like a good idea, but having revolving credit and open credit cards (when done in a smart fashion) can boost your credit more than closing everything can.

Lesson 10: Employee stock options. Companies will give you stock options, take full advantage!

Lesson 11: Saving for college… need I say more? Putting your child through college, or at least helping them, will put a smile on your face and give them a great opportunity.

Lesson 12: Kids and money… teaching them what you’re learning through these lessons is always a good place to start. Although I’m not too sure how they’ll feel about learning the nifty world of stocks and bonds at age 8.. or while eating ice cream. Time it right or you’ll have a rouge child who spends all your money without thinking twice.

Lesson 13: Planning for retirement. Hard work can pay off if you want it to. Make sure you don’t let your retirement fund just fend for itself.

Lesson 14: Asset allocation. Where to put your money/assets.

Lesson 15: Hiring financial help is a good idea. They can see things that you don’t see and know how to handle other people’s money effectively. I’m going to school for finance. Maybe one day I can do that for you! Just kidding. (Kind of… you can’t hate on the shameless self promotion!).

Lesson 16: Health Insurance. There’s so many different kinds. Some that employers offer, some that are private… some that steal all your money, and some that take close to nothing and help you the most. I also suggest you read into each presidential candidate’s health care plans before you vote. It WILL affect you. (That’s not a threat, I’m just stating the obvious I guess).

Lesson 17: Buying a car! So many options, so little time! Do you want the family friendly minivan, the luxury “pimp” sedan, or the hot off the market little coupe that can get you ladies?! (or gentlemen). This lesson will help you pick through what each car can do for you.

Lesson 18: Taxes. Taxes can make or break you depending on how you deal with them. Tax evasion (accidentally or on purpose) is a bad, BAD way to go. This lesson will clear up everything about taxes just for you.

Lesson 19: Home insurance. Especially if you live in a place where bad weather runs rampant or crime is high. I would have to say it’s necessary for everyone though- it gives you peace of mind.

Lesson 20: Life insurance. You need to think about your family when you plan anything regarding finances. The government and credit card companies are not kind when one passes away and will often times stick the remainder of the debt with the spouse or beneficiary.

Lesson 21: Planning your estate. Many people don’t plan for their estate at all. Here you can learn the steps to do that.

Lesson 22: Auto insurance. It’s something you will probably pay every month/every 6 months for your life as a grown up. Unless you live in the city and take the bus, but I want to write a letter to the city and let them know they should give everyone bodily insurance who spend their day using public transportation…it would be the equivalent to auto insurance except it covers our precious selves when we’re being body checked and injured.

Lesson 23: 401ks. Yes, they are all in jeopardy now with the fluctuating market… but it is the most important tool for your retirement.

I hope you take the time to go to this page- (http://money.cnn.com/magazines/moneymag/money101/index.html )  and read everything under these lessons. They are definite eye openers and will make you feel more confident and stable about your financial future.

I would like to propose a question to everyone reading this and I hope to take the time to leave a comment so I can get some insight. It will help me figure out the direction to gear my upcoming posts. It will also give me the opportunity to check out your blog as well. If nobody responds then you are all subject to my free-roaming thoughts… and that is never a good thing. So my question isssss *drumroll*

I wanted to know which of those lessons you have found most difficult to understand in the past, and what lessons this guide has help clear up for you as well. Any responses are greatly appreciated.

Let me first start by saying that I’m fairly sure everyone has been following this current financial crisis. Students, especially, are feeling the brunt of this situation. I am currently a student myself who has just went through the joys of attempting to get a student loan for the first time, and let me tell you, it was a complete pain in the butt! So I understand the situation for all of you college students out there, and even for people who are just trying to find a safe financial point for their families. Soooo to get you all up to speed, read on!

One of the big things that originally pushed us to this point was the sub-prime lending. If you aren’t sure what sub-prime lending is, it’s when companies extend loans to families or individuals, at an adjustable low interest rate for an extended period of years. The idea behind this is that people who so-so credit, not established credit, or bad credit can still get a house loan and pay it over a long (small chunk) their life. It may be an exciting time in your life until… your adjustable interest rate rises to almost 4 times your normal number, and you suddenly find yourself scrambling to making ends meet. Enter foreclosure, stage left. So as you can see, this was something that has been going on for a long time. People were put under false pretenses and now we are paying a major price. With all the foreclosures currently going on, big investment firms being investigated for shady practices and loan companies trying to take an arm, a leg and your first born child… I think it’s time to say things are getting difficult. If you’re curious about reading more on sub-prime lending, please go over to this wonderful link- http://current.com/items/89124784_mortgage_crisis_blues

Now that we’re past THAT wonderful subject matter, we can look into the current situation of the stock market. It’s been fluctuating like crazy lately and we all have a stake in what is going on. Whether it be because our parents have a 401k, maybe our college fund is in a COD, or maybe our loans are through smaller banks who are having trouble staying afloat amidst all this. Everybody is affected and it’s nothing to feel bad about. There is one thing you cannot do however. Do not take your money out of the bank. I know, I know, it’s a tough suggestion to follow, but let me break this down for you. When we have money sitting in the bank, it’s what the bank “borrows” from us to give out other loans, which keeps currency flowing as well as keeps interest rates down. But when people act frantically and start pulling their money out of the banks in times of crisis, suddenly the banks are peering around the corners of their empty vaults going… “who the heck are we going to borrow money from for these loans?” aaaaaaaand say hello to a credit freeze. I can’t stress enough how important it is that we all keep our money in the banks!

So what is the best plan of attack? In the next few posts I write, I’ll be going into some ideas on how students can save and invest money, banks they can use that have free checking accounts, as well as rehashing each presidential candidate’s tax plans and campaigns. You only have 24 days left to make your decision… I’ll be right there behind you to keep you informed! This post was just a warm-up, so pardon the fact that I didn’t hone in on one particular topic yet. I’m just getting my feet wet!

So I hope you get used to me being here because I have a lot of exciting financial information coming up!! =)

Faced with steep inflation of college tuition, many college aged people are looking to find out where the candidates stand on student aid and the rising cost of higher education. As over 17 million voting-age college students stand to be affected by the troubles in the student loan market, it has been harder for the candidates to avoid discussions on the costs of higher education.

From Bnet’s article on college costs in the candidate’s agendas:

This year, students are voicing concerns more loudly about their ability to afford a higher education as ever-rising college costs — up 22 percent in the last five years alone — have been thrown into especially stark relief amidst a media and public storm about the potential unavailability of student loans facing families in the upcoming academic year.

Traditionally Republicans like to cut public programs and funding in favor of projects deemed more important and McCain’s stance so far seems to be in line with that. To deal with the expanding federal deficit, McCain’s preferred solution is cutting government spending. This is good and bad since earmarks will decrease (under Bush the number has grown substantially). Earmarks refer to congressional provisions that direct approved funds to be spent on specific projects, and are sometimes a wasteful way to spend tax dollars but many do end up in higher education. Funding will most likely also be cut from programs that student and grads depend on. The final consequences are unknown since McCain’s camp has not stated a plan concerning post-secondary education and student financial aid.

But McCain would also permanently extend the 2001 Economic Growth and Tax Relief Reconciliation Act (EGTRRA) and 2003 tax cuts, which do include some measures that affect higher education.

Barack Obama has outlined a few proposals including those for grants, loans and other proposals that would help students, including establishing a $4,000 fully refundable “American Opportunity Tax Credit” available at the time of enrollment. This tax credit could cover the first $4,000 of college education costs. Another proposal would ensure that the Pell Grant would keep pace with the rising cost of college inflation, which is Pell’s major problem. Replacing FFELP (The Federal Family Education Loan Program) with 100% Direct Lending was also proposed in addition to a few more ideas.

To get the full break-down of Obama’s student aid proposals, including all those of the other candidates, visit Finaid’s guide to the candidates proposals.

In the end it’s much easier to promise to do something on college costs than it is to actually do something. But it is a good sign for students and institutions who’s issues can capture political attention and debate especially in an election year with so many hot topics.

A few days ago I was sorting through my miscellaneous pile of random papers, bills and notes from way back, when I discovered a rare, ancient artifact - my checkbook. Haven’t seen that for awhile., I said to myself. This brings up a good question I’d like to pose to everyone reading now. Do you still use your checkbook? And if so, why?

Ah, the checkbook. I remember my first checkbook. It was college and I opened my first checking account so I could pay rent and buy beer books. But soon that little book went the way of the doodoo with the advent of online banking. It took me more or less a year to fully make the switch but my finances are much more streamlined because of it. But I do still use checks to pay for a few things. Mostly just rent. Besides rent, the last time would have been… paying a parking ticket over a year ago.

In this time of convenience, checkbooks just don’t make the cut. Instead of carrying around a wallet of those paper slips that we have to fill out for every purchase, we have a plastic card that we slide. Instead of paying your monthly bills with checks and mailing them, it’s just easier to go online and get them all done in 10 minutes or less. And going online also gives you the option of seeing what your current balance is, something a checkbook could never give. It’s also a time of environmental responsibility; save more and conserve. Checks are soon becoming a thing of the past, at least from this blogger’s perspective.

So who’s still using their checkbook? Let me know in the comments!

Some of the biggest banking institutions are bailing on the student loan industry, referring to it as “unprofitable” and “a risky investment.” The hardest hit are community college students. Some providers, such as Citibank, JPMorgan Chase and SunTrust, are cutting their lists of colleges (mainly community and less-selective four-year colleges) whose students they will provide loans to, making students turn to other sources for pay for their college tuition.

Report by the New York Times:

By splitting out community colleges and less-selective four-year institutions, some remaining lenders seem to be breaking the marketplace into tiers. Students attending elite, expensive, public and private four-year universities can expect loans to remain plentiful. The banks generally say these loans are bigger, more profitable and less risky, in part perhaps because the banks expect the universities’ graduates to earn more.

Lenders are keeping quiet on how many colleges they’ve dropped which makes it tricky to estimate how many students have been affected. Colleges who have higher default rates are more likely to be dropped. And since most lower-income students attend community and a easy-to-get-into four-year colleges, these schools are the ones being dropped in most cases.

There are still some bright spots. Some lenders’, such as Sallie Mae and Nelnet are still lending and show no indication they will stop anytime soon. In fact they recently reaffirmed their commitment to federal loans regardless of the institution a student attends. And yet others like Wells Fargo are also picking up the slack and actively searching out colleges to lend to.

The New York Times article goes on to quote a college financial aid director referring to Citibank:

The logic is so flawed, that for us to have volume with them in the future, we have to have had volume with them in the past. [...] I find it totally and completely unethical.

But why would banks stop lending? It’s now harder than in the past for lenders to raise money due to the current credit crisis. That coupled with the government’s subsidy to lenders have contributed to the reevaluations of their lending practices.

Read the full New York Times article: Student Loans Start to Bypass 2-Year Colleges.

Every time I turn around it seems like a new peer-to-peer lending service is being launched. The latest, Fynanz, launched in March and is trying to bring the peer-to-peer structure to student loans. If you are looking to get into peer-to-peer loans (or P2P for short), either as a borrower or lender, you have many options to choose from; Prosper, Zopa, Lending Club, and Virgin Money are just the well-known ones that have recently launched. But with all the these sites launching so close together and all with basically the same idea, will the market be big enough for them all?

As the credit crisis forces banks to tighten their lending practices, peer-to-peer lending has stepped in to fill the void in the loan industry. P2P lets people bypass banks and borrow directly from a real person. It works for lenders because the security of being guaranteed and insured against loss is still there like a traditional loan backed by the government. The upside for borrowers is that lenders compete to give them better rates.

Zopa and Prosper seem to be best equipped to last the longest and emerge as the front runners in this yet developing industry. Lending Club, with its unique marketing strategy of first launching as a Facebook app, is targeting a slightly different audience than the rest and this strategy will help them spread their name faster than the others.

Fynanz is interesting because they facilitate student loans. But, whoever reads this blog knows that private loans always have higher interest rates than federal loans. Private loans should be avoided unless there is no other way get a federal loan apart from grants or scholarships. I don’t see Fynanz lasting as long as the others.

Billionaire Richard Branson’s Virgin USA investment firm late last year bought a majority of shares in another peer-to-peer loan company called Circle Lending. Now renamed Virgin Money USA, their angle is to help manage loans between family and friends who would like to avoid misunderstandings and repayment disputes.

Peer-to-peer sites profit from fees they charge borrowers and lenders to make and service the loan, not from a loan’s interest rate like you may think. They also check the borrower’s credit. Some even contact third parties to collect on bad loans.

But who does peer-to-peer lending really benefit? Well, since default rates are lower for peer-to-peer loans than for other consumer loans, borrowers gain from having that lower rate (apart from student loans, whose counterparts are federal loans which will always have lower rates). And lenders gain a good investment that has a low default rate.

But what happens when the credit crisis is no more and the credit/lending industry bounces back? Ouch. Maybe a few of these sites may want to take out a loan themselves…

In my last post, Save Early and Become a Millionaire, I commented on how a 16 year old can go from a pauper to a millionaire by saving up some cash and investing it in a Roth IRA over 40 years. I wanted to do a little more research and find out exactly what an IRA is. So this is what I found out…

IRA stands for Individual Retirement Account. It’s a retirement plan that lets you contribute up to a certain amount per year and provides tax advantages too. After you establish the account you can invest in bonds, stocks, mutual finds and CDs just like a regular cash account. There are a few different IRAs but the two most common types are Traditional and Roth. Roth IRAs were created to encourage people to save for retirement by offering significant tax breaks.

So what’s the difference between Traditional and Roth? Good question. Now listen up, this part is important. With a Roth IRA you pay income tax, and then make your contribution with after tax dollars. There are no taxes when you make a withdrawal. With a Traditional IRA you get a tax deduction, which lets you deposit before tax dollars then when you make contributions but you also pay income tax on the entire amount of your withdrawals. Roth has the extra advantage since taxes will probably rise in the future; paying taxes now rather than later will save you money in the end.

How do I start a Roth IRA? Any number of providers would be happy to help you start a Roth IRA, including banks, brokerage firms and insurance companies. But the first thing you should do is see if you are eligible. There aren’t many restrictions but the big one that stands out is your income; you can’t make more than $100,000. Next decide which investment will be the best for your Roth. Finally select a provider and create the account. I myself will be going with E*Trade’s Roth IRA account. The E*Trade account features no account fees or minimums, robust investing opportunities and advisors to help you with asset allocation strategies. Probably the best option if you just want to sit back and not worry about what to invest in.

What if I want to make a withdrawal? Firstrade says this:

Before the age of 59 1/2, withdrawals from your IRA account would incur a 10% penalty on top of any taxes owed. However, there are several exceptions to be able to withdraw from an IRA without penalty.

With many ways to save and invest your money out there, a Roth IRA is the simplest - and potentially the most effective - account to save for the future. The Roth IRA has the advantage of getting taxed only once, compared to twice or more with a regular investment account.

If you’re interested in learning more about Roth IRAs or IRAs in general, How to Start a Roth IRA will tell you in depth about the process of starting a Roth IRA. Firstrade also has a comprehensive IRA FAQ guide for beginners.

If you have an IRA already, please share your advice on the matter, or if you’re starting an account, share your experience in the comments.

It’s easier than ever to become a millionaire. So what’s the secret? Don’t laugh, but it’s plain old saving. Getting an early start on your savings coupled with the right investing strategy will bring you up to millionaire status. The catch? You’ll have to wait a few decades.

According to the MSN Money article Start on your first $1 million at age 16, the simple recipe to become a millionaire has five simple steps:

• Work 4 summers, from age 16 to 20
• Save the income in a Roth IRA account
• Invest in a simple, low-cost equity portfolio
• Wait 47 years
• Collect at age 67, untaxed and ready to spend (maybe on a new hip by this point)

The article takes into account that, starting from age 16, a person earns $2000 each summer for four straight summers. Then if invested in a Roth IRA, it will grow, tax-free, for as long as the account exists. All withdrawals from the account after age 59 1/2 will be tax-free. The money grows to $25,917 by age 30, $197,943 by 50, $547,037 by 60 and finally gets over one million by age 67 or $1,114,423 to be exact.

Two problems I see right away. First, getting an average return of 10.7% isn’t as easy as the article says it is. But, then again, some people say the opposite. The article also states that if you invest in small company stocks, whose long-term annual return clocks in at 12.5 percent annually, you will have even more money. Nice to know.

Problem number two, as you’ve probably already guessed, is that one million won’t be one million in 40 years due to a little something called inflation. Im guessing one million in the future might be equal to $250 thousand now. It’s still a nice chunk of change that if properly managed, could support you though your old age. And for only four measly years of saving, could save you a lot of financial trouble down the road. Albeit far, far down the road.

Plus this plan doesn’t have to be set in stone. Don’t stop saving at 16 to have even more waiting for you in 40 years. Or if you didn’t start at 16, who says you can’t start now? The 20s are the new teens anyway…

Also, another good reason to save would be to use it as an emergency fund. Many 20 somethings don’t find jobs straight out of college, or at least, jobs they want to stay at. This cushion of savings can really help take the pressure off when you’re unemployed. And as soon as you land that great job with the corner office and cushy black leather chair, start putting money back into the account. And while you’re at it, send a few bucks my way for giving you the idea.

If you’re a college student it’s safe to say you need money. Believe me, I understand. Students usually live on Ramen and infrequently do their laundry to save every quarter. One of the reasons the must cut back is the outrageous cost of normal college textbooks. The average college student spends about $900 every year on textbooks. Instead of footing the bill again next year, apply for the Chegg Textbook Scholarship and receive $500 in textbook rentals from Chegg, the place to rent college textbooks.

The winner of the Chegg Textbook Scholarship will receive $500 in textbook rentals from Chegg, and with the savings we offer that’s more than a year of free textbooks! Four runner ups will receive $50 each.

But what do I need to apply you ask? You need to write an essay of course; it is an real scholarship after all. The question you must explore in your essay is “What can one student do to help the environment?” The answers need to be submitted by June 20th and must be five-hundred words or less.

Check out the official page with the rules, eligibility and technical stuff at Chegg.com.