As you might know I’m all about automating our finances. I make every effort to make our transactions live in the digital realm so they can happen automatically without us having to worry about them:

– We pay our bills with online bill pay. I setup exception checkpoints so that if bills are larger than normal I get an email or if a payment isn’t made I get a voice mail.

– Our paychecks land in our bank accounts via direct deposit and our investments are made automatically as well.

– My wife and I put most of our purchases on our American Express Blue cash card to help organize and categorize our spending, plus earn credit card rewards.

– We don’t spend a lot of time budgeting, our spending doesn’t vary that much from month to month so we don’t spend a lot of time focusing on how we’re spending our money.

Is this the smartest way to do things? It’s what I’m most comfortable with but a new book from Baker at Man vs Debt called Unautomate Your Finances takes an alternate look at this approach.

Why Not Automate?

I think the line that best sums up Baker’s approach is that “the more you simplify your financial life, the easier it is to take back control”.  He and his wife have been battling consumer debt and have the used the methods he describes in his book to pay it down.  Their approach has been to have as few accounts and as little automation as possible so they can focus all their attention on the money they have, and the money they owe.

Here are some of Baker’s arguments against automating your finances:

• Automatic payments mean that you don’t notice as much what you’re spending your money on
• Automation makes your bad habits harder to change by pushing them to the back of your mind

Credit Cards vs Cash

Baker’s not a fan of credit cards and believes that paying in cash can make a real difference in the way you spend your money.   As he says, paying with cash “lowers the time between when you make the purchase and when you ‘analyze’ your spending. “

I’m in the middle of reading a book on behavioral economics called “Why Smart People Make Big Money Mistakes” and research has shown that Baker’s theory is correct. People do spend their money differently when they’re paying with plastic vs paying with cash.

Spending Exorcism

The useful thing about “unautomating” your finances is that you get in touch with every penny you’re spending and come to terms with how you’re using your money.  It’s almost like a debt intervention, or a spending exorcism, or like basic training for your budget. You get down in the mud and track every cent that comes in and out of your possession and ask yourself, “am I really spending money on the things I want in life”?

Why Unautomation?

I didn’t ask Baker why he wrote the book but you get a good feeling for why he might of from one of his early quotes:

“We’re living in upside-down homes, driving upside-down cars, and now even watching upside-down t.v.s on upside-down couches”

I can tell he’s astounded by the enormous amount of consumer debt we’ve accumulated in our country and wants to do his part to help people out with it.

So What’s the Answer?

So how exactly do you unautomate your finances?  Baker goes into a lot of detail about emotion vs. numbers and how to pay off your debt by fighting small battles; not getting overwhelmed by everything at once.  He offers an alternative to Dave Ramsey’s debt snowball called the debt tsunami; which gives you more flexibility about how you pay off your debt.

Baker offers lots of very specific actions and offers worksheets and instructions for:

• Creating a budget
• Following a envelope budgeting system
• Creating an emergency fund
• Deciding whether you want to use credit cards

Taking Action

So would an automation proponent like me consider taking Baker’s approach of buying everything with cash and tracking my purchases with paper and pencil for 30 days?  It makes me squirm to think about it but perhaps that’s an indication that I should take another look at our current process.

I love the automation because it means I don’t have to mess with the recurring bill payments, fund transfers, and trips to to the bank.  But I imagine going through those steps would make me look a little closer and think a little harder about how we spend our money.

I’m not committing to “going native” with my finances but I like Baker’s book because it makes me think about how aware we are of what we’re spending. It also offers tons of action steps we can take to make sure we’re staying on top of our money and Baker does a good job of getting you fired up to take action when you read it.  If you’re looking to get out of debt or get a better handle on what you’re spending then you might want to check out Unautomate Your Finances.

QuickBooks is the best accounting software for procrastinators like me!  I spent part of Sunday working on my business financials for last year (which I should have done sooner) and QuickBooks made it easy for me to get my business accounts up to speed. 

When I sat down yesterday morning I was dreading the process of creating all the ledger entries and entering all the transactions but by the end of the day my bookkeping for the year was done and I was reminded of why I love Quickbooks for accounting software.

I’ve been using the QuickBooks Pro version for a few years now and unfortunately I always seem to put off entering my data much longer than I should.  Typically I set aside an afternoon to work through months and months of getting my small business information in order.  QuickBooks makes the process much less painful than it would be otherwise; here are three of my favorite things about the software.

Transaction Imports

Entering data stinks. It not only opens the door to entry errors but it also takes up time that I could spend doing other things.  I was able to download information from my bank accounts (WebConnect format) and PayPal (IIF format) and upload them right into QuickBooks.

Unfortunately, Chase only lets you download the last 90 days of credit card transactions and I needed data from all of last year so I had to manually input those ledger entries those myself.  Note to Chase, please provide more than 90 days of credit card data download, everyone else is doing it : )

Import File Examples

Not all vendors offer the option of downloading WebConnect or IIF files but most allow you to download csv or Excel files and QuickBooks can accept those as well.

If you’re wondering about the file types, QuickBooks WebConnect usually has a .qbo extension and contains your transactions in an OFX format.  You’ll probably never need to look at the contents of the file but if you’re curious, an entry from your bank might look something like this:

     <STMTTRN>
      <TRNTYPE>CHECK
      <DTPOSTED>20090303120000.000
      <TRNAMT>-305.45
      <FITID>4021400009
      <CHECKNUM>1569
      <NAME>CHECK
     </STMTTRN>

An IIF file stands for Intuit Interchange File. A transaction in IIF format for a payment you made would look something like this:

TRNS ”4/13/2009″ ”Paypal” ”US Postal Service” ”Payment Sent” -6.12 
SPL ”4/13/2009″ ”Shipping Expenses” ”US Postal Service” 6.12
ENDTRNS

As I mentioned above, QuickBooks can also handle csv and Microsoft Excel files if your vendor doesn’t offer IIF or WebConnect.  You can import a range of business data, such as:

• Vendor bills
• Cash sales
• Cash refunds
• Checks
• Credit card transactions
• Deposits
• General journal entries
• Invoices
• Payments from customers
• Purchase orders

Business Reports

Once you upload or manually enter your transactions you can use QuickBooks to generate whatever business reports you need by selecting Report Center from the top menu.

There are many different types of reports available, as you can see in the graphic to the right, but the ones I use it for are the Financial reports.  You can generate the standard financial statements shown below:

• Profit & Loss
• Income and Expenses
• Balance Sheet & Net Worth
• Cash Flow
• Balance Sheet

The reports can give you insight to help you make business decisions and are also great come tax time.  QuickBooks defines these standard financial reports for you and then also lets you customize them as well.

What I love is that once you import/enter your data, you can slice it and dice it how you want and generate summary reports for interested parties, such as your accountant.

QuickBooks Support

Every business has a variety of needs and different types of data.  This means that we also run into a variety issues when trying to wrangle that data into something meaningful. For example, I had a problem importing one of my IIF files because the data in one of the records was funky.  What’s great about QuickBooks is that I was able to search online and find an answer to my problem right away.

In another example, in years past I had been using a convoluted method to tell QuickBooks that I had transferred money from one account to another but a web search revealed a much simpler way of doing it (Using the Banking -> Transfer Funds menu).

Although I usually start with the Quickbooks built in help reference, I typically end up searching online for answers to problems.  Many times those searches lead me to the Quickbook forums, where other users have run into the same issue and other users have shared their solutions.  Here’s an example of some of the topics covered in the QuickBooks forums.

If you’re really stumped, you can always turn to other people that have extensive knowledge of QuickBooks.  Since it’s so widely used, there are tons of people that have a lot of experience with the software and will solve your problem for a relatively small fee. Of course, no one likes to spend money but if you’ve been hassling with an issue for a while and need to get back to work, getting help may be worth the money.  Intuit’s created the QuickBooks ProAdvisor® Program where users can become QuickBooks certified so you know that if you hire with them they should be able to get you sorted out relatively quickly and easily.

QuickBooks Software Versions

Anyhow, in case you can’t tell, I’m really pleased with QuickBooks and how it helps me in my business.  I’m glad to have my financial reports all finished up in time for the tax deadline. Don’t forget the tax filing deadline for corporate tax returns (Forms 1120, 1120A, and 1120S) is coming up, March 16^th!

If you’re interested in testing out QuickBooks, you don’t have to use the Pro Version like I do. Intuit offers QuickBooks Online that you can try out for a month for free to see if you like it. 

They also offer the more basic QuickBooks SimpleStart which is cheaper, although it doesn’t have all the same import and transaction download features as QuickBooks Pro and only offers about a 1/10th of the reports. 

I’ve never used QuickBooks Premier so I can’t speak to it’s benefits over the Pro version but from what I’ve read the Premier version offers business planning, the ability to forecast sales & expenses, and industry specific reports.  Here’s more information on the different QuickBooks versions:

• QuickBooks Online
• QuickBooks SimpleStart
• QuickBooks Pro
• QuickBooks Premier

We covered money from a few different angles here on Money Smart Life last month.  As you’re probably aware, the primary focus was on taxes; however we did touch on some health insurance, retirement, and career topics as well.  Here’s a look at some of the articles from last month and after that I’ll talk a little about what you can expect this month.

Taxes

• Online Tax Software Success
• 2010 Federal Tax Brackets
• Common Income Tax Problems
• How to File Taxes Online
• Tax Credits for 2009
• Turbo Tax Review
• Turbo Tax Free Trial

Health Insurance

Health insurance is a major issue for all Americans because we all get sick or injured at some point and costs of dealing with these issues continue to go up.  We’ve realized this more since we’ve added a few more dependents onto our health insurance plan and I talked about the cost of sick kids. 

I also looked at how high deductible health insurance plans are not for everyone.  If you’re young and healthy you can build up a nice bundle of pre-tax money but if you have a lot of health issues it can really suck your wallet dry.

Retirement

This year brought some new Roth IRA rules that we go int a little more detail on. Mike Piper from Oblivious Investor warned us about IRA mistakes, specifically 9 sneaky ones that you’ll want to avoid.

Career

Referrals are often the best way to get your foot in the door, especially when not many companies are hiring. I shared some tips on how to refer a friend for a job when you don’t know a whole about their qualifications.  I had some changes in my job so I dug into the difference between exempt employees vs non-exempt employees.

Personal Finance

Then there were a few more that span a number of topics such as kids and money, marriage and money, paying for graduate school, and a credit card scare that left my heart racing!

Coming Soon…

Taxes

So what’s next?  Well taxes are due in a little over a month so we’ll touch on more tax topics.  Next week we’ll hear from the people at H&R Block talking about their H&R Block at Home software.  We’ll be giving away a few copies of the software, so be sure to get updates so you can put your name in for one of them.

Health Insurance

I’ll also have a follow up on the high deductible health insurance plan post from last month. A reader named Ted left an interesting comment that I followd up on and he’s going to share his health insurance experiences with us.

I also have a LOT to talk about in terms of health insurance.  I’m still going back and forth between the hospital and our insurance company on bills for our daughter’s birth, almost a year later. Right now, we’ve been stuck with over $11,000 of bills that should have been covered by insurance. 

I’ve been fighting to get the issues resolved and thnink it will be in the next few weeks. I’ll share some tips on how I’ve dealt with being stuck between the insurance company and the hospital.

Have a great weekend!

How can you check on your IRS tax refund after you’ve filed your taxes and are waiting to get money back?  Below is a tax refund schedule from TaxACT that shows an approximation of when your refund check should be mailed or direct deposit put into your bank account based on the date range that you filed your taxes.

Where is Your Tax Refund?

There are two ways to get your tax refund, through direct deposit or as a paper check in the mail.  As you can see from the table above, you’ll get your refund much faster if you eFile and choose the direct deposit option.

Here are the general time frames that it takes for you to get your refund once the IRS recieves your tax return:

• Paper File – 6 Weeks
• eFile – 3 Weeks
• Amended Returns – 8 to 12 Weeks

If your refund is taking longer than expected it could be because you made a mis-calculation while computing figures on your tax form and that you may get less back than you’d expected or nothing at all.  Or you might have made an error on your tax return such as accidentally switching digits in your social security number or some other typo.

So how do you know if there was a problem with your return or if it’s just taking awhile to get your refund back? The IRS has a number of ways that you can check on the status of your tax refund.

Tracking Your Tax Refund

IRS Website

Regardless of whether you filed electronically or not, you can use the IRS website to check the status of your refund.  The IRS has a tool called Where’s My Refund? that asks for your social security number, filing status, and the refund amount from your tax return.

If your refund has already been sent, you’ll get back the date it was mailed or deposited into your account.  If it hasn’t then the IRS will basically just tell you that they got return and are still working on it.  If they already tried to mail you the refund but it came back undeliverable they’ll indicate that as well.

If the Where’s My Refund tool doesn’t recognize the information you enter, it’ll then ask you for the specific date you filed and whether it was a paper or electronic filing.  If they still can’t find your information the Where’s My Refund tool will give you a reference number and ask you to call them at 1-800-829-0582, extension 362.

The IRS suggests that you wait to use Where’s My Refund at least 72 hours after electronic filing or 3 weeks after paper filing.  You can try it earlier but chances are your return is still being processed and won’t have status information to report.

IRS Phone Number

If you don’t have access to the Internet, you can also check the status of your tax refund by phone at one of the two numbers:

• IRS Refund Hotline: 1–800-829-1954
• IRS TeleTax System: 1–800-829-4477

Are Tax Refunds Taxable Income?

If you got a tax refund last year, will it be taxed this year?  The answer, as is the case with most personal finance questions, is that it depends. If you recieved a federal refund it’s not considered taxable income on your federal tax return.

However, if you itemized your deductions on your federal return and claimed a deduction for state and local taxes last year, then you may have to pay taxes on a portion of that refund.  There will be a tax refund worksheet as part of your tax form 1040 that helps you determine the how much of your state tax refund is taxable. The good news is that if didn’t itemize and you claimed the standard deduction on your federal tax return last year, your state tax refund is not taxable.

I’ve been an exempt employee ever since my first job out of college.  For a long time I didn’t really know the details about the labor laws behind exempt vs non-exempt; all I knew is that it meant I wasn’t paid overtime wages for all the late nights and long weekends that I worked.

Once we started a family I became less and less satisfied as a salaried employee, consistently working long hours without overtime pay in the hopes that someday I’d get a promotion.  The late nights at work stopped seeming like a challenge and instead became time away from our new baby and my stressed out wife.

I started searching for a new job and after a relatively short job hunt I was able to find a company that offered a much improved work situation than the one I was in.  I couldn’t belive my ears in the interview when they told me that it was a salaried position but also paid overtime for any hours worked over 40 a week!  At that point I went home and did a little research on the exempt vs non-exempt topic.

Fair Labor Standards Act

The Fair Labor Stanards Acto (FLSA) is a federal law that determines minimum wage and overtime pay guidlines and is enforced by the Wage and Hour Division of the U.S. Department of Labor.

The FLSA allows employers to exempt employees from certain parts of the Act; for example, minimum wage and overtime pay regulations. This is where the term exempt and non-exempt comes from, certain types of jobs are exempt from some of the rules laid out in the FLSA.

Exempt Employees

So how do companies determine which of their employees can be considered exempt?  Although there was general language describing who is exempt in Section 13 (a)(1) of the FLSA, it wasn’t specific enough for the Department of Labor as they tried to enforce the Act so Congress more provided more detail with 29 CFR Part 541.

The main determining factors for whether you’re exempt has to do with the specific tasks that you do in your job and how those full under 29 CFR Part 541.  They also look at whether you’re hourly or salaried and the level of your salary for the work you do.  The typical exemptions have become known as “white collar” exemptions and cover people in these roles:

• Executive
• Administrative
• Professional
• Computer Employees
• Outside Sales

Clear as mud, right? I guess that’s why corporations pay human resources specialists the big bucks to interpret the laws around FLSA and determine who is exempt. There is an additional exemption for “highly compensated” employees who are paid at least $100,000 a year.  I guess they figured if you earning that much then you don’t need to be paid overtime : )

Benefit of Being Exempt

One of the benefits of being an exempt employee is that your company is supposed to pay your salary even if they don’t have work for you to do:

“If the employee is ready, willing and ble to work, deductions may not be made for time when work is not available.” -  Salary Basis

I’m not familiar with all the labor laws but if weeks went by and my employer didn’t have any work for me then I’d start worrying that my job might get cut. However, for cases where you’re in between projects or clients and don’t have much to do for a week, if you’re an exempt employee then you still get paid your agreed upon salary.

Non Exempt Employees

So who are non-exempt employees?  The simplest answer is obviously anyone who doesn’t qualify for exemption under the terms described in the previous section.

Most of the time, jobs for non-exempt employees are hourly positions and typically follow a routine, with set standards and rules.  If you’re a non-exempt employee then you should be paid overtime, which is generally one and one-half the your regular pay rate for all hours worked over 40 in a week.  State law takes precedence over the federal law if it benefits the employee, so be sure to check your state employment laws to see what overtime rates should be.

Hybrid Employee

As I mentioned earlier, in my current job I’m classified as an exempt employee. However, the human resources department actually created a type of hybrid situation where my job title was also eligible for overtime pay.

It turns out I wasn’t required to work the late nights and long weekends necessary in my old job so I didn’t see any increase in pay from this policy when I started with the company.  This was fine with me because my whole point in quitting my job and getting a new one was to spend more time with my family.

Just last week, I found out that human resources had done a study of other companies and job titles in our industry and determined that making my group eligible for overtime pay wasn’t necessary. So the policy will be be changing in the future and I’ll no longer be a hybrid, exempt employee that gets paid overtime.  However, it’s something to keep in mind as you look for jobs.  It may not be widespread but there could be other jobs out there where you can have your cake (salaried employee) and eat it too (get paid overtime if you work more than 40 hours a week).

Hopefully this look at exempt vs non-exempt employees has been useful and I hope that no matter your job classification you don’t have to work overtime!

Angies List is celebrating their 15^th year online and is offering a coupon code that can earn you some cash and save your friends some money as well.

If you’ve never heard of the service, a while back I wrote up an Angies List review and also list some angies list coupon codes you can use to get a discount on the service.  I’m a member and actually used it not long ago when our dishwasher stopped working and flooded with water one night.  The service helped me find a good local appliance place to get the dishwasher taken care of right away.  I haven’t written about it on the site yet but I did tell some friends and co-workers about the incident.

Which brings me back to the anniversary deal that they’re offering.  If you’re a member of the site, you can use their referral form (shown below) to tell your friends about this Angies List promotion.

If they sign up for Angies List with the coupon code CELEBRATE then they’ll save 15% off of their membership. You could just email them directly but if you use the referral form that I showed you above, you’ll also get $15 if they decide to become a member.

Angies List Referrals

I wouldn’t email everyone in your address book about it because most people probably wouldn’t care and might get irritated with you clogging up their inbox.  I’d only use it if you have a few people you think might be interested.

For example, as I mentioned earlier, I talked about my recent dishwasher experience on Angies List with several friends and co-workers. A few of them sounded interested in seeing if there was a free trial or discount they could use to try it out for themselves.

Angies List Promotion

So to recap. If you’re a member you can earn $15 for each person you refer; the link is on the site under the “Member Resources” menu and is called “Invite a Friend”.

If you’re not a member and want to give it a try, you can get a discount with the angies list coupon code CELEBRATE.  The promotion is only for a limited time, if the promo code has expired by the time you read this then check out the other angies list coupon codes.

Online tax software is becoming more popular each year for people looking to file their federal income tax returns on their own.  Compete, a company that measures website visitors across the Internet, released a report this month that showed 11.5% more consumers visting the category of “Accountancy and Tax Service” sites than the previous year.

All three of the main online tax prep software sites saw more visitors than the year prior, with Tax ACT seeing a huge increase:

• Tax ACT – Up 42%
• Turbo Tax – Up 15%
• H&R Block – Up 15%

Of course, it’s no surprise that online tax software websites had a big increase in the number of visitors in January that’s when tax season starts nbsp;but the increase from previous years is what points to more people filing online. 

Traditional Tax Prep vs. Online Tax Filing

A recent Wall Street Journal article (trial subscription required) takes a look at how traditional tax prep companies are losing customers to online tax software.  While companies like Jackson Hewitt are suggesting that the bad economy has more people paying less to do their taxes themselves online; the tone of the article suggests that the shift to online tax filing is a long term trend that brick and mortar tax prep businesses should be concerned about.

Why Online Tax Software? 

So why are more people moving to online tax software vs desktop tax software or manually filing?  Here are a few things that come to mind.

Convenience – The first reason I can think of is that online filing is certainly more convienent than having to go to the store and buy tax software and then install it on your computer. All you have to do is open your browser and you can get started in just a minute or two.

Broadband – A few years ago this might not have been as feasible since more people had slower internet connections. Can you imagine trying to prepare your taxes using dial-up, I’d rather have my fingernails pulled out than have to sit through that frustration!

Promotion – Companies like Intuit and H&R Block are really emphasizing online tax filing.  For example, when I watched an episode of the show LOST on HULU a few weeks ago, H&R Block at Home was the exclusive advertiser for the program. I think the companie are also doing a good job of reaching out and interacting online.  For example, this interview I did with Intuit Vice President Bob Meighan about TurboTax online and also the presence of Intuit employees on social media sites.

Cost – I don’t know if this is the case but I imagine that offering the software online lowers the cost of delivering the product.  Of course, what the companies do with the cost savings is up to them but they could use it to help out and attract customers with things like the H&R Block at Home discount weekend.

If you do your own taxes, are you using online tax software? If not, what are some of the reasons?

Turbo Tax Review

I’ve used Intuit’s TurboTax to file my income taxes for the last five years. During that time, I’ve used a few different versions including the desktop and online versions of the software. I like the online version the best, and currently use the TurboTax Home and Business to handle my business filing needs. This year, I’m also going to give the TurboTax Business version a try to file taxes for my multi-member LLC.

Thanks to contributing writer, Debbie, for sharing her experiences with TurboTax.

TurboTax Free Trial

One of my favorite features is the ability to start using the online version for free. You can create an account on the website, and start entering your information as if you were going to use the software to file.

Just entering information doesn’t mean that you will have to use TurboTax to file your taxes. This let me try it out to see if I would like it before I had to make a decision to pay and use the software to actually file.

TurboTax e-File

I always use the e-file option, because if I’m owed a refund it helps me get it much faster than if I was to print and mail it. The IRS confirms receipt of the tax return within 48 hours, and the refund is processed in about 8 days. Federal e-filing is included in the price of your choice of TurboTax software – but if you want to e-file your State return, you may have to pay additional depending on where you live.

TurboTax Interview

When I first started filing my own taxes I didn’t know much about it. TurboTax literally takes you through your information one step at a time, telling you what information you need to gather and how to enter it into the software. The software handles all of the actual math and inserting your answers into the appropriate IRS tax forms.

I always go through every section possible, even if I don’t think it applies to me, because I’ve been surprised a few times at deductions I can claim that I would have skipped otherwise.  You don’t have to complete your information all in one sitting, either. You can save your progress and come back to it at a later time if you run out of time or just need to take a break!

Tax Software Challenges

One thing I had trouble with in previous years was finding a specific section to enter information. For example, I wanted to make adjustments to my home office expenses after I had already finished that section, and I had a really hard time finding it. I think for new users of TurboTax, it can be a challenge to navigate around through the sections to find a specific area.

I don’t think Intuit has made any changes to this, but I noticed this year when I went back to enter information I skipped over my first time through the process, it was a lot easier for me to find it. I’m guessing this is due to my experience level with the software now, rather than a change to the software itself because everything seems to be working the same as it has in previous years.

Tax Questions

If while you’re entering information in TurboTax there is something you don’t understand or a question that isn’t answered, you can use the Live Community feature to get help. There are a few options for getting assistance – an interactive agent, a community forum where other users of TurboTax answer each others questions, and a live phone call with a tax expert.

If you choose to make a phone call to a tax expert, it will cost $29 for 20 minutes – but chances are your questions can be answered through the interactive agent or community for free.

Tax Audit Check

I love that when you’ve finished entering all of your information, TurboTax runs a “check”. It will look at everything you’ve entered to see if there are any discrepancies or obvious errors and then takes you to that section within the software to make corrections.

It will also let you know what your audit risk level is based on the information you’ve entered and give you opportunity to purchase optional audit risk insurance. If you purchase the audit risk protection and your return is audited, TurboTax will help you understand why, and help you gather the information you need to provide to the IRS.

Hopefully this TurboTax review was helpful if you still haven’t filed your tax return yet this year and are considering tax prep software. Good luck doing your taxes!

Have you heard the saying, “If you fail to plan, then you should plan to fail”? Well how about making a “no debt plan” to keep yourself out of debt?  Well Kevin, of the blog No Debt Plan, is doing just that; sharing his tips for avoiding debt.

His site is setup to help people with basic financial education. As you can read on his about page, Kevin believes that the American education system doesn’t prepare students adequately for managing their money in the real world.  Kevin’s doing his part to fill in the gaps by sharing what he’s learned about money.  Some of the topics he covers are:

• Budgeting
• Saving for retirement or a rainy day
• Avoiding living paycheck-to-paycheck
• Buying a home

About Kevin

So what does Kevin know about money? Well, in addition to his life experience, he has a Bachelor’s Degree in Business Management and an MBA so he certainly knows how to whip together a spreadsheet.

Kevin’s passionate about showing others how to budget and get their financial situations under control. He’s been writing online since 2008 and has recently been working on a comprehensive guide for staying on top of your credit.

You can keep up with the latest on Kevin from his article feed or on Twitter

No Debt Plan Recent Posts:

• A look at mental mistakes made when I was in debt
• Is mooching off society wrong?
• Reward of working married finances as a team

Here are some other articles to check out from the last week or two around the web:

Valentine’s Day

• 7 Green Valentines Day Gifts Your Girlfriend Will Love @ Bargaineering
• A Frugal Valentine’s Day @ Million Dollar Journey
• Save Money and Celebrate Valentine’s Day for the Right Reasons @ No Debt Plan

Taxes

• How to Take a Property Tax Deduction Without Itemizing @ My Dollar Plan
• Do You Qualify for These 4 New Tax Breaks? @ Money Ning
• 11 Most Commonly Missed Tax Deductions @ Debt Free Adventure
• First Time Home Buyers Tax Credit – Who It’s For And What Is Needed To Claim It @ Free From Broke
• How To Generate and Issue Your Own 1099-MISC Forms @ My Money Blog

Investing & Retirement

• Social Security What You Need to Know About Benefits, Coverage, and Eligibility @ Generation X Finance
• How to Open An IRA Account @ Suns Financial Diary
• Save for Retirement With a Spousal IRA @ Five Cent Nickel
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• What Should I Do if My Toyota Has Been Recalled? @ Being Frugal
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• 2010 Federal Tax Brackets in Personal Finance @ Budgets are Sexy

Graduate school costs are an expense that’s tough to afford. If you need additional skills or a master’s degree to keep your job or advance at work, how can you afford to pay for grad school?

Costs & Benefits of Graduate School

U.S. News & World Report looked at some of the best graduate schools and found that  today’s average master’s degree holder earns an average annual salary of $52,000 compared to $42,000 for someone with an undergraduate degree. For those who’ve earned professional degrees such as law or medicine they can earn an average of about $82,000.

Yet costs can vary widely among U.S. graduate schools. Some average a few thousand dollars a semester in tuition – not cheap, but doable for many working people. However, Business Week estimated last December that the average tuition for a two-year MBA program now tops $60,000 – that doesn’t include room, board or other fees. So for top graduate schools in many fields – not just business – the whole graduate school bill can easily top $100,000.

Does Graduate School Make Sense for You?

No doubt about it, graduate school is certainly a big commitment.  It’s not just expensive, it also takes a big chunk of your time.  When I went back to school to get a Master’s degree I took night classes since I worked all day.  Most nights I wasn’t in class I spent doing homework and often worked over the weekends as well.   Before you decide to take on the expense and work load of graduate school here are some questions to consider:

1. Have I researched my career field fully to determine whether a graduate degree in this subject will improve my earnings and professional advancement? If I have significant experience in my chosen field, do I really need the degree?

2. How quickly do graduates from my school of choice find employment and what is the average opening salary in my chosen field?

3. Do I have the time and focus to attend school while I’m working, and have I set a reasonable deadline to graduate? Will it place an burden on my family, career or social life?

Dealing with the Cost of Graduate School

If you’ve already decided the school or schools you’ll apply to, then the next step is to determine how you’ll whittle down what you’ll spend to get that diploma. One of the first steps in that process is to evaluate your total financial picture. Many early and mid-career students have additional expenses to consider, not the least of which includes family.  Here are some ways that you can reduce the cost of graduate school.

Investigate endowments: A university’s endowment is its nest egg – a pile of investment dollars that produce investment income going to a variety of purposes. One of those purposes is grants and scholarships, the most attractive form of college aid because students don’t have to pay that assistance back as they would a loan.

Check on fellowships and assistantships: Depending on the advanced degree you’re going for, you might be able to fund your education through fellowships or assistantships. Fellowships are a sum of money awarded to promising students that can go toward paying tuition and room and board. Generally, they are awarded on the basis of merit and don’t have a work requirement.

Assistantships are a bit like a prestigious work-study program. Students who have a promising future are awarded a stipend or salary based on 10-20 hours a week of helping professors grade papers, conduct research, teach classes or supervise lab or workshop courses. Of course, any student considering these options also needs to consider whether they can support the workload while excelling in class.

Borrow smart: Most undergraduates exit college with debt in excess of $20,000, so without a pile of savings built up from their careers, most grad students end up borrowing heavily. The National Center for Education Statistics reports that based on 2004 data, 73 percent of all graduate students received some form of financial aid with an average amount of $15,100.

Generally it’s smart to tap all government-sponsored lending programs before turning to private borrowings. Stafford loans are generally the cheapest way to go with lifetime average. Subsidized lending rates for the 2009-2010 school year are currently at 5.6 percent (the unsubsidized rate is 6.8 percent), and their lifetime borrowing limits are at $138,500 for most degree programs and up to $224,000 for health professionals who spend the most on their education.

Check your qualifications for tax credits: Recent economic stimulus legislation has loosened up more tax benefits for new and returning students. The new American Opportunity Credit allows a rebate of up to $2,500 for each qualifying student in a family for the first four years of college.

The full credit is available to individuals whose modified adjusted gross income is $80,000 or less or $160,000 for married taxpayers. This replaces the $2,000 Hope credit for the first two years of school and the Lifetime Learning credit that applies at a lower amount afterward.

Get your employer to pitch in: Take advantage of every educational break you can take before you leave your company. If they require you to stay in your job a certain amount of time after accepting that aid or attaining your degree, work that into your plan.

Check local scholarships and grants: See if there are sources of grants and scholarships not only in your community, but also within your industry. Go online and do a general search for such aid among local nonprofits and professional organizations.

Consider a functional degree. All sorts of colleges – even the nation’s most prestigious schools – are considering abbreviated graduate and post-graduate programs that give students exactly the amount of education to upgrade their skills and head back into the workforce. In other words, if one year of college will do, why pay for two or more?

Get that PhD: If you’re in a field where a Ph.D means something – better job, more money, or both, then go for it because funding options might actually be more plentiful. Colleges want the best possible students in their Ph.D programs and load on tuition and living benefits to make sure that they choose their program and more important, that they complete those degrees.

This article on graduate school costs and options was produced in association with the Financial Planning Association (FPA), the leadership and advocacy organization connecting those who provide, support and benefit from professional financial planning.