Money & Finance #59: Credit, Money Management, and Saving

What a Good Fico score looks like!

Read the article How Credit Scores Work - Ok the article says " Fair Isaac and Company, which developed the score, felt that the score would only confuse consumers since there was nothing to tell them what it meant or what lenders were looking for." I don't know who they think they are kidding I don't believe for a minute that's why credit scores used to be hidden from consumers. And even now that they are available, we must pay and it's not inexpensive. IMHO, I think they should charge the business for accessing our credit scores and if they already do then charge them more! and not charge the consumer at all (it's their information after all). Then companies might think twice about offering credit so easily and ultimatley the consumers may be in less trouble. Thankfully I have good credit not because of anything I've gone out of my way to do just used common sense and paid back what I borrowed when I said I would. However I can see where this would be helpful information to someone who didn't know about credit and how it works, got into a bit of trouble and is now trying to work their way out of the problem. I took the Credit Score Quiz and scored a 10 out of 10.

I've never made a formal spending or budget plan but I looked around at the resources listed in the blog. The one you can complete in about an hour looks pretty basic and easy. It really is wise to know how much you make, how much you spend on absolute necessities, how much you spend on things you don't really need and how much is left over and what you are doing with it. Everyone should have an education on budgeting and managing your money. If I were to make a formal spending plan I would use the Quicken software that we have and use for daily. Once in awhile my husband and I will say to each other hey where's all the money going and we'll sit down and run a few reports on Quicken and it will tell us and we'll say hey, we really need to cut back on eating out, buying gifts, boy that phone bill is out of line with all the others did we (teenagers) go over? or that water bill looks high do we have a leak? etc...

With regards to the TCDRS site I did check it out and was happy to find that even though I am part-time I may still receive retirement benefits. Now start the countdown...29 years, 9 months, and 29 days to go....

Money & Finance #58: Banking, Budgeting, and Spending

The first thing I did was of course take the quiz; I love taking quizzes. I scored a 70 on the quiz and it said "You've got a solid grip on your finances."
On to the exercises....

• Yes, our bank offers free online banking and we use it regularly. I only use online banking from my home computer which is not a shared computer. I like that you can see images of the checks written so in case you forgot to write the complete information done I can still enter it in Quicken with the complete information. In addition to the user name and password they use a sitekey as well.


• We use Quicken and have for years. I like that it is only on my computer and I don't have to upload all the information to a website to track my spending. When you enter expenditures in Quicken you categorize everything so whenever you want you can see where your money is going. For example, you can ask for all restaurant purchases in specfic time frame and see what you've spent eating out. If I were to use one of the budgeting tools I would probably use Mint because"Mint is led by an experienced team including industry veterans drawn from the ranks of Charles Schwab, eBay, Expedia, Intuit, PGP and other leaders in the finance, security and software industries." I don't think I'd use expensr because of the social networking aspect. "The idea behind the social networking aspect is depending on your tags and categories you can compare yourself against other persons similar to your financial situation and as a result determine whether your spending practices are good or bad." I don't think my financial decisions can be determined if they are good or bad based on how they stack up to persons similar to my financial situation. I feel confident that my financial decisions are right for me but not necessarily everyone in my "financial situation" and the same goes for others financial decisions maybe be right for them but not me. I'd also want to know more about Shawn Gupta and Reman Child before I used expenr. Wesabe's executives, directors and advisors appear impressive so they might be second in line to Mint if I were to ever use one of these online tools. Foonance looks like the bargain basement alternative to online budget software. I couldn't even explore the site without logging in. Buxfer - good visuals but the professional "Team" consists of one guy? Shashank Pandit who is "currently on leave until Buxfer makes me rich or bankrupt." Spendji may know what they are doing when it comes to financial services and entrepreneurship but they didn't know what they were doing when they loaded a video to their website that is a copyright infringment. Rippleplay sounds like a system very similar to your mortage company selling your mortage and how some financial analysts try and explain how we got in the financial mess were in now. It almost makes for humorous reading. Scred didn't look helpful to me at all because I never do anything with others in which there is a financial obligation so complicated that we would need software to assist us.


• From the CR article - I've aways questioned this advice. "Shop around for the lowest gasoline prices. One way to do that before leaving the house is to check http://www.fueleconomy.gov/ for a list of Web sites where motorists can report and check out the latest prices by location." But how do you decide when to drive further for a better price? I buy gas from the Kroger's that is just outside my subdivision and generally notice when looking at prices at other stations while driving around that the price I pay there is right in line with the other places. I know gas is expensive but my time is valuable too and spending time researching the best price on gas and then driving to get it seems to be alittle overkill but to make sure I went ahead and checked the website just to see how much of a difference in price stations could be and how far away I'd be driving to get this less expensive gas. So the last time I filled up I paid $1.82 ($1.85 less my .03 discount for using my Kroger card). According to the gas price chart the cheapest place to get gas in my zip code is at Murphy USA @ 290 and Cypress Rosehill @ $1.78. According to Google Maps that is 6.6 miles and 17 minutes from my house. I work in the opposite direction and if you've ever been near the intersection of 290 & Spring Cypress you would avoid it like the plague, trust me. Buc-ee's has gas for $1.81 but that is even further away and would still require I drive past the dreaded intersection of Spring Cypress & 290. Kroger's, H.E.B and Randalls came in next with prices of $1.81, $1.82 and $1.83 respectively but all of these are off 290 and again in the opposite direction of my work or any places I frequent so they would all require a special trip which goes against the "plan your outings" advice from the same CR article. So I think I'll stick with my neighborhood Kroger and spend the time I save researching gas prices deciding what to make for dinner. Read the article on ways to cut back on your speam ending. Blog about 2 or 3 ideas mentioned that you'd like to incorporate/implement into your financial plan.


• Groceries - I spend what I spend and my kids still say "there is never anything to eat here."


• Utilities - My thermostat is on 65 in the winter and 78 in the summer. Hmmm....


• Phone, Internet, TV - As far as I am concerned it is all overpriced! Ok maybe you can save lots of money with promotional rates but when the promotion is over you have to keep switching and that takes time waiting while your put on hold to cancel the old service and sign up for the new service. Whatever happened to paying for loyalty? Taking advantage of promotional rates is something I just don't have the time or patience to deal with especially since you really do have to read the fine print and sometimes that is similar to reading assembly instructions written by a technical writer.


• Personal finance - I never use ATM machines unless they are my own banks even then I almost always go in the bank. I don't like to pay any fees at all. I've never paid any fees for banking as I used a credit union from the time I opened my first account till I moved to TX. Even though I still have the credit union at home as my main bank, we did open a local bank account and until recently it was "free" as well. However when we paid down a loan we have with them to under a certain limit (set by them) our accounts were no longer free. So let's see we were penalized for paying back our debt. That doesn't make sense, it would seem to me that's the kind of customers they want, ones that take out large loans and actually pay them back as opposed to those who don't pay them back. Suddenly our monthly bank statements had $20.00 maintenace fees on them that were never there before. Whatever happened to keeping the customers you have? It seems to be all about getting new customers. Again I don't have the time or patience to be switching banks very couple of years.


• Insurance - We did our homework when we shopped for our home owners and car insurance when we moved to TX. I marked that off my list then and frankly I've never had any reason to put it back on the list. I like our coverage, our company and the service they provide. Our rates have flucuated and again I suppose we could have saved some money by switching around but I value the security I have knowing that our insurance premiums are taken directly from our bank regularly and it's one less thing to worry about.


• Health care - my health care alternatives are decided upon by my insurance. The only decision I can make is whether or not to go to the doctor's, get the prescription filled, or go to the hospital.

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Ever wonder what the "I'm Feeling Lucky" tab on Google is?

I found this on Wikipedia explaining how Google loses $110 million a year as a result of this feature.

"Google's homepage includes a button labeled "I'm Feeling Lucky". When a user clicks on the button the user will be taken directly to the first search result, bypassing the search engine results page. The thought is that, if a user is "feeling lucky", the search engine will return the perfect match the first time without having to page through the search results.
According to a study by Tom Chavez of "Rapt", this feature costs Google $110 million a year as 1% of all searches use this feature and bypass all advertising."

Pot Luck #57: TXT U L8R - Texting

Text messaging is essential when you have teenagers, sometimes it's the only form of communication in our house. I can confirm what the NYT article states "Many teenagers prefer them to actually talking." I have had my woes with my own personal cell phone and right now I do not have a working cell phone despite a $178.00 monthly bill. When we text we don't use lingo but we do use abbreviations so we don't exceed text length and for ease of typing, though the girls have a full keyboard on their phones, I do not and it's much easier to type r instead of are. When texting you lose some key parts of the communication process, including body language, facial expressions, eye contact, voice quality, emotion, and speaking style including rhythm, intonation and stress; which can alter the way the receiver decodes the message considerably. With these elements lacking it can be vital that your message is as clear and concise as possible so keeping the lingo to a minimum when the message is important might be something you want to consider. I think the best thing about text messaging is you can get a message to someone without interrupting what they are doing like a phone call. Receiving a text message is also alot easier than retrieving your voice mail messages. So as a sender and a receiver I prefer text messages to voice in many situations. I don't however want it to take the place of voice communication all the time. There are still some things that I don't want to find out about via a text message, (someone's died, someone's been in an accident, I'm fired, etc..) There are still some things that must be conveyed verbally.
In regards to my thoughts on the New York Times article:

• I liked what Caitlin Williams said, "We are not at a point where there are a whole lot of rules for proper etiquette for texting. I think as it becomes a more acceptable form of communication, people will regulate themselves a little more" except I don't think it's a matter of time I think it's a person's willingness to adopt the rules of etiquette. Cell phones have been around for years now and there are still many people who conduct their business on their cell phone in public.
• "Usage controls were developed at the request of customers" according to Jack McArtney who says, “We know of some people who want to keep the kid’s phone from buzzing all night. They want them to get some sleep.” Hello parents? be parents and take the phone away if it's interferring with a good nights sleep, or what about turning if off? The on/off switch is the most important usage control and it's already a feature of your phone so no new developments necessary.
• Concerning safety - texting, like anything else that requires your attention (listening to music, talking on the phone) while trying to do anything else like driving, walking, even working out, is going to take your attention away from your primary activity and has potential problems. Yes, you can sometimes do two things at once but not always. If someone runs out between parked cars while your driving and your eyes are not on the road because your looking at your phone or even adjusting your radio station your level of attention is not the same as it would be if you were just driving. Does that mean we need laws governing our use of our cell phones while driving? I don't know the answer to that. I have been behind a driver who is not driving as attentively because they are on their phone and yes, that frustrates me to no end but do I pull over every time I get a call or place a text? No, I honestly can say I don't do that either. But then there are speed limits too and I don't always stick to those either. So laws may be one way to discourage an activity but it's not foolproof.
• Another kind of safety that you may not have considered when you provided your child with a cell phone. "We found that 44 percent of the high school boys that we have polled have seen at least one naked picture of a female classmate, and the boys are sharing their pictures too," Aftab said. Even if your children are not the ones photographed they may be sent these photos and view them without realizing what they are about to see. And if they are among those participating in sexting, Mark Rasch, a former cybercrime prosecutor for the Justice Department says it best. “The combination of poorly drafted laws, new technologies, draconian and inflexible punishments, and teenage hormones make for potentially disastrous results.”