Making a Personal Finance Calendar

personal finance calendarAre you a planner? Do you thirst for having the right information that can help you?

I know I tend to be this way, as it just happens to be how I roll.  Not for everyone, but planning ahead and having the right data gives me a feeling (perception?) of control and also points me in the right direction.  Making plans specific, without being too rigid, can also be really helpful.

Many of us tend to this sort of thing with our daily lives.  As in, putting together to-do lists for a day or maybe a week.  These lists can take on many different forms, including prioritization and such, but the main idea is that we make an informed plan.  It works for me, how about you?

How about taking this concept and applying it to our finances, while taking a full-year perspective?  I think this allows us to think holistically, and take into account all the factors that go into helping us get to where we want to go.  There can be so many aspects to personal finance that we don’t think of at any one moment, that planning things out a bit can get us structured.  Also, this can help us avoid wasted time in self-created crises or in dealing with minutia later.

Here is one way it could be done:

Step 1 – Assess Your Current Financial Situation

Take a look at your personal balance sheet, in terms of assets and liabilities.  Document everything, and have a clear understanding of where you are with your finances at present.

Also, try to examine your income and expenses.  If you’re tracking your expenses, it won’t be tough to get an understanding of how and where you’re spending money.  Either way, it’s good to know what your major payments are, and which ones are recurring.

Step 2 – Look at your Long-Term Goals

Once you’ve completed step one, and taken a realistic look at your assets, liabilities, income, and expenses, you can look at goals.  Here is where we can understand the bigger picture goals on where we are aiming, longer-term.  This will help us shape intermediate decisions.

Step 3 – Look at your Short-Term Goals

If we know where we are now and where we want to be long-term, we can start to assemble short-term goals.  I look at short-term goals as starting with 1-year, and then breaking it down to quarterly and then monthly goals.  For example, in order to save $10,000 per year, a person might want to target $2,500 per quarter.  Then, this can be broken down to monthly goals.

Step 4 – Set up the Calendar

Building upon the first 3 steps, we can go month-by-month and map out what we plan to do.  This can include specific goals AND different action steps.

Here is one example (of many possible):

January

  • Document steps 1-3
  • Make appointment with tax professional
  • Target new job opportunities
  • Cut dining out by 50%, to establish improved habits

February

  • Make sure to collect all necessary tax documents
  • Review your 401(k) contribution percentages
  • Plan and book summer vacation in advance, to secure good prices
  • Get a copy of your credit report, check for errors and see where you stand

March

  • Complete and file your taxes
  • Start new side hustle
  • Actively network for new job

April

  • Do spring cleaning, purge unwanted items from your home (either sell or donate)
  • Secure new job

May

  • Rebalance your portfolio
  • Examine the 529 or other college savings accounts you might have for your kids, reevaluate and make any changes as necessary

June

  • Review your current insurance policies, to make sure they meet current needs; also shop for competitive rates
  • Continue to build your side hustle, taking it to the next level

July

  • Do a mid-year review of finances, revisiting steps 1-3 and making adjustments as necessary.
  • Plan and book any holiday or late year traveling to get good rates

August

  • Review 401k contribution percentages
  • Document all of your possessions, taking an inventory for the purpose of insurance or other needs
  • Secure an outstanding mid-year review at work

September

  • Review your estate plan, make sure that you have everything secured, and allocated as you currently wish
  • Get 2nd copy of credit report

October

  • Fall purge – get rid of unwanted clutter, donate or sell items
  • Plan and start your holiday shopping, to make sure you find the best deals and get everything done in time with little stress
  • Continue to build your professional network

November

  • Rebalance your portfolio
  • Examine the 529 or other college savings accounts you might have for your kids, reevaluate and make any changes as necessary

December

  • Make any end of year tax moves that can help you
  • Evaluate your past year, in terms of plan vs. actual results; try to understand what happened and why
  • Take time to be thankful for the good things you do have, spend time with family, and disengage from money thoughts for a while

This is of course simply an example of what a personal finance calendar could look like.  Some of the more general entries (such as “build your professional network”) could probably be made more specific or quantified.  But you get the idea.

Overall, the concept basically involves making a customized plan that works for your individual situation.

Readers, what do you think? 

Do you ever map out your goals and action steps throughout the year?  Do you follow steps 1-4 in any form?

If you had to make a calendar, what are some highlights in terms of how it might look?

Festival of Frugality

cold_winter_dayHello, welcome to this week’s edition of the Festival of Frugality!  Many good articles here, especially if you enjoy saving money.  After all, frugality does have its merits :)

We’ll call this the Winter Cold edition of the festival.  There has been some really cold weather in much of the country, here in the final weeks of Fall.  Yes, it’s still not Winter yet!  Anyway, while the weather is cold, there are some red hot posts below.  Let’s get to them:

Daisy presents How Much Money Did Changing Our Mortgage Frequency Save Us? posted at When Life Give You Lemons.

Christopher presents Bill Harassment, What are your rights posted at This That and The MBA.

Gary presents Jobs With No Experience Required posted at Gajizmo.

Dollar presents Make Money Online With Work At Home Jobs posted at Easy Extra Dollar.

Daniel presents It’s Time To Stop Trying to Keep Up With The Joneses posted at Make Money Make Cents.

Oscar presents Tis the season of giving, right? Wrong! It?s more like the season of shopping and buying things for others. posted at Money is the Root.

Jay presents Five Ways for Parents to Save on Tutoring posted at Daily Fuel Economy Tip.

Jack presents Old Fashioned Money Saving Tips that Still Work posted at Money Saving Ethics.

Matt presents My Work at Home Truths posted at Single Moms Income.

Alexa presents How to Use a Zero Sum Budget posted at Defeat Our Debt.

Lenny presents Frugal Habits that you can Copy from the Rich posted at Best Money Saving Blog.

Andrea presents More Money, More Gifts: Effective Ways to Save on Holiday Shopping posted at So Over This.

Marissa presents Conference Planning: Not for the Weak posted at Thirty Six Months.

Monica presents It’s Beginning To Look A Lot Like Christmas! posted at Monica On Money.

Holly presents Avoiding Obamacare: Screw You Guys, I’m Outta Here posted at Club Thrifty.

Natalie presents Finding Out What Makes You Thankful This Holiday Season posted at Debt and the Girl.

Sustainable PF presents How Mobile Banking Can Help You and the Environment posted at Sustainable Personal Finance Blog.

FI Pilgrim presents Avoid Overspending When Throwing A Pity Party posted at FI Journey.

Andy presents Why credit cards are the best way to pay posted at Art of Being Cheap.

Donna Freedman presents Good to the last drop: Getting full use of condiments posted at Surviving and Thriving.

Bryce presents Gas Clothes Dryer Repair posted at Save and Conquer.

Justin @ Root of Good presents Three Months of Early Retirement posted at Root of Good.

John presents Two Great Days to Shop Online During the Holidays posted at Frugal Rules.

Fiona presents How To Network On a Budget posted at ReadyForZero Blog.

Crystal presents Growing a Blog – Sorry, It Takes Time posted at Budgeting in the Fun Stuff.

Ryan presents Bitcoin: Investment or Speculation? posted at Cash Money Life.

Daisy presents Cheap Things to Do on New Years Eve posted at Suburban Finance.

Kyle presents 4 Ways to Save Money on Your Small Business Expenses posted at The Penny Hoarder.

Jacob presents Five Great Tips For Cutting The Cost of Owning a Business posted at AllPersonalFinance.

Little House presents Save Money: Fix Those Leaks! posted at Little House in the Valley.

Jim presents Not All Billionaires Are Money Grubbing Tyrants posted at Critical Financial.

Paige presents Considering Using Your 401k to Pay Your Bills? posted at Modest Money.

Pauline presents Save money and use your cards this Christmas posted at Make Money Your Way.

Pauline presents Nice try, Amazon… posted at Reach Financial Independence.

Crystal presents My 2014 Financial Plan posted at Married with Debt.

Tushar Mathur presents The Four Gift Rule posted at Everything Finance.

SBB presents The Physical Manifestations of Keeping a Budget posted at Simple Budget Blog.

SavingMentor presents Insurance: Can You Get A Better Rate? posted at How To Save Money.

Maria presents Is saving really a virtue? posted at The Money Principle.

Mrs. Accountability presents Why Should You Stop Payment on a Check? posted at Out of Debt Again.

Cat Alford presents How to Avoid Big Purchases and Deal with Emergencies posted at Budget Blonde.

Thanks for reading this edition of the Festival of Frugality!

Carnival of Financial Camaraderie

Carnival of Financial CamaraderieWelcome to this week’s edition of the Carnival of Financial Camaraderie!

This is the first carnival hosted here at Digital Personal Finance.  If you haven’t visited before, please feel free to check out the site.  You can also follow on Twitter or via email.

Anyway, there are a lot really good articles below.  Enjoy reading them!

BUDGETING

SavingMentor @ How To Save Money writes 6 Tips For Keeping Better Tabs On Your Money – Keeping track of your money can be a chore that you don’t often want to think about. I know I dread the endless letters in my mailbox, the stack of unfiled papers on my desk, the bills that need paying, the bank accounts that should be checked, and the budgeting and investment spreadsheets I should be updating.

Jefferson @ See Debt Run writes Return of the Coupon Binder – The Coupon Binder is an invaluable tool for helping to keep grocery costs down.

Alexis @ FITnancials writes Moving Into Our First Apartment – We plan on moving into our own place around the month of February 2014, also so we can get a feel of what it is like living with each other before we move to a whole new city together.

Sam @ Grad Money Matters writes Mistakes Made When Flipping A Home – Before the economic downturn, it seemed like many people were finding homes to flip. This seemed to die down for a few years, and now house flipping seems to really be back. However, how do you know if house flipping is for you? How do you know if you can even make any money?

Daisy @ When Life Gives You Lemons, Add Vodka writes What Could HR Teach You About Money Management? – A good HR department in a company is worth every penny in salary because they make the overall work environment more comfortable, more efficient, and create a higher work quality. Good HR is so good, that there are a few lessons for your budget.

Daisy @ Suburban Finance writes Is Your Car an Asset or a Liability? – Banks will consider your car an asset when they are assessing whether or not to grant you a loan, but is your car really an asset? Just because you can sell something does not mean it’s an asset.

Roger Wohlner @ The Chicago Financial Planner writes Five 401(k) Investing Tips for This or Any Market – The Dow Jones Industrial Average has hit something like 30 new highs this year alone, the S&P 500 is near record levels as well. Twitter just went public and Obama Care will go into full swing in 2014. What does any of this mean to you as a 401(k) investor? Here are five 401(k) investing tips for this or any market environment.

Nicole @ How to Avoid a Cashtastrophe writes Reasons to Avoid Debt – Debt may seem like the norm in Western culture, but that doesn’t mean that it should be acceptable. Debt can poison your entire life. There are so many reasons to avoid debt, and Nicole lists some of them!

Jay @ Daily Fuel Economy Tip writes Picking the Right Auto Policy – Having the right kind of auto insurance is akin to having the right kind of health insurance, in most cases they can be equally as important.

Buck @ Buck Inspire writes Club MomMe’s Family Fall Fest 2013 Recap – Although I was amped for the Entrepreneurship for Moms speaker panel, there also were tons of sponsors and vendors showing off their wares.

Monica @ Monica On Money writes 8 Warning SIgns That You’re Living Beyond Your Means – Read these tell-tale signs and stop living paycheck to paycheck!

Holly @ Club Thrifty writes Why is Obamacare Taking Away my HSA? – Guess what. Obamacare severely limits the number of HSA-eligibile plans in Indiana. Is Obamacare taking away my HSA? You bet.

Barbara Friedberg @ Barbara Friedberg Personal Finance writes Roadblocks to Saving: Not Planning Ahead – Learn simple tips to save for a house, car, retirement, or wedding. Savings tips reduce money stress and are easy to implement.

Larry @ KrantCents writes No College, No Problem: 5 Careers That Don’t Require a Bachelor’s Degree – Many med school grads are left with crippling debt and shockingly high malpractice insurance payments.

Natalie @ Debt and the Girl writes Are We Enabling Bad Behavior? – I was catching up on some blog reading lately. I came across a blog where the blog owner was talking about purchasing something that I considered to be a little ostentatious.

Alexa @ Single Moms Income writes How to Make Money Blogging (Plus a Challenge) – Want to know how to make money blogging? Join me in a challenge to grow your readership and make money blogging.

Alexa @ Defeat Our Debt writes How to Pay Off Debt & Increase Your Income the Fun Way – In order to speed up your debt repayment you will have to locate extra funds to throw toward it. You can either continue down the path you’re on or earn extra money.

Graham @ Moneystepper writes Should I invest in emerging markets? – Should I invest in emerging markets?

Jason @ The Money Makers writes Apple Launches iPad Air in November – With a lighter and thinner chasis, the newly announced iPad Air has a more powerful processor with a great new design and performance features that is sure to continue Apple’s trend setting reputation.

Sustainable PF @ Sustainable Personal Finance writes The Importance of Saving Early – When my husband and I first married, we were poor and in debt. It was a difficult place to be, and, even as we made inroads and improved our finances, we still felt pinched. As a result, we decided that we could not afford to set aside money for the future.

Ben @ The Wealth Gospel writes The Twitter IPO: A Big Disappointment for the Little Guy – Twitter’s IPO was a big hit! That is, if you are an investment bank. For the rest of us, it may have been better to wait until it flops.

Robert @ Cult Of Money writes 7 Ways to Save Money on Your Heating Bill – The cold weather is drifting in and we are quickly approaching those rigid winter months. Last year, at the peak of winter, I was faced with electric bills hovering near $500 per month. That was $500 to heat a 900 square foot trailer!

Dollar @ Easy Extra Dollar writes Make Money Online With Work At Home Jobs – You will then need to check out some companies that have been known to hire freelancers or employees to work from home. Many of these employers will list their positions online work from home jobs.

Dave @ Gen Y Finances writes What To Know Before You Buy a Home – I have seen many people buy a home only to have made many, many mistakes. Before you buy a home, there are many things that you should think about or look into before you make one of the largest purchases in your life.

Michelle @ Diversified Finances writes How Can I Become A Full-Time Blogger? – Blogging is a lot of fun, but there are many things that go along with making an amount from blogging that you can actually live off of.

Harry Campbell @ Your PF Pro writes “Annual Enrollment for 2014: My Company’s HSA vs Traditional Plan “ – As most of you know, a health savings account or HSA is one of my favorite investment vehicles of all time. It’s the only investment that allows for triple tax savings – the money you put in isn’t taxed, the money you take out isn’t taxed and the earnings aren’t taxed – as long as you spend the money on qualified medical expenses. If you’re the perfect specimen of health by the time you retire, you can withdraw the funds in your HSA just like you would with a normal 401(k) or tra

Harry Campbell @ The Four Hour Work Day writes There’s no Loyalty in the Corporate World – I will never understand why people go into work and kill themselves working long hours and sacrificing their social life just to make someone else richer. If you’re getting paid by the hour, then you’ll see a direct correlation between how many hours you work and how much money you make. Unfortunately though, most high paying jobs aren’t hourly these days so you’re stuck working for a fixed salary.

BUSINESS

Hank @ Money Q&A writes How To Get The Most Out Of This Holiday Shopping Season And Black Friday – It is going to be a tough holiday shopping season for businesses, but that is going to be good for shoppers and consumers. I talk to Jon Lal, founder of BeFrugal.com, on the podcast about the upcoming holiday shopping season.

Sam @ The New Business Blog writes 5 Mistakes that Successful Entrepreneurs Wish they Would have Avoided – Many successful small business owners and entrepreneurs made mistakes when they started their businesses that they wish they could go back and correct.

Daniel @ Make Money Make Cents writes How to Boost Sales Using Just Slatwall in Your Shop – If you have your own shop and you are aware that you could improve your display area, slatwall could be an ideal option for you.

Robert @ Beat The 9 to 5 writes My Monthly Income Stream Report – October 2013 – October was a huge month for me professionally and I’m so excited to share with you some of the major happenings going on with my business. However, it was also a tough month to dedicate myself to this site, so I really wanted to bring you just a simple question last month: Should You Accept a Promotion if its Not Your Dream Job?

CAREER & EDUCATION

CAPI @ Creating a Passive Income writes Right Out of High School: Five Jobs That Don’t Require a Degree – Job markets are always changing. Here are five jobs that do not require the individual to have more than a high school diploma or a G.E.D.

Michelle @ Diversified Finances writes Is Freelancing Not For You? – I really enjoy freelancing, but there are some downsides. I always laugh inside whenever people tell me how easy life must be for me. There are some many things that go into owning a business, and if you aren’t careful then it can easily take over your life.

Jessica Moorhouse @ Mo’ Money Mo’ Houses writes 5 Must-Dos to Interview Like a Pro – Over the past month I’ve had time to reflect on my experiences in the workforce for the past 5 years and I’ve discovered a bunch of new (or new to me) dos and don’ts when it comes to interviewing like a pro.

Adam @ Money Rebound writes The World’s Best Rags to Riches Stories – Get your daily ounce of motivation from these people who had little way back but have almost everything in the world now.

Little House @ Little House in the Valley writes Benefits of Renting: Lower Unemployment Rates – Have you recently seen this headline or something similar to it? According to a study (there have been a few studies over the years linking these two ideas), countries with lower home ownership have lower unemployment.

KK @ Student Debt Survivor writes Public vs Private Universities-Why I Chose the Latter – Headed to college or grad school? Do your due dilligence before making your choice. Public doesn’t always mean cheaper.

 

FINANCIAL ADVICE

Jerry @ AutoFoundry writes Is it Smart to Finance a Car? – Contrary to popular belief in PF circles, it actually can be smart to finance a car–as long as you abide by a few simple rules.

Anton Ivanov @ Dreams Cash True writes The 7 Steps to Financial Freedom – Reaching financial freedom is one of the most sought-after goals. Get started on your wealth-building journey with my 7 steps to financial freedom.

Bob @ Dwindling Debt writes Age Old Debate of Whether to Buy or Lease – To buy, or to lease, that is the question. People have long debated on both sides whether they should buy or lease a car.

Lily @ Paying Debt Down writes 5 Home Improvement Tips to Help you Sell your Home Quicker – Selling a home these days is all about image. The problem that most people have is that they put a lot of effort into making the interior of their home look absolutely wonderful but fail to do the same for the exterior of their home.

Lenny @ Best Money Saving Blog writes What Is the Importance of Seeking a Mortgage Broker? – Many first-time homebuyers make a mistake by trying to negotiate a mortgage directly with a lender. Unless you are an expert in home loans, it makes much more sense to hire a mortgage broker to do the negotiating for you.

Jack @ Money Saving Ethics writes Tips for a Great Financial Year – Improving your financial situation is not as difficult as it might sound, but it does require dedication and thought. It is really just a matter of starting and maintaining healthy financial habits.

Matt @ Budget Snob writes The High Cost of Using Cash – It has been calculated that the aggregate expense to all households in the United States for accessing and using their cash is $31 billion a year.

Danielle @ Saving Without a Budget writes Financial Tips That Sound Bad but Work Well – If you ask most certified financial planners you will find that one of the things they are constantly warning their clients against is making bad money choices based on popular financial advice, which is often wrong.

Oscar @ Money is the Root writes What Home Loan Is Right For Me? – Buying a home is a huge financial step that permanently changes the household budget for a family. Understanding the different types of home loans before signing any paperwork is a must.

Adam @ Money Bulldog writes Should I Get a Mortgage? – How mortgages can be a problem that you can benefit from in the long run.

Kali @ Common Sense Millennial writes Twenty Things Twenty-Somethings Should Know About Money – It takes work and time to figure out something as complicated as money and personal finance – and sometimes, it is overwhelming trying to understand it by yourself. I wanted to help by composing a list of the twenty things most important for twenty-somethings to know.

Christopher @ This That and The MBA writes Evaluating Legal Advice Online – You can find all kinds of great legal advice online, but given the vast breadth of United States’ law alone, the advice you read may not be appropriate for your situation. That does not even take into consideration the sites that provide inaccurate or outdated information.

Robert @ Entrepreneurship Life writes Exercise and Entrepreneurship: Why Excess Weight Will Cost You – Your waistline affects more than your health. Research suggests that the detriments of obesity can extend beyond health and self-esteem right into the workplace. There’s a “consistent wage penalty” for excess body fat and a “wage premium” for muscular body composition

Miss T. @ Prairie Eco Thrifter writes Why I Don’t Use Credit Card Rewards Programs – We don’t bother with credit card rewards programs. Here is why.

Jon Haver @ Pay My Student Loans writes How To Pay Back Student Loans Quickly – Let’s assume that you’ve graduated and have earned a college degree. Hopefully the degree has enabled you to attain a nice job as well. Here’s several steps that you can take in order to facilitate the process of repaying your loans.

Taylor @ The Motive Blog writes Leasing a Car: Dumb Move? – It’s tempting to lease a car. The payments are low, the cars are new, and it seems so EASY. But like anything, there’s no free lunch. Find out why.

John @ Frugal Rules writes What My Mom Taught Me About Personal Finance – We can learn a lot from our parents, both good and bad. While none of us are perfect, it’s those tough times that teach us quite a bit that can be applied to personal finance and how to improve one’s lot in life.

Bobby @ Making Money Fast and Slow writes The True Cost of Commuting and Some Alternatives – You spend $125,000 over 10 years and 1.6 working years sitting in your car. So what can you do to stop this waste of time and money? Plenty.

Pauline @ Reach Financial Independence writes Money Choices: How Millennials Can Make The Right Financial Decisions – Here are some of the financial decisions Millennials can make and their implications on their personal life.

FRUGALITY

Daisy @ Suburban Finance writes A Cup of Coffee: Daily Necessity or Daily Indulgence? – Starbucks coffee is very expensive, and is an indulgence.

FI Pilgrim @ FI Journey writes Flipping The Script: How I Learned To Live On Last Month’s Income – Nobody wants to live paycheck to paycheck, but for a long time I did just that. Here is how I flipped the script and began living on last month’s income.

Brock Kernin @ Clever Dude writes How I Got A Brand New Xbox For $100 – A new Xbox will run you $250 or more….I got mine for $100!

Mel @ brokeGIRLrich writes Five Dolla’ Make You Holla’Day Series: Wife – Thrifty tips for holiday gifts for your wife.

Mr.CBB @ canadian budget binder writes Christmas Shopping Online or in-store ? – Did you know there are only 40 shopping days left until Christmas? With Christmas being not too far away the rush to get one’s Christmas shopping finished begins. While some people prefer to shop only in stores there are many people who will choose to do the majority if not all of their shopping online.

INVESTING

Debt Guru @ Debt Free Blog writes Fallen Behind: Catching Up On Retirement Savings – Proper financial planning takes serious dedication. If you have fallen behind, here are three helpful tips for catching up on your retirement savings.

Jester @ The Ultimate Juggle writes Easiest Way to Make a Profit in Real Estate – Investing in real estate can be a great way to set yourself up for the future. If you invest in the right property at the right price, you can create a positive cash flow from the beginning.

Lauren @ L Bee and the Money Tree writes How I Plan to Recoup Renovation Costs – Oh my glob. Any time someone asks me how my renovation is going I just shrug and say, “It has pretty much broken my spirit and soul as a person.” “But you love your house!” A co-worker replied. “Nope.” I said and finished eating my soup.

Ryan @ Cash Money Life writes Should You Invest Your IRA in a Savings Account or CD? For Most People the Answer is No. – Should you trust your retirement savings to the volatile stock markets, or should you keep your IRA in a savings account? The answer may surprise you!

Tushar @ Earn More and Save writes How to Make $100,000 or More Per Year – What would you do if you earned $100,000 or more per year? Well, you could fund an early retirement, take time off work to travel, remodel your home, or save money and start your own business.

SFB @ Simple Finance Blog writes How to Save Money When Buying Your First Home – Buying a home is an American dream for most of us, but it is a bitter fact that home buying is an expensive process.

Dominique Brown @ YourFinancesSimplified writes What is a Stock Market Index? – A stock market index is a relatively simple concept, and it allows you to see the big picture.

Don @ Money Reasons writes Slow Sale Zone Concerns – This is about the concerns associated with a slow sales zone. You should take this points into consideration when looking into such a consideration.

Arnel Ariate @ Money Soldiers writes How are Mortgage Rates Determined? – How mortgage interest rates are set is determined by a number of factors some of which you may have an influence on and many that you won’t.

writing2reality @ Write Your Own Reality writes Investing with Prsoper – After four years of investing in peer-to-peer lending with Lending Club, I have diversified and added Prosper to the portfolio.

Marissa @ Finance Triggers writes How to spot a good mortgage broker from a bad one – How can you decide if a mortgage broker is a good one or a bad one? The best way is to learn the answers to these questions.

Hadley @ Epic Finances writes Build or Buy? – Taking the big step to buy a home can be difficult. Buyers are often faced with the decision of whether they want to buy an existing home or build a new one. Here are some things to consider before making that big decision.

Robert @ The College Investor writes Atmel Is In An Earnings Recovery – Atmel Corporation (NASDAQ:ATML) is in the midst of an earnings recovery driven by a improving end markets and new product offerings. Atmel is exposed to touch screens, and can gain market share with new device wins in that market.

Pauline @ Make Money Your Way writes What are stocks and how to value them – This is a guest post from Troy who is starting an investing for beginners series and now his first series what are stocks and how to value them.

SAVING

The Warrior @ Net Worth Warrior writes Ultimate Guide to (Finally) Building an Emergency Fund – An emergency fund can help keep you on a path to financial freedom by reducing stress, eliminating the worry of affording an emergency and providing security that you can maintain progress. Through this guide, you will (finally) establish a painless emergency fund.

Marissa @ Thirty Six Months writes Hello, ING Direct, errr Tangerine – ING Direct was acquired by ScotiaBank last year. As a result of the acquisition, ING Direct was required to change their name as they are not owned by the ING Group anymore.

Nell Casey @ The Million Dollar Diva writes 5 Things You Might Be Doing to Sabotage Your Savings Goals – If you are struggling to reach your savings goals, you may be falling victim to a financial saboteur. Whether your goal is too big, undefined or your savings are not automated could be a reason for not achieving your goals.

Simon @ Modest Money writes Tips to Save Money on Groceries – Wasted Food = Wasted Money. Time to refocus efforts on controlling your grocery budget with this money saving tips.

Jon @ Novel Investor writes 2014 IRA Contribution Limits Stay The Same – Do you know the IRA contribution limits can change each year? Find out the 2014 traditional and Roth IRA limits, complete with income phase-out tables.

OTHER

Roger the Amateur Financier @ The Amateur Financier writes A Few Harsh Truths About Blogging – Some of the tricky things to learn about blogging, such as getting a server, getting assistance, and paying money to keep your website running.

Suba @ Broke Professionals writes Should You Learn to Fix Your Own Car? – Read my view on whether you should learn to fix your own car, and if it makes sense for you.

Crystal @ Budgeting in the Fun Stuff writes Marketing that Works! These Comercials Are Hilarious!!! – Mr. BFS and I have cable and we love our DVR. That means that I generally do not watch commercials.

Brent @ PersonalFinance-Tips writes Are You Covered? 5 Tips in Giving You Peace of Mind and Control over Your Future – While identity protection companies put the fear of financial ruin in people, the reality is that only 3% of the US population has any financial data stolen (guides.wsj.com) each year. If you are in the small percentage, however, it can wreak havoc in your life.

Mike @ Personal Finance Journey writes Stay at home and save while making the most of your garden this winter – When you want to escape the house during winter do you consider your home garden? 10 Ways you can use the home garden and save!

Wayne @ Young Family Finance writes Small Things That Make a Big Difference in Your eCommerce Business – When you’re running an eCommerce store, one of your most important assets is your customers’ loyalty. It’s not something you can buy, but it is something you can cultivate. Surprisingly, it’s the little things that make the biggest difference. Here’s what you can start doing now to make the best impression on your customers.

Mr. Frenzy @ Frenzied Finances writes Single Cent Problems: The Truth About The Penny – Looking at the history of the penny is a fun way to find meaning and the sense of miracle in something as small as one single cent.

SBB @ Simple Budget Blog writes Cruisin: How to Budget Your Vacation on the Seas – Going on a vacation on the seas? Here’s some tips on how to budget some of the extra items available on a cruise – so you and your family can have more fun.

Ted Jenkin @ Your Smart Money Moves writes Why Can’t We Do It All? – This question is often bandied about in regard to the endless quandary of many women who struggle daily…

Crystal @ Married (with Debt) writes Thanks to These Blog Carnivals – October 2013 to Current – Hi again! Every week, we submit our favorite posts to a variety of blog carnivals. When we are selected, it is common courtesy (and an expectation) that we link back to those that included us.

Bargain Babe @ BargainBabe.com writes Is Bankruptcy Better Than Debt? – Is Bankruptcy Better Than Debt? offers tips on saving money every day.

Don @ MoneySmartGuides writes Ten Tips for Choosing the Best Home Loan – Buying a house is stressful enough before even taking into account the loan. here are 10 tips for choosing the best home loan.

Eva Baker @ TeensGotCents writes Goodwill Training – Shopping with Sarah AND Eva – Sarah takes Eva on a night filled with fun, food, and Goodwill shopping tips. Who knew that shopping at Goodwill could be a competitive sport?

IMB @ Investing Money writes Railroads Increase Revenue from the US Oil Boom – The US Oil Boom is a big topic in politics, the environment and finances these days – and railroads increase the revenue from the boom! Read here.

Mrs. Accountability @ Out of Debt Again writes Who Should Pay For The Date? – To tell you the truth, I have not dated much in my life. But here are some thoughts on the topic!

Tushar @ Start Investing Money writes Write Down What You Spend: You’ll Save More – Do you have any idea how much you spend on a regular basis? This is a tricky question to answer unless you happen to write everything down. Few of us do this and that’s a shame – if we did we’d have a much more accurate view of our spending habits. But that’s not all.

Lindy @ Minting Nickels writes Know How To Spend And Manage A Credit Card Account Responsibly – Millions of Americans use credit cards; many people use their cards every day.

Cindy @ MidLife Finance writes 7 Lessons Learned From Bill Gates – 7 Lessons Learned From Bill Gates. It’s easy to find out what Bill Gates thinks…sort of.

Corey @ 20s Finances writes Optimizing Credit Cards – Are you missing out on this strategy with credit cards? Try to optimize your use of credit cards to earn more money with little hassle.

Cat Alford @ Budget Blonde writes Tips for Starting An eCommerce Store – If you are interested in starting an ecommerce store, this post contains several tips and tricks for cutting costs and making sure you turn a profit.

Maria @ The Money Principle writes Business in the European Union – how is it doing? – How is the European Union doing in the face of all the problems in the world? Has it achieved its founding 4 principles? We present a report.

JP @ My Family Finances writes Lost Health Insurance Because of Obamacare: Can I Still Sign Onto My Spouses Plan? – Spouses everywhere are taking a second look at their plans now that millions of Americans have lost their coverage due to Obamacare.

Minimalist @ Minimalist Finance writes Unusual Causes Of Damage That Warrant A Second Look At Car Insurance – One woman in BC submitted a car insurance claim due to a bear attack, and drivers should use the experience to find the right insurer for their needs.

Luke @ Learn Bonds writes Bond Buying Criteria – Looking at corporate bonds as an investment? Here are the criteria to look at when buying corporate bonds.

Tushar Mathur @ Everything Finance writes 7 Ways to Save and Make Money Right Now – There’s always a lot of reasons for the need to save money stat, but around the holidays, most of us feel the pinch on our wallets just a little bit more.

Kyle @ The Penny Hoarder writes Get the Tools to Increase Your Small Business Cash Flow – Increase your small business cash flow with business banking tools and cash management solutions. From managing your business cash flow online to automating payments, you can easily grow your cash flow and increase your bottom line.

Mayor @ Messy Money writes The Back Yard Oasis Money Pit – My hot tub adventure is a reminder that it is important to look at the total cost of ownership when making a big ticket purchase.

Katie @ IRA Basics writes What Happens to Debt When You Die? – Now we do not want to sound morbid but it is a fact of life that none of us are getting any younger and one day we will meet our maker. But what happens if we meet an untimely end while we have still got debts outstanding?

Andrea @ So Over This writes The Cost of Carrying a Baby: 8 Unexpected Expenses of Motherhood – On average, raising a child from birth to age 18 costs about $200,000. If you add college tuition to that number, you can end up paying up more than quarter million dollars to raise a college graduate.

Amy @ Money Mishaps writes How to Liberate Yourself from Student Loan Debt – The student loan crisis in America is absolutely massive and does not look like it is going to get better anytime soon.

Adam @ The Cheapest Cars To Insure writes What Does Third Party Insurance Cover? – Know the important facts about your third party insurance inside and out before it’s too late.

Brian @ Luke1428 @ Luke1428 writes 5 Common Rental Real Estate Mistakes You Will Make – Even after researching the rental real estate market for over a year before our first purchase, my wife and I stil made a few mistakes along the way. Here are five big ones that many landlords make but are easily avoidable

Grayson @ Debt Roundup writes The Gift Of Debt – Enjoying My Hobby – I used to be in debt. When you get out of it, you realize that debt actually gave you a gift. The gift is different for each person and I am no different. Debt gave me many things, but it also gave me a new perspective on my finances. Debt gave me the ability to enjoy hobbies again without worrying where the money was coming from.

Thanks for reading, and for checking out this week’s edition of the carnival.  This carnival is hosted every second week by My University Money and you can submit articles at Blogger Carnivals or Blog Carnival HQ.

Someone Tell Me: Why Do People Take Out Long-Term Car Loans?

There are many people who simply have a love affair with cars.  Frankly, I like cars too.  The difference between a really nice car and a functional, no-frills car can be pronounced.

That being said, I have a practical, basic car I bought used a few years back.   I could have taken out a loan and bought something really nice, but it’s not a need.  Rather, it would have been something I simply wanted.  There are other things that can be classified as needs as well, so why burn through available funds on a nice car?

Even more perplexing: why take out a long-term loan to buy car you really want but don’t need?

Let’s say a person has $10,000 in cash available to buy a good enough used car.  Obviously this won’t be anything upscale, but suppose it’s in good enough shape to last 4 years.  Your effective annual cost is $2,500.

On the other hand, let’s say you buy a brand new car for $20,000 but it can last 8 years.  You’re still looking at an effective annual cost of $2,500.  So, might as well buy a new car, right?

Here are 2 things that I think come into play when many people make such decisions:

  1. Loan costs.  There is a cost to them.  So, the second example isn’t going to have the same cost.  Keeping in mind that the person only had $10,000 up front, the other $10,000 would have to be borrowed.  Thus, interest charges will likely occur.  However, many folks don’t think of this to the extent they probably should
  2. Payment procrastination.  If payment isn’t required right away, it’s almost like people don’t feel accountable for their actions.  That is, until the payments drag on.  But that initial feeling, I suspect, causes folks to feel like they can buy way more than what they actually can afford.  So that $20,000 financed car might end up being a $35,000 financed car.

There’s no way around it, we can only buy what we can afford.  Sometimes, it can be necessary to take out some kind of loan for a car.  If someone can’t take any public transportation, has kids, etc – you need to have wheels depending on where you live.  In such cases, I can see how a short-term loan for a modest vehicle can be a no-brainer.

However, doesn’t it seem like many car loans are for cars beyond what a person really needs?  As in, way more than what a person needs?

I say that paying all cash for a car is a nice way to handle this.  What you have allocated for a car, through diligent saving, is what you can spend.

Readers:

What do you think about paying cash for a car vs. taking out a loan?

Do you agree that it’s best to pay cash and only take out a loan unless necessary?

Or, do you think that a car loan for a new car that the buyer really likes is totally normal and just a standard course of action?

10 Tips to Keep Income Flowing!

Watching every penny we spend it one way to approach personal finance.  Frugality does have its place, and I’ve been known to devote some attention to smart purchasing decisions.  Of course, that can only take us so far.

We have to make sure we make money as well.   Money has to be made before it can be saved!

It’s like a bucket full of water sitting outside, for example.  You can spend all your time trying to plug the holes in the bucket, but eventually the water will slowly evaporate.  Maybe you can keep the bucket in the shade, but that will only slow the inevitable.  That’s how our money eventually drains after normal expenses are incurred.

Why not try to focus on income?  In the water analogy, this would mean less time trying to stop leaks, and more time refilling the bucket.  However, if we get more water than needed for the present day, we can fill up more buckets.  That’s the thing about money, we always want a flow of cash (yes, cash flow!) that will be there for us.  Keep it flowing!

Here are 10 ways we can orient ourselves to making sure that we can maintain or increase our income:

  1. Hustle.  Get up, and get moving!  We probably already are, but this really means taking it to the next level and spending a little less time hoping and more time taking action.  Action beats inaction.
  2. Be persistent.  This is related to hustling, but it refers to being determined and not giving up.  I’m convinced that in many cases, if one person is only slightly smarter than another, he or she might easily get outperformed by the other person who is more persistent.  Many people are smart enough that they meet that entry-level requirement, but from there it often comes down to who wants it more.
  3. Get a good education.  Now, this doesn’t mean racking up unnecessary student loan debt just to get the highest ranked degree available.  Rather, it means taking your formal education seriously at every level and making sure that you get a good quality degree, be it undergraduate or graduate.  Don’t fall into the trap of thinking that education is unimportant, or the amateur notion that you can just Google anything to gain all the knowledge you need any just about any practical subject.  Not true.
  4. Keep on learning.  Yes, a formal education is your foundation.  However, with the rate of change of information, technology, tools, etc – it’s vital to practice life-long learning.  Keeping our minds open and brains engaged, we need to embrace change and seek ways to thrive in changing conditions.  All the while, we accumulate wisdom that we can take with us and apply in different situations.
  5. Over-deliver.  When you have work to do at your job, don’t just do what is asked of you.  Do it to the best of your ability, and then deliver more.  In this day and age, that’s not only important for having a chance to advance, but in many cases it’s vital to keeping a job as well.
  6. Be healthy.  Easier said than done sometimes, I know.  But we need to have the energy and strength to work and move forward.  It’s hard to do that to our fullest ability when our time and energy is diverted to managing health issues.  The healthier we are, the better chance we have to keep that income coming in – especially as we get older.
  7. Network.  Its often said that it’s who you know that can matter as much or more than what you know.  While I think that’s truly situational in its application, there is something to be said about the value of having a network.  Learn tips on how to use LinkedIn for your career.  Make sure to give to your network regularly, not just when you need it.  Then, it will be there when actually needed.
  8. Think like an entrepreneur.  We are all entrepreneurs in a way.  If you’re working for someone else, you are selling the product that is you.  Additionally, by thinking with an entrepreneurial mindset, we can not only help our employer but also ourselves.  Then we can have the nice decision to make of what to do with side income.
  9. Follow the money.  In business – and many organizations really are businesses at the end of the day – profit is the bottom line.  What is often valued disproportionately are efforts to either bring in more money or save money.  Since we know that you can only save so much, keep in mind that generating revenue is where its at.  Employers often especially like people that can directly help to increase revenue, instead of simply working as necessary overhead.
  10. Don’t take your success for granted.  Often times, some people don’t appreciate what they have until its gone.  Don’t take things for granted, and always remember how hard you worked for what you have.  Also, remember how easily much of it can be lost be a variety of situations.  Keeping our head in the game this way can help keep the income coming in!

Readers, do you follow any of these tips when it comes to making money? Do you have any other tips to suggest on how to keep and increase inflow of money?

Tips for First Time Homebuyers Looking for a Home Loan

It’s almost a rite of passage for people to purchase a home at some point or another during their working years.  Whether it’s a condo, townhouse, or single family home, there is much pride that  lot of people take with a home they can claim as their own.

Along those lines, it’s rarely an option for first-time buyers in particular to pay all cash for a home.  While I personally think it’s good to avoid unnecessary debt, a mortgage doesn’t really fit into that category.  Taking on a home loan is quite often an integral part of the home buying experience. There are a lot of good things that can happen as a result of a home loan, one example being a couple buying a new place when they start a family!

Along with the positives, there should also be other factors to consider when taking on a home loan.  These generally involve understand the amount of the loan and even the type of loan that someone would take.  Here are a list of 5 things to consider.

Don’t automatically borrow the maximum amount for which you’re approved.

Just because you’re approved to borrow a certain amount, it doesn’t mean that you should borrow that much.  Rather, take a look at your overall budget and factor in your overall goals.  If you’re trying to put away as much money as you can for retirement or financial freedom, borrowing a lot of money might derail your or at least seriously delay your progress.  Borrowing an amount that is much less than what you’re approved can be a great way to allow for solid savings, a balanced approach to finances, and overall flexibility.

Look for a house that meets your needs, but it doesn’t have to be a “dream home”

I think that for many people, there can be an almost romantic aspect to buying a home with their spouse.  Particularly when a new arrival is on the way, a couple has visions of that perfect home for the family, that fits their aspirational dreams.  While that’s a great thing, and life is certainly meant to be enjoyed, we also need to be careful to make wise decisions.  When taking on a loan for a home, remember that you want to buy a home that you like but is also a smart move financially.  Both matter!

Select the right loan duration

A longer loan duration might mean lower monthly payments, but it also means that you’ll be on the hook to pay it off for many years.   On the other hand, getting a shorter loan duration might provide less flexibility in the budget in case other unexpected things come up with your finances.  It’s important to give careful thought to the type of loan product you go with.

Find a competitive interest rate

Interest rates on loans can go up and down.  When you look at the calculations, slight variances can result in incrementally different monthly payments.  When aggregated over a number of years, these seemingly nominal amounts can add up to a lot of money through the course of the loan.  Therefore, it’s important to find the right interest rate at the time you’re buying.

Keep in mind the other home-related expenses

When taking on a mortgage, especially as a first-time home buyer, many people come from renting.  Thus, they simply might not think about all of the additional costs that are involved in a mortgage.  These additional expenses could include things such as:

  • Taxes (often a big expense depending on one’s location)
  • Maintenance
  • Repairs, and even association fees among others.  Added together, these costs can be quite significant, yet still brushed off as nothing more than an ancillary concern by some excited first-time buyers.  It’s important to carefully account for such fees well ahead of time.

Overall, taking on a home loan from NPBS or another lender can be a step toward purchasing that first home in which exciting, special memories can be made.  Keeping in mind factors such as the ones mentioned above can make the whole process a better experience not only in the short-term but in the long-term as well.

Readers, what factors did you keep in mind when buying a home?  Or, if not a homeowner, what would you consider when buying your first home?

3 Questions to Ask When Aiming For Financial Success

Financial success can come in many ways.  It can come from a great career that skyrockets to the highest levels, from pinching pennies until the savings accumulate, or maybe even striking it rich with a great investment!

Okay, those are extremes.  Most people do not reach the CEO level of companies, it’s hard to get rich by saving pennies, and most investments don’t provide “get rich quick” returns.  Rather, most of us have to focus on success in moderation in of these areas.   We hope to make a good amount of money, we try to live responsibly and save, and we plan our investments to provide a solid rate of return.

All that being said, not everyone achieves big success with money, nor does everyone ultimately reach financial freedom.  Sometimes things can derail us, or at the least they can hold us back to some degree.

Here are the 3 areas that I suspect we can focus on in terms of improvements, as aligned with those examples above:

Are We Making Enough Money?

Perhaps we aren’t focusing on our career as much as we could? Or, we expect to live in a 2-person household and risk putting all the eggs in the basket of one person as the breadwinner?  Maybe we don’t want to work 40+ hours and put up with the unpleasantness that sometimes occurs when working for others?  Well, no matter how we look at it, we need to make money in order to succeed financially.

Money doesn’t fall out of the sky.  We need to make it, and sustain cash inflow.  To the extent that we have more of it, even if it means trying to make side income, the better chance it gives us to save and invest.  After all, it takes making money to save money or invest it!

Are We Saving Enough Money?

Let’s say we are making a solid level of income, but we aren’t saving much.  Is it because we are spending money that we don’t need to be spending?  There is something to be said for understanding what we want, and differentiating from what we need.  Do we need that dream home, or can we live in a place that meets our needs.  Do we need that cool car, or could we drive a car that gets the job done and is reliable?  Do we have to take that exotic trip across the ocean, or could we take a much less expensive trip to a great domestic location?

You get the idea.  Saving money is a big deal, and it’s not just a matter of skipping that occasional coffee drink that will make the big difference.  It’s the bigger ticket purchases and expenses that can really have a disproportionate influence on our ability to save.

Are we structuring our life to be able to save? After all, if we don’t save money, there is nothing to invest!

Are We Investing Our Money Wisely?

Okay, so perhaps we have the first two areas covered well enough.  We make a decent income, and we’re able to save something.  Great!

However, some people can make money and control spending but just don’t know what to do after that.  Or, perhaps they are risk averse to the point of not wanting to invest in anything that might involve some risk for potential returns that could accrue.  They might let money sit in cash or low-interest accounts, being happy earning 1%.  Meanwhile, the inflation and the cost of living increases that regular occur can actually eat away at the savings to the point that they lower in purchasing power over time.

It’s important to be able to invest and earn a rate of return that allows you to build wealth.  Sure, there are risks, and decisions need to be carefully made.  But increasing the rate of return on investments can really supercharge efforts to increase net worth.  After all, if we don’t invest money that we have earned and saved, it’s like running with weights attached to our ankles.  Sure we can still move forward, but the progress will be slow!

Bottom line – let’s remember the process: make, save, invest.  Then, look at each step of the way and honestly assess how we are doing with our efforts.  They build off one another, and being strong with each can be great for our long-term financial success!

Readers, what are your thoughts on these 3 steps? Are you maximizing your success in each of the 3? Do you need additional improvement in one or more of these areas?

Investing Extra Income and The Value of Diversification

Making money is something we all want to do.  Not just making money, but for many people it really means making more money that we currently earn.

So how do we do this?  Well, one way to do it could be to focus on one’s career.  Getting promotions and/or switching jobs opportunistically (but not too often) to earn a higher income can be a great way to accomplish this.  The earlier in your career you grow your income, the more you can save.

Another way to do this would be to earn side income.   Seemingly growing in popularity, and certainly a topic that’s discussed more and more on personal finance blogs.  There are so many ways one can earn side income, ranging from blogging to tutoring to dog walking and points in between.  There is a side hustle opportunity for so many things!

This is all great, and as we know, it’s making more money can be a great way to build wealth.  However, that could be an incomplete approach.  It’s been discussed before, but the question of what to do with side income can really apply to any incremental income.  What can be done with it?

Keeping everything in cash might seem safe, but that’s not likely to appreciate versus inflation :)  One could also choose other low-risk or alternative investments, but those can be a potential part of a diversification plan.

What might make sense, and what fits conventional wisdom, would be to diversify the use of this extra money.  One aspect of diversification that can be profitable for many people is stocks.  Investing in stocks can be a tremendous way to grow net worth, though of course even within share trading there can be opportunities to diversify as well.  Of course one can invest in different companies within different industries.  There are also different investment types, besides individual stocks there are also ETFs and funds.

Additionally, people can diversify in terms of where the stocks are actually traded.  Quite often people trade in the U.S. stock market, as the Dow and S&P 500 are two widely followed baskets of stocks that are watched to gauge the strength of the domestic market.  Additionally, there are plenty of other markets as well.  There are opportunities to invest in stocks in the U.K. market, Japanese (NIKKEI) exchange, Australian stock exchange, the market in Hong Kong, and others.

However one does it, stocks can be an important part of a person’s portfolio.  When allocating assets, generally speaking many people do keep some portion in stocks.  The longer the time to retirement, often times the higher the percentage of investments that many people are willing to put into stocks.  While people should always think about risk as well, the growth potential of stocks, including those within a diversified portfolio, can be hard to ignore.

What it comes down to is that it takes more than just making additional money to get ahead for a lot of people.  Investing that additional money could potentially supercharge that growth.

Readers, do you actively invest extra (or regular) income? How do you choose to diversify your stock investments?

 

What to Do With Side Income

It seems like side income is all the rage.  All over the world of personal finance blogs, there are people that are really getting into the idea of making side income.  Some are succeeding wildly, others are able to make a few bucks here and there, and yet others are reading everything and salivating at the possibilities of bringing in more money!

That bring up the question, to me at least, of how people plan to handle the extra money.  What can someone do with the side income, in terms of his or her own budget or finances?

The way I have been operating, side income is not a primary source of income.  The efforts to make it are not insignificant, but they aren’t my main focus in terms of my time.  Rather, much more time and energy goes to toward the my actual career and interest in taking care of my family.  I say this based on the reality of the situation, though I am captivated by side income and do strongly believe in the importance of multiple streams of income.

Thus, the priorities are clear in terms of what I count on.

Having said that, there are probably many different ways people could handle side income.  Here are a few examples that came to mind quickly, in terms of what people could do with side income:

  • Pay for regular, daily expenses
  • Use it to buy things above and beyond what you could normally afford
  • Treat oneself
  • Safe for a specific purpose (example: wedding)
  • Use it for investments
  • Set it aside as truly incremental savings

The latter is what I’m using side income for at this point.  Incremental savings, above and beyond anything else put aside.

I look at it this way: If it’s truly side income, and not the main source of income, then I’m not going to count on it.  It’s like a special bonus, that is purely upside.  If it disappears, I could still function as I would otherwise normally do.  Bills would be paid, retirement savings would be set aside.  To the extent that the side income can add to this without time earning it taking away from the day job, then it’s all good!

Of course, we all have different situations and approaches to things, so I’m interested in how you handle side income.

Readers, what do you do with your side income? If you don’t currently have much, what would you do with it if you did have it?

 

 

Overanalyzing Investments

It seems like every year that goes by, there new sites or apps that capture the attention of different people.  These run the gamut of genres, from educational, to informational, and mostly (it seems) entertainment.

A number of these can help people with different aspects of their lives.  For example there are sites out there that help people track expenses and nutrition.  These can be very useful. However, there are also sites or apps out there that end up causing people to waste time- such as many games.  Yes, I should know…..I really enjoyed Angry Birds when it came out:)

There also apps that can do both: help you as well as waste your time.  Some can even lead you to overreact and make decisions that aren’t always necessary to make.

Along those lines, there was an interesting article on MarketWatch recently that talked about the notion of deleting investing apps.  While I don’t know that I would go that far as a rule of thumb, the article does bring some good points.  What resonates with me is the idea that people getting more information might be compelled to act on such additional information.  Which, in reality, might not always be such a good thing!

Here’s the deal, as I see it: many people like to actively trade in the market, or at the very least are predisposed to feel that they can beat the market.  There is some sort of bias I suspect many folks have about their own intelligence and skills.  The thing is, many times index funds outperform actively managed funds.  So, if many pros can’t beat the market, why does the totally average investor believe he or she has special talents to do so?

Armed with additional information at one’s fingertips, some people might make a higher frequency and volume of trades.  This could result in a financial outcome that isn’t necessarily better than would happen otherwise.  In some cases, maybe worse.

Or, this might get a person to simply spend more time checking investments out of habit and obsession.   This can waste time.  Sort of like a blogger checking traffic stats all the time :) The time adds up, and for little incremental reward.

Bottom line is that while many apps are cool and can truly be helpful, we should be watchful over how much time and importance we give to using them.  Sometimes it’s better to keep things simple!

Readers, what do you think of the notion that more information can sometimes result in excess analysis and reactionary behavior? Also, the idea that sometimes with more information, we can risk wasting our time for very little incremental return?