Beat up debt, but save too

My boy Eric hooked me up with a guest post today. He has a finance degree from the University of Colorado and an MBA from the University of Denver. He is currently a senior treasury analyst at a Fortune 500 company. He blogs about personal finance at Narrow Bridge and the Middle East at The Israel Situation.

Kicked in the face

It feels really good to kick debt in the face. In the last four years, I have bought a brand new, $17,000 car and taken on about $40,000 in student loans working on my MBA. Of the $57,000 in debt, less than $14,000 remains. I have a plan to be paid off completely in less than two years. I have managed to live below my means and kick debt in the face. However, beating the hell out of debt is only one part of the personal finance puzzle. It is also important to keep track of your finances and build up a safety net while paying down your debt. The two main savings methods that I am employing are investing in cash savings and investing in my retirement, but I had not been focusing on both of those as much as I should have until recently.

I have felt great about paying off my debt so quickly. Paying off a $90,000 MBA within two years of graduating is something anyone should be proud of, but I recently checked in on my savings account and realized I only have enough cash on hand to live for about 2 months, not the 3-4 that I should have saved. I am on track with my retirement savings, but that can always use a increase as well. Because of this, I have developed a two prong strategy to both kick debt in the face and kick yourself in the butt to start saving more.

Part I: Kicking Debt in the Face

You have probably heard of the debt snowball at some point if you are a regular on the personal finance blog circuit. If not, here is the low-down: Pay the minimum on all of your debts except for your highest interest debt, where you put every dollar you can. This is scientifically the fastest way to pay down your debt.

Part II: Kicking Yourself in the Butt

There is no big secret way to save money, you just have to set a plan and follow it. Sites like and banking sites like SmartyPig can help you track your savings goals. You can also set up a separate savings account at your bank if you want a little extra barrier between your savings goal and your spending accounts.

The smartest way to save your money is to not have to think about saving it in the first place. The best way I know of to do this is to set up your direct deposit from work to deposit your paycheck into two accounts. A certain amount of money is designated to go to the savings account and the remainder goes into your checking account. Keep your savings account deposit going as long as you have to in order to reach your savings goal.

Increasing your retirement savings is also an easy, automated process. Most employers let you take money directly out of your paycheck to be deposited into a 401(k), Roth 401(k), or IRA account. Every time I get a raise, I increase my contribution to my retirement accounts by 1%. If you are not taking advantage of a 401(k) match from your employer, you are giving up free money! Set that contribution level right now. If you are already contributing to your retirement accounts, just increase your level by a percent or two to keep building your retirement accounts. If you are worried about locking the money away, try an automated investing plan at a brokerage that allows you to sell and withdraw your funds whenever you want without tax implications.

Whatever you do, just make sure you are saving for emergencies and your future, and while you are at it, make sure you are paying off your debt too.

Questions: How did you decide how much to save vs use to pay down debt? Do you use the automated saving methods above? Why is Ninja so freakin’ sexy?

Editors Note: My only beef with Eric is that he likes to Kick debt in the face, where I prefer the punching method. And yes, I added that last question, I’m pathetic.

Dancing with Finances

stick figure dance

Guest post:

I want to thank Ninja for the opportunity for this guest post. It’s nice to be on this big stage of the kind, friendly, $2100 a year blog earning Ninja. <---- (edit: He forgot to add extremely good looking)

My story I’m sure is very common to many others out there. In a span of less then a year I got married, purchased a home and had a child. Two children to be exact, my wife and I had twins. That was over 11 years ago now. We had our 3rd child back in 2002. In those years we did a lot of living beyond our means. Things like vacations, cars, child items, home improvements, etc. We have racked up a pretty penny in consumer debt.

I manage the money. I consider myself educated. I have a college degree and a good paying job. I have danced around our budget for years. Ask my wife and she will tell you I’m not a very good dancer. I have kept an excel spreadsheet of our budget for at least 5 years. I’ve used it to watch our money go right out the window to creditors.

Roughly about a year ago I took a continuing education class titled “How to get out of Debt.” The instructor, a retiree, lead a 1-hour class and discussed the basic principals of the debt snowball. At the end of the class I found out that the instructor worked for Primerica (a financial service) and was ultimately running this class to see if he could drum up some business, but the information he provided started my personal finance journey.

I went home that night and built a number of debt snowballs sheets. Modeling how many years it would take to pay it all off if I could add an additional $10, $50, $100, $500, etc to my minimum payments. I reviewed this with my wife and we both agreed this was a great idea and it would be awesome if we could do this. I was excited about the new information I had learned, but failed to really act on it.

Fast-forward to May of this year. My wife and I were discussing vacation plans for the summer. We had just received an invite from her family for a mini family reunion and friendly day of Olympic style family competition. My wife’s family lives in CA and we love visiting them. We began planning the trip. After reviewing travel costs for the 5 of us (airfare, rental car,etc) I realized we couldn’t afford it. Not only because I didn’t have cash in a savings account, but because I didn’t even have enough credit left on my credit cards.

The reaction of my family was one of disappointment. I was disappointed too. Not in the fact that we wouldn’t be traveling to California for a nice vacation, but disappointed in myself for letting my family down. I started thinking about the debt snowball again.

About a week later, my brother called me and asked to borrow some stuff for his two kids’ upcoming graduation party. He talked about how he feared having two children in college at the same time. As I hung up the phone I again thought of the debt snowball and the fact that in less then 7 years, I could have 2 children is college as well. After the kids went to bed my wife and I sat down and made a plan. We went back over all the things that we’d talked about over the last year. We decided to close all of our credit cards, stick to a cash budget, and my wife would go back to work. (booya, for getting serious!)

That plan was put in motion back in June. It hasn’t been easy, but we have made due so far. We stayed at home for our summer vacation this year (for the first time in over 10 years). We’ve began discussing finances with our children. It has definitely been an adjustment, and there have been a number of “no’s” along the way, but we keep the big picture in mind: a budget without monthly payments to creditors, and a nice emergency fund in the bank.

In these last 3 months I found out that most of PF is just commons sense, there are no big secrets. I’ve had the ability and tools all along, I just lacked the discipline needed to make it happen. PDITF was the first blog I found when searching for information on the web. I’m in such a better place now, then I was 3 months ago. I have already chipped away at over 3% of my total debt!

I tried to keep my post in the spirit of PDITF, but also wanted to tell my debt story as is. I’d like to know what motivated you to get your finances together? If you had a do over, what would it be?

‘Tech’ blogs over at Until Debt Do Us Part which he started as a good way to stay focused on his own budget and finances. Go check him out.

Does your signature matter?

This guest post was written by Go Banking Rates, bringing you the important personal finance news, tools and strategies for the best ways to secure a high CD or savings account rate. Follow them on Twitter at @GoBankingRates and on Facebook at /GoBRates

In an age with rampant identity theft and credit card fraud, we do whatever we can to protect ourselves and our money. That’s what most of us think, anyway.

Take a look at your credit card. See the white strip along the back? Is your signature there?

Does it matter?

You may be surprised: It really does. It seems to be common knowledge that by not signing your card, you are somehow making it safer. Leaving it blank or printing instructions to see your ID instead will prompt the seller to check your identification and disallow an impostor from copying your signature. The problem with this well-know “fact,” however, is that it’s false. Here’s why:

Don’t Write “See ID” Instead of Signing

According to, you must sign the back of your card. Writing “see ID” or “ID only” on the back of your Visa or MasterCard, for example, is not only pointless, it technically invalidates the card. A merchant isn’t supposed to complete any transaction that uses a credit card lacking a valid signature.

Don’t believe it? The VISA Rules for Merchants handbook specifically states, “See ID or Check for ID is not a valid substitute for a signature…A refusal to sign means the card is still invalid and cannot be accepted.” But wait, there’s more. The handbook also explains that if this rule is ignored, the person who processed the transaction becomes financially liable should the cardholder dispute the charge.

Signature is for Legality, Not Security

Most people believe their signature is required on the back of their credit card in order to establish identity ‚Äî the signature confirms they are the true owner of the card. Technically, the signature can be compared against the one on the receipt if a fraudulent transaction is suspected. It isn’t main purpose of the signature, though.

Your signature is actually meant to solidify a contract between you and the issuer of your card. It’s not considered valid if left unsigned because you have not fully committed to the customer agreement. By leaving this space blank or writing something other than your name, then using the card to make purchases, you are actually violating the terms of your agreement.

There Are Better Ways to Protect Your Credit Card

Think about it: How often does a merchant actually ask for your ID, no matter what’s on the back of your credit card? Most of these people never bother. When they do, they don’t even compare the signatures on both cards, they only match the names and maybe check your photo, too. Signing the back is not going to make any difference in the safety of your card.

This means your best bet is to go ahead and sign it. At least your signature would be harder to forge on receipts and you’ll be in compliance with your credit card company’s terms and conditions. Then, take some real, effective actions toward keeping your credit card safe from fraud:

  • Only carry what you need. Don’t put every piece of plastic you own in your wallet. Only bring a card if you plan to use it. If your wallet gets stolen, you won’t have to worry about canceling cards and reversing charges.
  • Write everything down. Record all of your credit card numbers, expiration dates and bank telephone numbers and keep this information somewhere safe. If a card is stolen, you can have it canceled right away, hopefully before any charges are made.
  • Check your credit report. Periodically reviewing your credit report will alert you to any fraudulent activity you were unaware of.

Rich bride, poor bride

Guest Post: I write a blog over at which chronicles our adventures in wedding planning. Essentially, we are trying to coordinate 6 bridesmaids, 5 groomsmen, 3 families, and 110 guests who are scattered all over the country, stay in budget, and plan a wedding (and honeymoon!) that we will never forget. I’ve been interested in personal finance for several years, after grad school left me with a huge chunk of student loans. When I got engaged, I knew it was going to be an expensive 11 months. How on earth were we going to be able to afford a wedding without breaking our budget?

Have you ever heard of the television show Rich Bride, Poor Bride? It is a wedding show that follows couples to see if they can keep their wedding within budget. The tagline of the show is “No matter how big the budget, is it ever enough?” Some of you may have a heart attack reading this next sentence: couples on this show typically go over their budget at least 20% and I’ve seen some episodes where couples go 80% over budget. It’s rare that a couple actually comes in under budget.

Normally, couples will be creative with some “Do It Yourself” projects to help them save money. I got a “C” in art class in Middle School. A lot of couples have connections with people who are photographers, caterers, etc. We don’t have connections. We have about 6 months to go before our wedding, and all of our vendors are booked. We are slightly UNDER budget at this point and I’m going to share with you all how we’ve managed to do that

Set Your Budget (and Guest List!) Early

The first thing we did was to figure out what we could afford to put towards the wedding. Our parents offered us a certain amount of money, and that’s how we figured out the amount of money we had to work with. After all of this money is gone, NOTHING else will be spent. We price quoted vendors (venues, caterers, photographers, etc), to figure out what an “average” price was for these services before we booked anything.

The next step was for us to make a tentative guest list. We discussed the guest list with our parents to make sure we accounted for everyone who needed to be invited—we are having a small wedding, so the list was limited to family and close friends. The worst mistake you could make is thinking you want a 100 person wedding and then having the guest list climb to 300 after you booked a venue. that charges $150/person. Since we had our guest list determined, we were able to get proper pricing for the venue, food, booze, etc.

Have One Person Manage the Wedding Cash

I control ALL of the wedding money—all the cash goes to me, and then I distribute it as needed. I track who gave what money, on what date, and what we’ve paid our vendors. I track our expenses in a Google spreadsheet, so I can update it anywhere.

Look at Wedding Dates on the Cusp of “High Season”

We are getting married at a popular, somewhat expensive venue in Austin, TX.  Surprisingly, this is where we saved the most money. In Texas, wedding season starts March 1st and runs until November 1st. We decided to look at the latest date we could in February, and picked February 19, 2011. By going with a date considered “off season”, we ended up with a 25% discount on our venue (ceremony and reception), and catering.

Shop Around and Always Negotiate

I found a wedding ring that I liked at a local jeweler. It was priced at $1240, and was able to get the price knocked down to $1120. I asked the jeweler to write down the name and number for the ring, and then I went home and checked online to see if I could find it any cheaper. I found the same ring on the designers’ website for $740!

Another example is when I was shopping for my wedding dress.  Ladies, don’t buy a dress without checking the price online! My dress shop took $100 off of the price of my dress because I showed them that I had found the dress online for cheaper (they price-matched).

Price matching and negotiating should also be done with photographers, rehearsal dinner spaces, live music, etc. Since we are getting married in the “off season”, vendors have been very willing to negotiate.

Don’t Buy Stuff Too Early

Let me emphasize this—don’t buy ANYTHING until you are 100% sure you will use it. Just because there is a sale at Michael’s doesn’t mean you should buy a bunch of glass bowls because “it’s a great deal and you might be able to use them in the centerpieces”.

Currently, I have 250 crappy gray envelopes sitting in my closet because I thought they were “cool” and I could use them for “something”. They are ugly, small, and I can’t return them (I didn’t read the policies close enough) –$30 down the drain. Those “little things” that you don’t end up using can really add up.

Be Careful Not to Fall Into the “I have to have that!” Mindset

Do you need a photo booth? No. Do you need a chocolate fountain? No. Are both of these things pretty cool? Yes. Please remember that buying all the “extras” does not make your wedding great. Before we add any “extra” to our wedding, we discuss “will this really make or break our guests’ enjoyment of our wedding?” Usually, the answer is “No”, and we cut it. Our crowd is a “party crowd”, so we decided to splurge on the venue & food, booze, and a live band.  We are a happy and fun couple—we hope that our marital bliss is contagious and people will remember how happy and fun our wedding was. I don’t think anybody is going to miss napkins with our names on them.

Put “Buffer Money” in Your Budget

If you or your kids are planning a wedding, there is no doubt that SOMETHING will go over budget. Take your original budget and add at least 10% to it—we added 15%. My dress was substantially more expensive than I had planned (I thought I could find something I loved for under $1k. DID NOT HAPPEN), but we used some of the “buffer money” to cover the difference because well, that’s what it’s there for. Our honeymoon and “extra” decorations like the guestbook are other areas where we have gone slightly over budget.

I could go and on about what we’ve done to stick within budget, but these techniques are what helped us save the most. Bottom line, you CAN have the wedding you both want and not completely blow your budget. Our wedding is far from a “low budget” event, but that doesn’t mean we can spend whatever we want on this wonderful occasion. We made a plan, have done a great job at sticking with it, and will not owe the credit card companies thousands of dollars after the wedding.

Come check out my blog at!

Punch Crappy Health In The Face

Today’s guest post comes from Samantha who blogs at Make sure to check her out when you’re done here 🙂

Repeat after me: Your health is the best asset you have. You are responsible for your own health. Your health is the best asset you have. You are responsible for your own health.

So what does this mantra doing on a personal finance blog? If you ever listen to Suze …health and wealth go hand and hand…..

I want to scream (and like Ninja says…punch a baby in the face) when I hear reports in the news media that is too expensive for most folks to eat healthfully and engage in healthy behaviors. Sure it can be more expensive than eating Top Ramen for every meal—but “being healthy” is not too expensive and anyone who says so is making up excuses. I used to be one of those people—I know. And when I got real and started to take responsibility for my own actions—my life changed for the better.  The consequences of poor health are extremely detrimental and may possibly over time, cause you to lose money. Lethargy, illness, and poor self esteem cause people to miss work, not work to their full potential, feel badly about themselves and puts people at risk for developing more serious diseases over time that cost a crap ton of money. So when I say it’s important to maybe increase your grocery budget by a few dollars to include some fresh fruit or take 30 minutes out of your day to go on a walk—I say it truly believing that these things will increase your quality of life.

Let’s eliminate a few fallacies up front: Eating organic, hiring personal trainers and fancy gym memberships are expensive, but these are not prerequisites to getting and being healthy. The diet and fitness industry put entirely too much propaganda out there and it confuses people to the point where they never find results.

There are two major things that any person can do to maintain their health: diet and exercise.

The diet and fitness industries will have you believe that diet and exercise must be extremely complicated. Unless you have a medical condition—diet and exercise are not complicated. Enough with the exercise programs on those creepy infomercials with Chuck Norris that promise weight loss. You don’t need the $500 month diet plan with the special foods. Diet and fitness can be relatively simple and relatively cheap—nothing to bust your head and budget over.

Here are my top 8  tips to maintaining health through diet and exercise on a budget:

1)     Eat REAL foods: Real foods are those things in their pure form eggs, milk, vegetables, fruits and meats.

2)     Buy REAL foods on sale and in season: Choose your fresh selections from those that are in seasons and consequently, on sale. Purchasing fruit out of season shipped from South America is a sure fire way to spend money unnecessarily.

3)     Be choosy with “packaged” foods: Food that comes in a box or bag has generally been processed with a ton of added sugar, salt and fat. Be careful what you choose and stay away from convenience foods—they are generally more expensive and filled with crap. Packaged foods I like are: bread, whole grain cereals, oatmeal, canned vegetables and beans and peanut butter.

4)     Spend some time at the meat case: Meat can be really expensive. I find that my grocery store has really expensive meat one week and really cheap meat the next. Stock up on lean cuts like chicken breast, turkey, pork loins and other lean red meats when they are on special. Also, don’t be afraid to buy a large pack and split it into smaller portions when you get home.

5)     Eliminate Waste: Once you have purchased all your “healthier” foods—make sure you actually eat them. Pack lunches, plan dinners and don’t be afraid to experiment with new meals and soups to use all your food.

6)     Get out and move: Going for a walk/run is free. Yes, I understand that every person doesn’t have a safe place to walk near their home—so go find one. Beaches, malls, parks and schools are safe places to exercise during the day and cost no money.

7)     Pump it up: Strength training is also essential (I don’t always follow my advice). Buy some hand weights or purchase some inexpensive workout DVD’s to challenge you in new ways. I like Jillian Micheals 30 Day Shred.

8)     If you must, don’t feel guilty to buy: Some people will only work out in a gym. I get that—its normally safer and offers more variety. If you think you will actually use the gym membership—rearrange your budget and make room for it. Remember: your health is your most important asset. It’s okay to make it a priority. You can also check out resources like Now Health International Insurance.

I believe that every person should have no-barriers entry to health. Every individual in every regional area will have some challenges. Running outdoors is not realistic in some areas and finding a grocery store close to your home is a challenge in other areas. And there is entirely too much diet/fitness propaganda out there. The reality though, is this: You have to punch your poor health, poor eating habits, weight issues and excuses in the face if you want to win. And yes, it may cost a tad bit more to buy some higher quality foods to fuel your body. It is all fine and dandy to get rid of debt and save a gazillion dollars for retirement—but what if you aren’t healthy enough to enjoy it once you get there? I don’t preach the health message from a vanity or beauty perspective—that is extremely dangerous. It’s more than body image or being “skinny”. It’s about being the best you, so that you can appropriately kick ass in the other areas of your life.

The 20 somethings Financial Need-to-knows

Bill DAlessandro is an entrepreneur and former investment banker living in Denver, Colorado. He also writes “Ready, Fire, Aim” a blog about entrepreneurship, finance and lifestyle design. Bill has been managing his own finances since high school and has made a ton of mistakes, so pay attention, he kind of knows what he’s talking about.

My younger brother just graduated from college this year and is getting settled into a new job, life on his own, and financial independence. Along with his first paycheck, he’s also been bombarded with a lot of new financial choices and a lot of acronyms (IRA, 401k, APR, etc). Everyone knows they should be saving money, but the reality is that nobody ever tells you exactly how to go about it short of stuffing cash under your mattress. This post isn’t going to be an in depth discussion of what stocks to buy or how much of your net worth to put in bonds – rather, I want to focus on the mechanics of how to organize your finances as a single, newly independent young adult in order to set yourself up for prosperity and success.

The 401k

Ah, the first decision you’re going to have to make – how much of your paycheck do you want to allocate into your 401k? The most important thing to know about a 401k is that any money you contribute is “pre-tax”, meaning that it is taken out of your paycheck before taxes are calculated. This is the first way a 401k gives you “free” money – you’re able to sock it away before the government takes a cut. The second way a 401k gives you free money is an employer match. Policies vary among companies, but most offer a match of some kind, up to a certain percentage of your salary. Always, always contribute enough to your 401k to receive the full matching amount that your employer offers – this is literally money in your pocket as an incentive to save. After you’ve received the full employer match, it’s my advice that you don’t contribute anything further to your 401k right now. I’ll explain why in a minute.

Once you’ve got some money in your 401k, you’ll be asked what type of fund you wish to invest it in. You’ll have a lot of options, but your best bet is to select a “target retirement fund”. Add 40 years to the current date, and that’s roughly the year you should hope to retire. These target retirement funds will automatically keep you in equities while you’re young for maximum return, while gradually shifting to bonds for income and protection as you age. Set it and forget it. One thing to be sure of: make sure your 401k is invested in a broad-based fund, not exclusively in the stock of your employer. That’s a lot of eggs in one basket – just ask anyone that spent their career at Wachovia or Bear Stearns.

The Roth IRA

So now you’ve saved a few percent of your paycheck in your 401k (just enough to receive your employer match), but you still have some extra cash remaining that you can afford to lock away for retirement. Your next option is an account called a Roth IRA. Contributions to a Roth IRA are “post-tax”, meaning they come out of your wallet after you’ve already paid income taxes to the government. However, the big benefit to a Roth IRA is that once you’ve contributed, your money grows tax free, forever. That means when you retire, you can withdraw the full amount without paying a dime of taxes on the money you contributed OR on your capital gains. That means you never pay any taxes on all the compounded interest your money made you over the years. And after 40 years of compunding, that’s significant.

You can open a Roth IRA with nearly any investment company (Fidelity, Charles Schwab, TradeKing, and many more), though it may be easiest to use whichever company your employer uses to administer your 401k. There are two major rules regarding Roth IRAs – 1.) You may contribute a maximum of $5,000 each year. You can do this all at once or over the course of the year, but your total contributions may not exceed $5,000. And 2.) You may only contribute to a Roth IRA if you make less than $105,000/year. While this may not be an issue for you now, it hopefully will be in the future, so get those contributions in while you can so they can grow tax-free over the course of your career.

In order to contribute to your Roth IRA, write yourself a check and mail it to your investment company; they will deposit it in an account in your name. The best way to do this is to mail in a check for $416.66 each month ($5,000/12). This will help you in your budgeting, and also keep you disciplined.

Your Checking Account

Speaking of writing checks, now that you’ve contributed to your 401k and Roth IRA, it’s time to make sure you have some “walking around money”. For that, you’ll need a checking account. A checking account provides you with quick, easy access to your money through ATMs, checks, and a debit card. This is the money you’ll use to pay your rent, cover your tab at happy hour, and buy that electric guitar you’ve always wanted.

You can get a checking account from any bank in the country, but far and away the best choice is Charles Schwab Investor Checking. Their two most attractive account features are 0.5% interest (compared with 0% at most banks) and unlimited, free use of any ATM in the world. I can’t stress this second point enough – no more wandering around town to find a specific bank’s ATM, no more paying a $3 “convenience fee” at the gas station. It’s all free, anywhere, all the time. I want mention that I’m not paid by Schwab and that’s not a referral link. I just think they’re awesome (and have been a customer for 4 years myself).

Once you’ve got your checking account open, set up direct deposit with your employer. They’ll drop your paychecks directly into your checking account, and you won’t need to worry about cashing checks every 2 weeks.

So now that the money is streaming in, should you just let it pile up in your checking account? My advice is to keep about $5,000 in your checking account for day-to-day use and personal spending, and get the rest out of there so it’s mentally earmarked for saving or a rainy day. So where should you put any left over money after your 401k and Roth IRA are maxed out, and you have $5,000 in your checking account?

Investing in Mutual Funds and Stocks

If you still have money left over, it’s time to think about investing in individual stocks or mutual funds. Lots of people that are smarter than me (and many who are not) have written miles of text on which stocks and funds you should and shouldn’t buy (caveat investor), so I’ll avoid telling you what to buy and focus on how you buy it.

You’ll need a brokerage account. As with your checking account, there are countless firms that can give you what you need here, but be aware of fees. If you’re only investing a few thousand dollars, commissions can significantly eat into your profits. That’s why I want to make another recommendation – use TradeKing as your broker. Commissions are only $4.95 per trade (the lowest I’ve found anywhere), and they’ll let you trade stocks, options, and mutual funds. Again, they’re not paying me a dime – I just genuinely think they’re the best option.

Once you transfer some money into your brokerage account, it’s time to buy some stocks. Pick up the Wall Street Journal, read the news, and educate yourself – this is a good chance for you to start to learn about investing while the stakes are relatively low. Think long term – remember, you’re investing not trading. Be aware of capital gains tax laws – any profits from a position you hold for under 1 year are taxed as normal income at your normal tax rate (which could be as high as 30%). But if you hold a position for longer than a year, you pay only the long term capital gains rate of between 0% and 15% (depending on your tax bracket). So keep that in mind when you’re tempted to trade quickly in and out of stocks.

If you don’t have the time, knowledge, or inclination to pick individual stocks, you can use your TradeKing account to purchase nearly any of Vanguard’s 100+ index funds – all you need are their tickers, which you can find and research on Vanguard’s site here. While everyone’s investment objectives are different, if you want a set it and forget it index fund, take a look at VEIPXVDEQXVWINX, or VGSTX.

In Summary

So there you have it – a complete blueprint to getting organized financially in the real world. Let’s sum up the structure we’ve set up for you:

  • 401k Contribution — Enough to receive your full employer match, no more (every paycheck)
  • Roth IRA — $5,000 per year (one $416.66 contribution each month)
  • Checking Account — Consistent $5,000 balance for every day expenses, direct deposit, free ATM use
  • Brokerage Account — Any additional savings are invested in stocks or mutual funds for the long term

If you’re able to follow the blueprint I’ve laid out above, you will not only be able to sleep well at night knowing you’re doing the right things with your money, but also will have set yourself up with a framework to save responsibly over time and build wealth in the long term.

What do you hate buying?

This post was written by Jeff, who blogs on finances, health and the environment at sustainable life blog. He’s not as funny as Ninja, (or as good at drawing) but he does enjoy sunshine and dinosaurs.

When I went to college, I moved to a town that was about an hour from where I grew up. That meant that whenever I needed something odd or that I would use just once or twice and not need again, I could just go take it from my parents house. Usually, they wouldn’t mind (or wouldnt know it was missing) and I didn’t have to buy something that I didn’t want to buy. This was good for me, but later I realized that it set me up for being rather annoyed later in life when I moved farther away.

Because I always went home to get things when I needed them, my “budget” (who am I kidding, I didn’t have one) consisted only of things that I liked to buy/had to pay for like a cell phone, internet, rent and fun activities with my friends. I rarely spent money on things that were used in everyday life, such as bedsheets, pillows and dishes.

I considered buying those things a waste of my hard earned money, and an extremely lame use of resources to boot. I know my economics, every dollar that you spend on bed sheets means 1/8th of a burrito that you cant buy to enjoy with friends. So, I coasted along for 4 years not really buying anything of that sort and generally dismissing the purchase every time I needed something.

This set me up for a world of annoyance when I moved further away from my parents. I was making the bed one day when I realized my pillows were in dire need of replacement. I sat there dumbfounded for a while, wondering what to do. I really didn’t want to spent money on a stupid set of pillows. How lame. Money is supposed to be for fun stuff.

Reluctantly, I trudged down to the local Wal-Mart (basically the only place I could get pillows in town) and bought some. I wasn’t happy that I had to buy them, but buy them I did. However, I ended up seeing this as an important lesson for me on the allocation of my finances. Sometimes, you cant just spend all your spare change on fun, food and friends. You need some things to live and be comfortable, and no matter how much it sucks buying 6 bathroom towels when you’re 23, you’re showing you know how to use your (most likely limited) resources wisely.

I’d also like to add medical services of any kind to this list. I hate paying the bills for the eye doctor and the dentist.

To The Readers:
Are there any things that you absolutely hate buying? What are they and why do you hate to buy them so much