Punch Debt In The Face

"A dilemma"….follow up

by Ninja on April 3, 2009

About two weeks ago I posted about a dilemma I was having. For those unfamiliar, I was unsure of the amount of my disposable income I wanted to allocate to my “future house fund” and how much I wanted to throw at my student loan. That article has been my most read post and by far the most responded to. After mulling it over, running numbers, and deciding what I wanted my goals to be, I have reached a conclusion. I am committing to throw $1,000 each month towards that bad boy. That was the overwhelming recommendation from each reader that responded! I think in my head I was justifying the necessity to hoard my cash and put it all in my savings, when this clearly opposes mathematical reasoning.

Although I still believe personal finance needs to remain personal, I agree the numbers need to be strongly considered. I became focused on the desire to purchase a house (taking on more debt) when I should have been concerting my efforts towards breaking up with Sallie Mae.

This decision couldn’t have come at a better time! With a little over $12K in the bank, my Emergency Fund is fully funded (6 months pay) and allows me the freedom to throw as little or as much money as I’d like at my future house fund, or even better, towards my school loan.

So on this day, April 3rd 2009, I commit to putting a minimum of $1,000 to my school loans each month. Thank you fellow bloggers for whispering wisdom in my ear and opening my eyes… hey its like that Ace of Base Song… “I saw the sign, and it opened up my eyes, I saw the sign!” Booya for Ace of Base, Booya for sweet advice from bloggers, and double Booya for paying down debt!

I am punching Sallie Mae in the face!

Would you pay $10MM for a Hanger?

by Ninja on April 1, 2009 · 2 comments

Have you ever heard anyone say “There is no reason to reinvent the wheel.” or”If it’s not broken, don’t fix it”? Well if so go tell that person they owe you $10 million. I did a little google millionaire research and came across Devon Rifkin, a self made millionaire. I’ll give the gist of the article, but if you want the whole story or to look at other millionaires go here

Devon Rifkin,33
The Great American Hanger Company/Hangers.com, Miami
Projected 2007 Sales: $10 million-plus
Description: Manufacturer, wholesaler and retailer of clothes hangers

Frame of Reference: The fact that Devon Rifkin never attended college is just a tiny footnote in his success story. The fact that he has made millions selling hangers is slightly more unique. But for Rifkin, defying the standards means nothing if his business isn’t successful–or if his team isn’t sharing in the success. Says Rifkin, “To me, people have made the biggest difference because they’re the face of the business.”…

Essentially, homeboy was like “I don’t want to work for my dad so I guess I’m gonna make hangers and call my business The Great American Hanger Company. Oh and I’ll make millions doing it to.” That right their is ballerrific (combination of baller and terrific). It’s not like there was a world shortage of hangers and someone desperately needed to step up to the plate and provide, unless I missed something? But seriously, this guy took a simple, ordinary, everyday household item and reinvented the wheel. This got me thinking “What everyday necessity could I reinvent that will lead to my success?” I came up with two ideas….

…if I put “The Great American” before my product it will make me a millionaire right? Seriously though, it’s cool to see an average joe take a normal product and make it something that companies and people want. It should also serve as encouragement and remind us if 33 year old Hanger Guy can do it, so can we. You don’t have to invent something great, you just have to take something and make it better. Get out there and go reinvent the wheel.

New Website = Tight!

by Ninja on April 1, 2009

If you’re looking for One Chance To Live you’re at the right place. This is the new PERMANENT site. Everything should be the same, except the name Take a look around and thanks for stopping by!

A $20,000 transmission = Dumb.

by Ninja on April 1, 2009 · 1 comment

So I was browsing my facebook page the other day, when I saw a sparkly new car show up in one of my friends’ posts. Being that I am an Investigator for a living, I worked my magic and discovered my friend purchased a brand spankin’ new Jeep Cherokee. I thought it was a little odd that she purchased a new car being that the last time I spoke with her she was looking to quit her part time job at a local photography studio. I didn’t think much of it and I carried along with my facebook friend stalking.

On Friday night I was attending a dinner banquet/fundraiser for a youth group I am part of (YoungLife). While at the banquet, in walked Ms. Jeep Cherokee. We started chatting and I mentioned I noticed she had got a new car. I asked her a little about the circumstances leading up to the purchase. She told me that her last car’s transmission went out and it was going to cost $2,000 dollars to fix. With excitement, she further explained that her car was only worth $900 dollars so it wasn’t worth fixing. Im thinking to myself… “Okay makes sense, time to get a different vehicle.” But then she said “So I went and bought the Jeep.” When she said that, it took every ounce of my energy to prevent from physically cringing. I wanted, so badly, to know everything about her situation. I wanted to know, how much the car cost, how much she put down, and what the Hello she was thinking. Instead, I smiled politely and said “Well that’s exciting.”

Since when did a broken transmission become a justification for a $20,000 loan? I’d bet my right ear she put less than 10% down and now has a couple hundred dollar monthly payment to look forward to. I think what upsets me the most is that she is completely oblivious to the gravity of taking on such a big loan. I desperately want to sit down with her and ask why she didn’t sell the old car for $900 and buy a $5,000 ride? To be fair, she must drive cars until they are on their last legs, so hopefully she will hold on to the Jeep for the next 20 years, but I still don’t think that justifies it. I know most of us PFers have encountered similar situations. What did you do? Do you smile and politely pretend like your excited for them? Do you slap them across the face and tell them their dumb? Where is the line between telling someone how to manage their money and what makes the best mathematical and financial sense?

Depreciating assets suck,

My Expenses: February 2009

by Ninja on March 31, 2009 · 1 comment

Each month I’m going to try and post a list of my monthly expenses. This may or may not be of interest to my readers (sorry if you find this boring). If nothing else, it will allow me the opportunity to look back and see how my spending habits have changed over the long term. So here it is full disclosure baby… this is where my February cash flow went…

Explanation of Income:

Gift: This is money that I wasn’t expecting to get that fell my way. $500 this month was a great little bonus. I’m always stoked whenever this row is bigger than zero!

Interest Inc: Any interest that I may collect from investment/savings accounts. I’m a little creeped out that it worked out to $6.66 this month. Dear, Satan, please stay away from my bank account

Salary: My take home pay from the day job. I get paid every two weeks, so twice a year I get an extra paycheck for the month. May and October is when this joyuous occasion takes place this year.

Tax Refund: Self explanatory. (This was my Federal refund)

Tutoring: Something I do in my free time to make a little extra cash flow. This income varies widely from $200 to $1200 a month. At $772 I got no complaints.

If anyone wants to contribute money to any of my income categories, I wouldn’t be opposed, as all gifts are accepted….haha.

Explanation of Expenses:

Auto: Any maintenance and fuel costs associated with my car or motorcycle. This category excludes vehicle insurance. I’m telling you that motorcycle saves me some green…even though it is kinda dangerous.

Cash: Any cash withdrawals from an ATM.

Charity: $300 big ones split between a Christian Radio station I listen to and my church.

Dining: The dollar bills I be droppin’ when I take my lady on a sweet date (or when I’m alone and craving a tasty burrito)

Gifts: Any money I spend on someone else. In case you didn’t get the memo, February was Valentines Day so spending was a decent amount higher than normal months.

Groceries: Any food that I buy from a grocery store. My goal is to keep my dining and grocery expenses at about $250 each month. I get really happy when I am under that amount, like this month!!

Insurance: Includes car, motorcycle, and renters insurance.

Interest expense: This is my school loan . I have a monthly obligation of $178, but as mentioned in my other posts, I pay about double that each month. I took the $330 I normally put towards the loan and combined it with the $500 unexpected gift to take a small chunk out of my $25,000 balance. It wont be long till I kick Sallie Mae to the curb. Booya!

Reimbursement: This category gets a number put in it when I send the mob to go collect any money people owe me.

The overall total is the cash I had leftover after all my expenses. This goes straight in to my online savings account and, either stays there, or gets put in my Roth IRA.

Sooooo, this is where my money goes. I try to keep it in line with my spending plan a.k.a da budget. February was a pretty darn good month and I didn’t really break the bank in any one category. Keepin’ my life in order is super important to me and I love knowing where every dollar I made goes. Kinda weird to think you don’t know what I look like, but you know how much money I spent on household items in February. Does that make you creepy? Or me?

Carpe Diem,