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    • 1 More Day

    By admin | June 27, 2008

    Like I said earlier this will be my last post for the next two weeks on account of my Wedding tomorrow!

    Thanks to all for frequenting this site, and a special thank you for my family and especially my parents for all they have done. 

    I will pick back up after I get home from the honeymoon!

    Topics: Life | No Comments »

    $100 to Reserach You!

    By admin | June 26, 2008

    Courtesy of Hustler Money Blog

    Want some Cash?  How about a Yahoo $100 Research Promo.

    Here’s the deal:

    We conduct research in many ways, such as:

    * Visiting you at your location in a field study
    * Inviting you to come into a Yahoo! office to participate in a usability study
    * Speaking with you in a telephone interview
    * Participating in an online focus group study
    * Connecting with you with an online survey

    Signing up does not guarantee you an entry into the research, but it doesn’t hurt to give it a try. $100 for an hour or two seems like a good deal.

    Topics: Deals | No Comments »

    Free on Your Birthday

    By admin | June 25, 2008

    I am a big birthday person. I love it when my birthday comes around and I make sure everyone knows it. In fact, last year I pulled the old Michael Scott where I will start a conversation with someone like this…

    Me: “Oh, Happy Birthday”
    Person: “Mmh, It’s not my birthday”
    Me: “Oh, I thought we had the same birthday”
    Person: “Happy Birthday Chris”
    Me: “Thanks!”

    Gets em every time.

    So what do I like as much as this attention??? Free Stuff, take a look at some great options for free stuff on your big day.

    For the Kids:

    Courtesy of Bargainist

    Topics: Deals | No Comments »

    Climbed Out Only to Jump Back In

    By admin | June 24, 2008

    Have you ever heard this saying.  The thought of someone working so hard to get out of whatever hole they were in, only to jump back in it once they are out exasperates me.

    I have heard a lot of people talk about “re-establishing” their credit after getting themselves into a mound of trouble through debt. I just read an article saying the best way to re-establish your credit after a bankruptcy is to get a low-limit credit card, make small purchases, then pay it off early each month.

    I am sure it does help your FICO score, however, I have a problem with this advice for two reasons.

    #1) Why should you care about increasing your FICO score anyway? All a FICO score is for is to allow you to borrow MORE money (even though that is the thing that got you in financial ruin in the first place.)

    #2) This advice takes the “human” element out of the equation. If personal finance was 100% finance and 0% personal then my advice would be different, but it is inaccurate to say this.

    When a person files for bankruptcy it is because they were so far in debt the could not get out of it. At this point isn’t this something that that person should avoid rather than jump back into it?

    I advise people to not be concerned with “re-establishing” their credit. There are steps that you can take that we talk about on this website that will enable you to eliminate debt completely from your life. The only thing that I consider “acceptable” debt is a home mortgage and getting a home mortgage is a different kind of beast when applying for it.

    The lender is 100% concerned with probability of paying it back (not with FICO score). If they see your savings increase and you don’t have any new entries on your credit report they will notice this (not just the FICO score). In fact, I don’t know of any lenders out there who would even turn down somebody that drops a 20% down payment on their house.

    I have heard before, “The definition of insanity is doing the same thing over and over and expecting different results.” Getting back into what got you into a mess in the first place should be considered insane.

    Topics: Debt | No Comments »

    Nice Problem to Have

    By admin | June 23, 2008

    I am a day dreamer.  I often relate to JD from Scrubs on a regular basis and find myself drifting off with my thoughts.  Sometimes I end up thinking through math problems oddly enough.

    One of the scenarios that I have thought of was if I won the lottery and won, let’s say 50 million dollars, should I take all that money and take the lump sum or should I take payments over the course of a certain amount of years?

    Now I know this is a nice problem to have (unless you are Hurley from LOST).  But let me show you what decision I would make.

    In order to answer, we need to put a few assumptions into play. Chances are, the lottery will want to spread out annuity payments across 25 years. Meaning, they would pay out 2 million a year. Or they will offer a settlement for usually about 60% the total.

    Lump Sum

    So, if I opted to get the lump sum now the approximate settlement would be $30,000,000 minus taxes (35% federal tax bracket = $10,500,000).

    So the total present value is $19,500,000.

    Yearly Payments

    This would be $2,000,000 minus taxes (35% federal tax bracket = $700,000).

    Net of $1,300,000 per year.

    However, there is a concept called the time value of money that we all learn in our entry level economics class. Basically, $1 now is more valuable than $1 a year from now, or 5 years from now, so you have to take that into play using financial calculations.

    I ran the numbers in my financial calculator and $1,300,000 per year for 25 years with the assumption of 4% inflation has the PRESENT value of $20,308,703.93.

    So according to our assumptions:

    Lump Sum Present Value = $19,500,000

    Yearly Payment Present Value = $20,300,000

    Both are similar which is what I expected to find when I ran the numbers, but getting the annual payment actually looks like you might come out a little ahead. The results will change depending on what the assumptions are, so make sure when you win your millions to run the numbers again just to be sure.

    Topics: Planning | No Comments »

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