Jana Says

Yakezie Blog Swap #11: Finance 101: Keep your debt to a minimum

September 2, 2011 by Jana 8 Comments

Hi, I’m Little House from Little House in the Valley and I’m part of a larger personal finance blogger’s network called the Yakezie.com. Our community of finance bloggers selflessly support others with the common goal of sharing our finance experience and knowledge. As part of that support, we frequently swap posts to help broaden our readership. This month our blog swap topic is about the Best Tip for College Freshmen. Be sure to surf over to my site as well to read another member’s perspective on their Best Tip for College Freshmen.

As I pondered the single best tip I’d give to a college freshmen this semester, I was brimming with advice. However, much of that advice would go in one ear and right out the other, like budgeting for example (though an important skill). Instead, there are plenty of online programs to help manage a student’s spending automatically. So, as I weighed my suggestions based on importance, I decided that the single best tip for college students would be KEEP YOUR DEBT TO A MINIMUM.I can’t stress the magnitude of this tip alone without practically screaming it from the post in capital letters. When I mention debt, it can come in all forms; student loan debt, credit card debt, and *gulp* personal lines of credit debt.But before I go into the benefits of keeping your debt to a minimum, let me just outline a few ways to reign in the spending.Keeping school expenses within limits (warning: these tips do require some budgeting):

Housing – If you are attending college near your hometown, living at home will save a bundle of money. It may not be your first choice, but in the end it could save thousands of dollars. If you’re attending a college too far from home, check out alternatives to living on campus. Is there an apartment complex nearby that caters to college students for less than a dorm would cost you? Do you have friends attending the same college? Share a small apartment instead.
Books – University book stores are seldom the least expensive option. Get online and hunt down your books for less a week or two before classes begin. Don’t forget to check Amazon, eBay, Abe Books, and Chegg to name a few. Renting textbooks is also an option. Just be sure to weigh the pros and cons. When you’re finished with the books, you also have the option to sell them to recoup a bit of your expense.
Food – Learn to cook. Even if you can’t replicate Wolfgang Puck, learn to make a couple of pasta dishes, bean and cheese burritos, and sandwiches. Squeeze a couple of fruits and veggies in with every meal or so, and you’re verging on healthy.
Travel – So your friends are going to Cabo for Spring Break and you don’t have the cash. Skip the trip. Your time for travel will come when you have a full time job. Set a monetary limit for traveling each year and stick to it.

Now that I’ve outlined how to keep your expenses to a minimum, let me explain the benefits to keeping your debt to a minimum.Imagine you’re approaching graduation. You already have a job lined up thanks to some smart planning and internships. Your debt is minimal, only taking out student loans to cover education costs that scholarships and grants didn’t cover, and the total is less than what your first year’s salary will be. Your first year out of school will be its own adventure, but you’re not worried about drowning in debt, like some of your Spring Break Cabo friends, because you were wise enough to keep your debt under control and not get lured into splurging on credit.You’ve made a plan to pay off your student loan debt in five years so that you can purchase a house, move to a new city, or start your own business because you are debt free, something not many people can claim. Since you are debt free, you have choices others do not have.Keeping your debt to a minimum by making wise choices has opened up a multitude of other choices available to those who are debt free.

Are you keeping your debt and student loan debt to a minimum?

Wednesday guest post and some link love

August 31, 2011 by Jana 3 Comments

Today I have a guest post over at Baking the Budget. I was quite honored that she asked me as I have a lot of respect for her and what she does with her finances. If you have a chance, check out my post and make sure you take some time to read her site. She’s quite knowledgeable.

While you’re out visiting others, check out these posts:

Andrea at So Over Debt discussing why poverty is not a disease.
101 Centavos paying tribute to his grandfather.
Minting Nickels talking about why it’s OK to be a B.
Mom’s Plans giving great advice on how to buy organic foods on a budget
One Cent at a Time musing on what a blogger can learn from Steve Jobs
Wealth Informatics disseminating probably the most comprehensive breakdown of FSA/HSA benefits

And if you’re stopping by here for the first time from Baking the Budget, thanks for visiting!

Money Tune Tuesday: Something To Believe In

August 30, 2011 by Jana 2 Comments

I am a sucker for a good power ballad. Truthfully, I like all hair band songs but there’s just something about a good power ballad that makes me happy. And there are so many good ones to choose from: Steelheart’s “I’ll Never Let You Go”, Tesla’s “Love Song”, Warrant’s “I Saw Red”, Motley Crue’s “Home Sweet Home”, Skid Row’s “Wasted Time”. I could go on (and on and on) but I’ll spare you.

Perhaps one of the most popular power ballads is Poison’s “Every Rose Has Its Thorn”. While that’s a good song (but slightly overrated in my opinion), Poison has a significantly better power ballad–“Something To Believe In”. It’s a really pretty yet cynical and sad song, with very poignant lyrics (which I did not even need to look up in order to quote!). Here’s a sample:

“I drive by the homeless sleeping on the cold dark street,
Like bodies in an open grave
Underneath the broken old neon sign
That used to read Jesus Saves

A mile away live the rich folks
And I see how they’re livin’ it up
While poor they eat from hand to mouth
The rich drink it from the golden cup

And it just makes me wonder
Why so many lose and so few win”

Whatever you’re opinions on the causes of poverty, or the solution (if there is one), there’s no denying that it exists. And the way this song paints the picture is just so, well, accurate.

Check out the video below for the entire song:

Revising home economics

August 29, 2011 by Jana 13 Comments

As I was sewing a button onto my husband’s shorts the other day, he made a comment that he’s glad I took home ec in middle school. It wasn’t like a had a choice! Where I went to school, we were required to have 1 marking period each year, for all three years, of home economics. While that’s all fine and good, I can’t say that many of my home ec skills were learned during that time.

Sure, I learned how to sew a button and make pillows but there’s really not much else I learned. Oh, wait! I did read a recipe. Once. Mainly it was just a bunch of 11-13 year old girls sitting in a stuffy, windowless room, pretending to do actual work and talking about which boys were cute. It was great fun at the time but now, as an adult reflecting back, I realize what a gigantic waste of time that class really was. And it had so much potential!

Don’t get me wrong. I’m not faulting the teachers. They did a great job. We just weren’t ready to learn what they were teaching and those skills are not practical to teach 11-13 year old girls. But I do feel that home ec is an important class (which, by the way, I feel that boys should be required to take as well. Learning how to take care of oneself and one’s home is not solely a female job). People need to learn these important skills. Here are some of the changes I suggest:

Move it high school, particularly in the 11th or 12th grade as students are getting prepared for college. The information will be fresher and more relevant.
Teach skills for grocery savings. Kids have no idea how much food costs and if they’re getting ready to live on their own, it’s a good idea to give them some background information. Incorporate menu planning, looking for sales and using coupons. And while we’re on the subject, give kids ideas on how to prepare meals beyond macaroni and cheese from a box. Practical meals, not elaborate dishes.
Teach skills for how to effectively and inexpensively clean a house/apartment. Go over the importance of home hygiene, including methods for organization and establishing some sort of cleaning routine that also discusses doing laundry. My husband lived in his fraternity house for 3 years. I speak from personal experience when I say that boys must learn how to clean! My immune system is greatly improved from the time I spent in that house. (This is not to say that girls are immaculate. But I don’t know anyone who got ringworm from living in a sorority house.)
Teach basic personal finance skills. This includes how to balance a checkbook or use online banking effectively, the pros and cons of credit cards, having a budget, how to create a budget, how to look for a job, the soft skills required to obtain and keep a job, and the importance of paying bills on time. You cannot function as an adult if you do not have this information. I will leave the discussion about student loans, car loans, mortgages, and any other sort of major personal finance decision to the discretion of the teacher. This information may be better suited for another type of class.

Some people may think that this is a bit too sophisticated for home economics. I respectfully disagree. These are all elements that are crucial to running, maintaining and keeping a home. Many kids do not learn these skills from their parents or guardians. And I will concede that on some level, it is the parents’ responsibility to teach these skills to their children. Unfortunately, for whatever reason, many parents don’t do it. My parents didn’t. I didn’t know how to cook, balance a checkbook, clean my room properly, pay a bill or even make my own doctor appointments until I went to college. I only learned how to do my laundry at 16 because I was on a cross-country trip where we stopped at laundromats to wash our clothes. There was no real reason my parents didn’t teach me these skills; they just didn’t think it was important. Whether they thought they would always do it for me or I was too stupid to learn, I’ll never know. But it was only through trial and error, and reaching back into the depths of my brain to recall what I learned in middle school, was I able to survive.

Kids who are in the foster care system are offered the opportunity to work with programs and mentors on Independent Living Skills as they prepare to age out of the system and I think it’s wonderful that they’re given that opportunity. They sure as hell deserve it. But I think we need to start doing a better job of preparing all students to be responsible and practical adults. Schools are a great place to start.

Money Shuffle

August 26, 2011 by Jana 7 Comments

One of my most favorite possessions is my iPod. I love the entertainment it provides and I relish in the escape I get from music. I appreciate all kinds of music (with my favorite being the overall rock genre), and my iPod reflects my eclectic taste.

I also am a regular listener of Preston and Steve (for those not in the Philly area, this means nothing but they are, hands down, the best morning show I have ever heard) and have been for about 10 years. They play an assorted amount of on-air games, one of which is…well, I don’t exactly remember the name of it but it involves their iPods and 5 songs. So I decided to play my version of this game. I’ve named it “Money Shuffle”.

The rules are simple. I set my iPod on shuffle and wrote down the first 5 songs (yes, the actual first 5 songs. I didn’t skip if I didn’t like the song) that came up. Then I thought of a financial situation that I was in that was related to the song title but not necessarily the subject matter of the song. And now, the results:

Song #1 “Where Were You” by Journey–This one gave me some trouble but I eventually realized that this applies to every time I lose a coupon that I planned to bring with me on a shopping trip. I have a terrible habit of misplacing coupons right before I need to use them. I will often find them a week later and think “where were you when I needed you?!”

Song #2 “I Hope You Dance” by Lee Ann Womack–The easiest one of the 5 as it was the song my husband and his mother danced to at our wedding. I was then prompted to think of the cost of a wedding, and how ridiculous people can get. Going into debt for a wedding is so not worth it!

Song #3 “Your House” by Jimmy Eat World–Buying my house was both the smartest and dumbest decision I have ever made. I love that I’m a homeowner and have learned so much about budgeting and how to afford to take care of a home as a result but I really wish I’d waited to purchase a home. Lesson learned from that scenario: never let your emotions dictate a major financial purchase.

Song #4 “On Fire” by Switchfoot–This song reminded me of the time I melted our kitchen floor and was fortunate enough not to actually set my house on fire. It speaks to the importance of not only kitchen safety but the importance of having insurance and a home repair fund because let me tell you that replacing that floor was not cheap.

Song #5 “Desperately” by Slaughter–Oh, how many situations does this apply to? Too many to count. But I’ll tell you about the time I was so desperate that my then-boyfriend (and now husband) were a day away from payday and were were literally down to nothing to eat in the house. Literally, nothing. We went on a virtual scavenger hunt for any sort of loose change we could find. No stone was left unturned (seriously, no stone. I think we even were looking on the ground). We finally collected enough and went to nearest grocery store with a CoinStar. We made about $20, even with the 8.5% fee that CoinStar takes. We bought a box of pasta, some sauce and English muffins for breakfast the next day. That cost about $5. What did we do with the rest? We went drinking! How’s that for priorities?

Well, that’s it for this edition of “Money Shuffle”. Thanks for tuning in!