Do Better: Why Going Out On NYE Should Be A Financial Faux Pas

I'm not sure which holiday I find more pointless...Halloween or New Years' Eve. Why do I despise these two holidays so??? They cause people to be ridiculously reckless and not the least bit financially savvy.

Halloween
Let's be honest, there are two holidays that (as an adult) are only for the purpose of partying: St. Patty's and Halloween. St.Patty's I love. Halloween I hate.

Halloween costumes are the most expensive cheap thing I've ever seen in my life. Most of them are made out of something close to plastic (have you ever, EVER, seen a high quality Halloween costume?) but they cost you approximately $30-$40-$50 + shipping and handling  (because the really good ones probably aren't in stores). St. Patty's only requires a little green and a lot of beer. Both cheap options for me and just as fun.

Why would you ever waste your money on a Halloween costume?

New Years' Eve
Can someone please calculate (and post) how much money they spend on NYE...because I couldn't find a stat but I'm sure if people really calculated it, they would realize it is hardly the most fun they have all year but probably the most they pay to have fun all year. In fact, NYE might be the worst night ever to go out becauseeee:

• Every establishment charges an arm and a leg to get in. They make you think it's worth it because there's food and open bar but really that is just a ploy to help millions of not-so-smart people rationalize why it's remotely okay to spend $70-200 on cover to a club. Club goers say: "welllll I would spend that much including cover and drinks anyway, and I mean, it's NYE."
• Do you really consume enough drinks at a club on NYE to rationalize the crazy amount you paid for your ticket? I think not. We all know that the bar is so flipping crowded that it takes you at least 15 minutes to get one measly drink. The club owners usually put the kibosh on double fisting and you and your friends end up either making some elaborate scheme to figure out how you can maximize your alcohol intake, or become really annoyed and pissed at the barrage of people you have to fight through for one (included) drink. So most of you (admit it) pregame enough to make sure you only need a few drinks at the "open bar" because you know that filthy bar line could completely ruin your night. You learned your lesson on depending on that open bar last year right?
• Or, or, or, an alternative to the above is arriving at the party extremely early...likeeee 8:30/9 and soaking up as much alcohol as you can before it gets super crowded. But oh, by the time midnight hits, your feet are hurting, you're sweaty, you are almost starting to lose your buzz (and don't want to be bothered with the barrage of people at the bar because that's what you came early to avoid in the first place) andddd you realize...all of this still...is an ultimate FAIL.
• A new outfit is a must. Would anyone dare be seen in anything they already have in their closet? But I don't know why not...because NYE is easily the messiest club night of the year. Does anyone live by the 3-foot bubble rule? Well not on NYE you don't. Everything is jam packed, crowded, smushed, cramped, extremely annoying. This means more folks bumping into you, spilling on you, sweating on you and just overall touching you (and not in a good way).

If you've already wasted spent your money on a fabulous NYE ticket...no worries...I'm not judging you, I'm merely saying...

Maybe you can do better next year.

Are You The Type of Woman A Man SHOULD Date?

I think there's an important distinction to be made for the type of women men normally date and the type of women men should date. The difference is that men see the first type of woman (and date her) for all of the "less-important" superficial things. She is attractive - very desirable to other men aka "a nice arm piece". She has a good resume - education, ambition, "wifey" skills (cooking, cleaning, bearing children and still looking good after she does so). She is decent to hang out with - can be fun, good in bed, the fam will probably like her...essentially, he can stand being around her.

Don't get me wrong, all of those qualities are great to look for, but I think a major issue today is that 20-something men focus too much on those (and make them non-negotiables) and not enough on the ones that will shape, mold, and impact their lives in a far greater and more positive way for possibly a far longer time. In essence, they ignore the types of women they should date.

I was inspired to write this post by another blog - 7 Types of Women Every Man Should Date - and my own dating journey. I would highly recommend you read it first before proceeding because I won't go into detail about each type like the writer does.

This morning was my second time reading this post, but it spoke to me in a much different way than when I first read it. I asked myself, how many of these types do I believe I embody and how many of these types would the men I've dated/talked to/been emotionally involved with agree I embody. It is SO important to make the distinction between the two because let's face it, at the end of the day, perception is everything folks...especially if you want a ring on it.

So ladies, when/if you read the link above, please ask yourselves the same questions.

Men, if you read it, ask yourself how many of these types do you truly look for in a woman you decide to pursue. Not only that, but how many of these trump your more "superficial" non-negotiables like the ones I listed above. Maybe they should move a little higher on the list? #justsayin

Okay let's dig in. Starting with...

1. Submitted to God - for the sake of being politically correct I will say, submitted to a higher being or something larger than oneself. I run into soooo many people who are so worried about being "open minded" and "accepting" of different types of people, that they are willing to move this outrageously important quality to the back burner. Now obviously if you, the man, don't believe, then this would probably be N/A for you. But if you do and yo momma raised you to believe in God, submit to Him and pray (even if your behind isn't in church as much as you should be) and you are thankful that yo momma raised you with these values because they have in some large way/shape/form influenced you to become a man of high character...why, on Earth, would you want to be with someone who would not raise your children with the same values?! There are a ton of other reasons why this should be #1 on your list (like really #1, not a fake #1 that you can let go if you really like her) but I'm not going to go there. 
2.  A Selfless Woman - basically this means a PARTNER. For some reason, and men have this issue too, we are all so consumed with what we want to do for ourselves. "I want to make sure my money, career, body, car, clothes, are right." "I can't get serious about anything until I am where I want to be." All of these are selfish thoughts and they in no way shape or form help us practice how to be selfless. There are many, many successful couples (the Obamas being one of them) who have accumulated success in money, careers and lifestyles to-ge-ther. Not only do I think it's doable, but I also think it makes a stronger, longer lasting marriage (I will point back to the Obamas again) when you've built your life to-ge-ther. But before we even get there...we have to learn to be selfless. Practicing the me-me-me attitude in your 20's won't help your become more selfless. Maybe we should start focusing more on this now.
3. A Simple and Low Maintenance Woman - I had to read this description about three times because I would not use any of those words to describe me...but I understand why he's saying these women are good catches. However, I'm not sure I think that in order to be focused on the important things in life, you have to be simple or low maintenance. I associate simple and low maintenance with an inability to be flyy and...I. Just. Can't. lol. I think it's okay to like nice things and to want nice things. However, I think a man needs to discern whether the woman is truly able to restrain herself and let go of worldly possessions when needed. While she may like or want nice things, does she flip out when she has to forgo a nice thing for a while or forever? Maybe I'm just making excuses because I just don't measure up to this one. You decide.
4. A Woman Who Can Truly Be Your Best Friend - Once, when I was in high school, I got a piece of advice about marriage (from someone who has been in a very long one) that will stick with me forever: "You should always marry your best friend because you can never stay upset with your best friend for too long" (and therefore the bad things that happen in your marriage will not be able to permanently tear the two of you apart). It's Just. That. Simple. 
5. Emotionally Stable - I don't think this means the woman can't be emotional. She can be emotional...she just needs to know how to put her emotions in check and not let them govern her actions. I do think it's harder for more emotional women to accomplish this...because I am one...but it's not impossible and I definitely understand why this is important. 
6. A Loyal and Patient Woman - which requires a loyal and patient man. Should I repeat that? Yes it's awesome to have a woman who will be there through thick and thin, support your dreams and cheer you on. But oftentimes it seems that the reverse isn't always true. My issues and shortcomings may be different than yours, but that doesn't mean you get to expect my support and patience and then get annoyed/frustrated with the ways I am trying to grow. Please remember that. 
7. A Woman With Character - "Character is what we do when other people are not looking." One of the statements I hate most is when people go "Well s/he didn't do it to me, so I have no reason not to like her/him." What?! How does that make sense to you? I'm the type of woman that will get really upset if any guy I'm in the company of feels the need to call another woman a bitch. It speaks to your character.  If he is calling her a bitch that means he WILL call me a bitch and that is not okay. Any guy I spend time with should respect all women, even the ones that make him upset. Men this goes for you too. If you are dating a woman who is always talking about her friends or who doesn't respect her family, it speaks to her character. Just because it's not you she's talking about or disrespecting doesn't mean that she will never treat you that way. In fact she probably will.

I would like to consider myself more focused on being the type of woman a man realizes that he wants in his life for the long term. Unfortunately for myself and a lot of my close friends, it's really hard to keep hope alive because guys oftentimes look past you despite admitting that you have most (if not all) of the qualities listed above. They look past you because while they think those things are great, they're more focused on the superficial that makes them happy for 6 months to a year instead of the qualities that will keep them happy for a lifetime.

Posts like the one on Quentin McCall's blog help reassure me that I'm on the right path and that I'm focusing on the right enhancements, but also that I still have growing to do. God is not done with me yet but I'm glad that at 25 I can confidently say...

I am the type of woman a man should date.

Planning Travel for 2012

Top Budget Travel Destinations for 2012
that's a link y'all

Any of these places on your bucket list? Might want to save your pennies and make it there in 2012 because according to that article, they have the best bang for your buck.

• Azores
• Egypt
• San Diego
• San Antonio
• Atlantic Canada
• Belize
• Poland
• Tapei
• Athens
• Kansas City

You have time to decide. In the meantime...

PLEASE HAVE A HAPPY AND SAFE HOLIDAY!

I don't know a more selfish group of people than...Republicans

This is totally a vent post. Excuse me while I...

You know, sometimes, I can almost, kinda, maybe, on a good day, see where some Republicans are coming from...sometimes. But most of the time, I truly believe that these "standoffs" they have with Democrats are completely selfish and ridiculous.

People are struggggling and you are refusing to pass a bill that would allow them to keep $20/week in their pockets and a roof over their head in the event that they lose a job...even though the bill really only extends this "luxury" until the end of February (which might as well be now, I get it, that's not a real solution, but at least it puts some tick on the clock). Republicans still refuse!

Republicans are trying to make the Dems look bad by saying that the Dems are being the irrational individuals. They're leaving for their holiday vacations anyway, while the Republicans are diligently in Washington "trying to find a fix," "trying to negotiate." Give me a fawking break!

Moreover, the House Republicans want to call the Senate back to talk to them about it too. Now maybe this is my lack of knowledge about the system but...the Senate passed the bill 89-10, they're done, they've done their part, you, House, on the other hand, are the one that isn't finished. 

My Senator, Dick Durbin (IL-D), made a point on the news that I would like for us to examine further. He mentioned that he thinks the Republicans are doing this because the U.S. economy is slowly getting better and they do not want it to recover on Obama's watch (Bc let's face it, if Obama can show America that he has improved the economy we've [Dems] all been saying Bush effed up, Obama is going to win a 2nd term. If not, Republicans have a better chance, and a very possible one may I add, to get the Oval office back).

So it's simple economics...take money out of folks' pockets in the form of higher taxes and/or less unemployment benefits, they spend less, consumption goes down, and we all know consumption is only the biggest thing we usually look toward to determine the state of the economy...and there you have it, the economy does not keep getting better.

I would love, LOVE, to believe that Republicans are not that selfish. They could not possibly not give a damn about everyone else so much so, they would take it this far. But that seems to be the name of the game these days. I might be partial...wait, I take that back, I am partial...but I don't think the Dems are this bad.

Oh and Obama ending the War in Iraq and bringing tons of troops home in time for Christmas...genius. Have you heard? His approval ratings are reaching 50%. Republicans...you mad huh?

Curb Your Spending: Coupon Clipping

I bought a fashionable Nine West winter coat at the end of last winter season from Macy's online for: $0 out of my pocket

Let me see if I can remember the price breakdown:

1) End of Season = huge markdowns. The coat went from approximately $280 to $99. For that kind of bargain, why not buy your next winter coat at the end of the previous winter?

2) An additional promotion for 15% off of orders over $100 was being offered by Macy's (luckily they counted my $99 purchase as $100). This brings us down to a little under $85 for the coat.

3) I had a Macy's coupon for 20% off. This brings us down to $68. 

4) And I used a gift card I received for Christmas to cover the rest.

5) Oh and...Free. Shipping.

I get SO many compliments on this coat :-)

What I'm trying to say is...don't underestimate the power of a good bargain. Not only can keeping your eye open for great promotions and sales be beneficial, but searching for and saving coupons can be the difference between paying $20 for a coat (which is still awesome) and paying $0.

I am a coupon lover. I clip them for food, clothes, household necessities. I save the coupons I get with my receipts from Target and the grocery store (how many of you throw them away? Did you know that the coupons the machine spits out nowadays is usually for the exact items you just purchased?!) 
 
I keep my coupons on me at all times (clipped right to my daily planner in my purse) because you never know when you might need one.  I hate being at a store and thinking, dang, I think I had a coupon for this!

Most of us 20-somethings think coupon clipping is for old folks or "poor" folks, but the reality is, if you're trying to save money or curb your spending, you might want to take advantage yourself.

When are we...Damaged Goods?

Damaged Good (noun) - \damn-edge-d goo-d\ One who is no longer deemed valuable, desirable, or wanted due to being perceived as defective by the opposite sex, mainly because of a long-standing single relationship status. <She's beautiful and smart but she's 35 and has never been married, she must be damaged goods.>

I thought the rule of thumb is 30. Once you're 30, never been married, never been close to being engaged, are as single as a dollar, the perception by men is that something must be wrong with you. Because of course if you are educated, attractive and personable then a man somewhere would have scooped you up and put a ring on it. So because that isn't the case, something must be wrong with you.

The first date question will go from, "so, tell me about yourself..." to "so, why are you single..." Even more importantly, answering this question with "oh, I'm just young, focused on my career and having fun dating" is no longer acceptable. If you say that, something is REALLY wrong with you.

Recently, (as I approached the big 2-5) it was brought to my attention that this age has now been bumped up to 25! Well hot damn! I am 25! Lol. Scary right? Ehhh a little. 

Because I’m on this life high right now, I can write this post from a very positive point of view. If you all had caught me 4 months ago…oh gosh, I don’t even want to think about what negative things I would’ve had to say. 

I semi agree that by some age, a woman should, at the very least, have been in some form of a long-term, serious commitment (even if it didn't end in marriage). But I also think that there may in fact be a very good reason (or several) why this hasn't happened for said woman. Not to mention, what if the problem with a woman is that she sticks around in meaningless commitments non-relationships too long??? So yeah, a guy has put up with her for 2-3 years, buttttt the entire time she was really just his "bottom bish" and he has always been waiting for something better to come along. How many of us know (or were) that woman??? Exxxxactly. These days...the days of non-titles and non-relationships, it doesn't seem as cut and dry as it was in the past; the past days of one man, one woman, love, a proposal, marriage and then kids.

So if we must keep this rule, I would like to argue that the age should be 30 (and very soon being increased to 32, if only for my sake..lol). I mean at 25, you’ve barely started your career (most of us are about 3 years in). At the VERY least, you’re JUST becoming grounded. You’ve JUST become financially stable, developed a decent life savings, maintained a certain standard of living for a little while, and gotten into the groove of adulthood. Who in his right mind would expect you to be finished and scooped up by 25??? Now, I’m not knocking anyone who is...that’s awesome! However, for those of us who aren’t…I think it is only fair that we get another 5 years before we become…

Damaged Goods.

please.and thank you.

The Secret to Life...

Is not match.com.

Under the advice of one of my closest buds, I recently read "The Secret" by Rhonda Byrne. I would highly recommend any remotely spiritual person to pick it up. It's a really good book about the Law of Attraction (LoA) being the Secret to a happy, prosperous, and successful life. Don't think of the LoA simply in terms of relationships, but think about it in all facets of life. Think of it as "whatever I think, will become."

The book proclaims (and provides some evidence in the form of quotes from these individuals) that the most successful inventors and businessmen, knew this secret. As such, they were able to create things that no one else could even imagine..the light bulb, the telephone, the iPod, you get my drift...all because they did it with their minds first.

For me, the book just really made me aware of the power of my thoughts. The fact that if I think, repeatedly, that there are no "good Black men" or "all men are cheaters and liars" those things will be true time and time again for me. On the other hand, if I focus my thoughts on positive things..."I will have a very successful marriage," "I will be making a six-figure salary by 30," those things will be true for me.

There's more that goes along with the premise. The book goes deeper into things and there's a ton of repetition. But I think it's a good book to 1) read and 2) have on your bookshelf for trying times for a reminder to keep it positive.

One of my favorite quotes from the book, which I've saved as my iPhone wallpaper:

"...there is an affirmation that incorporates every single thing any human being can want, and this affirmation will bring about harmonious conditions to all things. The affirmation is this: "I am whole, perfect, strong, powerful, loving, harmonious, and happy.""

I. Can. Dig it.

p.s. I know I'm late, this book is old, it was on Oprah, and lots of folks have read it...BUT if I hadn't heard of it that means someone else hadn't AND if you have read it, maybe you should pick it up again.

Curb Your Spending: Brew vs. Buy

Us twenty somethings are serious about our coffee. And while this is okay with me...we need to be equally serious about our spending habits early on...

While I drink for taste (always getting decaf because I don't consume caffeine)...I'm still as addicted (ok maybe slightly less) as my peers who cannot go a day without their morning (or afternoon) cup of joe. Since I've made my job transition, I've picked up a very bad habit...spending $4 a day on my 'grande decaf no foam skinny vanilla latte' from Starbucks. If I'm in a good mood, I'm getting a pastry too.

A regular coffee from Stabucks runs about $2.20 (I've got the specialty drink disease). I hear some smarty pants out there rolling their neck and saying, "Well that's why I get my morning cup from McDonalds or Dunkin' Donuts. It's good and slightly cheaper. I spend less than $2 a day on my morning cup of Joe." You think you've outsmarted me. Think. Again.

A morning cup of coffee brewed at home cost about $.17/cup (6-ounce cup). So let's say you get 12 ounces with your store-bought cup...that same cup, made at home would cost you $.34/day.

I'll cut to the chase.

By buying ground or whole bean coffee from the grocer you would spend about $80 a year on coffee.

By going to McDonalds or Dunkin'Donuts everyday you are spending $480 a year on coffee.

Andddd for me, the specialty coffee whore...by buying a $4 flavored latte from Stabucks on the daily, I am spending $960 a year on coffee.That Howard Schultz is a fawkkkking genius. By the way, Starbucks sells a pound of whole bean coffee for about $12. This makes about 45 6-ounce cups which converts into $.58/day for a 12-ounce cup. This means $128 a year. Still a come-up.

You know what you could do with an extra $880 a year? No...not save it...

Buy a pair of really nice, red bottoms.

(Although for those of you who thought "save it" first...nice work, you're learning. I needed to make a bigger point though. The red bottoms make a big point.)

Note: These calculations are assuming Mon-Fri, 48 workweeks in a year (bc most folks get 4 weeks vacay and holiday time off)...so 240 days. If you get coffee on the weekends and your off-days...you can recalculate for 365. I just would prefer NOT to see those numbers. smh.
------

*Introducing: Curb Your Spending*
I received an email from a reader and she would love to see more on spending. She asked for one post. I decided, wouldn't it be fun to have a segment called "Curb Your Spending" where I talk about spending habits and advice on a regular basis.

The Moral of the Story Is....

Between this article and the one I posted regarding the pursuit of an MBA....I think the moral of the story is...

Get some work experience before pursuing a post graduate degree AND realllllly think about the market as it relates to the degree you're pursuing. It may or may not help, but it definitely WON'T hurt.

Shoutout to my LS Samantha Walls for being featured in this article on AOL jobs. :-) Check it out.
Why You Shouldn't Go Straight to Law School

Here ye...here ye! All the Black Friday deals....in one spreadsheet!

A colleague of mine sent me this AWESOME spreadsheet  that lists all of the Black Friday deals at ALL of the stores in one consolidated spreadsheet. Talk about LOVE.

Thought I'd Share: 2011 Black Friday Deals

HAPPY THANKSGIVING!

Remember to take the time (today and everyday) to reflect and think about all that you are thankful for. I want you all to know I'm thankful for you, for reading, appreciating and even critiquing 25andretiring. I am also thankful for all of the encouragement I've gotten regarding this blog and my growth. Thank you! Thank you! Thank you!

Have a blessed and safe holiday!

And be sure to check out my blog at midnight...I will have a post including ALL of the Black Friday deals...spreadsheet style (so yes, you can filter!!!). It's the most amazing thing ever!

Fast Forward: Where to Invest in 2012

Awesome article: Make Money in 2012

This article talks about where the market is going in 2012. Where you should probably look to invest. And what to look out for. Take a gander!

Just In Case You Were Thinking About an MBA...

I've been running into a lot of articles lately about why MBAs are a bad investment right now. The amount they cost (and the amount of debt you leave with) isn't worth the return on the investment (i.e. your salary once you leave the program). This has been noted especially true for the top tier business schools. So what's the solution? Lower tuition? I highly doubt that will happen...

Take a look: MBA Costs Soar

Match.WRONG

Okay, so this post requires me to be a little open and honest with you guys...but eh, what the hell, it's MUCH too funny not to share.

I recently, as in 2 days ago, signed up on Match.com, to give this online dating this a try...for the second time. Yes, I signed up for the 1st time while I was in public [accounting] and traveling 70% of time time. I think I lasted 30 days before I was completely disgusted and mortified that this could possibly be the pool of men I have to choose from. My initial reasoning for trying it out was because work didn't allow me to meet anyone...well outside of work. And two people I worked with met their boyfriend/husband on Match so I thought maybe I should take the stick from out of my *blank* and give it a try.

This time around, I decided...okay this could be a fun way to meet people during the winter months. Maybe, just maybe, there would be some cool cats on there. Keep in mind that I'm very picky when it comes to guys, probably much more picky than I have the right to be. It's cool though, I'm working on it. lol.

Anywho, day two and I get an email from some 38 year old man that reads:

I love you lady i live downtown chicago i,m a dj love me some oldschool and new2 so if you like a friend and a best friend or aman you can holla@yo man that me like going out to movie ' show ' bowling ,staking ,walk to the lake so if you need some thing like dat in your lyfe e.mail me and i will do the rest you feel me lady my queen is needed…

Seriously.

Seriously.

SERIOUSLY?!

After reading through it once, I had to send it to my bestie to decipher what the hell this guy was saying to me and she came up with:

I love you lady
I live in downtown Chicago
I'm a dj
I love old school and new school too
If you want a friend, a best friend, or a man--give me a call
I like movies ("the show"), bowling, skating, walks on the beach/lake
So if you enjoy these things too, e-mail me and I will gladly do the rest
Do you understand?
I need someone in my life that I can treat like a queen...

I just...I can't.

Do You Know What Your 401K is Doing?

For those of you who invest, or would like to start, the end of the year is a good time to take a look at your portfolio and figure out whether you want to shift things around in the near future. If you have a 401k or other retirement savings vehicle, this is absolutely something you should be doing at least once a year (if not more). Take a look at the funds you have your money going towards and ask yourself the following questions:

1) How did they do this year? Are they making money or losing money?
2) Are the riskier funds providing a larger return that the less risky options?
3) Am I diversified enough, for my age, income level, and how much I would like to save by retirement?

Most financial analysts would recommend investing a bit more aggressively while you're young, single, and have no kids. This is definitely the approach I take. What dose investing aggressively mean? Essentially, it's putting a larger percentage of your money in more risky investments (i.e. stocks are more risky than bonds).

Most 401k's (I've never seen one that doesn't) invest in mutual funds...which appear to you as these names you have never heard...like, American Funds Mutual Fund. Half the time, I don't know what they are either...so the thing I pay the most attention to is whether the funds I pick are fixed income, large cap, mid-cap, or small cap:

(in order from lowest to highest risk and return)

1) Fixed Income: these funds invest in bonds, which we should know are much less risky than stocks. Because of their very small risk, the return is also very small. If you're young, your retirement portfolio should not include a ton of fixed income funds. As you get older, it should include more.

2) Large-cap: These funds include companies with a market capitalization of about $8 billion or more. These are your very large companies who have been around for a while and have strength in the market. They're growth is pretty steady and therefore their returns are as well. These mutual funds will present less risk than the other two.

3) Mid-cap: This is the most popular choice for a lot of people because it represents the "middle-of-the-road" funds. The market cap for these funds are between $1B and $8B. They include companies that may offer a bit more return that a large cap because they're slightly smaller, a tiny bit newer, and a little more risky. I read in an article, that you can compare a mid-cap fund to a mid-size vehicle. It offers some of the benefits of the compact car (small-cap fund) without being as massive as an SUV (large-cap fund). I like this analogy. hehe.

4) Small-cap: This is where the money is at! lol. This is the most risky of the four options. These are new, baby, start up companies, with market caps below $1B. What does being new mean? The growth of these puppies can sky rocket (which means nice big returns for us), but due to their limited history, the financials are not as strong and therefore they can easily fail. So this is where you have the biggest risk but also the biggest return (or biggest loss).

The percentage of your money that you invest in the different types is totally up to you. I tend to be okay with taking on more risk while I'm living footloose and fancy free, so I put almost nothing in fixed income, very little in large cap, maybe about 30%  in mid cap and about half in small cap funds.

I will say that the more risky you go, the more often you should probably check your portfolio. Don't go moving things around every month...funds will have peaks and valleys, but you don't want to have 50% of your investment going to a small cap fund that's losing you a lot more money than you'd like for years on end. Alternatively, when you see a small cap getting you big returns, you might want to shift more money there while it's riding the big return wave.

The key here is that it's important to monitor what your retirement savings are doing (especially in this economy). You don't have to fully understand every little thing about the funds. It just takes a little common sense (and blog reading) to know what looks good and what looks bad.

Found this for the really cool kids: The Best Mutual Funds and Exchange Traded Funds

Happy Investing!

Job Hunt: How far are you willing to go?

During my daily browse of CNN Money, I saw a pretty interesting article:

I Doubled My Salary in North Dakota

I have quite a few associates/friends who are job hunting right now and most are having a pretty hard time finding jobs in major metropolitan areas. This article led me to ask myself how far I would be willing to move for some (or double) bigger bucks.

A newly discovered oil patch in small town North Dakota has attracted tons of oil business and therefore many new workers. The article showcases some pretty hefty salaries for blue collar jobs not needing college degrees. Imagine being the manager of a fast food taco joint making almost $100k a year. Or a young oil field worker, making upwards of $120k per year. All of these people moved from their hometowns (where jobs were scarce and pay was minimum wage) specifically to N.D. to take advantage of the up-and-booming economy.

I've run into some conversations recently around moving to low-populated areas to find jobs and make more money. A colleague of mine said his daughter moved to Idaho after college to become a public grade school teacher. She makes about $60k a year (I think that's better than a lot of teachers starting out). Maybe the new "thing" is to move to these desolate places your first year or two out of college, stack up some money and experience, and then make a move to the Chicagos, DCs, and New Yorks of the world.

So how far are you willing to go for the big bucks? As the age old saying goes...no pain, no gain.

Tax Tantrum Tuesdays: Tax Time a Ticking

I was thinking...

December 31 is almost here. You know what that means? Tax time is almost upon us.

Last tax season I spent a lot of time writing posts around income taxes and how to understand yours (remember the red bottoms?). This year I'm hoping most of you have taken the time and energy to pay more attention to your income in order to minimize money wasted in witholdings and maximize tax deductions.

My goal for the 2011 tax year was to be able to itemize. Since I don't own a home yet and therefore can't deduct property taxes or home loan interest, I can't use that to itemize. But! Charitable deductions and state income taxes are both itemized deductions I can take advantage of. So...I challenged myself to do more charity (the state is already taking my money) through tithing. Aside from tithing, I've also given $$$ here and there to other charitable organizations. Since tithing was something I should've been doing anyway (because I believe in it) I found this to be a great motivator for me to stay on it.

Confession: I fell off...somewhere around July. However, all hope is not lost! As long as my last tithes are paid by December 31, 2011, they count towards my curent year return. And so....I will be making a bulk tithe payment before the end of this year to cover the tithes I've missed from August - December.

Your task: Think about what your income tax return will look like now! Did you have any major job changes, income shifts, new possible deductions, possible lost deductions, that may impact your 2011 taxes in a few months? Think about those things now. Doing this and reaching out to a knowledgeable tax professional (or doing the research on your own) may alleviate the stress that tax season brings most Americans. You won't be fearing the unknown (that you somehow owe the government some absurd amount of money).

Instead...you'll know just what to expect.

Fed Up With Fees

Recently, there has been intense discussion regarding the new fees being imposed on customers by "big banks." When Bank of America announced the $5 fee it planned to impose on debit card users at the beginning of 2012, folks...went...crazy. Bank Transfer Day was organized in an effort to hit big banks where it hurts. Well...it worked.

In the month or so since this announcement was made, the news has reported that more than 650,000 "big bank" users have taken their money and accounts elsewhere...to credit unions. To give you an idea of how major this is...

• Credit unions across the nation normally see 650,000 new customers every year. To get this many in one month is a major increase for them.
• Bank of America has experienced a substantial drop in their stock price since losing so many customers (and thus so much money).
• Bank of America (and all other big banks: JP Morgan Chase, Wells Fargo, etc) have taken back their plans to impose monthly fees for debit card use. 

I guess Americans are sending a major message to "big banks." Something along the lines of....eff you, pay me.

In hearing this on the local news, I realized that I, a "big bank" customer (and lover, might I add),  don't really know the difference between credit unions and banks.  I decided to check it out and jot down the following lists of differences:

Banks

• for-profit
• publicly traded
• larger selection of products (retirement plans, investment plans, usually not offered by credit unions)
• regulated by Federal Reserve
• more ATMs and branches
• easy to join
• less personalized service
• primary focus: making money

Credit Unions

• not-for-profit 
• owned by members of the credit union
• members share a commonality (belong to the same church, school, employer, etc)
• regulated by National Credit Union Association
• limited locations
• limited range of product offerings
• higher interest rates on savings accounts (than banks)
• lower interest rates on loans (than banks)
• hard to find and join
• more personalized experience
• primary focus: making customers happy

A few important things to note about the above lists:

1) Because credit unions are non-profit entities, they are not subject to state and local taxes, have far less marketing expenses,  and don't have to pay out high executive salaries, like banks. These limited expenses allow them to offer higher interest rates on savings accounts, lower interest rates for loans, and lower or no fees on checking accounts, late payments and overdrafts.

2) Because credit unions are more concerned about pleasing their owners (the customers) they offer more educational services and seminars to teach customers about financial products and how to make smart financial decisions. Banks are less inclined to want you to be financially savvy because they are interested in making money.

3)  For both credit unions and banks, customers are insured up to $100,000. Just in case you're ballin' and thus this poses major cause for concern. lol.

I'm a big banker, but this list has definitely made me think twice about looking into credit unions. They could prove to be an awesome option as us 20-somethings to save for and purchase our first homes, kids' college educations, and retirement. This Bank Transfer Day just may have led to the rise of the credit union and if it saves me money...I'm not mad at that!

Update: I found this article about folks like me who are addicted to their big banks. Check it out.
I'm Addicted To My Big Bank

What Is Your Capacity?

Have you ever had a friend, significant other or any other person in your life, whom you felt was not giving as much of themselves to your relationship as you were. Even worse, it felt like they just didn’t get it. They didn’t understand why what they were giving wasn’t enough. They were looking at you like you had the problem!

Well last night, I heard a sermon from T.D. Jakes that posed a very interesting question:

What is your capacity?

Bishop’s sermon came from Exodus, the story of the Manna and the Quail. If you’ve never read it, check out chapter 16 of Exodus.

The part of the sermon that spoke to me was God and fairness. In the scripture, God provides manna, which is food, for the people. Some got more manna than others, but the people who got little, got enough, and the people who got a lot, got enough. One would think, well that's not fair, why did some get more than others. And to this point Bishop pointed out:

Who said God is fair? The bible does not say anywhere that God is fair. It says that God is just.  He further pointed out the difference between these two words:

Fair is to divide equally. Just is to respond to capacity. If you haven’t caught on yet, this means, God gives however much each person has the capacity to handle. For those families that had the capacity to eat more food he gave more, for those who did not, he gave less.

Bishop Jakes went on to compare this to relationships (this is where it gets relevant y'all). He pointed out that the problem with a lot of the relationships and marriages of today is that folks don’t have the same capacity. The man or woman you are in love with but you don’t feel like they’re loving you equally in return, may not have the same capacity to give as much love as you do. Sometimes, a person can be loving you as best they know how, with all of their might, giving you everything they have to give, but they may only have the capacity to give a “cup” while you have the capacity to give a “quart.” So that cup will never be enough for you. And you will burn up all of your energy trying to force that person to give you more than they are capable of giving.

  

Now I'm sure you're asking, as was I, how does one build their capacity? Bishop covered this as well: Your hunger (or drive) allows you to gain more capacity. As you push to love better, live better and do better, you gain the ability to handle more. On the other hand, if you remain complacent, your capacity will never grow.

Definitely an "a-ha" moment, as Oprah would say, for me. I'm sure we can all think back on past relationships that didn't work out for whatever reason and now realize that maybe the other person wasn't a bad person per se, maybe they just didn't have the capacity to give the same to the relationship that we did. Conversely, for those of us who have been left by someone when we felt like we were giving things our all, maybe we were giving it our all but they had the capacity to give a little bit more and thus expected more. The key, to finding SUCCESS in a relationship, is to find a person with the same capacity as you. And at the very least, we should all be pushing to love better, live better and do better, so that we will be able to give (and receive) the biggest capacity possible.

Chuch

For those of you who would like to hear this sermon, I've attached the video. The video is from the first time he preached this sermon at The Potters House (Bishop Jakes' church). The sermon starts about half way through the video.

I Knew He Was the One For You

I went to a wedding a few weekends ago for one of my ex-colleagues and her new hubby. It was beautiful. She was beautiful. They were beautiful.

I noticed during most, if not all, of the bridal party’s speeches, that people, in some way, shape, or form said “when he first told me about her” or “when she first told me about him, I knew s/he was someone special and/or the one.” I leaned over to my good girlfriend sitting next to me and said “so since apparently all of my friends will know who ‘the one’ is before I even know, can you let me know as soon as you know who my one is, because I would rather you not reveal that you knew for so dang on long at our wedding. I want to know right then damnit!” She cracked up laughing and assured me that she could do that much.

I had to wonder after listening to these speeches, do your friends really know when someone you meet is “different” and is the “one?” or is that just something people say during speeches because it sounds good and is polite to your new hubby/wifey?

I have actually had one of my very best friends tell me that she thinks (well now that she thought…and I guess maybe still thinks) that this one guy I recently experienced a connection with was the one. I mean…it makes sense that she thought that…heck, even I thought that. There is something extremely special about him that I can’t really put into words. There’s this compliment, even in the worst of times, that I feel like we give each other. Something I’ve never experienced before.  Now maybe I will experience this again. Who knows. But I know that he’s the first guy who I felt I could get through absolutely anything with and it was then that I realized that, that feeling is a VERY integral part of knowing you’ve found the “one.” Not love. Not happiness. But really FEELING like you can make it through the WORST of times with this person because you all have some natural (well really it’s unnatural) bond that will withstand the test of times. A feeling that when he’s not at his best, you can fill in, when you’re not at your best, he can fill in and when you both are not at your best, you still find a way to pull each other up out of the “bottom.” A feeling that even imagining him at his WORST, isn’t enough to make you think you’d ever want to leave. It’s just a very powerful feeling to have.  I think so at least.

I wondered to myself, is this maybe what the difference between loving someone and finding your soulmate is? I certainly don’t believe that everyone ends up with their soulmate. I think timing and proximity play such a big role in who you end up with, that sometimes, if you’re lucky enough for your soulmate to enter your life, s/he might exit just the same and you just have to be thankful that you got the chance to meet them at all.

I also wonder if the “thing” that my newly married friend’s bridal party saw is the same thing my friend sees.

I ALSO wonder if one of my very best friends is right.

Only time will tell.

And I happen to have recently fallen in love with this song. :-)

Question: What do you all think finding your soulmate feels like? Can outsiders see that you’ve found “the one” before you?

Reeeeee-Mixxxx

As you can tell, I’ve been struggling with writing lately. I think I finally figured out why: my finances aren’t all there is to my life. And what I mean by that is…for the past few months, I’ve had a crap load of other things to concern myself with and in dealing with those things, the time I could devote to researching, reading up on, and writing about financial stability had to take a major back seat.

It finally occurred to me late one night that this is okay. It’s okay if I can’t always write about financial stuff. Anddddd… it is okay if I broaden the intensely pointed premise of my blog currently and allow it to become more well-rounded and inclusive of my life.  After all, I AM 25.

One of my favorite bloggers,  sofullsista (who also happens to be one of my wonderful line sisters), advised me early on that there will be long hiatuses, bumps in the writing-road, and complete direction changes with my blog. They are all necessary for it to grow and reach it’s full potential.

Well here’s my first major revamp. I am still 25 and retiring, but now…you’ll get to see a bit more of the 25 year old J

Can All the Rich Folks...PLEASE STAND UP.

Did you all read Warren Buffet's op-ed for the NYT? I <3 him...genuinely I do. I am definitely a proponent of taxing the rich heavier...not merely because the U.S. is broke and our economy and deficit both need some serious help, but just off of principle man...they can afford it.

Buffet acknowledged that his effective tax rate for 2010 was 17.4%. GTFOH. That means only 17.4% of his billions went to the government. While there are middle class Americans making much less than him paying 25% or more of their income to taxes. How is this possible you ask?

Well yes, Buffet is part of the highest tax bracket (35%), however, the tax breaks for the wealthy are just that plentiful that he went from 35% of his income to actually only paying 17.4% of his income. This is expressly why rich people should have to pay higher taxes. They can afford better tax professionals, sift money into legal tax shelters, and ultimately come out on top. It makes me sick.

Now Warren argues that increasing taxes to individuals grossing more than $1million would create additional revenue for the U.S. without impacting their lifestyle. Agreed. He also argues that lower capital gains tax rates do not "increase investment," they merely give rich folks another tax break. He said, and I quote, "People invest to make money, and potential taxes have never scared them off." Agreed. He also argues that lower tax rates correlate to lower job creation. I'm not quite sure I get that one but because I love the man...AGREED.

Well two days later, guess who agreed he would be willing to pay higher taxes...THE DONALD. lol. Although he agreed he would pay higher taxes, he disagreed that Warren Buffet's philosophy will work. He argues (along with many economists) that increasing taxes on the rich will hugely affect the business climate. Wealthy businessmen will move to other countries (and take their businesses with them) to avoid the taxes. As we all know this would negatively affect the job market andddd ultimately be bad for everyone.

I get that philosophy but I wonder if THAT many wealthy businessmen would leave. I don't really think so. Lol It seems like such a hassle to pick up and do all of that just because you have to give the government $5 and you've got $5,000. But Donald says these folks are business machines, all they do is think money, and for them, that'd be enough. Of course no one is willing to call their bluff so alas we have this never ending argument on taxing the rich. Blah-se blah-se.

What do you all think?

Debt Ceiling Vote: This is getting ugly

As most of you have probably heard, there's this huge debt ceiling deal going on right now in Washington. Specifically, back in January we realized that the debt ceiling needed to be raised because by May 2011 the U.S. would pass the legal borrowing limit of $14.294 trillion (we passed it on May 16). A short term solution was to move some money around to pay our bills. But now...we need a long term solution...legislation to increase the debt ceiling. If this doesn't happen it would would be quite horrible for the U.S. economy and also possibly reduce the U.S.'s S&P credit rating. A reduction in the credit rating would mean that the U.S. would incur higher borrowing rates (because they'd seem like a less reliable borrower; it's pretty much the same thing as if your credit score dropped). The bad part for us is that if the U.S. incurs higher borrowing rates, that will mean higher borrowing rates for me and you. Here's where we will most likely be impacted:

1) Credit Card rates will increase - although most credit card rates are tied to the prime rate which probably won't increase, credit card companies may raise the margin rate tied to the prime rate. So instead of your interest being the prime rate + 10% you may be seeing new rates of the prime rate + 11 or 12%. The good thing I guess is that your credit card providers are required by law to let you know about any interest increases 45 days before the change.

2) Slightly higher mortgage rates - for anyone looking for a home right now, you may want to pay close attention to this. Although the rates may not raise more than 0.2%, no one wants a higher mortgage rate. For current homeowners, your rate wouldn't be impacted until it's reset.

3) Student loans may undergo even higher increases than currently planned - student loan rates are already scheduled to increase from 3.4 % to 6.8% for federal loans. This would become even higher if the debt ceiling legislation is not passed. And for private loans that could mean interest rates out of the WAZOO! We know how they will take you for everything you own.

4) Slightly  higher car loan rates - of course as soon as car financiers feel the pinch of the increased loan rates they will pass it on to consumers. This increase is thought to only be about 1% though which does not make a huge dent in a car payment. It is still something to keep in mind if you're in the market for a new car.

5) Money market and savings account returns see NOTHING - unfortunately the current returns on your savings and money market accounts will stay the same. Yes, we'll have to pay more interest but they won't have to pay us anything extra. Just the way the cookie crumbles.

6) Investment portfolios - this is going to be something you'll want to watch closely as it will have all sorts of impacts if this legislation doesn't pass. For one, people will start to sell their stocks and bonds, decreasing stock prices. Corporate earnings will fall as interest rates on corporate debt increases and in turn make investment in companies look less attractive - another hit to the stock market. Lastly we'll also be hit by a loss of confidence in investments and any impact to our current economic environment, especially anything portraying it as more uncertain will negatively impact stocks and bonds.

Now why can't Congress get this done:

As always, Congress can't agree on anything! The House refuses to pass a debt ceiling bill that won't cut enough spending. Obama has vowed to veto any bill that only extends the debt ceiling in the short term. The Republicans are threatening to filibuster. There's all of kinds of disfunctionality going on here. And the worst part is...if this doesn't get solved by tomorrow, August 2nd...the U.S. is officially BROKE. And you can prepare for your grandparents, great aunts and uncles to not receive their social security checks until the U.S. gets some money to pay its bills.

Lord have mercy. 

Take a look at the actual budget amendment bill here

Are you financially compatible with your (potential) spouse?

I found this cute quiz on CNN Money and thought I'd share. We're at that age where marriage is an option and most of us are looking forward to spending the rest of our lives with someone special. But oftentimes we underestimate the impact of our own (or our partner's) financial habits on the potential lifelong partnership. You will hear this over and over, and statistics have shown, repeatedly, that the leading cause of divorce is MONEY.

Somehow, when we're all in love (and before we're married), we don't take it as seriously as we should. I mean how petty would you sound if you told your homies you were deciding not to marry your sig other because his/her financial habits are just atrocious...or don't align with your long term financial goals. That sounds kind of silly right? It's like, you're giving up on the supposed love of your life because of THAT...something as simple as money. Their money habits could change! You aren't perfect either. You'll just take ownership of the bills and budgeting. You'll closely monitor the spending. You'll keep it all in check.

As quickly as we put this problem to the side and decide to deal with it later...it comes rearing it's ugly head and we wish we would've thought twice.

One of the things I admire most about one of my "young role model couples" is that before they got married, they seemed to have a very secure hold on how they would work together financially. They didn't live together but they both considered each other in the majority of their financial decisions. A financial problem for one person, was seen as a financial problem for the other as well. It was always a group effort...even while they were on their way to marriage. Smart move I think.

So the quiz asks a few questions (about 11) on your spending habits and financial decision making skills. At the end it categorizes you into one of four buckets:

1) Socially Driven
2) Financially Driven
3) Physically Driven
4) Inner Driven

I ended up with at least two points in each bucket but I ended up being mostly inner driven. My close second place was financially driven. I would have to heavily agree with both those assertions.

You take it (even if you're single) and have your partner take it (if you're not). See if it matches up with your perceived financial strengths in the relationship. Maybe you'll find out something new! At least, you'll start up a conversation you may need to have before making any major decisions :-)

Financial Compatibility Quiz

Now Year's Resolution

I've been on a list kick lately. Today alone (well the day I wrote this post), I've made four lists. I think that when things are going as planned (at least somewhat), I start to go planning crazy and I use lists to continue formulating the working plan. Anyway, the list I'm sharing today is my "Now Year's Resolution" list.

I suggested for you all to make your own as well. Please feel free to share how you interpreted this and how it helped, if at all? If you'd like to dive into specific items on it, feel free. As open or closed as you wanna be. Go for it. Comment away! :-)

As for mine, I wrote a list of all of the things I would still like to accomplish in 2011. These may be things that were on my list at Jan 1, 2011 and have yet to be accomplished,  new tasks that I've added, or enhancements to tasks that weren't fully developed at Jan 1. I also tried not to make it too long. Once I got to about ten items, I decided to just focus on those because I'm learning that I don't deal well with being overwhelmed...and let's admit, long lists are frickin' overwhelming!

"Now Year's Resolution - 2011"

1) Complete apartment vision - Since moving in I've realized that getting this place together is going to be a LONG process, but I want to have an end goal in mind. And btw, one of the other four lists I made was a "Things to add to my apartment" list. lol.

2) Make (semi) permanent career decision - I can't dive too deeply into this decision but it includes whether to make a career move, change, or go back to school and pursue another masters (maybe more than one) or a ph.d. TONS to think about...and fast.

3) Lose 20lbs (at least) - I can't even start with my weight right now on this blog. It's a contiuous personal journey/struggle for me. And as with most ppl, weight loss is on the top of my list at all times. Why wasn't I just born with a super fast metabolism that lets me suck up all food and sight and never pay the consequences. deep sigh. I digress.

4) Take a makeup instrcution class - I've always wanted to be able to do more with my makeup but today while looking through Essence on the plane I thought to myself, why don't I take a class on this one day. In my spare time. The spare time I'll have once I accomplish #2. :-)

5) Take boxing lessons - I've heard this is an awesome workout. Also passed a spot in the South Loop over a month ago (and found out a friend goes there) and thought to myself that it could be a really fun workout.

6) Cook three times per week - I mean if I'm going to get married some day in the next 5 years (I am SO speaking this into existence), I should probably put this into practice.

7) Pay off all credit card debt - After I achieve this, I'm going to have to come up with a plan to not drive the debt back up again. I'm really good about getting it to $0 but then I get comfy and start spending again. Stop. Pay off. Anddd the cycle starts again. Yeah. Bad. I know. BUT, I am not of the belief that not having credit cards are the way to go. I think they are an absolutely necessary addition to one's financial portfolio. I just also think you have to learn how you can manage them best (and not let them manage you).

8) Increase savings by at least $3,000 - This is just necessary. I'm still young. I'm into saving agressively right now while I have less financial committments that I will one day (kids, mortgage, etc). Of course, everyone should tailor this to their own situation.

9) Keep on tithing  - Jesus is a waymaker. If you didn't know, I'm telling you. Ever since I've been tithing, I haven't had to worry about one financial issue. I found my own place within my budget and the blessings keep on raining down on me. And I still LOVE writing my bimonthly check to my church :-)

10) Two words: David. Yurman. - This is more of a prize at the end of the rainbow. To keep me motivated and focused. I went to the David Yurman store in Houston today. Love. Y'all know how I am about jewelry. And it's time to add a little Davie :-)

Bills Bills Bills

Rent is due. By July 5th. Boo.

I've taken the liberty to re-vamp/ re-organize my bill payment schedule. This means I need to take a look at and decide if I would like to change:

• Which bills are paid from which paycheck (the 30th or the 15th)
• Make all necessary due date changes to the bills I decide to shift around. In case you didn't know, you can change the due date of most bills. Very convenient.
• Which bills are automatically deducted from my checking account.

I was not looking forward to this exercise. In fact, I was completely loathing the fact that I should do it. But with any major changes such as a new place (with increased expenses) or a change in cash flow (due to a new job or loss of one), I think this is absolutely necessary. I would encourage you to do the same...and maybe even on an annual basis.

Update: Monday June 27th

So at the time of this post I wasn't able to fully explain WHY I'm re-organizing my finances but now since it's official I can tell you all. I got a new job! I'm moving on from my current place of employment. It's a bittersweet feeling because I've learned a ton and fostered some pretty awesome relationships there but I'm so ready to move on to phase 2 of my career. A new apartment, new salary, etc. all led me to a mid year reorganization. Whenever you experience major changes like these, you should take the time out to see if your budget is still representative of your financial situation also.

Halftime: What's Your Game Plan?

It is almost the end of June 2011. Can you believe it?! That means half of 2011 will be over in just a few weeks. I decided today that it would be a perfect time to evaluate my progress through 2011 thus far....in all realms of life. What has changed? What is the same? Am I keeping up with what I planned to attain this year on Jan 1? Where am I behind? Why? If I'm doing well, how can I make the last half of the year even better?

If you can't tell by now, know that I'm BIG on feedback, constructive criticism...basically anything that allows us to learn and grow.
I'd encourage all of you to do the same with yourselves. What were your goals for 2011 and how are you progressing? This can be financially or otherwise. Let's not get to December and realize we haven't gotten where we wanted. Life is going by quickly and for some reason I just really want to get it right...after all, this is the only chance I've got.

My next few posts will be dedicated to evaluating. Let's explore together :-)

First stop: "Now Year Resolution" For fun, why don't you work on one of these for yourself. I'm not going to define it for you. I've already made mine. Make yours, with whatever you think it should include. Let's share next week!

Quick Pick: How much is too much?

A question I get a LOT from my friends and peers: How much of my income should go towards rent/mortgage?

My rule of thumb is 25% but I read a Washington Post article that says 30% of your gross income. Gross is your income before taxes and deductions are removed. This means the following affordabale rents if you make $3,000/mo gross income:

25% - $750/mo
30% - $900/mo

This percentage is not supposed to include utilities or other household expenses.Only your home payment.

Of course you need to adjust your percentage for your other monthly committments (i.e., car note, loan payments, child support, etc). If you're looking into buying, 30-33% is a decent estimate od affordability because your income will increase yearly and your mortgage payments will not.

Hopefully this adds to your roladex of  financially savvy information! Happy apartment/house hunting!

Well I'm movin on upppp...to the East side...

Greetings!

Sooooo.

First things first, I'm moving into my OWN PLACE. Gahhhh! I'm so excited. In Hyde Park, on a cute little cul-de-sac'd (did I make that tense up) street, one block from the lake, where birds chirp and lawns are pristine and I will have one of my very on line sisters living right across the street. I. AM. TOO. GEEKED.

With all of the excitement, I haven't really thought about the fact that paying the entire rent and all utilities (y'all cable is so expensive when you're the only one paying it!!!) solo will put me on a tighter budget than ever. Well I mean I did the financial analysis that informed me I could technically handle it. But, the reality that I won't be able to soothe my work woes with massive amounts of online shopping and weekend getaways as much, hasn't kicked in. But after month one, I'm sure that reality will kick in. Prayerfully. lol

So I went on a blogging hiatus (by the way, who does that after like 2 months of blogging???) because I'm incredibly busy with work and life. I don't think I've worked less than 12-15 hours a day for the past few weeks and therefore sleep is very limited. Additionally, I'm coming into my promotion year at work...which is a big deal anddddd seems to be really emotional (as for me, EVERYTHING is).

But I'm coming back because I need this blog to keep my sanity...and most of all I need it to keep my pockets safe after my big move!

So I'm back and I'm still...

25andretiring.

Excuse me for the Inconvenience

I am not in a bloggy place right now. I have a lot going on and I need to make sure I handle it all the best way possible. With that being said, I'm on some kind of blog hiatus. I will be back sooner than later but I just thought I'd let yall know.

Peace and love.

Tax Tantrum Tuesdays: Stay Out of Trouble

Another finance guru I absolutely love, Mellody Hobson, President of Ariel Investments in Chicago, talks about personal finances on Good Morning America from time to time. Specifically, I was reading an article discussing the IRS's increase in tax audits. Every person I know, including myself, should be very, very afraid of the IRS. Not afraid to the point that you are scared to try to do your own taxes, but afraid to the point that you don't ever want to purposefully lie to them. Ever.

When I hear of people lying to the IRS about small, insignificant things like filing single when you're actually married, claiming kids who aren't yours, claiming your kids when you know your 'baby momma' already claimed them, I send up a quick prayer...because if the IRS finds out, they're cleaning you OUT. Believe me, you don't want it. Most of the time, actually, ALL of the time, it's just not worth it.

With that being said, there are some obvious red flags that the IRS looks for when they're determining who to audit. Statistically, only about 1% of Americans with annual incomes under $100k get audited. The more money you make, the higher the probability that they will want to audit your return. Additionally, your return is more likely to get audited if you have big changes from one year to the next. It sends up a red flag. So if you start making a ton more money, claiming three children as dependents when last year you only claimed one, or claiming a large deduction/credit that you don't normally claim, BE SURE to keep those records.

Other more specific red flags for the IRS are:

• High expenses. A lot of expenses are deductible as itemized deductions. If any of these are abnormally high, like $60,000 in medical expenses, or $10,000 in work related expenses, you should make sure you have some great documentation to prove you're not lying.
• High charitable deductions. People use charitable deductions ALL the time to beef up their itemized deductions. Be careful. Make sure you have check stubs, receipts, letters from non-profits detailing how much money you gave them. Mellody says that the average charitable donation is around 2% of one's income...so if you're donating around 10%, that may be cause for concern.
• Errors. This is easily avoidable because of all of ability to e-file. But if you're still using a paper return, make sure to double check your math, make everything nice and neat as to not arouse any questions from the IRS.

In general, just be honest. It's much better for you in the long run. If you made an extra $10,000 cash doing some kind of side hustle, don't hide it. The amount of tax you'd pay on that would be far less than the penalties and fees the IRS will hit you with if they ever find out.

Debit Diet: "Where da, where da cash at?"

I'm in complete reform mode. Last night I did my federal tax return, started on my FIVE state returns (traveling all of the time has it's cons), and put together my debt snowball budget! I'm happy to say that my snowball has me paying off all of my debt (with the inclusion of my private school loans and the exclusion of my federal school loans) by the time I'm 30. I will see my first major payoff (credit cards) by May 2011 and I will have paid off a small school loan by the beginning of 2012. My car loan and larger school loans take a little longer but either way it goes...I'm stoked!

In addition to implementing the snowball, I came across another one of Dave Ramsey's amazing ideas that I am very excited to share! Dave Ramsey's....

Cash Envelope System

The way it works:

1. Label envelopes with different budget categories such as, food, miscellaneous, entertainment, gas, etc. Dave says you can do this for all of your budget categories but for me, I'd probably only want to do it for the ones I actually spend money on throughout the month. I have no need for a bills envelope because I pay all of my bills via automatic debit, which many of you may do as well.

2. Once you get your paycheck, you cash the amount of money you are to spend on these categories, and put each respective amount in its envelope.

3. As the month goes on, whenever you make a purchase, you take the money for that purchase out of its rightful envelope and you record the purchase on the envelope. Once all of the money in an envelope is gone, you can no longer spend money from that category.

For those of us who don't want to carry a lot of cash on us, or fumble around with 5 or 6 cash filled envelopes, we can do the same thing with our debit card. Instead of putting cash in the envelopes, we can make a debit card purchase, then record the purchase on the respective envelope and insert the purchase receipt in the envelope. Once we've reached our monthly max in any category, we can't use our debit card for those purchases anymore until the next month.

I'd like to add a component to this that I don't think Dave came up with. Once putting this into practice for maybe three months or so, I'd like to challenge us to deposit any excess money unused at the end of the month into our savings account. Of course that money could rollover to the next month but in order to help with discipline I think it would be more beneficial to get used to being limited to a specified amount of money each month. If you don't use it, you save it. Just a nice way to beef up the savings over time as well.

I'm going to implement this spending system in March. I shall let you all know how it goes! And  for those who would like to take the journey with me, let me know!

P.S. I wanted to name this post...Don't be surprised when she ask...."Where da cash at?"...and I would've, but it was too long.

Ta ta!

Tax Tantrum Tuesday: You Can Do It!

Tax Season is in full swing. And as of Monday, all of you itemizers can file. I'm a huge advocate for doing your own taxes, especially if you don't itemize. Paying any type of service or person to do them is a complete and total waste of money. In fact, a lot of my friends/family in the past have asked me to do their taxes...and while I've done some, I always tell them I'd much prefer to teach them how to complete their taxes themselves, instead of just doing it for them.

One of my friends actually took me up on that offer last year. I went up to her house after work and we sat down for an hour or so. I explained everything she needed to know about personal income taxes. She was a very excited learner which made me a super excited teacher :-)

I got a wonderful instant message today from her letting me know that I would be so proud of her because she completed her own 2010 tax return today in 30 minutes! I am in fact proud and it goes to show that you should not be afraid to touch your tax return. If you're nervous about getting it right on the first try, have a friend or tax professional look them over before you submit. As long as you complete everything in good faith, the IRS will not truck you off to jail. You'd be amazed at how much mone you can save...

...doing it yourself!

Happy Filing!

Trick AND Treat

Yeah, yeah, I know it's Valentine's Day and not Halloween but the title just fit better. Additionally, while I don't consider myself to be a bitter single woman, I don't think of Valentine's Day as some super fantastic addition to my world....mostly because I believe we should be spreading love every single day...not just once a year. But I guess that goes for most holidays...

I digress. Recently, as you all may know, I've been really focused on managing my money correctly since becoming a full time working woman. Since July 2010, I've reduced a lot of my monthly costs in order to allow me to save more money and reduce debt. However, most recently, as in the past few weeks...I've been on this spending frenzy. Well...I'm not sure that's what you'd call it but whatever it is, it ain't good. It hasn't really hurt anything too badly, it has just forced me to slow down on my massive savings revolution...which makes me sad.

I think I'm starting to realize that I have these financial roller coaster rides....where for a few months I'll be doing spectacular (and sometimes I'm not even sure what I'm doing to make the money flow like it does) and then for another few months, I will need to watch what I'm spending like a hawk, as to not overextend myself because I'm thisssss close. I hate those months. They make me nervous. Does anyone else have this problem?

My financial personality, as I'd like to call it, makes me the type of person who always thinks the worst is going to happen..I think they call this pessimistIC. So if I feel like my emergency cushion isn't all there, I'm freaking out when I don't have a really big threshhold for error, which is usually the case in the down months. Sometimes...I just need to check myself.

So while I stumbled upon this video on CNN Money, I was excited to share with you all. Some guy (he didn't say anything about himself) was advising ways to "Trick Yourself Into Saving More." I thought maybe we could all try to implement these and see how it helps or hinders our progress:

1) Put Savings on Autopilot - this includes automatic deposits into your 401k, IRAs and your savings account. I definitely do this now...I cannot count on myself to manually transfer money every month from one account to another. Automatic transfers have become my best friend.

2) Dangle a Carrot - now this was interesting to me because I kind of do this...but I think I need to do it a lot better. hahaha. Dangling a carrot involves setting a savings (or debt payment) plan with a reward once you've achieved the goal. For instance:

Goal: if I can increase my savings by $5,000 by June,
Reward: I'm allowed to purchase a new really expensive bag I've been eying.

I think usually I start here...but at some point, when I'm on my way to the reward, I convince myself I've done well enough to get the reward now...lol. Not to mention, if I want something now (say a new bag, shoes, etc), why would I still want the same thing in June...there will be something new for me to want and it could be completely out of season. So maybe I should try smaller rewards along the way that lead up to a large one? It's like eating 6 small meals a day to effectively diet instead of starving yourself all day and then binging on one huge meal. *just had an a-ha moment*

3) Use a Stick - so this is the opposite of dangling a carrot and I'm not sure would ever work for me but maybe some of you respond better to punishment rather than reward. The idea behind this is to make yourself a commitment contract. If you don't hold up to your end of the bargain, you have to pay a fine (I guess to your savings???) or punish yourself in some sort of way. Yeah...punishment de-motivates me so I'm going to stick with the carrot.

4) Focus on the Big Stuff - in general, when looking for ways to cut costs and save money focus on the big stuff...get a smaller apartment instead of the larger one, buy a used car instead of a new one, etc etc.

I have definitely done this in the past year. I yearn so badly for my own one bedroom in Chicago...but I'm sticking with a roommate for the time being because my costs are greatly reduced and it allows me to save more and pay down more debt. Not to mention that most of the time I absolutely love my roommate. Even still, frequently I scour Craigslist and rental agencies looking at apartments. In the end I'm always forced to remember that I can have that, AFTER I reach my savings goals. I guess this encompasses a little carrot dangling too.

On the car aspect of this...I completely failed.

Next...

Thirsty Thursdays: Zero Me Out

I received the following question from a reader:

Can you write a blog about bankruptcy one day? I'm baffled by the idea...how does someone's debt just discharged?

Well this takes me wayyyy back...to some class in undergrad where I learned the differences between all of the different types of bankruptcy. While the idea seems simple, it's not as easy to file bankruptcy and be completely dischraged of your debts as you think. Let's take a look:

There are a few chapters of bankruptcy (7, 11, 12, 13), only one chapter discharges ALL of one's debt (chapter 7). The other chapters are for debt restructuring...where you pay off as much as you can with your disposable income and your remaining debt gets restructured to make it more feasible for you to handle.

Chapter 7 bankruptcy is the most commonly filed chapter. This chapter discharges all of your debt with the exception of, taxes, penalties and fines administered by the government, alimony, child support, and student loans. Additionally, the court uses your assets to pay off as much of your debt as possible. This means, even though you lose your debt, you lose ALL of your assets too (except the exempt ones...which are few and far between). However, you can't just file Chapter 7 bankruptcy all willy nilly. You have to be able to qualify by showing that you really cannot afford to pay your debts. If a Bankruptcy Trustee reviews your financial situation and decides that you can pay some of your debt with your disposable income, they can deny your ability to file Chapter 7 and instead force you to file the second most common chapter...13.

Chapter 13 bankruptcy is a financial reorganization organized by the federal court. Basically, the bankruptcy court lays out a plan for an individual to pay off their debt. It's like going to rehab for debt. It still comes with a 10 year credit report punishment, in which you cannot obtain any new loans/financing.

Regardless of what chapter you file, filing bankruptcy is NEVER glamorous. It comes with painful years of horrible credit which could wreck more havoc on your life than you'd think.

Reader, hopefully this has helped your understanding of bankruptcy a bit better.

Tax Tantrum Tuesdays: The Tax Equation

So recently, we've been talking about a lot of different parts of the individual tax return. Below I've illustrated how all of these parts work together to complete your tax return. Honestly, understanding taxes is as simple as knowing and understanding this equation...and it is simple as pie:

Let me make sure you can read that the way I meant to write it:

It says... Income minus above the line deductions equals adjusted gross income, minus standard or itemized deduction minus exemption(s) equals taxable income, multiplied by your tax rate equals your tax liability, minus your tax credits, minus your tax payments equals the amount you are either refunded or the amount you owe.

I bet a bunch of y'all are finally happy you know what AGI is. lol

This equation helps you understand how deductions and credits work to help lower your tax liability. The goal of claiming deductions is to reduce your taxable income as much as possible. This means even if your income is $100k, you could have enough deductions to reduce the portion of that which you actually pay taxes on to about $60k. If your tax rate is 25%, wouldn't you love to only owe 25% of $60k vs 25% of 100k? Right.

Even once you get that taxable income down, tax credits are a way to reduce the amount of your actual tax. They are a dollar for dollar reduction. So if your tax liability is $10k for 2010 and you can take the $8k homeowners tax credit...now you only have a $2k tax liability. That my friends is a beautiful thing.

Payments are just your withholdings that you've been paying out of your paycheck all year. Remember the red bottoms? Say if you paid $9k during 2010 and your tax liability is $10k and you've taken the $8k credit to reduce your tax liability to $2k. That means a $7k return for you. On the other hand, if you paid in $9k during 2010, your tax liability is $10k and you have no credits. You will end up owing $1k.

Hopefully this equation shows you how all of these parts work together for (or against) your tax benefit.

Feel free to ask questions on this! I feel like it can still be a bit confusing :-)