Paying Off Credit Card Debt

This is the first article I am writing based on reader request.  This person wanted to know how they could pay off credit card debt.  This is a situation that many people are in.  I hope if this is your situation you would like to get out of it so you can save more and have less financial stress.  Let’s see the options.

The first steps

The first thing you must do is set your spending below your earnings.  If you spend more than you take in after taxes then your balances will go up and you will NEVER get out of debt.  So once you have done this, stop using your credit card.  You are earning more than you spend, so now there is no need for credit.

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Weddings

Weddings cost a boatload of money or at least everyone in the wedding industry wants you to pay a boatload.  The average cost of an American wedding is $26,000, but I’m sure the median cost is less as there are plenty of people that get married in a courthouse.  You are not required to spend a ton on your wedding, but if you want to invite a lot of people then you need to get clever if you don’t want to spend a fortune.

Venues

The decision of where to have your wedding is probably the most expensive one.  You could have it at the park and it would cost almost nothing whereas a fancy hotel will cost a bunch.  The location is broken into two parts, the ceremony and reception.  You can have them both at the same place which could save money, but perhaps that place would have to be really big and charge a lot, so splitting it may be cheaper.

We had the ceremony at a church and the reception at a restaurant.  This turned out to be cheaper than many of the places which could do both.

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I’m Off to Europe

I’m at the airport and going to Europe.  You may think I am going to fly there for free with all my points and you’d be correct.  However, this time it is not for a simple vacation, I am moving there to do a 1-year MBA program.  This is the transition that I hinted out before and the reason I have moved to cash.

Reasons for Europe

It is cheaper.  There are many good deals to be found outside of the United States.  The cost of living in the city I am going to is much lower than where I live in Orange County.  In fact, the average monthly income is less than my rent, meaning my rent is going down by a lot.

Reasons for Education

Education can be a good way to improve and invest in yourself.  Right now, I am my biggest source of income.  I don’t have a huge sum of money generating dividends, real estate, or business.  The best way to increase my income is to earn more and I believe an MBA is an investment that can pay off.  Fortunately, it is much more affordable in Europe so I won’t have to take out a huge student loan.

Conclusion

Being outside of America means that I will not get to take advantage of all the free money available from credit cards, banks, and Staples.  However, I think reducing my spending and increasing my education will be positive consequences.  My school is going to be half the time at half the cost.  This is also one-year of weekly postings so I think next year I will be slowing down as I may not have as much to save or as much time to say it.

This entry was posted in Earn.

Invest in Yourself

So much of our income goes toward stuff we buy for ourselves.  We can also use our money to invest in the stock market, real estate, and other stuff.  But another great use for your money is to invest in yourself.

Health

One good way to invest in yourself is to maintain your health.  Your money is no good if you are dead.

  • Exercise
    • Keep yourself in shape and you will feel better and live longer.  Exercise doesn’t need to be a pain, find some sport you like and you are set.
  • Visit the doctor
    • Checkups can identify if you have any problems that should be addressed.  It is horrible to be diagnosed with a disease, but it is worse if it goes undiagnosed and you find out right before you die an early death.
    • Go see a dentist as well.  Have a problem in your mouth can be painful and costly.
  • Healthy habits
    • Don’t smoke.  Smoking is going to cost you years off your life and you very well may end up with cancer.
    • Eat a healthy diet and maintain a healthy weight.  Most Americans are overweight and this causes a lot of diseases and is totally preventable if we control ourselves.

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Year End Summary 2016

Usually a year flies by, but this one sure seems like a long one because so many things happened.  I spent two months in Taiwan and one in China learning Chinese.  I went on vacations to Japan and Portugal using points and filed taxes for my business.  But this blog started with the idea of sharing interesting ways to make or save some extra money, so let’s get to how this year went.

I’m including my wife’s activity as well because we are a great team.

Credit card signup bonuses:

British Airways – 100,000

Marriott – 87,500

Southwest – 50,000AA Miles

AA – 150,000

American Express – 75,000

Merrill + – $1000 for flights

Barclays Arrival World Plus – $525 for travel

Shopping Portal bonus miles – 40,000

Total – 502,500 + $1525 travel ($9,025 value)

Additional income:Discover Cashback

Cashback ($1000)

Cashback portals ($250)

Lyft bonuses ($3000)

Uber bonus ($750)  The driving was little more than break even, so I’m not including it.

Reselling ($1000)Staples Credit

Bank bonuses ($1550)

Staples credit ($360)

Total – $7,910

Conclusion

I have about $7,910 in bonus income which is about $6,000 after taxes and over $9,000 worth of travel which I am consistently using to travel.  I used the Staples credit to buy some stuff I need around the house as well as a jet drive for our MacBook.  The beauty of all this extra money is that it was all earned in a way that didn’t put me at risk of losing money.

However, the year was not without some failure.  My decision to try to install garage doors didn’t work out, but that only cost me $100 in losses.  A terrible decision was to buy gold as it was risky and although it earned some points, definitely cost me lost of money.  In addition, if I was more invested I could have earned 13% since the beginning of the year.  So, it was a pretty good year overall and as I hinted last week, next year will be a big transition so I don’t think I’ll be able to match it.  Next week I will share what we’ll be doing.

I’m a Terrible Investor and So Are You

George WashingtonThe Dow Jones Industrial Average is at over 19,000, its highest ever.  Everyday there seems to be some bad news that will lower the stock market, but it continues its march to new highs.  Trump elected, big drop followed by super massive positive streak.  Then Italy votes against current government consolidation which may be another domino to fall for the EU, but the market decides higher it is.  Meanwhile, I am convinced that the market is overvalued, but this is speculation on my part.  I certainly don’t know what the market is going to do, but I’m making my investments as though I do.  That means I am my own worst enemy.  Right now I’m not participating in the significant gains, but instead earning .95% in my savings account.  I’m young, so now is the time to start investing because my money can compound, so what is the problem and solution?

Problem

Since turning eighteen the market has doubled, however my initial money has not.  I decided to pick certain stocks, sell too early, buy low quality stocks, and pay lots of transaction fees.  All this lead to greatly reduced returns.  It is easy to win when the market is going up and people will think they are doing a great job, but when it goes south people freak out.  The 2008 crisis made the market drop 40% and I bet there were people that sold all the way down and decided that stock was too risky.  However, since that bottom the market has almost tripled, more than erasing any losses.  In the long run the market has always gone up and I anticipate this going forward though perhaps at a slower rate.  As one person I met with last week put it, the market is not made for human trading.  You may not have had breakfast, feeling tired, or decide to sell your stock before going on vacation.  However, a computer is told what to do and will not let emotions get in the way of executing that plan.

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This entry was posted in Invest.

Black Friday, Cyber Monday, and Shopping

BR OrderYou may be thinking that this article is coming out late when Black Friday already passed and you’d be right.  But since I only have a dozen consistent readers at the moment, I think this article will be more of a guide for future readers.  Did you buy anything this year?  Being frugal you may have thought I didn’t, but after years wearing the same wardrobe, I decided to get new pants and shirts.

My deal

Gap and Banana Republic had a 50% off sale on Black Friday.  I went into the store and purchased one shirt and one pair of pants.  This was a good decision because it confirmed what size I am.  I then paid with a gift card I used my Discover rewards to get.  An $80 shirt became $40 + tax and I used $40 of Discover rewards to get a $50 Banana Republic gift card.  They gave me the $7 gift card balance in cash, so I got an $80 shirt for $33, a 59% discount.  If you don’t have Discover rewards you can often buy discounted gift cards on many sites including Staples, eBay, or Raise.  I had a good start, but my day didn’t end with a pair of pants and a shirt.  I went back home to their website where I purchased five more items.  The benefit to shopping online is you can use a cashback portal, but you can’t cash out the gift card balance.  The portal gave me an additional 5% cashback.

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The Library Still Exists?

Library FineYou may think the library is a place for children, but you may be mistaking that with the children’s section.  The library really has the more resources for adults and has resources for the 21st century.  A few months ago I purchased When Breath Becomes Air because it was a new release and those take a long time to get your hands on at the library, or so I thought.  My mother was number 130 on the waitlist, but in a couple weeks they called and said it was her turn and needed to pick up the book by the next day.

Reading

I think reading can be a surprising expensive hobby.  Buying a few books a month will cost a few hundred a year.  My wife is currently late with a Barefoot Contessa book which is running us 25 cents a day.  We can’t return it because we are out of town burning some airline miles, but the book is $20 on Amazon ($15 used).  Paying the late fees are way cheaper than the cost of the book.  I like reading the newspaper and used points to get it, but now try to spend more time learning more skills rather than keeping up with the news.  I think reading is a good hobby and keeps your mind sharp and entertained, but I don’t think it is good if it becomes too much like TV and saps your time and life away.

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