Oct 24 2012

The Newsletter is Coming Back From the Dead

By |October 24th, 2012|Blog, Life|1 Comment|

Many of you are receiving this post in your email and you might be thinking “What in the name of Uncle Fred is going on here?” The answer is I’m bringing the Thousandaire Newsletter back from the dead.

I started this newsletter a long time ago but only sent out two or three editions. It turns out it didn’t make a lot of sense to have some content for the website and other content for the newsletter.

So I’m changing it up!

From now on my “newsletter” is simply going to be all the original content from my website in your inbox. When I write a post, you’ll find it in your inbox that morning. I can metaphorically hear the excited cheers and the simultaneous disappointed groans as I type this.

Some of you will love this change, and others will hate it. But I do have my reasons:

  1. I’m only posting 1-3 times a week, so you won’t be bombarded with daily emails (like you would have if I made this change a year ago).
  2. If you’re like me you don’t like your work seeing your browsing history. This way you can read Thousandaire content in your email without going to the website (but I still want you to come to the website and post comments if you can!)
  3. The newsletter doesn’t have any ads, so it’s a great way for you to get my content without having to look at advertising.
  4. Who doesn’t want an email from Kevin McKee a few times a week? (probably everyone, but I’m going out on a limb here)
  5. If you don’t like it, you can unsubscribe at any time (the unsubscribe link is at the bottom of every email).

I also realize that if I’m going to be in your inbox every week that I need to step up my game. Especially considering my recent engagement and my adventure in buying a house, I have plenty of great content in the works.

Also, I’m going to make a conscious effort to get back to being what I call “funny” and what my fiancee calls “embarrassing”.

Finally, other newsletters I’ve sent have usually included music videos. I haven’t had time to make any new music videos, but I do have a copy of my live musical performance from the Plutus Awards last month. Enjoy the video and I hope you will enjoy receiving posts in your inbox from now on!

Oct 23 2012

9 Big Steps to Buying a House

By |October 23rd, 2012|Blog, Personal Finance Tips|30 Comments|

I’m finally at the point where I’m ready to talk about the next huge step in my life. A few weeks ago I got engaged, and a day later my fiancee and I got a call from our Realtor saying that the offer we put in on a house was accepted. There are so many things that can go wrong in the process of buying a house that I didn’t even think it would be worth writing about until I had cleared a few hurdles. As of Monday 10/22, I have cleared enough hurdles where it seems fairly likely that the deal will go through. For those that have never bought a house or haven’t bought one in a long time, here are the nine biggest steps that I’ve encountered in buying my first home. The following steps assume you will be taking out a mortgage to buy your house (cash buyers would skip a lot of steps and probably know enough that they don’t need a list like this anyway).

9 Big Steps to Buying a House

1. Find a Realtor (optional)

Our first step in finding a house was to find a Realtor. You don’t have to get a Realtor but it’s free for you (both the buyer and sellers Realtors are paid out of the purchase price of the home) and your Realtor has a lot of expertise that you probably don’t have. As someone going through the process without any real estate or contract knowledge, I can say that doing this without a Realtor would be way too hard and time consuming.

2. Find a House

Go online to national websites like Zillow.comTrulia.com or local communities like liveatchurchillfarms.com to start looking for houses.  Your realtor can help you find homes if you like, but Tag and I preferred to find ones we like online and send a list to our realtor so he could set up the showings.

3. Get Pre-Approved for Financing (optional)

Once you’ve found a house you like and are thinking about making an offer, it’s a good idea to get pre-approved for financing. This will help you understand if you can realistically get a loan for the home, and it also shows the seller that you are serious and have the means to buy his or her house. You don’t have to do this, but it makes your offer look stronger.

4. Make an Offer

piggy bank house

photo credit: Images of Money

Talk to your Realtor have him pull some information on recently sold homes in the area and come up with a good offer. If you think the house is worth $200k, go in with an offer that is lower than that but not so low that the seller doesn’t take you seriously. Remember that your Realtor’s commission is based on the sale price of the house, so a higher sale price means a bigger commission for him or her. Listen to your Realtor’s advice, but it’s your money and ultimately your decision how much to offer.

5. Negotiate

If your offer isn’t accepted, negotiate. For the house we are hoping to buy the seller drew a line in the sand at $205k. We came back and said there’s no way we could do $205k and the best we could do was $200k; take it or leave it. We were actually really surprised when he took it.

6. Get an Inspection

I’m not a nationwide real estate expert or anything, but in Texas you have an option period (typically 10 days) where you can back out of the deal at any time. This 10 day period is the time to get your inspection. If there is anything wrong with the property that wasn’t in the seller’s disclosure, consider asking for additional money off the sale price. Don’t ask the seller to fix problems because you don’t know if they will do it right. Just ask for money off the sale price and do it yourself.

7. Apply for Financing

Once the inspection is done and you are ready to buy the house, you need to talk to a bank and start the financing process. Shop around for rates and keep in mind that closing costs are expensive. You’ll either need to pay cash at closing or have the bank increase your interest rate in exchange for paying some or all of your closing costs.

8. Get an Appraisal

The approval process for getting a home loan is very long and extensive, but one of the biggest hurdles is the appraisal. A bank isn’t going to lend someone $200k for a house if they believe it’s only worth $190k. In my case the bank hired the appraisal company and set up the appointment while I paid for it (which is part of the closing costs). My appraisal came in right at $200k, so now there’s just one more (huge) step.

9. Get Approved for Financing

At this point there’s just one more hurdle to jump (this is where Tag and I sit today): have the bank approve the loan. They need to make sure you have enough money to pay for the down payment and closing costs, that your income is high enough to support the monthly payments, that you’ve been at your job long enough to consider your income stable. They check your credit score, credit history, and do a bunch of other stuff. It takes a long time, but that makes sense. If you were going to lend someone over a hundred thousand dollars I hope you’d take the time to review their creditworthiness too!

And Now We Wait…

This is just a high level overview of our process so far. Who knows what other hoops we’ll have to jump through to make sure the financing is approved? Right now I’m just waiting to hear back from the bank to find out if I need to give them any more information. Over the next few weeks I’ll discuss some of these steps in much greater detail talk through some of the specifics of what Tag and I did, what we did pretty well and what we could have done better. I’m not an expert by any means; I’m just happy to share my experience and I hope it helps someone. Readers: Have you bought a house recently? Was your experience the same as mine?

Oct 22 2012

5 Frugal Tips That Will Get You Through Christmas

By |October 22nd, 2012|General Personal Finance|3 Comments|

It’s only October but Christmas is right around the corner and you don’t want to break the bank while you get presents for all of your loved ones. Money can get a little tight around the holidays, so here are five frugal tips that will help you get through Christmas with your bank account still intact.

1. Get Everyone Something Special to Eat

If you are really good in the kitchen then Christmas is the best time of the year to share your gift with the world. If you can make something special like homemade soda pop or the best salsa anyone has ever tasted, all you have to do is a make a big batch of your specialty, bottle it up, and give it away. It’s unique, it’s (hopefully) delicious, it’s fun, and best of all it’s cheap!

2. Use a Savings Account to Start Saving Now

If you haven’t already starting saving for Christmas it’s time to start saving now. And if you want a few extra bucks in your pocket then it’s important to get the right bank account for all your savings. You have a lot of options and you can compare best savings accounts online to make sure you use the right account.

3. Earn Interest on Your Checking Account

Finding the right savings account can take some work, and it can also be hard to remember to put money into the savings account so you can earn interest. If you want to earn interest but don’t want the hassle of a second account, you may want to consider bank accounts with savings attached to them. This way you can earn interest without the hassle of moving your money from one account to another.

4. Buy Presents Used

What’s the difference between a brand new video game and a used video game? Aside from the price, there usually isn’t any difference at all. Video games, DVDs and BluRays, musical instruments and more can be purchased second-hand and are usually just as good as they would be brand new.

5. Take Out a Loan

If all else fails and you still don’t have quite enough money for the Christmas season you might consider taking out a loan. The smartest financial decision is to just use money you have for your Christmas shopping, but if you decide to take out a loan then you should use a loan calculator just in case. This way you can model out the terms and figure out how much it will cost and how quickly you can repay the loan.

Oct 17 2012

How to Save Money on Web Hosting

By |October 17th, 2012|Blog, Life|4 Comments|

In the last few weeks you may have noticed my website running a little faster. You also may have noticed that my new faster web hosting is cheaper than my old host. Wait, no, you wouldn’t know that.

That’s why I’m telling you now!

This website has been moving slowly for months now, and I’ve been wanting to do something about it but my new website Reward Boost is taking up so much of my time (and will be launching a new exciting feature soon) that I hardly have time to write blog posts, much less optimize my site performance.

web server pic

photo credit: DeclanTM

While I wasn’t even thinking about a new web host, luckily I saw on my twitter feed that one of my personal finance blogging friends Andrea has started her own web hosting service. I asked her for some information and here’s what she told me:

  • My old hosting was sharing servers with thousands of other websites. She currently has way less than thousands of clients, so my website has all the resources it needs. That means it’s going to be faster.
  • I get personalized service from someone I can trust. I can just call or IM Andrea and she will fix it. I’ve already had her address a few things and it’s the best customer service I’ve had!
  • She’s actually running her business with a server from my previous host, so I know the hardware is is going to be reliable.
  • Best of all, I get all of these benefits at a lower price than my previous host!

I’m now an engaged man, which means I need to spend my free time with my fiancee and planning our wedding, while I need to save as much money as possible so I can pay for it. My new web hosting with Nuts and Bolts Web Hosting makes running this website as hassle free as possible while also lowering my expenses.

I know many of my readers have their own websites. If you are paying more then $5 a month for your hosting and aren’t getting incredible personalized customer service, I definitely suggest you check out Andrea’s hosting plans.

I’m saving about $50 a year using her plans, which might pay for a couple chairs at my wedding. It’s not much, but every little bit helps!

Oct 16 2012

Landlord Insurance Makes Renting Your Home Safer

By |October 16th, 2012|General Personal Finance|1 Comment|

This is a post on behalf of Vicky

One of the best ways to increase your income is to have a rental property and become a landlord. If you can find a tenant at the right price then you can not only have someone pay your mortgage and build more equity in your home, but also earn a few extra bucks in your pocket every month.

However, as with any business there are risks and it’s important to make sure you aren’t on the hook for a huge bill if something goes wrong.

That’s why it’s important to consider landlord insurance if you are going to rent your home. Landlord Insurance for Direct Line can give you financial protection against death or bodily injury and/or loss or damage to third party property.

What You Don’t Know Can Hurt Your Tenant (and You!)

house for rent

photo credit: cdsessums

You never know what’s going on inside the walls of a home. There could be structural weaknesses due to poor construction during the build or a renovation. Maybe termites found their way into the house without your knowledge. Maybe it’s such an old house that the structure just isn’t sound anymore. It’s also hard to be sure that all the electrical was run safely and that all the appliances were installed properly.

If your tenant falls through an old rotted floor and breaks his leg then you’re going to have to pay for his medical bills and probably more for his pain and suffering. If some bad electrical wiring causes a fire and your tenant loses all his belongings, he will be looking to the landlord (you) to replace all of his things.

Hopefully these things never happen, but if they do then these situations can seriously damage your financial well-being if you aren’t covered by landlord insurance.

Protect Yourself Against Catastrophic Loss

One of the most important principles of personal finance is to make sure to protect yourself against catastrophic loss. You can probably afford to fix a water heater or to have a vacant home for a few months.

You probably can’t afford to replace everything your tenant owns or pay for his medical bills and pain and suffering. Landlord insurance is a great way to make sure an unfortunate situation doesn’t turn your rental business into a trip to bankruptcy court.

Oct 15 2012

Saving Money Takes Motivation

By |October 15th, 2012|Blog, Personal Finance Tips|12 Comments|

I’ve been writing about personal finance for over two years now. I’ve been running numbers, finding out the smartest ways to pay down debt. On multiple occasions I’ve identified places where I spend too much money (like on eating out). And in many instances I’ve recognized a problem and done nothing about it.

Why worry about spending too much money on eating out? I was still paying all my bills, contributing 6% to my 401k, and saving a heck of a lot more money which was used to pay off student loans and then to save for a theoretical house.

Then I got engaged and everything changed.

Now I know I need to save money because I have a wedding to pay for. I may be buying a house in the near future as well, which means I need to pay for the down payment, repairs, updates, and anything else. If I get a house then I want to adopt a dog, which also costs money. And then after Tag and I are married we will eventually start having kids which (you guessed it) costs money.

Spending a hundreds of dollars a month at restaurants and fast food places wasn’t a big deal 8 days ago. It all changed when I got engaged.

We Are Shedding for the Wedding (and the rest of our lives)

Tag and I made a decision after we got engaged that we can’t eat out anymore. Not only is it too expensive, but we can’t do that to our bodies. Our wedding pictures are going to last forever. We’re going to have those pictures in our house for the rest of our lives, and we darn well better look good in them.

The more we eat out, the harder it will be for us to get to our ideal weight for the wedding and the harder it will be for us to save up enough money for the wedding and the house.

Then once we get married and have kids, the costs of eating out (both financial and health related) are multiplied even more.

That means I actually have to start cooking. This past week I’ve cooked Mexican (shredded chicken with taco seasoning, great for tacos, burritos, and salads), Italian (ground turkey with arrabbiata sauce, served with wheat pasta), and Beef Stew (I added garlic, took out the mushrooms, and substituted beef broth for water in this recipe). Overall I had delicious and relatively healthy meals at a fraction of the cost of what I usually pay to eat out.

my beef stew

Here are the leftovers of my delicious beef stew.

True Motivation Changes Your Life

I was never really motivated to change my habits because the only reason to change was theoretical. I knew I would get married and have a house one day, but that stuff wasn’t tangible until I got engaged. All of a sudden I really have a family and a house to prepare for, and I need to start preparing NOW!

Readers: Do you have true motivation for your financial and life goals?