Jul 24 2012

Wouldn’t a 5% CD Be Great?

By |July 24th, 2012|Blog, Personal Finance Tips|15 Comments|

The other day I was lamenting the fact that I can’t get any better than a 1.1% return on a CD, which means there’s no point to even consider tying up my money for such a low rate of return.

It makes it so hard to save money when the interest rate you can get at a bank is lower than the inflation rate. That’s why I’ve turned to alternative places to invest my money like Lending Club, but I don’t want to put too much money there because the risk of default could get super high if America goes back into a recession or enters a depression.

If I want a safe investment in a bank, then American banks simply aren’t the right place to put my money.

Then it hit me: what if I could invest in CD-like products in other countries that might have higher interest rates?

27 seconds and a quick Google search later I found that I can get over 5% on a 3-month Australian Term Deposit (same as an American CD) with Ubank Term deposits. Are you freaking kidding me?!

Interest Rates are Higher in Australia

People in Australia are actually rewarded for saving money with great low risk interest rates while I’m stuck here in America getting a measly 1%.

australia

photo credit: lednichenkoolga

I’ve actually been wanting to get into some foreign currencies, specifically the Australian Dollar, and now I realize that I can get 5% on my money in addition to any gains (or losses) I might have against the US Dollar.

The problem is I can’t figure out how to put my money into an Australian bank. The account I linked to earlier requires that you be an Australian citizen and have a residence in Australia. I certainly don’t meet the criteria and I assume most of my readers don’t either.

Unfortunately it doesn’t look like I can become an Australian citizen very easily. I don’t have any Australian blood in my body and I have never even been there.

Readers: Do you have citizenship in another country? If so, can you get better interest rates there than are available in America? Do you know a way to invest in CDs from other countries without becoming a citizen?

Jul 23 2012

I Saved a Bunch of Money on Food Last Week

By |July 23rd, 2012|Blog, Personal Finance Tips|7 Comments|

Last week I wrote about how I was spending too much money on food and I wanted to stop eating out for an entire week.

One week later I can report that I made it almost all week without eating out and saved a bunch of money.

In June I spent $939 on eating out and groceries (which also includes paper towels, toothpaste, and anything else that I don’t eat but buy at the grocery store). In the last week I spent about $42.

I did have to buy food when I went into the office twice (I could have packed a lunch but I wanted to eat in the cafeteria with work colleagues), but I spent $8.18 combined on both days. My work has a pretty good cafeteria where I can get 2 tacos, a drink, and a bag of chips for $4.09. Technically that’s “eating out” but it was cheap.

food

photo credit: jefferyw

Everything else I ate this week came from groceries that I already had in my house or the $34 worth of groceries I bought during the week. My girlfriend Tag made some awesome lime chicken and a casserole that fed me for about 4 or 5 meals during the week. It does get a little tiring to eat the same exact meal a bunch of times during the week, but when it’s something really delicious like Tag made then it’s easier.

She even put some vegetables in there so I’m going to assume I’m 1000% healthier this week than I was last week.

It’s Easy Saving Money When You Identify a Spending Problem

The hardest part about finding ways to save money on spending is to identify where you have a spending problem.

Scratch that. It’s ADMITTING you have a spending problem.

I hadn’t looked at my food budget for months because I KNEW what I found would be terrible. It’s that stupid theory that if you don’t see something it’s not really happening. It makes absolutely no sense and makes me feel like an idiot, but I know I’ve done it before and I’ll probably do it again.

Readers: Are you spending too much money on something? Are you ready to make a change?

Carnival Links

Y & T’s Weekend Ramblings at Young and Thrifty
Carnival of Retirement at My Personal Finance Journey
Carnival of Fin. Camaraderie at The University of Money
Yakezie Carnival at The Ultimate Juggle
Wealth Artisan’s FinCarn at Wealth Artison
Carnival of MoneyPros at My Family Finances
Canadian PF Happy Hour at Canadian Personal Finance
Carnival of Financial Planning at The Amateur Financier

Jul 19 2012

I’m the Master of Ceremonies at the Plutus Awards at FINCON12

By |July 19th, 2012|Blog|10 Comments|

I’m sure there are a bunch of you out there thinking “I love Kevin’s music videos and his sense of humor so much, I wish I could see him live!”

Okay, maybe my mom is the only person actually thinking that, but I’m still excited to announce that I will be hosting the 2012 Plutus Awards (personal finance blogging awards) at the Financial Blogger Conference in Denver this year.

I’m the “Master of Ceremonies”

According to the Plutus Awards site, I’m the “Master of Ceremonies”. I just learned that MC is short for Master of Ceremonies (who knew?). Why the heck would anyone want to shorten “Master of Ceremonies”? I LOVE IT!!! I don’t get to be the master of much now that I live with my girlfriend, so at least I get to be the master of something!

Maybe to make things interesting I’ll take a cue from this obviously talented MC:

MC

photo credit: pretendtious

Or… maybe I’ll just wear a suit. Perhaps a tux if it’s in the budget. This guy scares me.

I do want to give credit to lots of bloggers who are coming together to make this event happen. We are all trying to make sure that this awards ceremony is fun, exciting, engaging, and doesn’t take too long.

And after all that work is done, I’m gonna be the one up on stage trying to pull everything together, which should be a piece of cake. As you can see from the announcement I’m highly qualified to host the awards ceremony:

Kevin is an accomplished performer and host, having landed the lead role in his first grade Halloween play “The Pumpkin Patch Kids” and most recently hosting Kevin McKee’s College Graduation Extravaganza.

My mom has the video tape of that 1st grade play somewhere. I bet there’s a good chance I end up picking my nose at some point during the performance. If she ever finds it I’ll upload it to Youtube and we can all have some great laughs over it.

I’m Taking Requests

I want this event to be awesome. I want it to be fun and entertaining, and mostly I want to make sure we are honoring all the great work that has been done in the personal finance community over the last year.

If you are going to be at FINCON12 and have any suggestions of what you’d like to see at the Plutus Awards, please leave your ideas in the comments. The only definite rule I have so far is that we need to keep the award ceremony to 1 hour or less (hopefully less so people don’t fall asleep). Let me know what you want me to do as the MC, and give any other ideas that you think would be completely awesome!

Jul 17 2012

Skills, Not “Education”, Make You Money

By |July 17th, 2012|Blog, Personal Finance Tips|32 Comments|

Today while I’m at work I’m going to spend some time talking with a senior manager about taking a new job within the company.

My goal is to move into the Mobile Phone and Tablet division because I believe mobile software is the future of technology. I want to get into the field while it’s still relatively new so I can get great experience and make myself a much more valuable and marketable employee. There’s only one problem.

I don’t have any mobile development experience.

I’ve actually looked into taking a mobile development class at the local community college, but after looking through their course catalog I’ve realized they don’t offer mobile programming courses. In fact there are very few colleges or universities that offer courses in this new and exciting field.

So college is outrageously expensive, many graduates can’t find jobs or work jobs that require only a high school degree, and they can’t even stay current and offer courses on the latest technologies? I’ve already written about how I believe higher eduction is a huge bubble waiting to burst and tank our economy, but they can’t even teach the latest and most highly sought skills? What a rip off.

I’m Gonna Learn Mobile Development from a Web Course

I realized that if I want to learn mobile development I’m going to have to do it without the help of a college, and unfortunately I’m not a good enough developer to just “learn as I go”. I needed to find some way to get instruction without going to a college.

androidEnter this kick-butt site Udemy.

This site allows people to create their own classes and charge users to access their content. It looks like anyone can create a course and there is a built-in review system so users know which courses are best. Unlike college where you take the courses that are required with instructors that may or may not be more helpful than Sheldon Cooper, on this site you get to read the reviews, take what you want, and learn at your own pace.

I haven’t tried any of the courses yet (because I’m a little busy building my own site), but once my new site launches I plan to take either Android Programming for Beginners ($49) or Android Apps in 1 Hour: No Coding Required ($99) using this awesome free tool built at MIT called App Inventor.

The best part is that either one of those classes is going to be a heck of a lot cheaper than a class at my community college.

Skills Beat Education Almost Every Time

Imagine you take one of these courses and learn to build mobile phone apps. Then you use that knowledge to build a few apps, publish them for the iPhone and Android, and maybe even make a few bucks along the way. Now imagine you and some guy with a Masters Degree in computer programming are interviewing for a mobile development position. He has the edge when it comes to education, but all you have to do is pull out your phone in the interview and say “Look what I’ve built.”

If I’m the hiring manager, I’m hiring the person who has proven he has the skills and experience to do the job and I don’t care if he or she has been to college or not.

Mobile development might not be the right career path for you, but if you know what you want to do then I suggest you figure out how to learn the skills. It could be going to college, or it might be an online course or an apprenticeship. Don’t worry about a piece of paper; when you have awesome skills it doesn’t matter.

Readers: What’s the next thing you plan on learning, and how are you going to learn it?

Jul 16 2012

Food is Expensive

By |July 16th, 2012|Blog, Personal Finance Tips|24 Comments|

So I had a hypothesis that I might be spending too much money on food, especially considering the fact that I’m now living with my girlfriend and buying food for two.

What I found was disgusting. I spent $939 on food (groceries + restaurants) in June.

Apparently I’m eating out much too much. In fact I ate out 35 different times during the month of June, which comes to over one meal outside the home per day. I guess there’s a reason my friends call me Fat Kevin.

I’m not as young as I used to be and my metabolism isn’t as strong as it was years ago. If I don’t start eating out less, I’m going to get fat, spend a bunch of money, Tag is going to leave me and I’ll lose to The Hoff in my Race to $1 Million.

I can’t let any of that stuff happen.

I’m Not Eating Out for 7 Days

I decided that Tag and I need to kick this eating out habit. Cooking for one is hard because you always end up with a lot of leftovers and you are stuck either eating leftovers most of the time or throwing out excess food. If you end up throwing out lots of excess food then it isn’t much cheaper than eating out.

fat kevinCooking for two is much better because double the amount of eaters means half as much leftovers. The problem is it takes a lot of time to shop for the right groceries, plan out meals, and cook them.

Luckily Tag and I have done that. We have a few meals planned this week and a bunch of stuff to make easy meals like sandwiches. We made a decision on Saturday that we wouldn’t eat out for seven days.

So far it’s going well. On Sunday Tag made banana bread, which we ate for breakfast. Then I made grilled cheese for lunch, and we went to my aunt’s house for a steak dinner like we do every week.

Now we just have to make it six more days without spending a dime at a fast food joint or restaurant.

What’s Next?

We are going to make it a week without eating out. But it won’t mean much if we go right back to Jack in the Box and Taco Bell next Sunday. The goal is that we find some recipes over the next week that we really enjoy and will cook more often.

Furthermore, I’m going to start keeping closer track of my eating out expenses. I’m not sure what my monthly food budget should be, but I know it needs to be lower than $939.

Be on the lookout for more food related posts. This is a pretty big deal for me and I’m not going to let overspending on food ruin my goals of having money to buy a house and increasing my net worth.

Readers: How much do you spend every month on food? What do you do to keep your food expenses down?

Carnival Links

Carnival of Fin. Camaraderie at The University of Money
Carnival of Financial Planning at Master The Art of Saving
Carnival of MoneyPros at Portfolio Princess
Carnival of Retirement at Good Financial Cents
Totally Money Carnival at Money Reasons
Y & T’s Weekend Ramblings at Young and Thrifty
Yakezie Carnival at Tackling Our Debt

Jul 12 2012

Other “American Government Bubble” Investments

By |July 12th, 2012|Blog, Personal Finance Tips|11 Comments|

As you probably know by now I’m very worried about the growing American Government bubble and I believe that investing in dividend paying companies in countries with a trade surplus is the safest way to put money in the stock market.

But the stock market isn’t the only place to invest. If you want to ensure your money retains it value or grows, there are a few other investments mentioned in The Real Crash that should do the trick.

Precious Metals

The experts say that a good diversified portfolio includes 10% precious metals. I tend to agree, although I’m willing to go up to 20% of my assets and I want to hold at least half of it physically.

I’ve already written about junk silver which is my favorite form of precious metals. It’s easy to identify real junk silver (any dime, quarter or half dollar made before 1964) and they could very well become the default barter currency in the event of a true collapse of the dollar.

While silver has the inherent value of being a “precious metal”, it also has applications nano technology and super computing because it conducts electricity better than any other metal. I highly recommend having some junk silver stored safely in your home.

If you prefer gold, that’s another good way to invest in precious metals. Some people think the price of gold is inflated, but I contend that the reason the price keeps going up is because the Federal Reserve keeps printing money. I think the Fed will keep printing money, so I think gold will keep going up against the dollar.

Precious metals are a great way to diversify your portfolio and protect against an American Government bubble.

Foreign Currencies

Another way to prevent your money from losing value is to get out of the dollar and into a more stable currency. Even when we aren’t in a great recession I don’t trust the Federal Reserve to maintain the value of the dollar. The Federal Reserve is a private bank that makes money by printing dollars and lending them to the federal government.

money

photo credit: Nina Matthews

When a private, profit-seeking company increases their profits by devaluing the value of everyone else’s money, it makes the dollar incredibly risky.

Unfortunately a central bank isn’t unique to America. All currencies in the world are fiat currencies (meaning they are not backed by any physical assets). The key to picking a currency is to make sure that the country has a history of keeping inflation low and that the country exports more than they import.

Some currencies I like are the Australian Dollar and the Swiss Franc. I don’t like the American Dollar or the Euro.

I honestly haven’t invested in any foreign currency yet, but I do know that you can invest in currencies through the stock market with companies like Currency Shares. If you know a better way to invest in foreign currencies please leave a comment and let us know.

What’s The Worst That Could Happen?

Overall I recommend at least 50% of your portfolio be invested in a combination of dividend paying stocks in countries with trade surpluses, precious metals and foreign currencies. And my question is: “What’s the worst that could happen?”

If there is an American government bubble and it bursts, these investments might not skyrocket, but they should definitely do better than American dollars and American stocks.

However, if there is no American government bubble or if it doesn’t burst in our lifetime then you’re probably still alright. Your international investments could very well outperform American investments.

Readers: Is your investment portfolio diversified enough to overcome hyperinflation of a particular currency or government default of some country?