I think it's always a worthwhile exercise to try and come up with ways to earn additional income. More specifically, the more 'passive' it can be, the more worthwhile it is. One way I've been thinking about lately, and have actually tried on a small scale is by reselling concert/entertainment event tickets.
I decided to try a couple trial efforts and followed some guidelines:
- Buy the tickets from Ticketmaster when they go onsale playing the "Saturday @10am browser refresh game"
- Buy two sets (one more expensive to sell, one cheaper to use)...hopefully the profit pays for the cheap tickets
- Only buy tickets at an amount I felt the event was worth if I ended up having to use the expensive tickets
- Try to sell the tickets through StubHub even though fees are high (10% for buyer, 15% for seller) because of comfortability, ease of use, guarantees
- Avoid EBay because my profile has minimal feedback, it's not very flexible as far as changing/removing items, and fraud kind of worries me
Trial 1:
Event - The Police
Tickets - 2 @ 12th row center
Cost - $250 each plus fees
Situation - These were pricey, but hyped as the biggest show of the summer and one I was very excited to see. I couldn't get any takers at a profit, so we decided to use these as an anniversary gift to ourselves. We were able to sell the cheap (lol, ~$80 each) tickets and made enough to cover beer and a cab to the hotel.
Trial 2:
Event - Jewell
Tickets - 2 @ 7th row center
Cost - $75 each plus fees
Situation - The show was very close to being sold out, but I was not able to sell these at a profit or even break-even (after StubHub fees). I offered them up for purchase price through an email at work about a week before the show. Luckily, someone responded within an hour and gave me a couple bucks extra.
Thoughts going forward:
- I need to investigate alternative selling places such as CraigsList, reselling on Ticketmaster, and any others.
- I don't think I want to buy tickets for any shows I wouldn't go to myself (Unfortunately this rules out some popular and highly profitable shows such as Hannah Montana).
- I would do a 'same day' trip to 4 decent size markets, and 'weekend trip' to 4 more so that should give me a good variety to choose from.
- I need to find another way to get good tickets for regular price, sites like this help for pre-sales, but there must be other ways. I don't understand how I can login right at the time they go onsale and sometimes get stuck with tickets 20+ rows back.
Has anyone tried this or have any suggestions?
Wednesday, November 7, 2007
Tuesday, October 23, 2007
Expense Accounts: Are You as Frugal as Normal?
Do you practice being frugal at work? I haven't had an expense account at my current employer yet, but went on about 3 or 4 business trips while at a previous employer. Each time, I used my company credit card (with minimal guidelines) for all expenses. They were later entered into our company software, approved and the card was paid off at the end of the month. Keep in mind, at the time I did not practice a frugal mindset in my personal life.
On one particular winter trip, I was the lone company representative in a very cold part of Canada. Toward the end of the week, I was by myself and felt 'entitled' to enjoy dinner at a nice restaurant for working hard (and by myself in a not very fun environment). An appetizer, combo meal, and 2 glasses of wine later...my self-given 'reward' turned into a $60+ meal. After I returned, I felt pretty bad about it and was ready to pay for the excess if questioned by my manager. When my manager received the notification for approval, he questioned my categorization of the expense as 'dinner', instead of 'entertainment' which we are supposed to use when taking others out to dinner. I sheepishly explained that it was dinner for just me and he merely asked that I spend more cafefully next time and approved it.
I know there is a fine line between seemingly excessive and necessary business expenses, but some like my example are closer to the first. Sure, my management had no issue with me rewarding myself for 'a job well done' and the expense had virtually no effect when considering the overall budget, but I could've made a more fiscally responsible decision in working for our shareholders.
What other ways can employees practice being frugal at work? A few small ones quickly come to mind:
· Turning off your PC and other devices when leaving at night.
· Only using a printer (especially color) when necessary.
· Re-using cups (or bringing your own) for coffee, water etc during the day.
On one particular winter trip, I was the lone company representative in a very cold part of Canada. Toward the end of the week, I was by myself and felt 'entitled' to enjoy dinner at a nice restaurant for working hard (and by myself in a not very fun environment). An appetizer, combo meal, and 2 glasses of wine later...my self-given 'reward' turned into a $60+ meal. After I returned, I felt pretty bad about it and was ready to pay for the excess if questioned by my manager. When my manager received the notification for approval, he questioned my categorization of the expense as 'dinner', instead of 'entertainment' which we are supposed to use when taking others out to dinner. I sheepishly explained that it was dinner for just me and he merely asked that I spend more cafefully next time and approved it.
I know there is a fine line between seemingly excessive and necessary business expenses, but some like my example are closer to the first. Sure, my management had no issue with me rewarding myself for 'a job well done' and the expense had virtually no effect when considering the overall budget, but I could've made a more fiscally responsible decision in working for our shareholders.
What other ways can employees practice being frugal at work? A few small ones quickly come to mind:
· Turning off your PC and other devices when leaving at night.
· Only using a printer (especially color) when necessary.
· Re-using cups (or bringing your own) for coffee, water etc during the day.
Clark Howard: The Consumer Warrior
I'm fairly new to the world of personal finance blogs and even more new to posting on my own. I've seen and continue to see some of the same names (Dave Ramsey for debt elimination, Warren Buffett for value investing, etc) come up in various blogs, but have yet to see Clark Howard's name mentioned. His self-appointed task in the world is to help others "save more, spend less and avoid getting ripped off."
Clark hosts a weekday radio show out of Atlanta from 1-4pm ET which is syndicated to many radio markets across the country. His broadcasts are available for download in MP3 format. In addition to taking calls on his show, he provides a volunteer based call center helpline for various finance related questions. He also has a number of books available on general information as well as specific topics such as real estate. Finally, his website has categorized information as well as daily summaries of what was discussed on that day's show.
I've been listening to Clark for about a year. I must admit some of the information gets repetitive (Roth IRAs and 529's are good, etc) but it does on PF blogs as well. The listener calls he takes can be very eye-opening and sometimes downright amusing. When taking scam related calls he sets off a ridiculous audible alarm while the listener is talking and then calmly explains to them what they are talking about is indeed a deal that's 'too good to be true.'
Further information can be found at http://clarkhoward.com/
Clark is not my primary source of reference in personal finance decisions, nor is any one person. However, I do consider him a significant voice in the combined pool of reference for my PF decision making. I'm curious why others have not commented on Clark before...at least from what I've noticed. Have others heard of him or have any thoughts?
Clark hosts a weekday radio show out of Atlanta from 1-4pm ET which is syndicated to many radio markets across the country. His broadcasts are available for download in MP3 format. In addition to taking calls on his show, he provides a volunteer based call center helpline for various finance related questions. He also has a number of books available on general information as well as specific topics such as real estate. Finally, his website has categorized information as well as daily summaries of what was discussed on that day's show.
I've been listening to Clark for about a year. I must admit some of the information gets repetitive (Roth IRAs and 529's are good, etc) but it does on PF blogs as well. The listener calls he takes can be very eye-opening and sometimes downright amusing. When taking scam related calls he sets off a ridiculous audible alarm while the listener is talking and then calmly explains to them what they are talking about is indeed a deal that's 'too good to be true.'
Further information can be found at http://clarkhoward.com/
Clark is not my primary source of reference in personal finance decisions, nor is any one person. However, I do consider him a significant voice in the combined pool of reference for my PF decision making. I'm curious why others have not commented on Clark before...at least from what I've noticed. Have others heard of him or have any thoughts?
Friday, October 19, 2007
Company Stock: Don't Put All Your Eggs in this Basket
I recently attended a workshop that our company sponsors from time to time on different retirement topics. I'm not even 30 yet, so I was definitely the youngest in the room. It didn't bother me, because I know that I learned things to help my future retirement pot grow to its greatest potential. In any case, the topic this time was asset allocation. It's a pretty familiar topic to me as it's key in providing a risk-tolerant and consistent return over the long haul. However, I was able to pick up a few nuggets of knowledge to use in the future.
The thing that caught me off guard was the stat shared about the number of people in our 401K plan who invested in company stock (~40%) of which a large percentage had NOTHING else invested except company stock. I was surpised they didn't go into specifics as to why it was not a good idea. It may not have mattered since I'm guessing those who needed to hear the advice were probably not present anyway, as these sessions are voluntary. If your current cash flow (salary) is controlled by Company A, why would you rely on Company A to provide your retirement income (401K) as well? In my opinion, it's just too much of a reliance on a single entity. I hate the fact that people's lives were in financial ruin because of it, but the Enron example is a strong and real one that hopefully others can learn from.
I can understand the reasons for investing in your company's stock, however, there are alternatives for each:
· Wanting to be an owner in your company - Keep a maximum of 5% of your portfolio invested in the stock and you can still have ownership while properly allocating elsewhere.
· Sense of pride in your company - Buy their products/services instead, tell others why they are a good company.
· Don't know what else to invest in - Choose a retirement date/target fund or low expense index fund(s) instead.
In a former employer's plan, we were given a 4% match in the form of company stock. It wasn't ideal for me, but I wasn't going to complain about an equivalent of free money. Luckily, about 4 years after I started working there, we were given the option of transferring the stock into other funds as well as newly matched investments. It went into effect on 1/1 and because I noticed our stock in the past had been fairly cyclical, I waited a few weeks until I felt the price was right (I know, trying to time the market is dumb) and I moved ALL of it into the other funds I had chosen. I was probably in the minority that took similar action or even noticed the change had occurred. We didn't receive mailings, emails, etc...I only noticed due to a small intranet announcement.
I don't like to get involved in other's financial business without them asking for advice, but this is one area where it's probably worth it to make suggestions if they talk about owning company stock for one of the above reasons.
The thing that caught me off guard was the stat shared about the number of people in our 401K plan who invested in company stock (~40%) of which a large percentage had NOTHING else invested except company stock. I was surpised they didn't go into specifics as to why it was not a good idea. It may not have mattered since I'm guessing those who needed to hear the advice were probably not present anyway, as these sessions are voluntary. If your current cash flow (salary) is controlled by Company A, why would you rely on Company A to provide your retirement income (401K) as well? In my opinion, it's just too much of a reliance on a single entity. I hate the fact that people's lives were in financial ruin because of it, but the Enron example is a strong and real one that hopefully others can learn from.
I can understand the reasons for investing in your company's stock, however, there are alternatives for each:
· Wanting to be an owner in your company - Keep a maximum of 5% of your portfolio invested in the stock and you can still have ownership while properly allocating elsewhere.
· Sense of pride in your company - Buy their products/services instead, tell others why they are a good company.
· Don't know what else to invest in - Choose a retirement date/target fund or low expense index fund(s) instead.
In a former employer's plan, we were given a 4% match in the form of company stock. It wasn't ideal for me, but I wasn't going to complain about an equivalent of free money. Luckily, about 4 years after I started working there, we were given the option of transferring the stock into other funds as well as newly matched investments. It went into effect on 1/1 and because I noticed our stock in the past had been fairly cyclical, I waited a few weeks until I felt the price was right (I know, trying to time the market is dumb) and I moved ALL of it into the other funds I had chosen. I was probably in the minority that took similar action or even noticed the change had occurred. We didn't receive mailings, emails, etc...I only noticed due to a small intranet announcement.
I don't like to get involved in other's financial business without them asking for advice, but this is one area where it's probably worth it to make suggestions if they talk about owning company stock for one of the above reasons.
Tuesday, October 9, 2007
My Road to Wealth
You will find countless magazine articles, blog entries, etc. on each of the guidelines below with different variations. However, I will present all of them gathered and presented from my experiences. I truly believe if I can stick to these, I can attain wealth for my future. I have organized them into prioritized Tiers. Again, the order and priority will be different for each individual, but if you aren't sure where to begin I would recommend starting with something like this…
Tier I
Spend less than you earn
You won't be successful until you can conquer this skill. If you can't, you need to spend less (cut-back, live more frugally) or make more money (extra job, raise).
Pay off your 'bad' debt accounts
Includes credit cards, car loans, misc. loans
Obviously, you must pay the minimum amount due on each account. After that, put some extra toward the account with the highest interest rate. When that account is paid off, take the amount you were paying on the old account and add it toward the next highest rate account. Continue until all accounts have been paid off. This can also be referred to as 'snowballing debt.'
Build an emergency fund
This is a set amount of money placed aside for emergency situations that can easily be accessed (interest bearing savings account, ie INGDirect). The amount differs per person and responsibilities they have, but I've heard anywhere between 2-12 months of expenses to cover potential job loss, disaster, etc. Because my spouse and I both work and don't have any kids, 2 months is sufficient for us.
Tier II
Invest in a 401K, 403B
Ask your employer for details and make sure you invest at a minimum the amount it takes to get the maximum match from them if they offer one. In addition, a good practice to have is an incremental increase each time you get a raise (ie. 1-2% each time). The money comes out of your paycheck before you have a chance to notice it's not there!
Invest in a Roth IRA
This is where you can see the beauty of compound interest at work. Your money grows until retirement and earns interest that is never taxed. In other words, once you take it out, that amount you see is the amount you get to keep.
Tier III
Save for education
Retirement funds need adequate time to accumulate and continue to grow. I placed this below personal retirement because a child's education can always be funded by different methods: grants, scholarships, loans, etc. However, education costs continue to grow at an aggressive pace, so it is important to investigate and fund accounts such as ESAs and state sponsored 529s.
Pay off your 'good' debt accounts
Ok, no debt is good – after all, it means you owe someone else money! However, there can be tax advantages to education and mortgage loans as well as home equity lines of credit. Therefore, I don't consider these as important to aggressively tackle as 'bad' debt.
Invest in taxable accounts
Whether it is a home improvement project such as finishing a basement, a big vacation to Europe, or a new car, chances are that you have some mid-term goal in mind that you would like to be saving for. Depending on the timeframe, choose the investment that best weighs risk vs. return and put money toward that.
Give back
If you have accomplished all of the above, now is the time to start sharing with those less fortunate than you. I am not suggesting that you should wait until now, only pointing out that if you haven't by this point, now is a good time. There are many worthwhile charities; there is almost certainly one that matches up with your interests and concerns.
Tier I
Spend less than you earn
You won't be successful until you can conquer this skill. If you can't, you need to spend less (cut-back, live more frugally) or make more money (extra job, raise).
Pay off your 'bad' debt accounts
Includes credit cards, car loans, misc. loans
Obviously, you must pay the minimum amount due on each account. After that, put some extra toward the account with the highest interest rate. When that account is paid off, take the amount you were paying on the old account and add it toward the next highest rate account. Continue until all accounts have been paid off. This can also be referred to as 'snowballing debt.'
Build an emergency fund
This is a set amount of money placed aside for emergency situations that can easily be accessed (interest bearing savings account, ie INGDirect). The amount differs per person and responsibilities they have, but I've heard anywhere between 2-12 months of expenses to cover potential job loss, disaster, etc. Because my spouse and I both work and don't have any kids, 2 months is sufficient for us.
Tier II
Invest in a 401K, 403B
Ask your employer for details and make sure you invest at a minimum the amount it takes to get the maximum match from them if they offer one. In addition, a good practice to have is an incremental increase each time you get a raise (ie. 1-2% each time). The money comes out of your paycheck before you have a chance to notice it's not there!
Invest in a Roth IRA
This is where you can see the beauty of compound interest at work. Your money grows until retirement and earns interest that is never taxed. In other words, once you take it out, that amount you see is the amount you get to keep.
Tier III
Save for education
Retirement funds need adequate time to accumulate and continue to grow. I placed this below personal retirement because a child's education can always be funded by different methods: grants, scholarships, loans, etc. However, education costs continue to grow at an aggressive pace, so it is important to investigate and fund accounts such as ESAs and state sponsored 529s.
Pay off your 'good' debt accounts
Ok, no debt is good – after all, it means you owe someone else money! However, there can be tax advantages to education and mortgage loans as well as home equity lines of credit. Therefore, I don't consider these as important to aggressively tackle as 'bad' debt.
Invest in taxable accounts
Whether it is a home improvement project such as finishing a basement, a big vacation to Europe, or a new car, chances are that you have some mid-term goal in mind that you would like to be saving for. Depending on the timeframe, choose the investment that best weighs risk vs. return and put money toward that.
Give back
If you have accomplished all of the above, now is the time to start sharing with those less fortunate than you. I am not suggesting that you should wait until now, only pointing out that if you haven't by this point, now is a good time. There are many worthwhile charities; there is almost certainly one that matches up with your interests and concerns.
Monday, October 8, 2007
Hello World
The title of my first entry takes me back to the beginning of college and my first major - Computer Science. For those that aren't familiar, it is fairly common for the first program taught when learning a new computer language to be called "Hello World." I only lasted a semester in the major as I just wasn't cut out to be a programmer, but it did provide a nice transition to my Management Information Systems major in the school of business. It proved to be a much more comfortable mix of computers and business for me.
Having a pretty substantial interest in computers and the internet, I have always been familiar with blogs, but didn't realize until recently their use and popularity outside of acting as an online diary or way to update friends and family. I have stumbled upon (and now browse about 50) personal finance blogs and have found them amazingly helpful and fun to read. I've now got the itch to give it a try myself.
Hopefully, I'll get past the "Hello World" test and begin to write successful and helpful blogs for others to enjoy. I can't wait to begin to learn how to improve, market and perhaps even advertise in my blog. If not, I'm sure it will be a good learning experience to help me transition into something else.
Having a pretty substantial interest in computers and the internet, I have always been familiar with blogs, but didn't realize until recently their use and popularity outside of acting as an online diary or way to update friends and family. I have stumbled upon (and now browse about 50) personal finance blogs and have found them amazingly helpful and fun to read. I've now got the itch to give it a try myself.
Hopefully, I'll get past the "Hello World" test and begin to write successful and helpful blogs for others to enjoy. I can't wait to begin to learn how to improve, market and perhaps even advertise in my blog. If not, I'm sure it will be a good learning experience to help me transition into something else.
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