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Proverbs Guide to Finance

The proverbs of Solomon son of David, king of Israel: for attaining wisdom and discipline; for understanding words of insight; for acquiring a disciplined and prudent life, doing what is right and just and fair; for giving prudence to the simple, knowledge and discretion to the young- let the wise listen and add to their [...]

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Top Personal Finance Blogs

by Derek Clark

Money Crashers recently released a new ranking list for the top personal finance blogs using a new ranking scheme. It combines 9 different rankings to get an overall rank. The separate categories it uses are:

Feedburner Subscribers
Twitter Followers
Alexa Rank
Compete Rank
Technorati Rank
Google PageRank
Yahoo Inbound Links
SEOmoz mozRank
SEMRush Search Value

There are several nice features to the Money Crashers list that some others may not have. The first, which I already mentioned, is that it uses an algorithm that combines each of the rankings rather than just using one of them as a default. It does however allow you to sort by ranking if you want to see the blogs in order by a particular metric.

Another nice feature is that it has the blogs separated into categories, so it allows you to show the rankings for different blogs that are similar. For example, Christian Finance is one of the categories.

If you have your own personal finance blog go over and check out the list to see where you rank. If you just like to read about personal finance this is a great way to find new blogs that you may not have heard of before.

I’d suggest checking out the Christian Finance category to start. It includes some of my favorites including Bible Money Matters, Christian PF, and Redeeming Riches.

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Random Acts of Kindness

by Derek Clark

A generous man will prosper; he who refreshes others will himself be refreshed. Proverbs 11:25

My wife and I recently added a new line to our budget. Random acts of kindness. It isn’t going to be huge, just a few bucks a month, but I think it will be a very rewarding thing for us. Remember that generosity was the last principle in my series on Proverbs Guide to Finance.

I got the idea while out to dinner with my family for my Mom’s birthday last week. On a whim I decided to buy everyone’s meal. It wasn’t a birthday present, I’d already given her that. My dad and I got her a Blu-ray player with Wi-fi built in so she could get Netflix. She’s a big fan. Anyways, back to the point. I just thought it would be nice to buy my family’s supper that night. Just as the Proverb said, it was very refreshing.

Random Acts of Kindness

So we decided to add a new category to our budget. It is strictly going to be for doing nice things for people for no reason at all. It could be for someone it need, or it might just be someone random. It could just be doing a nice thing for friends and family who don’t need it at all, just to show we care. We will probably pick up the tab when going out to eat with our friends more often. It might be paying for the person behind us at a drive thru. Maybe we decide to buy a meal for somebody next to us when we are out for dinner.

What we decide to do isn’t really important. It is just nice to brighten somebodies day. It is letting people know that people still care. Free Money Finance talked about this type of creative giving awhile back here and here. Several people commented that it was silly to give money to people that didn’t need it while others need it more. Here was my response that was included in the second article.

I completely disagree with those saying you should only give to those desperately in need. I’ve seen this done, and had it done for me and it really brightens that persons day. The person may or may not need it financially, but it is always nice to know that there are caring generous people out there. You can make a difference in the life of an average joe just as much as someone who is homeless. We should be striving to make the world a better place for everyone we meet. I especially like those who are giving to people in the military or some such.

Giving to those in need is great, and we should do as much as we can for people we know need help. However, sometimes you don’t know who might need your help. It isn’t always financial. Maybe they just need reminded that people still care and that there are good people still out there. The person behind you in line at McDonald’s can almost certainly afford their double cheeseburger. That isn’t the point. If you can show a person in need that people care, it is worth way more than $3.98, or whatever the total happens to be.

If anybody has any stories of doing something like this I’d love to hear them. If you have other ideas for creative ways to give I’m all ears as well.

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Tradeking Review

by Derek Clark

Tradeking is an online discount broker. I’ve been using it for around 2 years now so I thought I’d do a review. I’ve used several different brokers including ETrade and Zecco, and so far Tradeking has been my favorite.

Pros

Let’s start off with the good things. First, the price. It is only $4.95 to make a trade for stocks or options. With options you have to add $0.65 for each contract. I found ETrade to be significantly more expensive at around $9.99, and Zecco was about the same as Tradeking. If you have $25,000, Zecco gives you 10 free trades a month. 10 trades would be plenty for me, but I don’t have that much invested right now. As such, I’ve chosen Tradeking for some other reasons that I’ll highlight below.

I’ve found the interface of Tradeking to be very easy to use. It is simple to switch between accounts. I have both a taxable account and a Roth IRA with them. Making a trade is easy, and even the research is half way decent. These are the areas I found Tradeking to be better than Zecco, and ultimately they are why my accounts are with them now. While the research options aren’t as good as with ETrade, it is half the price. Ultimately I use Yahoo Finance for most of my research, so the price was the main factor in my decision, with the user interface being second.

Cons

While I have liked most things about Tradeking, it isn’t perfect. There a few small things that are slightly annoying. I use TurboTax to do my taxes, and there isn’t an automatic import of trades for the year. Several companies work with them to make it easy at tax time, unfortunately for the last few years I’ve had to enter everything by hand. It is a bit of a pain. I’ve sent requests to them to support this, and I have high hopes that this will change. If it does, I’ll recommend Tradeking even more.

The other con for me is a little silly. In the name of security they make you click pictures of a keyboard on the screen to enter your password. You can’t just type it in. It is a pain and in my opinion doesn’t increase security. It is a minor annoyance, so I just go with it.

Conclusion

Overall I am a big fan of Tradeking. It is cheap enough that you don’t have to have a ton of money invested to make reasonable trades. You should generally aim for a maximum of 2% in trade costs, so taking into account a buy and a sell I recommend starting with at least $500. Until then the costs to trade make it very hard to make any money. As such, you can get into the market easier with Tradeking than you could at say ETrade. If they managed to hook up with TurboTax to make my life simpler at tax time, it will be just about perfect for me.

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Give Your Home Owner’s Insurance a Checkup

by Derek Clark

This past weekend I had my car broken into. We lost a GPS, phone car charger, and my bowling bag with 2 balls, shoes, and braces. Seriously, who steals bowling balls? It was a pretty unfortunate weekend. After filing a police report, I went to check on my insurance to see what it would be covered by and if it was worth it to make a claim.

I wasn’t sure if it would be covered under the car insurance or my home owner’s insurance, but I was hoping for the car. Since I’ve been with my current insurance company for so long the car insurance deductible is down to $100 since I hadn’t made a claim yet. The home owner’s insurance deductible was $500. Wouldn’t you know it, stolen stuff falls under the home owner’s insurance.

So, unfortunately there wasn’t much point in making a claim, as all the things that were stolen added up to a little less than the deductible. My agent said there would be a good chance of my premium going up if I did, so I decided against putting the money towards our deductible. We aren’t going to replace everything right away anyways.

Now to the checkup part. While I was going through my policy, I noticed that while my total insurance level was fine, there are limits to how much I can get for certain categories. I’ll be honest, it isn’t something I really paid attention to when I first got the policy, as I didn’t have much of anything in the house. I was under all the limits easily. Some examples of categories that were there are:

Jewelry
Cameras
Guns
Tools
Silverware
Computers

Like I said, when I first got the policy I was easily under the limit for all of these categories. However, since then I have gone over in a few categories, and it never crossed my mind to raise the limits. Thankfully this served as a good reminder to check those out and see what the difference in premiums would be. I raised 2 categories by a few thousand, and the difference in premium is about $1.33 a month.

Hopefully I won’t ever need to collect on the insurance, but thankfully now if something were to happen it wouldn’t be as big of a problem as before. This served as a good reminder that I should probably check up on this at least once a year. If it has been longer than that for you you may want to give your policy a look.

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Generosity, PGTF Principle 7

by Derek Clark

One man gives freely, yet gains even more; another withholds unduly, but comes to poverty. A generous man will prosper; he who refreshes others will himself be refreshed. Proverbs 11:24-25

This is the final principle in my series on Proverbs Guide to Finance. Check them out if you missed any.

Generosity is one of the most important parts of personal finance in my opinion. If you aren’t helping others it just isn’t as meaningful. I truly believe it is better to give than receive. Sure I like getting stuff, but some of my best memories of gifts are from the ones that I have given. Being generous is really the end goal of financial independence for me.

A generous man will himself be blessed, for he shares his food with the poor. – Proverbs 22:9

We have a duty to take care of those less fortunate than ourselves. The widows, the orphans, wives of military men. This doesn’t mean I think we should turn to socialism. The government isn’t nearly as efficient at taking care of the needy as the private sector is. Non-profits like Nashville Rescue Mission do a far better job of helping people than our government does.

Unfortunately we don’t do as good a job of taking care of people as we should. If we did there would be much less need for the government to try to take over like they have been.

Whether or not you believe in tithing, giving to those less fortunate than you in some fashion needs to be a part of your personal finance planning. The blessings are real, and you generally feel better than the person receiving the aid.

Free Money Finance had a great piece today on creative giving. Thanks to FMF for featuring a comment of mine. I think creative giving can be a lot of fun, you never know what kind of day a person is having, and paying for their meal in the drive-thru could really brighten their day. Who knows, maybe even change their life, showing them that some people still care.

Let me know what you think about creative giving and being generous in the comments. If you have a story of how you’ve given creatively in the past please share it. I can always use more good ideas. If we get enough responses I may turn them into a post.

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Get Some Help and Make Some Plans, PGTF Principle 6

by Derek Clark

Plans fail for lack of counsel, but with many advisors they succeed. Proverbs 15:22
The plans of the diligent lead to profit as surely as haste leads to poverty. Proverbs 21:5

Planning

Financial freedom isn’t easy. It doesn’t just happen. You won’t just wake up one day and say wow I have a lot of money in the bank and no debt. It doesn’t work that way. You have to plan for success, and then work diligently to make your plans succeed.

Make a budget. Set up your debt snowball. Learn how to save for retirement. These are all things you need to plan ahead for. Many of them are also things you should get some outside advice for.

Advisors

You are only as smart as the people you put around you. Now this doesn’t mean you have to go and spend lots of money on financial advisors, though that is an option. You just need to gain wisdom from smart people you can trust. Hopefully you have a friend or family member that is like minded enough to bounce ideas off of. Having somebody that you are accountable to is very helpful for financial success.

There is also tons of really great free advice on the internet. Do some searching around. Check out Free Money Finance, Bible Money Matters, Get Rich Slowly, Christian Personal Finance, Yakezie, or Early Retirement Extreme. Each of these sites are full of great advice. If you want to talk to someone for advice, send me or one of these guys an email and we’ll be glad to help. My email is clarky07[AT]gmail[DOT]com. You are welcome to email me any time. I’m happy to help. Many of these sites have ask the readers days as well. You can have your question discussed and answered by the many intelligent readers of these sites.

You can’t just wing it. Make a plan to succeed, and then follow through with it. Also, there is too much great information out there to try and do everything yourself. Reach out to others for help and your plans will have a better chance of success.

If you missed it, check out the whole list of principles in my intro post on the principles of finance found in Proverbs. Each principle is key in your journey to financial freedom.

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Diligence, PGTF Principle 5

by Derek Clark

Lazy hands make a man poor, but diligent hands bring wealth. Proverbs 10:4

Hard work has always been the key to success. Get rich quick is always a scam. Unless you have a big inheritance coming, the only way to become financially independent is to be diligent about working hard. Getting rich slowly is the way to do it right.

This is obviously closely related to principle 4 of avoiding laziness. I decided to include both because of how many times diligence is repeated in Proverbs.

Proverbs 12:24 – Diligent hands will rule, but laziness ends in slave labor.
Proverbs 13:4 – A sluggard craves and gets nothing, but the desires of the diligent are fully satisfied.
Proverbs 10:4 – Lazy hands make a man poor, but diligent hands bring wealth.
Proverbs 21:5 – The plans of the diligent lead to profit as surely as haste leads to poverty.

Just as a side note, profit is not a bad word. As much as some in the government and media would have you believe, it really is a good thing. When people work hard and provide a good or service that people want, profit is the result.

Let’s take deeper look at a few of the other verses. “The desires of the diligent are fully satisfied.” If you have a desire and you work hard to fulfill you will be satisfied. If you don’t work hard and instead sit on the couch, you get nothing.

“Diligent hands will rule, but laziness ends in slave labor.” Everyone tries to vilify CEO’s, but guess what, they worked really hard to get where they are. You aren’t able to go that far without a little diligence. The lazy people end up working for them, or slaving away to them back in the case of the bankers. You can’t expect to get to the top without putting in any effort.

“Lazy hands make a man poor, but diligent hands bring wealth.” Anybody see a trend here? The point is obvious. God makes it clear that working hard and staying diligent when things get tough is a very good trait that will be rewarded. Being lazy and hoping for someone else to take care of you will make you poor and a slave. Whether that is a slave to debt, slave to job you hate, or slave to a government that holds your well-being in its hands. Any way you look at it things look much brighter for the diligent hard working person. Take your future into your hands and do something productive with it.

If you missed it, check out the whole list of principles in my intro post on the principles of finance found in Proverbs.

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Laziness, PGTF Principle 4

by Derek Clark

Laziness brings on deep sleep, and the shiftless man goes hungry. Proverbs 19:15

In other words, get to work. Too many people expect everything in life to be given to them. Right now we have more people than ever living off the government. Help in bad times is one thing, laziness is another. You have to actually work hard to succeed.

As the Proverb says, the shiftless man goes hungry. Dave Ramsey puts it this way, “Get out of the cave, go kill something and drag it back.” You have to get out there and work hard if you want to succeed in personal finance. Laziness on the other hand is just going to lead to heartache and despair.

Now this is going to step on some toes, but I believe many of the people fired in this last recession deserved it. Many of the companies that cut salaries used the recession as an excuse to trim the fat. In good times many of these people would have kept their jobs, but in a recession companies get an excuse to get rid of people who aren’t performing.

Unless the companies went out of business completely, the really good employees kept their jobs in most cases. I watched companies like Microsoft layoff 5000 people as they reported billions of dollars in earnings. They certainly weren’t going to go bankrupt if they didn’t let them go, but the recession gave them the excuse to get rid of people who were not performing. This is good for the company, but not for those people.

Unfortunately, many of the people currently out of work don’t even want jobs. I know some are truly trying hard and struggling to find work, but many simply don’t want to go back to work. This is an actual conversation a small business owner I know had recently:

Unemployed person: You aren’t hiring are you?
Owner: Not at the moment.
Unemployed person: Good, can you sign this for me saying I came looking for a job?

Seriously. Many people are happy collecting their unemployment check while they sit at home watching TV. Proverbs 10:4 says that lazy hands make a man poor, but diligent hands bring wealth. If you want to win at personal finance you have to get out there, kill something, and drag it back to the cave. People like Jeff at Deliver Away Debt who have been working overtime and multiple jobs to get out of debt. If you need some inspiration take a look at his blog. He is really killing it. That is how you succeed. Sitting at home collecting an unemployment check doesn’t cut it.

If you missed it, check out the whole list of principles in my intro post – Proverbs Guide to Finance.

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Say No to Debt, PGTF Principle 3

by Derek Clark

The rich rule over the poor, and the borrower is servant to the lender. Proverbs 22:7

The heart of personal finance is to spend less money than you make. Whether that means making more money, spending less, or a combination of the two. Any way you look at it you cannot spend more money than you make and be successful in finance. This means no debt. You can’t borrow money for a car, and cut up your credit cards if you still have them.

Proverbs is clear on this point. The borrower is servant to the lender. Some translations go even farther saying the borrower is slave to the lender. If you owe money to somebody you are under them until you pay it back. This is why you shouldn’t lend money to friends and family. It changes the relationship. It becomes a master slave relationship instead of a peer relationship.

Debt kills a person’s ability to grow wealth and gain financial independence. The key to growing wealth is the magic of compound interest. Your money grows as it earns interest from investments, and as time goes on you start earning interest on the interest. That’s where the magic happens, and given time anybody can grow wealthy. The problem with debt is it robs us of that magic, and even works the opposite way. Visa and Mastercard are enjoying the magic of compound interest on your credit card balance.

Do not be a man who strikes hands in pledge or puts up security for debts; if you lack the means to pay your very bed will be snatched from under you. Proverbs 22:26-27

This has played out all across the country over the last few years. Our country fell in love with debt, and people bought many things they couldn’t afford. One of those things was houses. Unfortunately many people lacked the means to pay for the houses they signed up for. Because of this they lost them, and in the process made the entire economy come crashing down with them. The principles of personal finance laid out in Proverbs are as true today as they were when they were written. Say no to debt and you will spare yourself a lot of heartache and misery.

If you missed it, check out the whole list of principles in my intro post – Proverbs Guide to Finance.

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Don’t Make These 5 Job Hunting Mistakes

by Guest Author

The following is a guest post by Crystal at Budgeting in the Fun Stuff. Her blog covers living expenses, saving for your future, and the fun stuff in between.
According to the Yahoo Finance article, Five Mistakes Online Job Hunters Make, these actions will NOT get you hired:

1. Forgetting Manners -
If you use Twitter or you write a blog, you should assume that hiring managers and recruiters will read your updates and your posts… “Assume your future boss is reading everything you share online,” says Miriam Salpeter, an Atlanta-based job search and social media coach.
2. Overkill
Blanketing social media networks with half-done profiles accomplishes nothing except to annoy the exact people you want to impress: prospective employees trying to find out more about on you. One online profile done well is far more effective than several unpolished and incomplete ones, says Sree Sreenivasan, dean of students at Columbia University Graduate School of Journalism.
3. Not Getting the Word Out
When accounting firm Dixon Hughes recently had an opening for a business development executive, Emily Bennington, the company’s director of marketing and development, posted a link to the opportunity on her Facebook page. “I immediately got private emails from a host of people in my network, none of whom I knew were in the market for a new job,” she says. ” I understand that there are privacy concerns when it comes to job hunting, but if no one knows you’re looking, that’s a problem, too.”
4. Quantity Over Quality
Choose connections wisely; only add people you actually know or with whom you’ve done business. Whether it’s on LinkedIn, Facebook or any other networking site, “it’s much more of a quality game than a quantity game,” says Ms. Canfield. A recruiter may choose to contact one of your connections to ask about you; make sure that person is someone you know and trust.
5. Online Exclusivity
Scouring the Web for a position and doing nothing else is rarely the best way to go. “When job-seekers choose to search for jobs exclusively online — rather than also include in-person networking — they may be missing out on ‘hidden’ opportunities,” says Mr. Schoonover. “Higher-level jobs are not posted as often as lower-level jobs online. In-person networking may be needed to uncover these higher-level positions, which may be filled by executive recruiters.”

I completely agree with all of these.
1. I know my company Googles the employees and has laid off people based on a few Facebook posts. One post was anti-boss and the other was crude.
2. I’d think leaving a professional account unfinished would be the definition of of unprofessional, right? So yes, make sure your accounts are completed and have at least of couple solid contacts.
3. I talk alot (surprise, surprise, hahaha), and I’ve gotten all my jobs by talking about the fact that I was looking. My hubby-to-be actually referred me to the contact I used to get into my current job. A solid contact and some people skills can make things pretty easy.
4. If a prospective employer calls one of your contacts and they don’t remember you, that would probably get an aplication tossed. Being picky is just a good idea when you are talking about people who will be actually speaking for your future.
5. I got all but one of my college jobs and my main job by applying in person and by networking…the one job I received through an online application was seasonal work that I was way overqualified for. :-)
What do you think of their list?

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