Category Archives: Uncategorized

Guest Post on The Frugal Farmer

credit: freedigitalphotos.net by Stuart Miles

credit: freedigitalphotos.net by Stuart Miles

I have a guest post featured on The Frugal Farmer today which talks about how to invest in real estate. Here is an excerpt of the post, please click on over to read the full post!

There is an allure to making it rich investing in real estate. There are late night infomercials telling you they can teach you to build a real estate empire. There are shows about making big bucks flipping houses. Real estate investing is NOT a get rich quick scheme, but it is a great way to build wealth. If done right, investing in real estate has many benefits including having monthly cash flow, tax benefits, having your tenants’ rent check pay the mortgage, leverage and appreciation. There are many ways to invest in real estate but for purposes of this post, I am going to focus on buy and hold real estate investing.

Click over to read the rest!

Baby #2 Has Arrived!

Baby #2
I’m happy to announce that Baby#2 has arrived in the Living Rich Cheaply family. Older brother has been very helpful with helping out with his little bro. And to long-time readers of this blog, unlike last time when we had an unintended home-birth because the doctors kept telling us it was not time yet, they didn’t dare send us home this time around.

I’ve really been struggling to post consistently and I’m sure having two little ones needing attention will make it doubly tough. How do you bloggers with kids and a full-time job juggle all of this?? I will definitely try to get back into the blogging groove though. When I originally started this blog about three years ago, it was because I didn’t find many personal finance bloggers who were trying to raise a family in the NYC area, which can be challenging because of its high costs of living. At the time, my wife was also planning on staying home with our first child so we would be living on one-income, making it even more challenging. Although opportunity knocked and she decided to accept a job opportunity that came unexpectedly. Now with two little ones, we started having conversations again of having one parent stay home with the kids at some point. We’ve also talked about whether we would move to a bigger place or a different neighborhood with more affordable housing (still in the NYC metro area though so the term “affordable” is relative). So let me leave you with some relevant posts that I’ve written about living in NYC with a family:

Is it Possible to Raise a Family in NYC?
This post goes over some of the pros and cons I find with living in NYC with a family. It’s something that is constantly on my mind. Part of me daydreams of living in a lower cost of living area, but it’s tough to leave a place I’ve known my entire life and where pretty much all our family and friends live. Plus, it’s an awesome city! Just expensive…

Is NYC Really that Expensive?
Yes, living in NYC is expensive, but it’s mainly because of the high cost of housing. Other than that, there are ways around keeping your costs relatively low living here.

Why Do You Live Where You Live?
This post goes over the reasons why people choose to live where they live. NYC is ranked the #2 most stressed city, so why am I still living here?

Small Baby, Small Apartment, Small Budget
Surprisingly, this is one of my most popular posts. I write about what baby stuff we use to conserve space since space is limited. We have since moved to a slightly bigger apartment, but conserving space is still a priority. And now with two kids, space is even more limited.

Are Millennials Sweating Student Loan Debt?

This is a guest post and infographic. Check out my comments at the end and leave a comment of your own.

Education costs are already climbing near record setting levels, but according to a new review by Credit Sesame, millennials aren’t going to be searching for other options, demonstrating the reward down the line is worth the cost.

While the price of university has long been going through the roof, the millennials, who were born between 1981 and 2004, are still looking towards going to college and believe it produces more value than in the past, an opinion that the Gen X did not agree with back in the day. The key distinction between the millennials and Gen X is how carefully the new undergrads are picking their degree to study and exactly how much it will help them establish a secure career future.

The outcomes in summary are down below on what we discovered after the survey:

• Earnings: We found out that over 10 per. of millennial parents made over $150k a year, while only 3% of Generation-X parents met that very same bracket. Next up, over 25 per. of millennial families earned $110k annually while only 4 per. of Generation-X met that bracket. On the other spectrum you’ll find merely 16 per. of millennial families within the $32k per segment or less, whereas one-third of Generation-X parents produced that income.

• The Payout: When we arrived at paying for school the results revealed that nearly 25% of millennials were required to pay out a minimum of $25k, however only 6% of Gen X happened to be paying a similar price. Alternatively we get 50% of Gen X spending $10k or less, while on the millennials side it happened to be 27%.

• The Pay for Knowledge: Our data even showed the value of income when it came to choosing which major to join, and it was substantially different for the pair of generations. When it came to millennials an astounding 33% said that their income had a large impact on their selection, however only 14% of Gen-X agreed that income was a primary decider.

• How Do You Really Feel About That?: When questioned if university is really worth the price tag, 76 percent of millennials agreed it does, although only 68 percent of Gen X agreed.
Edvisors recently published that the graduating class of 2015 racked up by far the most debt in US history. But, millennials will continue to hold a college degree in high regard and its ability to give you a better future financially. The data submitted by the Labor Department in 2013 confirms, showing that people in the US with a college degree on average earn 98% more per hour compared to those who didn’t complete college. But, this doesn’t change the fact that rapidly rising price of university has been out of hand and paying off school loans has been harder and harder each year.
The great news is student loans do not need to control your life. Here are some of the ways you could take control over your current student loan debt:

• Direction – Handling your student loans is a great approach to ensure that you are structured and capable to make a change in places you get the possibility. There are plenty of short-term choices you could make that could have sustaining impact on your long-term financial situation, for one you can start by getting a part-time job, sell some of your old things around the room that you no longer use, or study extra hard to earn yearly scholarships for excellent performance

• Ask Specialists – Creating an assessment on your credit rating and getting custom repayment opportunities can be achieved with companies such as Credit Sesame

• Alert: Interest Rates Ahead – This could sound obvious, but trying to pay back more than your per month bare minimum is the best technique to reduce the financial debt that you have to pay over the long haul. Not surprisingly, not many take the initiative to do so, usually choosing to spend their own extra cash elsewhere

• Consult Your Lender – If you are having troubles repaying those student loans then one of the best options would be to consult with your loan company to find out whether you can either defer some of the installments or even minimizing them if it is possible

We will need to understand that the 4 year degree brought much less appeal to Gen X, the cost mirrored that importance by being substantially more affordable previously. Now millennials prefer degrees that will produce higher earnings and also are usually in demand from employers, not only in present time, but in the longer term as well. Despite the fact that for many students loans are incredibly widespread and departing college with a huge amount of debt is a lot more common, that doesn’t mean that it will continue to be so for a long time. There are many solutions available that can guide you on a tailored plan to begin paying back that debt within a much shorter period.
TL;DR
Student Debt Attitudes: Millennials vs. Gen X Provided by CreditSesame.com

My comments:

Millennials have the most student loans of any other generation. Having the financial burden of student loan debt affects millennials’ ability to buy a house and to start a family. It is one of the biggest problems facing, not only millennials, but the economy. Nevertheless, this study by Credit Sesame finds that millennials are undeterred and still feel like a college degree is worth the cost. College degrees are pretty much a requirement in today’s job market. A college degree is an equivalent of a high school degree a generation ago. So while I do agree that a college degree is worth it, I wouldn’t go deep into debt getting one. I don’t think that a more expensive school will always give you better job prospects upon graduation.

Another interesting finding in the study was that millennials are more pragmatic in choosing majors which will have higher salaries. When it comes to this topic, there are two camps. One camp argues that you should major in what you are passionate about because you will excel at it, thereby enhancing your career options. The other camp argues that you have to be practical and find a STEM major because that’s where you find the jobs and the higher salaries. As with many topics, I think there is a middle ground. I don’t think someone should be compelled to pursue a STEM major solely to find a high-paying job. If I forced to major in engineering or physics, there is a possibility I wouldn’t have graduated college or would have had a very rough time, plus low GPA. I also wouldn’t be naive and think I could major in English literature or Art History and expect to have no problems finding a job and paying student loan debt. As for me, I majored in Business Management partly because I was interested in it, but also because it was a major that was more likely to get me a job. I minored, but eventually double majored in Political Science because I found it interesting. I think minoring in a topic you are interested in is a great option. Plus, there are always electives to choose for courses that you are more passionate about.

Do you think what major you choose matters? Did you go the pragmatic route or did you choose your passion? Is a college degree worth it no matter the cost?

Co-op Buying Process

credit: By Jennifer D. Ames (Own work) [CC-BY-SA-3.0 or GFDL], via Wikimedia Commons

credit: By Jennifer D. Ames (Own work) [CC-BY-SA-3.0 or GFDL], via Wikimedia Commons


As I mentioned in my previous post, we just moved to our new digs. In the last year or so, I’ve posted a few times about thinking about buying a co-op and signing the contract. When you purchase a co-op, you do not technically own the apartment, but you own shares of a co-op corporation that owns the building. So I’m not technically a homeowner, I’m a shareholder.

When I started researching about the co-op buying process, I saw an article where the writer said that a trip to the dentist to get his tooth extracted was a more pleasant process than the co-op application and approval process. I can’t say that the process was that bad, but I can see how it can be, especially for luxury co-ops in Manhattan with stricter guidelines and snobbier people. =)

Fees
Oh those pesky fees! Yes, you have to pay for the privilege to buy a co-op. Here are a list of fees I paid:
1) Non-refundable processing fee in the amount of $350
2) non-refundable credit report fee, in the amount of $75 per applicant (Don’t worry, they didn’t charge for a credit check of my 15 month old)
3)Non-refundable application fee in the amount of $500 (refunded if your application is denied). I’m sure what the difference between an application fee and processing fee is??
4) Move-in fee in the amount of $100
5) Move-in deposit in the amount of $400 (refunded when they determine that you haven’t scratched up their walls/elevator during the move and after they determine that you are in compliance with the rules, like having 80% carpeting)
The fees are to be paid using certified bank checks or money orders.

Application
The application consisted of about 30 pages asking pretty much everything they can ask about your financial situation. You also had to copy and collate 7 complete copy sets to submit. Here are a list of the main things they wanted:
4 most recent paystubs
3 most recent bank statements as well as other financial institutions (retirement accounts/investment accounts, etc)
2 most recent utility bills
Letter from your landlord (if renting) stating how much your rent is, how long you’ve lived there and that you are current on the rent payments
3 personal reference letters (per applicant) stating what a wonderful person you are and what a wonderful neighbor you’ll make. Some co-ops require professional reference letters as well from co-workers and supervisors. I should have submitted a personal reference letter from Little LRC’s friends too, written in crayon explaining that he is very quiet and doesn’t like banging on the floor.
Statement of Net worth They asked us to list all of our assets, which included not only your bank accounts and accounts with financial institutions, but also your vehicle, jewelry and furniture. They also asked you to list all your liabilities like mortgages, student loans or other debt. Surprisingly I never knew our net worth. While I do use Personal Capital to track my assets, it doesn’t include my wife’s accounts and did not include my pension information. Not sure it’s a pf faux paux not to know my net worth, but it didn’t really matter to me as long as we were living within our means and meeting our savings goals. Seeing your net worth is pretty cool and I was pleasantly surprised. I’m tempted to post it like other bloggers do, but I think I’ll keep it private for now.
Passport sized photos of all applicants (Yes, they wanted a passport sized photo of Little LRC too. They’re lucky he sat still for 2 seconds to get a good shot!)
Letter of employment from employer
Mortgage Commitment Letter
Copy of driver’s license or other government document establishing permanent residence in the U.S. I guess non-permanent residents are not welcome.

Deadline
As I mentioned, I had to submit 7 collated copies which included all the above documents. I spent a bit of money at Kinko’s and killed a bunch of trees making these copies. I was also there hogging the copier for a while early in the morning trying to get all the copies made before the deadline. Well there wasn’t an actual deadline, but I wanted to get the board approval ASAP and also, my mortgage commitment was good for only 60 days. You see, the co-op board only meets once a month, so if you don’t get it in before the first Friday of the month, you’ll have to wait until the next month. Oh and another thing, this was in July and this co-op board takes August off so I’d have to wait until September if I didn’t submit it on time! I submitted the application slightly late as the first Friday of July was a holiday and I didn’t get the mortgage commitment until that weekend. The co-op board was nice enough to take my application to review for July. They did inform me that the fees mentioned above had to be paid with certified checks or money orders and I wrote them personal checks. Argh…I need to pay more attention to the details! I ran to the bank (Little LRC in tow) to get them and ran back with the proper payment.

Co-op Board Interview
For our interview, it seemed more like a foregone conclusion. I think that the application package which includes all your financial details was sufficient. They did ask us a few questions regarding whether we had pets and told us to have thick carpeting so as not to disturb those below us. However, some co-op board interviews are more intensive. They want to make sure that you’re not going to be throwing wild parties in your apartment perhaps. However, I’ve heard that some questions can border or being racist. And of course they don’t need to state a reason for rejecting you so they can often get away with it.

Rules
One of the many complaints about living in a co-op or in a community with a home owners’ association is the various rules that you must comply with. There are pros and cons I guess. Not having rules may cause headaches when your neighbors do things that would annoy you. The con is that even though you are an owner, I mean shareholder, you still need to abide by other people’s rules. I haven’t had the time or patience to read through the book of house rules. Maybe I will break out the book one night when I need good reading material to help me fall asleep. However, a few of the rules I know of for my co-op are the 80% carpeting rule and no pet policy. If you want to make renovate or remodel, you can’t just call a contractor up, you first have to get the approval from the co-op board. And of course…fill out another application. When there’s an application, an application fee is no doubt included. There is also a deposit that you must submit which is refundable.

Jumping through hoops just to become a shareholder and putting up with rules set by a co-op board may not make sense to many. However, such is the realities of housing in the NYC metro area. Buying a house is prohibitively expensive for most, so buying a co-op is the only option if you decide not to rent. I don’t think there’s anything wrong with renting, but it made financial sense for us to buy a place now.

Versatile Blogger Award

versitle-blogger-bwI am very honored Connie from Savvy with Saving nominated me for the Versatile Blogger Award. Although she admitted that she has “no idea what this really is or how it got started”…it is still an honor and privilege that another blogger thought to include me. So thanks Connie!

There is apparently only one rule in this award of unknown origin, and it is that I have to share 7 random facts about myself, so here goes:

1) I have no athletic ability to speak of and really am not great at playing basketball, though I loved playing and watching it growing up. During my freshman year of high school, I joined the intramural basketball team. My high school did not have a “real” basketball team as it was a pretty small school with 3 to 1 girl to guy ratio. The rule for this intramural league was that everybody was required to be selected and allowed to play at least 5 minutes. Well of course, I was selected near the bottom and allotted my minimum 5 minutes per game. Due to some circumstances, many players couldn’t make a playoff game (yes we made the playoffs). I scored a total of ONE point in that playoff game, but it was a game winning foul shot. That was an exciting experience that I’ll never forget. Oh, we eventually won the championship. I still have the trophy to prove it!

2) Speaking of playing basketball, when I was a kid I dreamed of being the first Asian-American point guard for my favorite team, the Knicks. That Jeremy Lin kid was living my dream during Linsanity.

3) I was riding an ATV on a mountainside in Costa Rica in the driving rain. I was lagging behind all my friends who were way ahead of me so I sped up while going downhill to try and catch up. I hit a rut and fell off the ATV. The fall wasn’t too bad, but the ATV flipped onto the side and landed on top of my leg. No big injuries, except maybe a sprain and a bruised ego. I looked over to my left and realized that the cliff was only a few feet away. I’m very lucky!

4) I lived in Mexico for a month (the Baja Penninsula area) as a part of a “Group Study Exchange” with Rotary International. I lived with a few host families, some who didn’t speak much English. I think it’s a great experience to be immersed in another culture and live among the locals in a foreign country.

5) I played the piano for about 7 years growing up. Unfortunately, I was too busy watching T.V and playing my Nintendo that I didn’t practice much. Sorry Mom! I wasted your hard-earned money. Even though I didn’t practice as much as I should have, I still have a decent foundation. I bought a keyboard and want to start playing again. Maybe I’ll force see if my son wants to learn to play one day?

6) When my wife was pregnant, I think I had the fear that many husbands had: not making it in time to the hospital. I kept reading in the news of mothers having to deliver at train station or in a car because they couldn’t make it to the hospital. I DID NOT WANT THAT TO HAPPEN. Anyways, when my wife started feeling contractions we headed over to the hospital. We were sent home, with the doctor telling us it was not time yet. We went again the next afternoon and were told the same thing. Well the doctor was wrong because our son decided to come soon after when we got home. On my son’s birth certificate, it has my wife’s name as “attendant at birth” and also our address under “Address of facility or hospital.” I’m very proud of my wife for staying cool under the circumstances…and myself for not passing out.

7) I am blind in my right eye. It was a birth defect. Many days I don’t even notice that I have slightly diminished depth perception and peripheral vision, though I like to blame that on me not making it into the NBA…not my lack of athletic prowess.

Now for my nominees for the Versatile Blogger Award:

Done by Forty

Young Adult Money
Money Mini Blog
Income Surfer
Frankly Frugal Finance

(I just realized the C. from Romanian Experience also nominated me. Thanks C!)