Tag Archives: travel

Mind-blowing Ideas Found Reading Blogs

credit: Freedigitalphotos.net

credit: Freedigitalphotos.net


Even before I started my own blog, I was a blog reading addict (mostly personal finance blogs). I’ve learned so many great things and gotten so many ideas from reading blogs, which include ideas that the main stream media often don’t talk about. I was tired of reading the recycled articles about making a budget and contributing to your 401K up to the employer match. I didn’t want to read any more stories about how early retirement was almost impossible (and by early they meant 50’s) and that even retiring at 65 might be a pipe dream. Here are some of the amazing things that I’ve learned thus far:

Retire in your 30’s

I always thought that, like most people, you get a job, work for 40 some odd years and retire in your 60s. I thought I was doing an awesome job saving for retirement when I opened an IRA account and increased my 401K contribution over the amount that my employer matched. Since I was working in government where I had a pension, I started thinking that retirement at 55 would be possible and thought that was incredibly awesome. Now when I stumbled upon the Early Retirement Extreme blog where the blogger, Jacob, said that he retired after working 5 years and was not yet 30, my mind was blown. He was a little extreme with his frugality, but then through Jacob’s blog, I found Mr. Money Mustache and his story really made me think that early retirement was possible. He went into detail about how he and his wife retired early, and argued that early retirement didn’t mean a life of deprivation, explaining often that he lives a very fulfilling life. I’m not going to be able to retire in my 30’s, but it’s possible I get there in my 40’s.

Simple, Stress-free Investing with Superior Results

I have talked about index investing many times on my blog. I believe in it and I am glad that I found this strategy. It wasn’t always this way though. Like many others, I used to chase returns by trying to a hit run by investing in the next hot stock and by investing in mutual funds which had the best returns. Now I realize that it is difficult if not impossible to consistently beat the market, so I just stick with low-cost index funds. Warren Buffet has encouraged most investors to just invest in low-cost index funds and I’m going to take his advice. This investment approach has also reduced my stress. The market drops a few hundred points! There’s a recession coming! Britain is exiting the EU! I’m investing for the long haul and I don’t really care about the stock market fluctuations. I continue to invest and stay the course. I’m not exactly sure when I first learned about index investing but it was likely on the Bogleheads’ forum.

Don’t Pay Taxes

You know how the saying goes that “there are only two guarantees in life: Death and Taxes.” Well, what if you could pay very little or no taxes? Wait wait wait, I’m not saying you should be like Wesley Snipes and get convicted of tax evasion. There are legitimate ways for regular working Joes to shelter our money from taxes. When I read the blog post title $150,000 Income, $150 Income Tax and Never Pay Taxes Again, I was very interested. We often hear about maximizing our returns when investing, but most times we ignored tax savings. Taxes are boring and complicated. Nobody really wants to deal with them. Heck, most people I know have no idea about their own taxes! They send their tax documents to the accountant who files the taxes for them. The tax policy in the US targets people with earned income so if you reduce your taxable income by “making your take home pay as small as possible,” you can avoid paying a good amount of taxes. Justin who blogs at Root of Good and wrote the post about paying only $150 in income tax with a $150,000 income, suggests that “you do everything you can to make your take home pay as small as possible” by maxing out tax advantaged plans like Retirement plan contributions (401k, 457 or 403b plans), flexible spending accounts, health savings accounts, and others. I’m pretty sure that after I read this post, I immediately logged onto my 457 plan online and maxed out my contributions.

The post about never paying taxes again was found on the Go Curry Cracker blog and it gave four simple rules to eliminate taxes:

◾Choose leisure over labor
◾Live well for less
◾Leverage ROTH IRA Conversions
◾Harvest Capital Losses AND Capital Gains

I’m especially a fan of choosing leisure over labor to eliminate taxes. That’s a win win! This advice is geared more towards those seeking or near early retirement, which is what I often dream about.

Out-of-State Real Estate Investing

I always wanted to invest in real estate but it didn’t seem possible because real estate was so expensive in the area where I lived. When I read that the blogger FI Fighter, who also lived in a high-cost-of-living-area, invested in real estate in states where the prices made more sense and where the properties would cash flow, I was very intrigued. I was somewhat skeptical at first but after some due diligence and research, I jumped in and also purchased a rental property out-of-state.

Travel for Free

I used to focus on earning cash back on my credit cards. When I read bloggers write about earning travel points on credit cards and going to exotic locations for nearly free with points, I didn’t really pay much attention because I always figured it was just too good to be true. There was a catch, right? However, after I read more and more stories of people were doing it, I was of course, interested to see if I could get in on it too. After learning some of the “tricks of the trade” with travel hacking, I’ve been able to score some free flights and have stayed at hotels (some pretty luxurious ones) for pretty much free. If you are someone who overspends with a credit card, travel hacking is not a good idea. If you are disciplined with your spending and are an organized person, you can definitely take advantage of travel hacking. I think I first started reading about travel hacking on the Flyertalk forums, but the information can get pretty technical and it might be intimidating to newbies. I think from that forum, I found the Million Mile Secrets blog which is a great resource for those interested in pursuing this. If you want to learn more about this area, there is even a free online course about the topic on Travel Miles 101. If you want even more hand holding, you can contact Holly from Club Thrifty with your ideal itinerary and she will help you create a “credit card rewards-fueled plan that can make your travel dreams come true”

You Can Really Make Money Online!

I always thought that there was an opportunity to make money online but I didn’t know how, plus I am not the least bit technically inclined. Reading articles where bloggers reveal how much money they earn online really opened my eyes to the opportunities out there. Check out the income reports on Club Thrifty and Making Sense of Cents and tell me you don’t want to learn more about this possibility. I definitely am and will need to learn more about how to earn some money online! The best thing about making money online is that you can be often work from anywhere and your schedule is a lot more flexible. Also, if you do it right, a lot of the income can be passive.

Drastically Reduce the Cost of Your Cellphone Service

I was in a family plan with AT&T and had an employer discount. I thought that was the best that I could do. There was no other way to reduce this expense unless I went with some unknown network which was probably unreliable. Then I read Is Your Cellphone Plan Ripping You Off? on the Saving the Crumbs blog and I knew that I could saved a lot of money by switching. Being that Cricket Wireless uses AT&T’s network, I figured there was no downside to the switch. With Cricket Wireless’ family plan, you can have 5 smartphones with unlimited talk and text and 2.5 gigs of data (after which your data speeds are reduced) for $100. That is less than half of what you would pay if you had a similar plan on AT&T. So why wouldn’t I switch? I’ve also heard great things about other plans like Republic Wireless and Ting which are a lot more affordable that the traditional plans, but I haven’t tried them. If you’re interested, you can check out the review on Republic Wireless here, and the review on Ting here.

Consider an Adjustable Rate Mortgage
When I was purchasing a co-op, I went to the bank and the loan consultant just assumed that I was looking for a 30 year fixed mortgage. I didn’t know any better and after the housing crash in 2007, there was such a stigma with adjustable rate mortgages that I just assumed that a fixed mortgage was superior. I truly regret not doing more research about this because I would have saved a lot of money if I didn’t go with conventional advice. When I read Financial Samurai’s post, 30-Year Fixed Mortgage Loan or an Adjustable Rate Mortgage (ARM)?, I knew I made a costly mistake. Here is an excerpt of what he had to say:

“First of all, the average duration one lives in and owns a home is 7 years. If that’s the case, what on earth are you doing borrowing a 30-year fixed rate mortgage for? A 23 year + overestimation of ownership is a serious miscalculation based on the statistics at hand. With a 5/1 ARM, your underestimation is only 2 years, but you already have baked that in”

We bought a co-op which is a junior 4 (small dining alcove converted into a small bedroom). Being that our family was growing, it was very likely that we’d outgrow the apartment in 5 to 7 years. I did run the “rent vs buy” calculator and given other factors, I think it made sense to buy a co-op even given this timeline. But it made no sense to get a 30-year fixed mortgage. If I had gotten a 5/1 ARM, I’d reduce my interest rate by 1% saving over a thousand dollars a year. *Face Palm*

Do you see anything here you might implement in your life? Have you read anything tips or ideas on other blogs that was really mind-blowing? If so, please share in the comments!

Should I Renew My AAA Membership?

501px-American_Automobile_Association_logo_svg
A few days ago, I received a letter in the mail from AAA asking me if I want to renew my membership. I only spend $40 a year on it, but I’m not sure if its really worth it to keep it. In the 7 years that I’ve been a member, I’ve only had to call them twice. Here’s a recap of those instances:

It was a week before my wedding, and I was driving home from work, intending to stop by a vendor to make a payment. I had just merged on to the highway when my engine just shut down. I was stranded on the side of the highway. I called AAA and they had a local mechanic shop send a tow truck to tow my car at no cost. However, the cost to later fix my car was absolutely not free or cheap, but that’s another story. The second time that I had to call AAA was when I was leaving work and noticed that I had a flat tire. I considered changing the flat myself, but I am not handy at all was in my suit and tie and didn’t want to mess it up. Anyways, a tow truck came and he told me there was no need to put on the spare. He inflated the tire and patched the leak and I was on my way. All in about 15 minutes and $10. It turned out better that I didn’t attempt to change the tire because a $10 patch job was all that was needed.

Many people swear by AAA. It has been around a long time and has a great reputation. My father used to have it too, though I’m not sure he ever had to use it. However, with more options today and alternatives today, is it really worth it. The cost of AAA for the basic plan is $52, plus a one-time $10 membership fee (the fee is waived if you opt for automatic renewal). My sister is an associate member on the account, and addition members are an extra $28. So we split the total costs and pay $40 each per year.

Roadside assistance
Many people who drive older or less reliable cars want the peace of mind of having roadside assistance. For basic membership, they will tow up your vehicle up to 3 miles, make minor repairs, jump start your battery, replace a flat tire with your spare, deliver fuel, and lock out service. It kind of boggles my mind that people run out of fuel, but I’m a paranoid person. I don’t even like it when the fuel gauge indicates that I have less than a quarter tank left. The main purpose of AAA is to provide roadside, but my auto insurance company, Geico provides a similar service for a fraction of the cost: $6.70 per 6 months. So basically, $13.40 for Geico’s roadside service versus AAA’s $40. I have no experience with Geico’s roadside service though so I cannot vouch for its responsiveness.

AAA discounts

Attractions
One of the secondary benefits of being a AAA member is that it provides discounts at various attractions. Here in NYC, you can save 40% off movie tickets, 20% off Bronx Zoo tickets, 15% off Madame Tussauds and Cirque du Soleil, among other attractions. I’ve gone to various attractions inside and outside of New York where they offer a AAA discount where I’ve saved a couple of bucks. But still, I’m not sure that those few times make it worth the money.

Shopping
Another discount that AAA provides is at various stores. There’s 10% off at the Gap Factory Store, Banana Republic Factory Store, Payless, among others. Also, at the Tanger Outlets in New York, you can receive a free coupon book. I did use this benefit a few years ago and with one of the coupons in the book, my wife and I bought Adidas sneakers (on the clearance rack) for a total of $35 (Hers were like $16 and mine were $19). I don’t think I’ve gotten a better deal on sneakers before. You can buy the coupon book for $5 though, and we really don’t go to the outlets much so I’m not sure that’s worth it.

Travel
When booking a hotel, you often have an option to choose the AAA rate which sometimes gives you a better deal. The last time I used my AAA card to get a discount at a hotel, my wife and I hadn’t made prior arrangements and just found a hotel along our way. I asked about the AAA discount and it saved me $20. That’s not bad, but for the most part, we usually plan our hotel stays and you might be able to find better deals using Hotwire or Priceline. There are also Hertz coupons that they send me once in awhile, but I’ve never used them. Same with the other travel services they provide.

DMV Services
There are other miscellaneous benefits that AAA provides, but the last one I’ll mention are the DMV services. I’m sure many would gladly skip a trip to the DMV and renew their registration at a AAA office, so this might be a good benefit. However, how often do would you take advantage of this benefit. Plus, you can do many things online now as well without going to the dreaded DMV.

So is renewing my AAA membership worth it?

3 Must Do’s for the New Year

credit: freedigitalphotos.net by Stuart Miles

credit: freedigitalphotos.net by Stuart Miles

Well it’s over a week into the New Year and I’m finally getting to this post. So my New Year’s resolution should probably be to stop procrastinating! Actually, I don’t like to make New Year’s resolutions because I almost never follow through with them anyway. But with a New Year and a new start, here are a few things that I think should be on everyone’s to do list. Plus, these are pretty simple and easy to do.

Make a Budget

I have to admit that my wife and I don’t really have a budget. I know what you’re thinking, “what kind of personal finance blogger doesn’t make a budget?” Well, my wife and I have listed all of our expenses and made a determination as to how much we should save each month, but we don’t track our spending. We live within our means and are pretty frugal, so there was no real need to have one. Keeping a budget just seems like too much of a hassle. But I’ve been reading a lot about Personal Capital from fellow bloggers and finally tried it out. I like the interface and the ability to see all my accounts on one site. No more having to log on to each individual account to see how it’s doing. It also tracks our expenses which will be helpful to see if there are leaks in our budget that can be cut. Also, Personal Capital is free so why not try it? To read a more thorough review, check out the review from Jacob who blogs at Cash Cow Couple.

Start Investing/Invest More

If you are still on the fence about whether you should start investing, well you really shouldn’t be. As I posted in When Lazy and Cheap is Better, investing does not have to be time consuming or complicated. So, if you haven’t started saving and investing for the future, now is the time to do it. Start contributing to your 401k. Go open an IRA account.

Whenever I read articles about starting to invest at a young age, I pat myself on my back for starting to invest in my 401K plan and opening an IRA retirement plan when I first started working. After reading an article from Matt who blogs at Mom and Dad Money, I realized that good habits can go bad. While, I’ve increased my contributions into my 401K plan, my IRA contributions have stayed the same. Yes, I still contribute the same amount as when I just started out and was making a much lower income. That pat on my back has turned into the kick in the butt I need. I will be increasing the amount that I contribute into my IRA.

Travel for free

One of my big regrets is not getting into travel hacking sooner. I did churn a couple of cards and received 2 free roundtrip tickets and a stay at a luxurious hotel, among other things. But now with a little baby, I don’t know if I’ll be traveling much in the near future. In addition, we are looking at taking on a mortgage, so we don’t want any dings on our credit report. But, I will definitely be looking to get back into the game ASAP. If you want to learn a little more about traveling for free, check out How to Travel the World for Pennies on Budgets are Sexy. I’ve told many friends and family about traveling for pennies using credit card rewards and bonuses, but many are skeptical or don’t want to make an effort to do it. For those who need some extra hand-holding, Brad from Richmondsavers offers a free travel rewards coaching program where he will teach you how to travel for free. His blog also offers instructional guides to travel to different locations for free, so make sure to check it out.