I’m sure I’ll get some disagreement with this decision, but I’m a big boy and I can take it.
Here’s the story: I’m a personal finance blogger, I just financed our new (to us) van with a six-year loan, and I honestly think it was a good decision.
At the end of January, my wife and I completed a debt management plan in which we paid off $109,000 of credit card debt in 55 months. In order to make a large payment to our program each month, we had to live on a very tight budget. We weren’t able to save up the money necessary to pay cash for our vehicle (as we were hoping to do).
The van we were driving was 10 years old. While I realize that many vehicles last longer than that, it was becoming a money pit. We’d just put new tires and brakes into it, and the power steering sounded like it was next. One day after work, the blinkers stopped working as well. Expecting this was the beginning of a never-ending parade of maintenance costs, we decided it was time to replace our family’s primary vehicle.
We searched and found a 2013 van that fulfilled all of our requirements. Since it was a year old, it cost thousands of dollars less than a comparable brand new model. We negotiated with the salesperson and talked him down to below the Kelly Blue Book value. Not being the best negotiator, I counted this as a success.
Then it came time to talk to the finance guy. [ continue reading... ]
You’ve been thinking of getting a new-to-you car for a while now. After all, you’ve been spending more in maintenance and repairs for your current car than what it’s worth.
You start looking around, but you just can’t find a good car in your price range. Do you fork out more money than you planned, or do you continue your search?
This is the dilemma my brother has found himself in. Over the past year, his 1996 Ford Ranger has had an increasing number of problems. He’s at the point where finding a new car is going to be more cost-efficient that repairing his old truck.
But where should he start? [ continue reading... ]
Not too long ago, CNN Money reported on an international assessment of teenagers and financial literacy. The test, which was administered to 15-year-old students in 18 countries, ranked the United States in the middle. The top results went to Chinese students, with students in Belgium, Estonia, New Zealand, and Australia also scoring quite well. In the United States, close to 20 percent of students didn’t even reach what is called “baseline efficiency.”
This brings up interesting questions surrounding financial literacy. Recent contentions that most adults fail basic financial literacy quizzes indicate that what students aren’t learning in school is catching up with them as adults.
The result is that we, as a nation, tend to struggle with basic financial concepts — with our money situations suffering as a result. [ continue reading... ]
I have a love-hate relationship with financial rules of thumb. On one hand, I recognize that not everyone is going to spend as much time thinking about and researching financial topics as they should, and rules of thumb give them easy-to-remember guidelines for staying on track. But on the other hand, these types of guidelines are often inaccurate, outdated, or outright wrong — and following them can derail the very goals you’re trying to achieve.
In particular, saving for retirement seems to be a subject that attracts these “rules.” What’s worse is that these rules will often still be stated as facts long after they’ve lost credibility.
Here are three retirement rules that no longer apply, followed by what you should be doing instead: [ continue reading... ]
Financially prepping for summer vacation includes budgeting for hotels, flights, gas, and activities. Of course, it also includes an allowance for fun spending on souvenirs and memorabilia.
What you might be forgetting is a vital, undetermined expense of your vacation: food.
Food expenses are one of the most over-looked and under-budgeted aspects of vacation planning. It’s easy to take meals for granted, because at home, you’ve already budgeted for groceries and the occasional take out.
But when you’re away from home, you’re dependent on prepared foods at grocery stores, gas stations, restaurants, and hotels. You might have already accounted for eating out at a few special places during your trip, but what about the rest of your meals? You’ll be spending more than you would at home, so it’s an important expense to prepare for — instead of just “winging it.” [ continue reading... ]
I love getting things for free, so I was excited when my wife said she’d won free movie tickets through a Facebook promotion by a local television station. The tickets were for a pre-release viewing of a comedy that wasn’t due to hit theaters for several weeks. Free tickets to an unreleased movie? Count me in!
Unfortunately, free isn’t always as awesome as it sounds. [ continue reading... ]