No better time to reappear

After disappearing from the world of blogging for almost three months what better time to appear than now? Two days after Lehman Brothers and AIG have become household names for unfortunate reasons and 50 days before the Presidential election. I will not comment on the election (for now at least) but I will comment on the sudden interest in the world of finance on every wesbite and column around. Actually I think I will not comment because I have nothing nice to say about this and the remedies put to use so far for this "disease" as the Wall Street Journal has called it make no sense. If you don't believe me read for yourself:

Worst Crisis Since 30's, With No End Yet in Sight

AIG in 30, or More Like 45, Seconds

Freakonomics: Economists’ Insights

Hello!!! I disappeared because I have been so busy. In addition to work I am in a summer program which means 5 nights of class and an unhealthy amount of reading. Hopefully it will be all for the best. Here are some good personal finance articles from the weekend.

Economy Can Wait; Stimulate Your Savings
Hoarding Nations Drive Food Costs Ever Higher
Is Your Tank Half Empty or Half Full?


By the way a personal project which I have always wanted to take on is one which can empower young women in developing nations to freely attend school during their menstrual cycle. Though strange to us, many young girls are forced to stay home from school for up to one week a month when their menstrual cycle begins. Menstrual pads are expensive or very inaccessible in smaller cities.

Though I was first put off by the idea of reusable menstrual pads, it now makes a lot of sense to me and it is a pretty clean invention. Many sites are now showing women how to sew these pads themselves and reuse them for years. With so many in the Western world now concerned with going green the idea is catching on albeit at a slow pace. However for the young girls in other nations this idea must spread like wildfire. It is appaling to think a menstrual cycle can possibly keep a young girl from passing a class if she misses too many days of class. Please visit the website of an organization green4girls.org which has already started this effort and hopefully when I get some time I will begin to teach myself how to make these later this summer. I have absolutely no sewing ability and have never tried but I will dust off my mother's old sewing maching and give it a try. It's for a good cause.

Simplify your (financial) life

I came across “Simplify Your Life” by Elaine St. James, a national best seller back in the 1990’s which is about exactly what the title states. Though the book is not about personal finance, it is amazing how much of the advice St. James gives also applies to anyone trying to straighten out their finances. Here are some of the best tips with regards to money that she gives.

1. Reduce the clutter in your life.
8. Cut your laundering chore in half.
19. Move to a smaller house.
20. Drive a simple car.
22. Build a simple wardrobe.
24. Rethink your meals with friends.
27. Cancel your magazine subscriptions. ( In addition to not having to pay for subscriptions, most magazines are trying to sell you more stuff.)
28. Stop the newspaper delivery.
33. If you don’t like the holidays, bow out.
37. Take a vacation at home. (Not applicable to me right now, because I need to really get away. But for the most part there are a lot of places right in our own backyard which we have never experienced.)
40. Rethink your buying habits.
41. Change the way you shop.
42. Reduce your need for goods and services.
43. Get rid of all but one of your credit cards.
48. Next time you buy a car, get it secondhand.
51. Work where you live or live where you work. (Though she was referring to the time saved not being on the road, gas prices today make this especially important.)
57. Simplify your eating habits. “Eliminate processed foods.” (These foods can be higher in fat and prices.)
58. Always split a restaurant meal.
60. Make water your drink of choice.
62. Pack your own lunch.

Small Financial Victories

As of today I have paid off all debt with the exception of my college loans. I paid off a lump sum of about $3,000. in debt to Capital One (who contrary to what they claimed in their ads a couple of years ago) are a huge hassle. I also paid off about $700. in debt to Mastercard. While I was on track with Capital One and would have been finished paying off my debt by next year had I continued to pay $200./month at 9% interest, it is my Mastercard that stressed me out. This is a revolving account, my first credit card which I signed up for in front of the dining hall in college. Though I paid on time and always paid at least 5X more than the minimum, I had not seen a zero balance on this card in almost 4 years. The highest it ever reached was around $2300. in 2005 and finally last summer it was looking like it would be paid off by August. But low and behold I charged a couple more things on it and I could not get out of the $500. balance range for the last several months. Finally about 3 weeks ago I decided to pay them everything I owed which was $694.86. I am not a homeowner so I have no idea what having 6 figure debt feels like but this was stressful enough. My biggest challenge now is should I shred the Mastercard or not because I still feel like I may feel like I "need" to use it during my next trip to the gas station. When I called Mastercard today and heard the automated service say the words I have been longing to hear for so long "your balance is zero dollars" I also noticed they added $1,000. to my line of credit. Thanks for the temptation.

And in one last final financial victory, though I normally do not pay coupons any mind, I received one in the mail last week for a free sandwich at Potbelly and I put it to use today. One veggie sandwich on the house. I feel so liberated.

Recent articles on 20-somethings

These recently published articles on young people trying to make it in these times makes life look not so fun.
Starting Salaries but New York Tastes
Checking out Roommates
Toughest Summer Job This Year is Finding One

Downsizing

I have always admired people who have been able to get rid of all of their belongings and live somewhat stuff-free. I guess I am too attached to certain possessions to get rid of them though I have tried. I always regret letting go of those items later, whether it be clothing or books. Since I have realized that I am not strong enough to let go of my possessions I have pretty much stopped buying new stuff. At least I'm trying. I just gave away 6 pairs of jeans this weekend which were all in great shape and went to the mall on Monday and wanted to buy a new pair of jeans. While in the fitting room I realized I would just be keeping myself in the cycle of buying stuff which I barely use and then have a difficult time parting with, so I left the mall empty-handed. Keep in mind I still have about 10 more pairs of jeans to give away. Unless the item of clothing is a necessity ie: work clothes ( I barely even buy that) I try not to buy it. I have only purchased about 4 books this year (all used). I do not buy electronics (I just use other peoples'), CD's, gadgets, candles, and all the other stuff people spend on regularly. My biggest weakness is by far toiletries (make-up, hair care, lotions) however I justify this by saying that at least once I finish these products they will not take up space, of course the empty bottles will most likey end up in a landfill. Believe it or not I have not adopted this lifestyle to save money but rather because I am sick and tired of clutter. Anyone who has moved lately knows how shocked you become when packing by the amount of stuff you can acquire in a short period of time. I have no attic or garage to store my stuff so it is more obvious that I have too much stuff in my home since storage space is at a minimum. While I do not ever think I can take on the somewhat hippie-like minimalism of the couple mentioned in this article I do understand where they are coming from. Like the sociologist quoted in the article says "You have to care for it, store it. It becomes an appendage, I think. If it enhances your life and helps you do the things you want to do, great. If you are burdened by these things and they become the center of what you have to do to live, is that really positive?” If you do not believe me ask go ask someone who has recently moved. So if you know me and I will be buying you a present soon it will probably be something like dinner or a drink because I care about you and I want you to avoid clutter as well.

Carnival of Personal Finance #147

Thanks to MoneyNing.com for including me on the Carnival of Personal Finance #147. I'm honored.