Of late, I’ve been reading a lot of personal finance blogs and I could kick myself for the information that I’m discovering that I wish I’d known before. Nevertheless, it is not too late. I am turning 23 this year and I got started on my first ‘real’ job. My job automatically contributes the maximum amount from my paychecks to a 401(k) which they match at a rate of 9%. This is pretty good. Their benefits are good such that M has dropped his employer’s health plan in favor of mine e.g. they cover 90% vs his employer’s 80% plan). Based on stuff I’m reading, here are several things I’m learning:
- Debt resolution should be #1 on your list. You can do this by paying it down aggressively or “snowflaking” approach popularized by Dave Ramsey i.e. you pay little at a time, taking money from little areas that you might otherwise ignore. In my case, snowflaking will be the best way to go afterall that’s pretty much how I cleared up my Bank of America credit card. Let me see them collect 20.74% APR on a zero balance card. In your face!!
- Building an emergency fund. The idea of an emergency fund is emergencies. It’s said that an emergency fund should be “three to six months worth of basic living expenses”. Without going into too much detail, this will also require me/us to practice some serious snowflaking habits. Now, I started this one out the wrong way. What did I do? I put $100 in a tip jar. Now, this is a special tip jar, but M just showed me a neat way of retrieving money from this jar so I’ve safely retrieved the $100 from this jar, but that’s not what was wrong with my approach. The money was just sitting in my tip-jar when there are no-cost high yield savings accounts that are liquid (i.e. easily accessible assets)! So, I have started an Orange Savings Account with a 4.10% annual percentage yield. All you need to open this account with is: $1.
- I’m also learning that it is a good thing to participate in another type of retirement account (the IRA or individual retirement account) called a Roth IRA. I would go out right now and start one, but the biggest obstacle is committing to the somewhat hefty payments that need to be made monthly. Additionally, I’d like to set up one for both Matt and myself so it will take some number crunching. Last night, M & I couldn’t sleep and we actually sat down (or up cos we were lounging on the bed) and tallied our cost of living. We are going to do some interesting things with that discovery and I’m pumped about being savings, et cetera.
- A key principle to getting rid of debt and not getting stuck in the cycle is not channeling all your funds towards the debt such that when some mini-disaster strikes, you will end up having to resort to dipping into the credit card pool. It’s taking a little while for me to wrap my head around that, but it makes perfect sense. For a while last year, I would throw quite a bit at both cards and by the end of the month, I’d find out that I was essentially going nowhere! However, little chips here and there caused me to wipe out the Bank of America card, some old lingering school fees, etc.
That’s about it for now. I’ve been going nuts tinkering with my WordPress 2.3.2 installation because contrary to my last post’s congratulatory tone, I still am getting the “tinyMCE is undefined” error which causes the toolbar to disappear. I finally hunted down Dean’s FCKEditor plugin for WordPress and I’m typing merrily once again. I hope the WordPress developers fix whatever is causing the TinyMCE toolbar to disappear. I mean, I reuploaded a fresh instance of WordPress 2.3.2 (after deleting old files) and my toolbar showed briefly. Today, I logged in and coudn’t get my toolbar to show. Anyhow, I’m working with the FCKEditor now so I don’t care too much. In more WordPress news, I’ve been discovering some really cool plugins most notably StatPress! It’s like WordPress.com stats on steroids!! l recently transitioned from using the WordPress Reports plugin because it kept “forgetting” that I’d put in my Google account information a zillion times. So, I decided to go with Local Analytics which gives a lot of customization room. Still, I really miss the nice report view that the WordPress reports gave me. I haven’t gotten used to the really complex Google analytics interface and it takes me a while to figure who visited my site, and from where. It’s a confusing mish-mash. That’s why I still have Statcounter running on this site because it condenses the information and presents it in relevant bite-sized and digestible chunks. Hey, I’m easy to please.
Oh and lastly, I finally gave into activating the Share This plugin because it really wiped out several things in one fell swoop: giving you the ability to email/IM/twitter any post you like to your friend/enemy/frenemy as well as posting it to any or all of your accounts on Facebook/MySpace or the next hot social networking site. I didn’t like that the original developer (Alex King) had sold the plugin and that I had to sign up to use the plugin, but it wasn’t that painful and I just hope I don’t get spammed. Besides, the older version of the plugin is still available. He’s pretty involved in the WordPress community and I trust his plugins. Alright, I’m getting tired. It’s red flag day and I’m really twitchy. I wonder how come I am relatively docile up until the day comes. Then, I turn all grumpy and usually, my grumpiness is even what alerts me to the possibility that the red lady’s come a-knocking! I know, weird. I’m pretty regular although not to the exact day. It’s more along the lines of a windows of 7 days. So, stay outta my way for the next 5-7 days. lol