What Are The Best Personal Finance Books?

As I was walking around the local Barnes & Noble over the weekend, I found myself in kind of a rut. Nothing seemed particularly interesting, but I haven't read a good book about money for quite awhile so that's what I was browsing for. Instead of searching through the Amazon reviews for a good book, I though it might be better to open it up to everyone out there.

So, what is your favorite book about money? The last money book I read was one of Jim Cramer's (the high strung Goldman trader turned hedgie-turned CNBC talking head), and can't say that it was something I'd recommend.

Image: Lin Pernille @ Flickr

High Yield Checking Account Interest Rates Hold Up Better Than Savings

High yield savings account interest rates took a hit again this week (Feb 16) with a majority of the major players again reducing returns. However, high yield checking account returns have held up better. Bankdeals.blogspot.com reports this week that there are still plenty of good returns to be found with high yield checking accounts. Below is a list of places that you can still get a good deal from Bankdeals. The site also has a ton of information about the highest CD, savings, credit union yields, and bank account bonuses for the rate chasers out there.

• 6.01% Reward Checking at Air Academy FCU
• 6.01% Reward Checking Account at Charter Bank
• 5.51% Reward Checking Account at Provident Credit Union
• 5.09% Reward Checking Account at Consumers Credit Union
• 5.01% Reward Checking Account at State Bank of Toledo
• 5.01% Reward Checking Account at Connexus Credit Union
• 4.44% Reward Checking at First Arkansas Bank & Trust
• 4.00% Reward Checking Account at First National Bank

PS: Before you jump to a new account for what could be a teaser rate it's a good idea to crunch the numbers with a rate chaser calculator to see how long it will take for that new rate to pay off.

What Will You Do With Your Stimulus Check?

Now that it is looking more and more likely that Pres. Bush's economic stimulus package will in fact be made a reality as early as next month -- raining down checks of $300 to $1,200 per household.. What do you plan on doing with your check? I plan on investing the money (I suppose that shouldn't come as a surprise since I blog about being cheap). Sorry to those of you expecting me to do my part to get this economy back on track - hopefully other people carry my weight for me.

I'm curious to hear from other people what they plan to do with their refund. Of course, if this plan is going ot work people need to spend the money and the sooner the better. It has been reported that it takes at least six months for the spending to stimulate the economy.

Economists are notoriously poor at predicting and modeling what will happen with the economy, so what is your guess? After all, you have a better chance of being right than the weather man.


Read more about the plan @ NYT

Image: dcjohn @ Flickr

Study: Want to be rich? Be Moderately Happy

We’ve all hear that the rich are unsurprisingly more happy on the whole than typical common folk, but there is a new study that says when it comes to financial success, it’s better to be only slightly more happy than average.

Turns out that after researchers at U. Virginia, U. Illinois, and Michigan State analyzed data and published findings in Perspectives on Psychological Science. The conclusion was that people who rank themselves a 7 or 8 on a scale of 10 achieve more success than people who rate themselves a 10.

So, does this mean that someone like Richard Simmons who is an eternally perky 11 on 10-point scale would do better if he turned it down a notch? Not sure, it’s difficult to accurately quantify happiness since happiness is a subjective beast.

The study posits that people who score off the charts for happiness tend to look at the world through rose colored glasses and as such don’t learn from mistakes – making them less productive than people who are less happy.

I will throw my completely unscientific theory out there… I think that people who are really happy are less successful because they are in a word content. People who are completely content in my opinion generally have less drive – and maybe lack the Type A high achiever personality found in many people who find above average financially success. People who are super happy might fall into either people who are content with meeting an average level of success and comfortable lifestyle – or they may be entrepreneurs who continue to keep on going regardless of what life may throw at them taking bigger risks for bigger rewards. Just my two cents.

Link @ Yahoo Finance

Image: Itzafineday @ Flickr

Free Websites That Help You Save Money

Mint: Think a free stripped down version of Quicken, Money or other personal finance packages delivered via the web. Mint connects to over 3,500 U.S. financial institutions and even suggests where you can get higher rates.

Rent-o-meter: Want to know if your landlord is ripping you off? Are you charging your tennants the market rate? Simply enter your address, monthly rent, number of units, and unit size. The Rent-o-meter gives you a snapshot of whether you are getting a good deal or not.

Buy-side Realty: Megadiscount (no service) broker that will give you back 75% of the commission they receive from the broker. For example if you purchased a $200,000 home and the buyer's agent typically gets 3% of the purchase price, you pocket about $4,500 out of the deal.

Trulia: Demographic information on various areas. Find homes for sale, track trends, local real estate data and more.

Zecco: This online broker has received some mixed reviews and they recently altered their business model from free trades -- to free trades if you maintain a $2,500 account balance. Still pretty good. If you don't want to keep $2,500 in the account then it will cost you $4.50 per trade.

Bankrate: Bankrate aggregates the going rates for mortgages, home loans, credit cards, cd's, and has a lot of other useful financial information too.

Zillow: Real estate valuation service. Check what homes are selling for in a particular area. There have been plenty of people who claim its data is flawed and that it can be far to high or low, but even if imperfect it still has some useful data for people that are home shopping.

The Super Size Me of Personal Finance

I just read a review of the DVD "Maxed Out" which is apparently being touted as a movie that does what "Super Size Me" did to fast food -- to debt. I'm not sure how exactly one would go about pulling this off, but until I can get a copy from Block Buster (review to follow later) all I have are Amazon reviews to tide me over. The Amazon review seem to be a mixed bag. Overall it seems like the movie is getting a positive review, but reviewers are claiming that it loses focus somewhere along the way by trying to do too much. I imagine it is difficult to make a feel good story about a family living paycheck to paycheck, even if they spent unwisely to get themselves in that position.

Do Investors Have Too Much Information Available?

I was reading an article over at the FT today about the explosion in benchmarks and equity indices now available to the average investor. It is enough to make your head spin or at least check Investopedia much more than can possibly be healthy.

I know there are a lot of people out there who love gobs of information and can't seem to get enough of it. I find myself drifting the other way in many areas. It's not that I don't like being able to quickly find what I'm looking for or don't love the vast quantities of stuff out there on the internet. I think my problem with the push toward information overload is the opposite, I think I'm turned off by the fact people want the 30 second sound byte version of EVERYTHING. The world's economy is simplified by the FTSE, EFT's have exploded, and there are even website that will ruin the endings of movies you have yet to see.

I hate to sound old, but I just don't think there should be a super-shortcut for everything. I'm from a generation that had the internet in High School... I have been known to IM watch TV and eat dinner at the same time... and have seen friends become borderline stalkers due to Facebook... so why do I have a problem with the short cut polarize everything, cut out all the discussion way that media outlets operate these days?

Image Credit: NedRichards

Stock Market Flirts with 14,000

The market finished at a record high today, although not quite at 14,000. It had traded earlier in the day at that level but did not reach that peak before closing. The market is up over 12% for the year and now some analysts are forecasting 15,000 before the end of the year. When you look at the statistics it is a little bit astonishing. The market moved from 13,000 to 14,000 in a mere 57 days. Additionally, the market has closed at a record 57 trading days this year. This is pretty amazing since oil has been marching upwards.

Of course there are still people losing money in the market and hedge fund pros getting paid gobs of money to lose money for their clients. I think now is still a good time to get into the market although I'm not about to steer you astray and offer stock tips.

If you are looking to get in the market you can open up a brokerage account by tomorrow and start investing. Fidelity and Charles Schwab are perennial favorites, while brokerages like TradeKing and OptionsXpress don't have minimum account balances or service fees.

Head over to the library or half.com, there are plenty of good investing books that can school you in what a P/E ratio is and teach you how to tell if a stock is overvalued. Or pick up "The Intelligent Investor," the book that Warren Buffet has said is one of the best. After you get your feet on the ground with the basics you can read up on what the pro's are doing. For those of you who have cable (and can stomach his personality) Jim Cramer's Mad Money is a solid show for beginners run by a guy who made a killing by running a hedge fund.

Finally, you can see what the big institutional investors are doing for free by checking out what are the most active options. Head over to Yahoo!Finance and Market Watch which are tremendous resources to get you started.

Have something to add? Leave a suggestion in the comments or email me.

Image Credit: Helico

Personal Finance Carnival: #3

Here's my not so regular round-up of the best personal finance articles I read from other blogs:

Financial lessons from The Office TV series @ Consumerism Commentary

The Consumerist has a post about four accounts you need and four accounts you don't

My Money Blog has 14 brochures to help you understand home mortgage loans.

The Five Cent Nickel has an article about how credit card bonus chasing effects your credit score.

John Chow blogs about Google bouncing Adsense checks.

Have a suggestion for my next roundup? Drop me an email.

Free Stock Trades?

When I was checking my email last night I came accross an adsense ad for free stock trades. So what you say, I get about 150 of those a week in my spam folder. Well maybe so, but having some spare time I clicked it anyways and it turns out yet another company is trying to use the web to shake up tired business models.

Zecco promises to give you 10 free trades a day or 40 free trades a month for free. After you reach 40 it charges $3.50 per trade (which is still less than most online brokers). The company also does not charge a minimum account balance or maintenance fees unless you are trading on margin. The company has a matrix that lines its fees up against the competitors here.



The interface doesn't look like anything out of the ordinary or too spectacular, but you can't beat the pricing...

Has anyone tried this yet? I haven't used this service at all, but love the premise. I assume (which is always dangerous) that the way the company can keep costs so low is that it fills both sides of the orders clients place. In other words if at all possible waits to find another Zecco customer that is selling what you're buying before it closes the order. However, this isn't uncommon and every broker tries to do this.

I am guessing though that Zecco trades are less than instantaneous - although I haven't heard anything to the contrary, but for me it wouldn't be a big deal. I'm not a day trader and those of you who are day traders are probably using a more robust service anyways. Plus, if you are buying and selling you should be using the good ol' market limit so you can lock in the prices you want to buy or sell at anyways.

I'd love for this service to succeed or at least cause a little disturbance in the pricing structure of the bigger players. If you have used Zecco email me and let me know what you think.

Link:
Zecco.com

Google Your Way to Saving Money Online

As almost every retailer has an online presence, so come the online coupons. Since I'm cheap all about saving money I typically start by Googling "[store name] coupons" before I make a purchase online. Not exactly rocket science, but then again most of the time saving money is more about luck and being persistent than it is about actually being smart.

Yeah I know, it takes an extra minute or two, but it is well worth it if you can get free shipping, $5 off, or sometimes a bit more. For example, my latest search looking for Target coupon codes let me to find $5 off a purchase of $50 and free shipping.

If you aren't into sifting through Google sites for coupons you can always start at places like CouponChief. Check it out.

Link
Coupon Chief - Online Coupons

PLEASE NOTE: THIS IS A SPONSORED POST

Should You Buy Organic Produce

Organic everything is a huge business, especially now that Wal-Mart has jumped on the bandwagon. If you are one of the average American's who don't shop regularly at Whole Paycheck Foods... The question is, are there actual benefits to eating organic and if you can't afford to eat all your produce organic, then where will you get the most bang for your buck?

Money Magazine recently ran an article that explained which fruits and vegetables are the worst offenders as far as pesticides are concerned. Since I currently can't find the magazine, I tracked down a similar list via Google at the Environmental Working Group. I have recreated the list below. The data group has also posted their data set online if you are skeptical about the findings. Although the Money Magazine list wasn't as detailed, from what I remember the results were similar.

The Full List: 43 Fruits & Veggies

RANK	FRUIT OR VEGGIE	SCORE
1 (worst)	Peaches	100 (highest pesticide load)
2	Apples	96
3	Sweet Bell Peppers	86
4	Celery	85
5	Nectarines	84
6	Strawberries	83
7	Cherries	75
8	Lettuce	69
9	Grapes - Imported	68
10	Pears	65
11	Spinach	60
12	Potatoes	58
13	Carrots	57
14	Green Beans	55
15	Hot Peppers	53
16	Cucumbers	52
17	Raspberries	47
18	Plums	46
19	Oranges	46
20	Grapes-Domestic	46
21	Cauliflower	39
22	Tangerine	38
23	Mushrooms	37
24	Cantaloupe	34
25	Lemon	31
26	Honeydew Melon	31
27	Grapefruit	31
28	Winter Squash	31
29	Tomatoes	30
30	Sweet Potatoes	30
31	Watermelon	25
32	Blueberries	24
33	Papaya	21
34	Eggplant	19
35	Broccoli	18
36	Cabbage	17
37	Bananas	16
38	Kiwi	14
39	Asparagus	11
40	Sweet Peas-Frozen	11
41	Mango	9
42	Pineapples	7
43	Sweet Corn-Frozen	2
44	Avocado	1
45 (best)	Onions	1 (lowest pesticide load)

The results suggest what you may have already guessed. The fruits and vegetables with the thinest skins (like peaches, apples and strawberries) are more likely to be contaminated with the most pesticides. Whether you find it helpful or not, it's nice to know how potentially bad the produce you are buying is before your next trip to the store.

Link:
Image Creative Commons R@punsell

Book Review: Never Eat Alone

I just finished the book Never Eat Alone by Keith Ferrazzi and recommend it as a good read. The book is predominantly about networking. While it is not everyone's favorite topic, I think the book offers advice that is more valuable than the standard "it's all about who you know." I look at the book as being more motivational as it discusses goal setting and has a number of examples of determined people succeeding against the odds.

Ferrazzi begins the book by talking about his humble beginnings in Pennsylvania and tracks his educational and professional background. He writes about how early on his father recognized the doors that strong connections with powerful people could open up professionally and in education. After college Ferrazzi became the Chief Marketing Officer for Deloitte Consulting and Starwood Hotels before taking a job as CEO of YaYa Media and opening his own consulting firm.

Never Eat Alone attempts to draw distinctions between the smarmy bunch of hyper-networkers who fail to foster deep connections with contacts they meet and the people who can effectively use their network to further their career. The former group of people are painted as the one-sided used car salesman types who come off as fake and hand a business card to anyone who will speak to them. The later group of people are described as poised to grow their network and potential for professional success.

This book begins with a section on goal setting and how to create a three-tiered plan to help you end up where you want to be professionally. As the book goes on, the author fills in details of how he got where he is. While I think the advice is generally point on, I do have some important caveats for people who thinking about reading the book:

First, the author attended Yale and Harvard Business School, two of the most prestigious academic institutions in the world. He repeatedly touts the idea of relying on your University alumni network to get new leads and business confidants. Ivy league aside, if you went to a small private university, smaller state university, or no university at all this isn't going to be very helpful for you. In my opinion, the single most valuable skill that an ivy education gives you is not a skill at all -- it's access. Ivy graduates immediately have a shared talking point and network to many of the rich and elite which can help open doors that others simply do not have access to.

Second, some of the tactics the author uses for networking and meeting specific people seem borderline stalker-ish to me. This may be because I'm not a person who is extremely outgoing or a person particularly attracted to sales. I don't see anything wrong googling someone you intend to meet or otherwise doing some research but thinking up elaborate plans to place yourself in positions where you just so happen to bump elbows with someone just to say you have met with them seems a bit much to me.

Third, there is a good portion of the book devoted to name dropping and chest thumping about how impressive Ferrazzi's list of associates and contacts is. If you have a low tolerance for this sort of thing you may want to consider looking elsewhere for reading material.

Caveats aside, Never Eat Alone is a worthwhile read. The book has solid tips, suggestions and strategies for navigating conferences, attracting other connected people, and mastering small talk. Another major plus is the book is a relatively fast read. The material is not very dense or dry and you can get from front to back in a reasonable amount of time.

Let me know if you have any other good business, finance, or other books to read you recommend.

When Using a Credit Card is Better Than Debit Cards

If you are traveling this 4th of July week (for those of you in the U.S.), chances you will be taking a credit card, debit card, or a few of both with you. There are a few reasons why traveling, credit cards are superior to debit cards:

1. Temporary Charge Authorization: When you make swipe your card at the pump or make other purchases with your debit card the merchant will make a temporary charge for $1, $20, or even $50. The company then charges your account for the amount in full when the transaction has been completed and cancels the initial transaction. The problem is that the initial transaction can take up to 48 hours to disappear from your account and may end up over drafting your account.
   
   
2. Car Rentals: Simply, many car rental companies won't let you rent a car with a debit card, although I think this is beginning to change.
   
   
3. Disputed Transactions: Some debit cards do not offer the purchase protections that credit cards do that allow you to run to Visa or Mastercard to take care of problems if the merchant won't. However, this fact has been widely publicized and as a result Visa and Mastercard have both make a marketing push to let people know that this is changing.

Links
Which to Use @ MarketWatch
Picture - Flickr Selvin

Hottest and Coldest Real Estate Markets

Now that subprime has left the front pages of the newspapers, media outlets everywhere are looking for the new "it" thing to worry about. With inflation always a concern it seems that housing and inflation are going back and forth as the things that CNBC sound the alarms about most frequently. So what markets are on fire and which are making sellers nervous?

According to Yahoo Finance the best buyer's markets are:

1. Tampa, FL
2. Minneapolis, MN
3. Miami, FL
4. Kansas City, MO
5. Chicago, IL
6. Phoenix, AZ
7. San Diego, CA
8. Milwaukee, WI
9. New York, NY
10. Atlanta, GA

The best seller's markets are:

1. Raleigh, NC
2. San Francisco, CA
3. Austin, TX
4. San Antonio, TX
5. St. Louis, MO
6. Houston, TX
7. Portland, OR
8. Dallas, TX
9. Denver, CO
10. Baltimore, MD

Links
Yahoo! Finance Top Real Estate Markets
Flickr ericskiff

Top 5 Most Expensive Web Addresses

A domain address runs about $8.95 at a place like GoDaddy. But, if you are a little ahead of the curve and can snag one that becomes a hot button issue, common phrase, or term you can make a huge return on investment. Easier said than done of course, but most things are. Below is a list of the most expensive web addresses that have been sold in recent years from Forbes.

1) Sex.com - Sold in early 2005 to a Boston based company for a mixture of cash and stock. The sale netted the seller $12 million dollars.

2) Porn.com - The largest ever cash web address transaction netted the sellers $9.5 million dollars.

3) Business.com - While the sellers received $7.5 million dollars for the address, the company was a victim of the dot-com bust and now is an ad parking site serving up links to other sites.

4) Diamond.com - Ice.com paid $7.5 million dollars for the address in May 2006 and $2 million extra for Bling.com in an associated deal.

5) Beer.com - The address was purchased by the world's #2 brewer Interbrew for $7 million dollars.

Of course as investments go domains are questionable at best, and I'm not advocating this as a great idea... But at $9 a year you might be able to afford taking a risk or two. GoDaddy has a deal running (valid as of this post) that will net you 10% off your order by entering in the coupon code: SB2006.

Links
Most Expensive Web Addresses
Picture @ Flickr Eric F. Schwartz

The Entrepreneur Urge

Sure the failure rate for new businesses is high, but that doesn't undermine the fact that starting a business is right up there with owning a home in living the "American Dream." So if you are thinking about striking off on your own what do you do so your dream doesn't go up in flames like so many other start-ups.

Well aside from ironing out a good business plan here are some things you can do to get yourself started.

• Don't Wait Till You Are Sure it Will Work: Nothing is guaranteed so might as well try. But, don't bet the farm unless you are willing to lose what you bet. This is the biggest reason people never start a company based on the great idea they have had for years -- individual risk tolerances and family issues prevent lots of people from ever trying.
  
  
• Weigh Your Risks: What is the worst thing that can happen? Running a business is a ton of work, but it also has a lot of reward and is less risky than many people make it out to be. Many young people will live their corporate lives without job security or a pension, not to mention social security. If your company might cut you free as soon as business slows down, why not take things into your own hands? Of course, you get to enjoy a lot more upside if you succeed and you are the guy in charge too.
  
  
• Pick a Name: It is important that you do some research to see if your business name has been taken. Search through your state's corporate records (most all of them have databases online) to see if your name is already in use. Check to see if your domain is already reserved (GoDaddy.com is great for this, especially if you Google for some coupons first). If your domain is taken you can run a Whois search to see who owns it and when it expires and try to have a firm like GoDaddy grab it if the expiration date is approaching for about $30.
  
  
• Get Some Legal Advice: Now if you are going it alone this might not be a big deal, you can form an L.L.C. for about $100 by filling out some paperwork online and receive a tax identification number. But, if you are going into business with a partner / family member / stranger you really need a buy-sell agreement. The agreement tells how the business will be wound up. If your partner leaves will they control the company even though they are absentee. What if a relationship sours and someone wants out. A buy-sell plans for those events that you can't envision while you are excited about your business prospects (kind of like a will or prenup).
  
  
• Choose Your Business Entity: Depending on your state you likely have plenty of options, whether it is an L.L.C. or L.L.P. that give you the tax advantages of a partnership (pass through taxes), but none of the pesky liability of a partnership.
  
  
• Test the Waters: You can start small. Most businesses start as side pet projects and run that way until the entrepreneur can gain some assurance that his or her idea won't be a total flop. A domain name costs $10 and hosting just a few more dollars per month. If you have an all-in-one printer, laptop, and phone you can replicate most of the modern conveniences that renting an office would provide... now if you want to manufacture widgets this might not apply to you.
  
  
• Get Some Credit For Your Company: Limited liability is great, but not if you have to personally sign for every document. Banks and other lenders won't extend credit to your new start-up without a personal guarantee because they know how risky a new business is. Head over to Staples and open up a business credit account. Buy some pens or something each month for about 6 months and ta da you have a credit history for your new baby.
  

Post your comments and any tips you have for aspiring entrepreneurs and I will incorporate them in the next draft of my musings.


Image: Jon Cage @ Flickr

Sell in May and Go Away?

The Big Picture has an article that suggests long term the axiom "sell in May and go away" may ring true. The site claims that it also holds true for world markets. During "good periods" (Nov-Apr) the S&P 500 has historically returned 8.5% per year during , while the "bad periods" (May-Oct) returned 3.2% per year. Still not terrible, but not great either. Head over to see the full story @ The Big Picture.


Link
Sell in May @ The Big Picture
Image James & Viliga @ Flickr

The Rich Don't Save Either

Market Watch has an article this week claiming the lower and middle class aren't the only ones finding it difficult to put money away. The article cites a study conducted by HSBC bank that surveyed people making over $250,000 per year. Over a third of respondents said they had difficulty saving money because of a "need to pay everyday bills".

You won't find a shoulder to cry on here. If you are pulling down a quarter million a year, even if you are getting eaten alive by taxes, you should be able to at least max out your retirement savings accounts. You might not get that beach house on Florida or that new Porsche you had your eye on last year, but sometimes life just isn't fair.

Link
Sophisticated Investor @ MarketWatch
Image James & Vilija @ Flickr

Do You Make Less Than Your Dad?

A new study is showing that in real inflation adjusted terms 30 year olds today make less than their fathers in the mid 1970's. In 2004 the median wage for a male in his 30's was $35,010 which is about 12% less than men at the same age in 1974. This finding is a departure from what was going on in the 1990's when adjusted wages were 5% greater than in 1974, clocking in at at $32, 901.

Unfortunately, the study couldn't pin point why the wages are now lower. Personally, I don't think it's a bad thing that they couldn't. Economists can't take all the variables into effect and shouldn't try to. With the magic of statistics the researchers could have probably molded the results to achieve whatever result they wanted too.

More interesting than the article itself for me were the comments after the article which encompass a wide array of stereotypical views on both sides of the political spectrum. The comments can be loosely categorized as 1) I wouldn't want to be a young person today they have it rough, 2) people need to try harder, kids these days are afraid of hard work, 3) the government needs to be like ________(fill in socialist European country) and start leveling the playing field.

I'm very supportive of a free market system and think government meddling has probably caused some of the problems like astronomical health care costs that are happening right now. However, I wouldn't mind seeing the government subsidize student loans a little more in the form of lower interest rates (not by doling out grants). While many corporations are started by risk-taking college dropouts, the people they hire may be equally qualified but stomach risk worse. The economy is better off with more educated people in it whether it is at a tech college, university, or professional school. I think it's probably better to invest in people than it is to change the tax system to concentrate and perpetuate wealth.

Link
30 Year Old Man Never to Be as Rich as Dad @ ABC NEWS
Photo From Paul Goyette @ Flickr