Archive for August, 2007

33 Days And 33 Ways To Save Money And Reduce Debt

This is the anchor post for my series, 33 Days And 33 Ways To Save Money And Reduce Debt.

To keep up with the posts in this series, subscribe to No Credit Needed’s RSS Feed or to the daily email updates.

  1. Day 1 of 33 Days And 33 Ways To Save Money And Reduce Debt: Eliminate Fees
    1. Reaction Post 1: My Money And Politics
    2. Reaction Post 2: Beyond The Consumer
    3. Reaction Post 3: Paid Twice
  2. Day 2 of 33 Days And 33 Ways To Save Money And Reduce Debt: Brand Disloyalty
    1. Reaction Post 1: Paid Twice
    2. Reaction Post 2: Catholic Stewardship
    3. Reaction Post 3: PaulaB
    4. Reaction Post 4: Being Frugal
  3. Day 3 of 33 Days And 33 Ways To Save Money And Reduce Debt: Sacrifice
    1. Reaction Post 1: PaulaB
    2. Reaction Post 2: Chief Family Officer
    3. Reaction Post 3: Single Ma
    4. Reaction Post 4: Paid Twice
  4. Day 4 of 33 Days And 33 Ways To Save Money And Reduce Debt: Extra Payments Extra Deposits
    1. Reaction Post 1: Being Frugal
    2. Reaction Post 2: Go To The Ant
    3. Reaction Post 3: Paid Twice
  5. Day 5 of 33 Days And 33 Ways To Save Money And Reduce Debt: Eat Out Less
    1. Reaction Post 1: Paid Twice
    2. Reaction Post 2: Making Cents Of Debt
    3. Reaction Post 3: Being Frugal
    4. Reaction Post 4: Romandock
  6. Day 6 of 33 Days And 33 Ways To Save Money And Reduce Debt: Share Your Story
    1. Reaction Post 1: Being Fugal
    2. Reaction Post 2: Paid Twice
  7. Day 7 of 33 Days And 33 Ways To Save Money And Reduce Debt: Snowball Your Payments
    1. Reaction Post 1: Paid Twice
  8. Day 8 of 33 Days And 33 Ways To Save Money And Reduce Debt: Stop Using Your Credit Card
    1. Reaction Post 1: Being Frugal
    2. Reaction Post 2: Reformed Spendaholic
    3. Reaction Post 3: Paid Twice
    4. Reaction Post 4: DebtFree – Revolution
    5. Reaction Post 5: Paid Twice
  9. Day 9 of 33 Days And 33 Ways To Save Money And Reduce Debt: Make Time To Manage Your Finances
    1. Reaction Post 1: Consumerism Commentary
  10. Day 10 of 33 Days And 33 Ways To Save Money And Reduce Debt: Sell Some Stuff
    1. Reaction Post 1: Paid Twice
  11. Day 11 of 33 Days And 33 Ways To Save Money And Reduce Debt: Understand Taxes
    1. Reaction Post 1: Frugal For Life
    2. Reaction Post 2: Working Canadian
  12. Day 12 of 33 Days And 33 Ways To Save Money And Reduce Debt: Be Sure
    1. Reaction Post 1: Chief Family Officer
    2. Reaction Post 2: Paid Twice
  13. Day 13 of 33 Days And 33 Ways To Save Money And Reduce Debt: Get Organized
    1. Reaction Post 1: Mrs. Micah
    2. Reaction Post 2: Paid Twice
  14. Day 14 of 33 Days And 33 Ways To Save Money And Reduce Debt: Call For Discounts
    1. Reaction Post 1: Paid Twice
    2. Reaction Post 2: Financial Dominance
  15. Day 15 of 33 Days And 33 Ways To Save Money And Reduce Debt: Understand The Big Picture
    1. Reaction Post 1: Fabulously Broke In The City
  16. Day 16 of 33 Days And 33 Ways To Save Money And Reduce Debt: Enjoy Being Frugal
    1. Reaction Post 1: The Good Life On A Budget
    2. Reaction Post 2: That’s Swell
    3. Reaction Post 3: Making Cents Of Debt
    4. Reaction Post 4: MrsMicah
    5. Reaction Post 5: Paid Twice
  17. Day 17 of 33 Days And 33 Ways To Save Money And Reduce Debt: Carefully Consider Surfing Credit Card Balances
    1. Reaction Post 1: Paid Twice
  18. Day 18 of 33 Days And 33 Ways To Save Money And Reduce Debt: Remember Due Dates
    1. Reaction Post 1: Paid Twice
  19. Day 19 of 33 Days And 33 Ways To Save Money And Reduce Debt: Go Crazy Get Ahead
  20. Day 20 of 33 Days And 33 Ways To Save Money And Reduce Debt: Create A Binder For Manuals
  21. Day 21 of 33 Days And 33 Ways To Save Money And Reduce Debt: Focus
    1. Reaction Post 1: Paid Twice
  22. Day 22 of 33 Days And 33 Ways To Save Money And Reduce Debt: The Emergency Fund
    1. Reaction Post 1: Single Guy Money
    2. Reaction Post 2: Beyond The Consumer
  23. Day 23 of 33 Days And 33 Ways To Save Money And Reduce Debt: Illustrated Debt Snowball
  24. Day 24 of 33 Days And 33 Ways To Save Money And Reduce Debt: Roth IRA
  25. Day 25 of 33 Days And 33 Ways To Save Money And Reduce Debt: Paid Twice
  26. Day 26 of 33 Days And 33 Ways To Save Money And Reduce Debt: Give Yourself A (Pretend) Pay Cut
  27. Day 27 of 33 Days And 33 Ways To Save Money And Reduce Debt: Taking A Few Hours To Organize Financial Documents
  28. Day 28 of 33 Days And 33 Ways To Save Money And Reduce Debt: Find Out How Good (Or Bad) Your Situation Really Is
  29. Day 29 of 33 Days And 33 Ways To Save Money And Reduce Debt: Don’t Feel Bad For Keeping Things Simple
  30. Day 30 of 33 Days And 33 Ways To Save Money And Reduce Debt: Know Your Weaknesses
  31. Day 31 of 33 Days And 33 Ways To Save Money And Reduce Debt: Stay Away From The Mall
  32. Day 32 of 33 Days And 33 Ways To Save Money And Reduce Debt: Decide Which Debt To Attack First
  33. Day 33 of 33 Days And 33 Ways To Save Money And Reduce Debt: Remember To Live A Little

Here’s my plan:

Over the course of the next 34 days, I’ll write a series of relatively short, focused posts about ways to save money and/or reduce debt. I want these posts to be ‘quick reads’ – easy to understand tips and techniques.

Here’s how you can participate:

1. Respond to individual posts with comments/questions/suggestions.

2. If you have a blog, pick a particular post and write your own ‘reaction post’.

3. If you have an idea or request for a particular type of post, contact me and let me know.

4. If you have a blog and you like a ‘reaction post’ that someone else has written, link to their ‘reaction’ and write a ‘reaction to their reaction’.

Here’s my goal:

I want increase the number of people who are saving money and reducing debt. I hope that the simple tips and techniques will add money to your pocket, help you to reduce your debt, and increase the number of people who are reading No Credit Needed.

Once I have created the list of 33 tips and techniques, I’ll record and release a special episode of the No Credit Needed Podcast, summarizing the posts in this series.

This series of posts is inspired by Darren’s 31 Days To Building A Better Blog. Darren does a great job of writing about blogging, creating a sense of community, and organizing information.

Preparing For The Birth Of A New Baby

Well, well. If you read my last post, then you know our good news. My wife and I are going to have another baby. He/She is due in April. We’ve spent the past three days telling our friends and family. We are so very, very excited. My daughter, 7, wants the baby to be born NOW. My son, 3, wants twins, so that “he can have one and she can have the other”!

Over the course of the next few months, I’ll be adjusting my budget so that I can be financially prepared for the birth. I will increase the amount that we budget for health care. (We have health insurance, but we will need to prepare for co-pays, prescriptions, medicines, and other incidental expenses.) I’ll begin to gather baby-formula coupons. (Our doctor usually has a big stack of coupons for Similac, our preferred baby-formula.) I’ll check Amazon for diaper specials. We’ll go through our closets, sorting through usable and unusable baby items. We already have a crib, a rocking chair, and other baby basics, but we’ll be looking for a new changing table/twin bed. (Instead of a changing table for our son, we simply used a twin bed. It served two purposes. We could lie him down on the bed to change him, and if one of us needed to sleep in his room at night, we could sleep on the twin bed. But, now HE’s sleeping in the twin bed, so we’ll have to get another one, if we choose to go that route.) As far as baby clothes go… grandparents baby, grandparents!

I’m really looking forward to being a daddy (again). Clearly, once the baby arrives, our lives will change. Household expenses will go up. Free time will go down. Budgets will need to be adjusted and belts will need to be tightened. But, it’s going to be awesome. My words fail, as they often do… so allow me to simply share the following from Psalm 139: 13-18

For you formed my inward parts;
you knitted me together in my mother’s womb.
I praise you, for I am fearfully and wonderfully made.
Wonderful are your works;
my soul knows it very well.
My frame was not hidden from you,
when I was being made in secret,
intricately woven in the depths of the earth.
Your eyes saw my unformed substance;
in your book were written, every one of them,
the days that were formed for me,
when as yet there were none of them.
How precious to me are your thoughts, O God!
How vast is the sum of them!
If I would count them, they are more than the sand.
I awake, and I am still with you.

We Are Going To Have Another Baby!!!

I have some great news. My wife and I are going to have another baby! The baby is due in April, so I’m sure I’ll be doing a lot of blogging about “baby stuff” between now and then. Our daughter is 7 and our son is almost 4, and they’re both really excited about the idea of having a baby around the house. I’ll have much, much more to say about the baby (and how this news will affect our finances!) in the days to come, but I just wanted to write a quick post and share our awesome news! Yay!

Learning More About My 403(b) Plan

I work for a tax-exempt organization so, instead of having a 401k, I have a 403(b). My retirement contributions are sent by my employer to the company that operates the 403(b), but the responsibility for allocating those contributions rests with me. I’m rather new to the “investing game” and I’m taking the time to research the various mutual funds available to me inside my 403(b) plan.

My 403(b) offers two different fund categories.

Category 1: Select Funds: These are basic mutual funds. By selecting among the various “select funds” I can create a completely customized “portfolio”.

According to the Securities and Exchange Commission, “A mutual fund is a company that pools money from many investors and invests the money in stocks, bonds, short-term money-market instruments, or other securities.”

According to Wikipedia, “In finance, a portfolio is a collection of investments held by an institution or a private individual.”

So, when I invest in a select fund (mutual fund) my money is pooled with the money of other investors and used to purchase stocks, bonds, etc. The combination of all of my select funds (mutual funds) equals the total value of my investment portfolio.

Types of Select Funds available in my 403(b):

Money Market
Low-Duration Bond
Medium-Duration Bond
Extended-Duration Bond
Equity Index
Real Estate Securities
Value Equity
Growth Equity
Small Cap Equity
International Equity

Let’s assume that I have $1000 in my 403(b) account. I can choose to allocate that $1000 in any manner that I wish. I can put 50% in the International Equity fund and 50% in the Equity Index Fund, or I could allocate 5% to Small Cap, 10% to Real Estate Securities, and 85% to the Medium-Duration Bond fund. The choice is completely up to me, as long as the allocations for my funds add up to 100%.

I’ve created the following graphic to illustrate how a 403(b) retirement account would work if my entire portfolio was invested in Select Funds (Mutual Funds):

403bbb.png

Category 2: Blended Funds: These funds invest in the various Select Funds. In other words, these are funds-of-funds.

Types of Blended Funds available in my 403(b):

Flexible Income
Growth and Income
Capital Opportunities
Global Equity

These funds provide inherent diversification and are listed by their assumed risk/return ratios. In other words, those looking for a higher return (and who also have a higher tolerance for risk) might choose to invest 100% of their contributions in the Global Equity fund. I can purchase one Blended Fund and still diversify my investments. Going further, I could also purchase multiple Blended Funds, but doing so might defeat the purpose of purchasing a Blended Fund. Blended Funds, by definition, are already diversified and categorized by risk/return assumptions.

403z.png

My 403b provider offers Select Funds (which are mutual funds) and Blended Funds (which are funds that invest in the various Select Funds). I am free to decide how to allocate my investments.

1. I can choose to purchase only Select Funds (or just one Select Fund).

2. I can choose to purchase only Blended Funds (or just one Blended Fund).

3. I can choose to purchase Select Funds AND Blended Funds.

Confused? Most people are. I will confess, it takes a lot of effort to understand retirement funding and the various allocation options that are available. There are so many terms to understand, so many different opinions about what to invest in, and so many people trying to make a dollar “giving advice”. It’s amazing that something so important, so vital, is shrouded in difficult to understand terminology. Hopefully, as I move forward, I’ll gather more information and understand more and more about investing.

So, how have I chosen to allocate my money? I went the easy route and put 100% of my money in the Select Fund – Equity Index. This fund is an index fund, it invests in the stocks of the S&P 500, and it has a very low expense ratio. I like to keep things simple – very, very simple!

(One note: My 403b provider describes their funds-of-funds as Blended Funds. Certain mutual fund providers also offer regular mutual funds labeled “Blended Fund”. If you run into this term, be sure that you understand the difference.)

Please note: I am not a financial professional and I do not give investing advice. Take the time to educate yourself about investing.

Resource: For additional information about the 403(b), checkout 403b wise.

Resources: If you are looking for a great book about investing, may I suggest the following two? I really like them both.

The Little Book of Common Sense Investing: The Only Way to Guarantee Your Fair Share of Stock Market Returns (Little Book Big Profits)

The Bogleheads’ Guide to Investing

How To Get The Most Out Of No Credit Needed

When I started No Credit Needed in April of 2005, I intended for this site to be a simple blog – a site where I could track my progress as I paid off my debts. Over the course of the last two and a half years, No Credit Needed has evolved into much more – a place where I can share my own story, link to other sites that I like, and connect with other people interested in personal finance.  Now, not only do I maintain No Credit Needed, I also publish the NCN Podcast and manage the NCN Network. I want to thank long time readers, listeners, and members for keeping me motivated. If you are a new reader, here are some ways that you can “get the most” out of No Credit Needed.

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