As many of you know, No Credit Needed is a member of the Money Blog Network.  I’m consistently impressed by my fellow members - and the content of their sites.  I thought it would be cool to highlight a few of their posts, and how those posts have helped me save money and kept me informed.

A few months ago, I purchased a new-to-us automobile.  I used a version of this letter , designed by Five Cent Nickel, in my email to the automobile dealership.  I also followed the advice in this post, from Free Money Finance, for finding the real cost of the used automobile.  By combining their advice, I was able to get a good deal and we now have a car that we love.

All Financial Matters always does a good job of breaking down complex topics into easy-to-understand posts.  For instance, I had a choice of two different index funds - and I used the information here, about S&P 500 Index Funds, to make my choice.  As a side note, JLP from All Financial Matters was recently interviewed by Mike Causey.  Click over and check it out!

Get Rich Slowly is a treasure trove of valuable personal finance information - and one of my favorite posts is this one about escaping the paycheck-to-paycheck cycle.  Personally, I believe that the most important financial decisions we make must be made before, not after, we receive our paychecks, when we sit down to create our monthly budgets.

A few years ago, Consumerism Commentary wrote this interesting post about choosing a new cell phone provider.   While I’m stuck in my current contract, I did forward the post to a friend, and HE used it to get a great deal!

Having a new baby is great - and expensive.  Thankfully, Wise Bread has some great DIY tips for new parents.  Our baby girl is awesome and she’s sleeping five hours at a clip!

Mighty Bargain Hunter compiled this awesome list of money related forums and message boards.  I love connecting with other people who are interested in personal finance and money management.

I hope you’ll take a minute or two to visit each of these sites.

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I like stuff - gadgets, gizmos, and thingamajigs. I also like saving money. So, I’ve created the $100-A-Day-Rule.

For every $100 that I want to spend on the purchase of a new product, I must wait one day before I make the purchase. This creates a self-imposed ‘cooling-off’ period.

If a new gadget costs $100, I have to wait one day until I can purchase the gadget.

If a new gizmo costs $400, I have to wait four days until I can purchase the gizmo.

If a new thingamajig costs $1400, I have to wait two weeks until I can purchase the thingamajig.

I tend to live ‘in-the-moment’, which is just a fancy way to say, I like to impulse buy. In the past, when I wanted something, I just went out and bought it. And, in the past, I’d be stuck with payments, long after the desire for the product had gone away. I once purchased a video game console - because a good buddy had one - and I don’t even like video games. I used my credit card, bought the console, played a few games of Madden, and then never touched it again. A $250 gaming console sat, unused, in my entertainment center, for three years.

Now, when I want something, I use the $100-A-Day-Rule. I spend time researching, looking for cheaper alternatives, and deciding if I really want the item.

Since implementing the $100-A-Day-Rule, I have seen a dramatic reduction in the number of things that I actually want to buy. In fact, in most cases, once I leave the store and get home, I forget why I ever wanted a particular item in the first place. But, if I do find that I still want a particular item, I have built-in system which allows me to take time to do some research and find the item at an affordable price.

At $100-a-day, it would take about 3 1/2 months to decide on whether or not to purchase a $10,000 automobile. 3 1/2 months is long time to ‘cool off’ from ‘new-car fever’. Imagine if every person, when they went to the lot to purchase a new car, were required to wait 3 1/2 months before they could make a purchase? Might we see some dramatic changes in shopping/buying habits?

Side note: As the numbers move higher and higher, the cooling-off period grows longer and longer. There is a point at which the length of time gets a bit ridiculous - shopping 2.5 years for a $200,000 home might drive anyone crazy. So, I’ve capped my cooling-off period at 6 months. If I want/need an expensive item, and I’ve shopped for it for six months, and if it’s in our budget, I go ahead and purchase it.

Here are a few recent examples of how using the $100-A-Day-Rule worked for me:

Wanted: $500 set of golf clubs. Waited: 5 days, purchased a different set for under $300.

Wanted: $1,400 lawn mower. Waited: 14 days, decided not to purchase but to look for alternatives.

Wanted: $1000 HDTV. Waited: 10 days, decided I needed more information, waited additional 2 months, purchased similar HDTV for under $900.

Wanted: $400 driver to match new clubs. Waited: 4 days, decided that my golf game does not merit the purchase of a $400 driver. Heck, my golf game does not merit the purchase of a $40 driver!

Want: A new laptop. Waiting: 10 days, and counting. I want/need a new laptop, so I am spending some time, looking for a good deal on a new laptop. I can’t decide if I want to spend $400 on a cheap model or $1500 on a better system, so I’m using the higher price as my guide and looking at all options.

Final notes: I have found that the MORE I want an item, the LONGER the cooling off period needs to be. I never want to be in the position where I am making a purchase, based on my emotions. So, if I really, really, really want something, I double the time that I have to wait, and then I make my purchase.

Edit: I want to thank JD over at Get Rich Slowly for sharing the story of Joshua, one of his readers, and how Joshua used this technique to avoid a an impulse purchase.

If you find this article to be helpful, please Stumble It and spread the word.

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Nine years ago, I bought a blue chair-and-a-half.  Yesterday, I hauled it away.

As I was driving down the road, returning from the ‘dump-trash’ (that’s what my daughter calls the local collection facility) - I started thinking about the old blue chair.  My wife and I purchased it on a whim.  We lived in a small, two bedroom apartment, and we were expecting our first child.  We were, as we always were back then, broke.  But, we had good credit.

We went to a local furniture store and we scanned their selection of chairs.  Quickly, we picked out out the blue chair-and-a-half, because it matched our other furniture.  We used the furniture store’s in-house financing - and we promised ourselves that we would ‘pay the whole thing off, next month’.

When the next month rolled around, we didn’t ‘pay the whole thing off’.  In fact, we took eleven months to pay for the blue chair.  That’s right.  It took us nearly a year to pay for a chair.

I was recently digging through some old paperwork, and I stumbled across the financing documents for the blue chair.  I was astonished to see just how much we paid for the chair - and that the interest rate had been 21.99%!  I also noticed that they charged me a delivery fee - and yet I distinctly remember using my own truck to bring the chair home.

As you can see, back in those days, I wasn’t very money savvy.  In fact, I was foolish.  When I wanted something, I went out and got it, regardless of its price.

Now, we are thinking about getting a new chair, to replace the old blue one.  For the time being, we have simply moved an old recliner from one spot in the den to another, and we are using it to fill the space where the old blue chair used to sit.  Eventually, we’ll buy a new chair.  But, we’ll shop around first - comparing prices and features.  We’ll pay cash and the purchase will be included in our budget.  And, we’ll do business with a local furniture store with whom we have an established, first-name relationship.

In other words, we’ll make an informed decision based on rational thought, instead of an impulse purchase based on irrational want.

It isn’t easy, thinking about the way things used to be.  But, it is good to know how much we’ve changed.  It’s amazing how much better life is, when you have a plan and you stick to it.

How have your money management skills changed, over the years?  Do you still impulse shop?  Are you living on a budget?  Leave a comment and let us know how you are doing.

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Each month, our health insurance premium is deducted from my wife’s paycheck.  Every year, I pay our annual renter’s insurance premium.  And, once every six months, I pay our automobile insurance premium.  The premium is the amount charged, by and insurance company, for actual coverage.  But, not only do we pay insurance premiums, we are also, in the event that we actually need to use the insurance, must pay a portion of the expense, not covered by the insurance company, called the deductible.

Renter’s Insurance -

We live in a house provided by my employer, as part of my compensation.  My employer carries coverage for any damage to the house itself, be we carry coverage for the contents of the house - our stuff.  We have had our current policy for more than ten years.  Our annual premium is less than $150.  Our deductible, for most events, is $1000.  I must say, for the price, our renter’s policy is a great deal.  I would strongly suggest to anyone who is renting an apartment or living in a house that they do not own, that you get a renter’s insurance policy.  Coverage will vary from policy to policy and company to company, so shop around and compare prices.  In most cases, the higher the deductible, the lower the premium.  One note - always keep enough money in your emergency fund to cover your deductible costs.

Health Insurance -

We have health insurance through my wife’s employer.  Our annual family deductible is $2000, with a per person deductible of $1000.  After we meet our deductible, our insurance company then pays 90% of our expenses.  Again, it is important to us to keep enough money in our emergency fund to cover and deductibles.  My wife just had our baby, so we’ve now met our annual family deductible.  By the way, when we arrived at the hospital to have the baby, we had to pay our portion, up front.  It was fun to see the look on the cashier’s face when I handed her a stack of hundreds.

Automobile Insurance -

Our automobile insurance covers our three, paid for automobiles.  We choose to pay for ‘full coverage’.  Our semi-annual premium is about $600.  For less than $100 a month, we are able to fully insure our automobiles.  I’ve been with my current insurance agent for more than 18 years.  I have no doubt that I could ’shop around’ and find a lower premium, but I know my agent by name and he answers the phone when I call.  My wife was in an accident several years ago, and within 15 minutes, our agent was taking care of our claim.  We raised our deductible to $1000 three years ago, and this reduced our premiums more than 15%.

How our deductibles affect the amount of money we keep in our emergency fund -

If you total our renter’s insurance, health insurance, and automobile insurance deductibles - $1000 + $2000 + $1000 - you get $4000.  For us, that’s our ‘rock bottom’ emergency fund amount.  If we maintain a minimum of $4000 in our emergency fund, at all times, then we can be confident that we can pay all of our deductibles.

By the way, as I type this post, I’m holding baby number three!  How cool is that?  New babies STILL rock!

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We are home with the new baby.  She’s doing so well and I want to thank all of you who responded with ‘well wishes’ and prayers.  My wife and I took her for her first checkup today and she is a healthy, happy baby girl.  My mother-in-law is staying with us this week, helping with the baby and our other two kids.  Big sister and big brother love baby number three and are enjoying showing her pictures to their classmates.

I am ready to get back to blogging about personal finance -

I’ve already started to publish updates over at No Credit Needed Network.  I am about 1 week behind.  Updated charts will be published, every hour, around the clock, until I catchup.

I’m moving forward with my weight loss, over at No. Calories Needed.

Friday morning, I’ll release a new episode of the No Credit Needed Podcast.

I want to thank you all for your patience, as I work blogging into our new 3-kid household.  I love writing about personal finance and I have a new series of posts that I think you will really enjoy.  Over the next few weeks, I have several topics to write about - including how the new baby changes our budget, increasing our life insurance coverage, and why I decided not to sell our old car.

Again, I want to thank all of you who left comments, wrote guest posts, or sent emails.  We are truly blessed and we have so enjoyed the last few days.

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While we settle in with new baby - No Credit Needed will feature a few guest posts from some of my fellow personal finance bloggers. (I’ll also mix in a few posts of my own, as I find the time.) Today’s post comes from Prime Time Money - and it should get you primed and ready for a great summer of personal finance management.

5 Rules of Spring Training (for Your Finances)

It’s spring training time in major league baseball. Time for the players to head south and get ready for a long season of games. In a similar way, we non-pros need to dedicate some time during every season to get our financial lives together. Why not start now? Whether you’re a rookie or an old timer (like NCN), here are the 5 (unofficial) rules of spring training for your finances.

Pitchers and Catchers Report First

The first positions to show up at training camp are the pitchers and catchers. Why? I suspect because it takes longer for them to get their arms ready for the season, and their ability to work together is critical to the team’s success.

When getting serious about managing your finances, whether it’s your first time or just an annual update, it’s best to start with the most important elements. For me that’s been (1) spending less than I earn and (2) ensuring proper savings for retirement. These, I’ve found, have been my most important players. So I focus on those first. Determine what the major items are for you and spend your early efforts there.

Start Slowly

Regardless of the position, everybody player needs to ease into it. There’s no point in going out full-speed from day one, risking injury and burnout.

The same is true of our finances. Don’t try and tackle every issue tonight, or even this week. That huge amount of credit card debt took a while to build up, so it might just take a while to get rid of. Make yourself a plan of all the things you need to accomplish, whether it’s debt reduction, organizing your files, increased retirement savings, or buying a first home. Work on them as you find time. Take a long-term approach to meeting these goals. It’s a long season, just make sure you have a plan and you’re headed in the right direction.

Go Somewhere Warm

Major league teams go to either Arizona or Florida for their spring training. I think they call them the “cactus” and “grapefruit” leagues. They take this out-of-town approach so that they have consistent weather and can be away from the distractions of their home town.

For me, I’ve found that I do best with my finances when I take myself out of my normal routine and comfort zone. Read a new and motivating personal finance book. Visit a quality personal finance blog.  Go cash-only for a week. Mix things up a bit and see how that changes your perspective and provides motivation for a lasting effort with your finances.

Practice the Fundamentals

The key to hitting a fastball or making the throw to first is not natural talent alone. These players swing the bat several hundred times a day and make the same routine throws over and over again. Repetition of the basics is the backbone of any quality baseball training program.

Likewise, for your finances, practicing the fundamentals over and over will lead you to success. For debt reduction, practice the debt snowball. For short-term savings, try making it automatic. Most importantly, find the little things that are working for you and simply repeat them.

Have Fun

Lastly, another element to spring training in baseball is lots of fun, as evidenced by this recent at-bat by “Yankee” Billy Crystal. Spring training is filled with stunts like this, and the teams do a good job of keeping the atmosphere light and care free.

Personal finance can be a dry and boring topic if you let it be. Make sure you’re having a little fun with it along the way. Do this by focusing on all the enjoyable experiences you will be able to afford once you get things organized. Also, be sure and celebrate the goals you accomplish along the way. Have fun!

I want to thank Prime Time Money for this awesome post. I encourage you to visit Prime Time Money, read more about PT Money, and subscribe to the PT Money RSS Feed.

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