Fox has launched their new TV channel, Fox Business with the corresponding website FoxBusiness.com. Unfortunately my cable provider, Cox, isn’t carrying it…
The website however is beautiful. Very nice colors and layout; very modern and not cluttered. Of course they have a personal finance section as well as the other usual business news related sections.
That’s right, $50! There are a couple of ways you can qualify to enter, and it is pretty easy.
The first method is to blog about this contest, linking to this post along with a link to FinanceFavorites.com with FinanceFavorites.com as the anchor text (as I have just done). This will qualify you for two entries. Just email me via my contact page with the URL to the post along with your email and you get two entries. If you are not using a Wordpress blog, a trackback would be appreciated, but not mandatory (WP blogs should send a trackback automatically if you link to the post). The trackback URL is:
If you sign up on FinanceFavorites.com and submit at least one post, that will get you an entry as well. Even better, for every post you submit you can get an extra entry. To prevent abuse, each post submitted must be no older than 2 days and be unique. In other words you can submit a post that was done on Monday by Wednesday, a post done on Tuesday by Thursday, etc. This is so people don’t take a whole blogger’s history of posts and submit them all at once.
Yes, feel free to submit one of your posts, but keep it to one a week. The idea is to promote other bloggers in addition to your own. While you are at it, please visit, vote and comment on the posts that have already been submitted. This will help promote that blogger. I am sure you will find some great articles out there that have yet to be discovered.
The contest will run from now until the end of October, giving you plenty of time to submit your entries and tell your friends. The winner will be announced the first week of November.
If we get 50 people signed up and submitting, I’ll seriously consider throwing in another $50. As long as it doesn’t look like someone is trying to scam/spam the site (I’m watching…), I’ll do it.
If you are familiar with Digg, then you can pretty much figure it out. FinanceFavorites.com is geared towards a community supplied and community voted articles and blog posts. In other words, you the user submit blog posts that you have read that you think others would thoroughly enjoy. You can also vote on your favorite submittals. Those votes are what promotes the posts and sends traffic to that blogger. The blogger sees this traffic and continues to create more great content for you to read. Simple right?
No you do not. You are free to register, submit and vote without having a blog at all.
Quite honestly, I love reading personal finance blogs but I’m not as good at it as others. Combined with all of my other projects I don’t blog as much as I would like. So, this is one way that I can contribute back to all the other PF bloggers out there.
Will I make anything off of this? Initially I will not be monetizing the site, but it doesn’t mean that I won’t in the future. That doesn’t mean that I will have tons of ads on it to clutter it all up, but I might come up with a way to advertise later on. One thought I have is to allow bloggers to directly buy advertising on the site to better promote themselves; allowing them to help themselves along with helping me 
If you have any other questions, please ask them as comments so other can benefit. Thanks!
During the TechCrunch40, Mint received the prize for the best presenting company. While I haven’t used the site myself, it looks to be a web version of Microsoft Money or Quicken.
Is anyone currently using Mint? Any experiences out there?
So just how do you protect that great running stock? One surefire way to keep your emotions out of the equation and protect your profits is by using a trailing stop. To put it simply, a trailing stop lets you set either a dollar amount or a percentage amount that will follow or trail, the stock price and if the price comes down to that point a sell order is triggered automatically for you. This kind of order is quite common for those that trade commodities and forex, but not quite as common for regular stocks.
Note: A trailing stop does not guarantee that your order will be executed at that specific price point. While in practice it does, market conditions may be such that your order isn’t execute on exactly the same price. What kind of conditions? A really fast moving market, such as a crash or a really volatile market.
This is the $60,000 question (figuratively speaking of course :). Where you set it depends on how much the stock has moved already, how much you anticipate it to move and how much volatility you are willing to accept. As for myself, I use a percentage trailing stop of about 5% to 8%, leaning more towards the 8% mark. At 8%, I give the stock the opportunity to weather a minor correction (jargon for sell off) and keep moving up without getting stopped out too soon. The more a stock has moved up also plays a little bit into my equation as well.
In the 10%-15% range I will keep it a bit closer to 5%. Why? Well 10%-15% gains in a stock is pretty good sweet spot to sell, and most people will. What can happen is the market will start to take profits around this price point which of course can drive the price down. If the stock is really good, it will either not drop or the drop will be very short term, say a day or, as the big players — namely mutual funds — buy into that sell off and that will drive the price back up, hence the nervous zone. To put it another way, at 5% I can take a small correction, but will lock in a 5% to 10% gain on my trade without the risk of losing all of my profits if the stock doesn’t recover quickly and continue to move up. The 5% to 10% gain comes from taking the 10%-15% gain minus the 5% trailing stop.
If it does recover quickly and move beyond 20%, then I’m more willing to give it some leeway, since at 20% I’m locking in a 12% gain (20% minus the 8% trailing stop). This is the spot where we would like all of our trades to be! At this point you’ve already made a really good gain at a minimum of 12% and are letting the stock ride. You aren’t worried about trying to spot a top or do any other kind of fancy analysis to wring out every last penny of profit. Yes, yes you are effectively “losing” 8% when your trailing stop does get triggered, but don’t think about it as losing anything. You’ve already gained 12% and who knows how much more, so losing that last 8% isn’t really losing anything at all.
Before you ask, yes there are occasions when a stock will make a larger than 8% correction, you will get stopped out, then it turns back around and keeps going up. It has happened to me and frankly I don’t worry too much about it. OR, I take my profit, and put some back into that stock IF I believe that it has at least another 10% percent to gain. You won’t find that often because if you think about it, that is a gross gain of 30% on the stock. So you only got 12, 13, 14% or whatever on it. Is that such a bad thing?
Yes, there are occasions when I will get to a 20% gain and not put a trailing stop in and just sell it at that point. Those occasions are:
OK, so to see a quick example of how this works, I will use a stock that I own as of this writing. The stock is Research In Motion Limited (RIMM). As of the close of 9-19-2007 it is at $91.80 and I have an 8% trailing stop. That means that if the stock tanks tomorrow it will sell automatically at $84.46 ($91.80 - 8% = 84.456. I rounded up). I bought RIMM at $71.67 so my net gain would be 17.85% (yes I factored in trading fees).
However, perhaps RIMM goes up another 1.6% as it did today. That means the closing price would be $93.27 and my trailing stop would now automatically be set to $85.81 and it starts all over again.
So by using a trailing stop you can go about your day and not worry too much about watching your stock on a daily basis trying to determine if it is close to a top and decide if you should sell or not. You also remove the emotional aspect of wanting to hold a stock that goes down too far waiting for a comeback. When it goes down to your stop, it sells and you move on.
Do you have enough life insurance? Better yet, do you even know what life insurance is? And the most important question, do you have enough life insurance?
In our attempt to save for retirement, pay for college and get that next house, we tend to forget about life insurance. The vast majority of people who work for at least a medium size company usually gets some kind of life insurance from the company as part of their employment further reducing the chance that we think about it as part of our financial future. However, have you asked if yourself if you really know what life insurance is, what it is supposed to do and they different types of insurance available?
Life insurance or life assurance is a contract between the policy owner and the insurer, where the insurer agrees to pay a sum of money upon the occurrence of the policy owner’s death. In return, the policy owner (or policy payer) agrees to pay a stipulated amount called a premium at regular intervals.
As with most insurance polices, life assurance is a contract between the insurer and the policy owner (policyholder) whereby a benefit is paid to the designated Beneficiary (or Beneficiaries) if an insured event occurs which is covered by the policy. To be a life policy the insured event must be based upon life (or lives) of the people named in the policy.
Insured events that may be covered include:
Life policies are legal contracts and the terms of the contract describe the limitations of the insured events. Specific exclusions are often written into the contract to limit the liability of the insurer; for example claims relating to suicide, fraud, war, riot and civil commotion.
Life based contracts tend to fall into two major categories:
My personal feeling is that life insurance is not the best investment vehicle for your money. There are far more lucrative options out there such as mutual funds, Certificates of Deposit, index funds and so on. That means I’m a proponent of life insurance for protection. Why? The primary reason is there are better places to put my money, as mentioned above.
In any event, over the course of the month I’ll cover different aspects of life insurance, from the different types, how it is transacted, etc. More to come…
There was a time when I used to use Microsoft Money
It didn’t matter that it would connect to my bank online and download everything. It didn’t matter that I could see all kinds of really cool graphs and charts. I just couldn’t keep up with it. To be honest, I don’t even manage my checkbook anymore. I just use my debit card and between keeping what I’ve spent in my head and checking my balance online, that pretty much sums up my personal finance accounting practices.
I know, I know, it isn’t a great habit to get into and it has bitten me more than once. Perhaps I should give it another try. The question is, do I go with a simple paper budget or go with a software package (I still have my copy of Money). What do you use to keep track of your finances?
Whether you do or not, the government just might. After reading the post on TheTaoOfMakingMoney titled Interesting Facts And Confusing Thoughts About The American Poor which talks about a report from the Heritage Foundation called Understanding Poverty in America it is amazing the things that the average ‘poor’ family has. From owning a home, having amenities live TVs, DVD players, multiple cars, they don’t go hungry, and on and on.
As some of the commentors suggested, being poor can mean many things. It could mean being in a certain level of debt, or having an income level below a certain (which is what the government generally uses). The concept of being poor is also relative as to where you live. Being poor in America is a whole lot better than being poor in, say Africa. Most people equate being poor to somewhere between homeless and living on welfare.
My take is that being poor is a state of mind more than anything else. Even if you live below the poverty line — as I did once — this does not mean that you will or should always be poor. More often than not, we live at or slightly above our means. As long as you look to improve yourself and control your spending you will never be ‘poor’.
Recently my wife and I were both laid off. I had a small amount of credit card debt that I was slowly paying off and decided to go ahead and pay them all off at once with the severance pay that I got.
What was I thinking? Well, two things primarily. First, it wasn’t a lot of money and if we need them we can still use them. Second, if I didn’t do it now it was just be that much longer before I did and hopefully it will help my credit rating that much sooner.
The real question is, was this a good idea?
Kiplinger has a post about earning a guaranteed 18%. While great linkbait, it is also a tad misleading. The post says that by paying down your credit cards you can earn 18% by not paying interest. Well, to me that is saving 18%, not earning it.
They also go on to say:
And if you’re itching to put $1,000 into stocks, think of it this way: The interest you’d pay on that balance would almost certainly cancel out the return you’d make on $1,000 invested in the market in a year.
Hmm, well I suppose that might be true if you don’t pick good stocks. I managed 20% in under eight weeks on two stocks, Apple and National-Oilwell Varco in a mere 38 days.
That isn’t to say that paying down or paying off your credit cards isn’t a bad of course.
Back in December I wrote about making a go of our budget. Well… it didn’t happen. Budgets are just hard for me to stick to, which in some ways is kind of ironic because I’m a numbers kind of guy. I just like keeping track of things, except when it comes to a budget.
Well, after teaching our son about budgeting, I decided to pull up the spreadsheet that I originally did for our budget and brush off the dust and take a look at it. Part of me felt bad because here I am teaching my son about it, but not doing it myself.
So today while I was bored at work I decided to update it just a bit and my wife and I talked about getting back to it. It will certainly take some discipline, which is hard for me, but I know we can do it. Part of the problem may be that we aren’t really hurting for money but we don’t save enough either or manage what we have. It is nice that if we want something we can pretty much just go and get it. Not anything mind you, but if we want to go out to eat, or go pick up something for the house, etc. Naturally all those little expenditures add up. So with a little work we are going to try again.
The question then is how to stick with it. A big issue is motivation, and perhaps the motivational tricks from our money jar will help. You know, seeing it work becomes its own motivation.
What tips do you have for sticking your budget?
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