A Time for Gratitude and Reflection

During the holiday season, many of us feel the need to show appreciation through big presents and gestures, and spending money on gifts we can't afford is very common. It's imporant to remember that  expressing appreciation for what we already have can be just as rewarding. Medical studies show that taking time out of your day to be grateful for your family, friends, and positive parts of life can make you happy, improve your sleep, and even cut your risk for heart disease. And some say it's just as important to appreciate the things that are challenging, stressful or simply unfair, because they are helping you grow, learn and become a stronger person. 

Some things I am grateful for:

• My parents, who still support me financially and emotionally when I hit a rough spot 

• AmeriCorps, for giving me the opportunity to enter the non-profit world, fix my personal finances, and work with inspiring and intelligent professionals

• SparkPoint staff and coaches, for being supportive and encouraging as I embark on the next stage of my life 

Will I be able to express my appreciation to these people with lavish gifts this year? Unfortunately, no. But I am going to be creative and grateful, and inspire the people around me to take time to find gratitude within their own lives as well. Can’t beat that, right? ;-)

Economic benefits of major tax cuts: explaining the myth

I never thought I would say this, but I am loving me econ class right now. The topic we are discussing in class right now is fiscal policy. Being a democrat, I always felt like big tax cuts and less government spending was not the best answer to reducing our deficit, but now I feel like I actually have a proven, statistical reason to support my "hunch."

I've learned that there are two major actions the government can take to boost spending or "jump start" the economy. It can either enact tax cuts (supply-side economics) or increase spending (demand-side economics).  However, according to my econ book, tax cuts will always have less of an impact than increasing governmental spending, because tax cuts indirectly affect the economy (b/c this affects people's income, and people most likely won't spend their complete income - some of it hopefully goes to savings. This does not affect GDP).  Governmental spending, on the other hand, is a direct injection of money into the economy resulting in increased demand, and increased GDP.

I think that reasoning is right. =/ If I explained this wrong, please help me!

Our optional reading included an article by Alan Murray, "'Dynamic' Scoring Ends Debate on Taxes, Revenue" (from 2003!). Now this article broke it DOWN.

It explained why so many people were arguing that tax cuts will be majorly beneficial to the economy (even though basic economics, as I just explained, already knows it isn't). There was this guy, Art Laffer, who met with Dick Cheney and Donald Rumsfeld in 1974 and "sketched a curve on a cocktail napkin suggesting that a cut in income taxes could provide such a spark to the economy that government revenues would rise, not fall" (Murray). This graph, however, did not have any numbers on either axes. Murray does a really nice summary of the debacle, but it comes down to this: the Congressional Budget Office (CBO) did an extensive study and used dynamic scoring (which was invented to figure out the "numbers" for the graph), but unfortunately those "numbers" did not prove anything. 

Murray says, "using some models, the plan would reduce the budget deficit from what it otherwise would have been; using others, it would widen the deficit. But in every case, the effects are relatively small. And in no case does Mr. Bush's tax cut come close to paying for itself over the next 10 years."

On top of that, the two "models" that did show an improvement in the deficit as a result of the supply side (tax cut) strategy were models that assumed "that after 2013, taxes would be raised to eliminate the remaining deficit."

His conclusion:
"Certainly, tax cuts can improve overall economic growth. And certainly, revenues may rise as a result. But at current levels of taxation, those effects are relatively small. There is no free lunch."

My conclusion
So, if we care about reducing the deficit, it looks like at some point we will have to start PAYING TAXES.

3 yrs later: I finally understand the housing crisis

The “Return to the Giant Pool of Money” radio show from This American Life was really interesting and insightful. I am a little embarrassed to have to admit that I never really understood the “housing crisis” completely. I knew big banks and greedy investors were at fault and that they were giving people bad loans, but I had no idea how complex the whole system had gotten and how many players were actually involved. This radio show definitely cleared a lot of things up for me!

Two things that really suck out to me (that I didn’t know before):

1. The Wall Street people were looking at BAD DATA. No wonder this practice of giving NINAs, creating CDOs, etc., went on for so long. The data was telling them it was a good idea. This was a triumph of data over common sense. 
2. No one was looking at the big picture and thinking about the long term effects to the economy. There were lots of players in the game, from mortgage brokers, to banks, to investors and no one took responsibility, because everyone thought it was not their problem. 
3. These players were earning A LOT of money to make this system work. A ridiculous amount of money on commissions. These high commissions and high ROIs definitely propelled the problem and encouraged the loosening of the rules.

The show included the story of two people who started at the complete opposite ends of the spectrum and ended up in similar situations: Richard Campbell, the Marine facing foreclosure, and Glen Pizzolorusso, the sales manager making a lot of money selling bad loans/mortgages (and ending up losing everything).

I liked how they started with Glen and his lifestyle before the housing crisis and then transitioned to Richard and the beginning of the crisis and finally, back to Glen and the outcome of the crisis. Through interjecting these personal stories throughout the show in between the technical talk, it was really easy to understand how the mix of personal behavior, bad banking products, and loss of oversight lead to such a severe economic downturn.

I realize now that from the outside it’s very easy to point fingers and blame all the people who made lots of money from taking advantage of low-income individuals and families. But, really, we need to look at the whole financial system and the governmental laws put in place to support these risky actions if we really want to change things.

Go ahead, listen to it! "Return to the Giant Pool of Money"

a little update on last year's retirement obsession

Almost a year ago now, I wrote a couple blog posts on retirement, because for some reason I was a little obsessed with it. Well I'm not that excited about it anymore.

Your retirement is FRAGILE! 

I did a lot of research and invested about $1750...now I have $1535, which is not that bad since we had a major downturn in the stock market about two months ago. But, still! I'm down $200...when I wanted to be making money. This really makes me question the whole system. I can't believe people rely on the this type of income to fund their retirement.  It seems absolutely crazy and risky.  Yet, it's the norm.

When I saw my account decrease I was sad, but I wasn't worried.  My retirement is many, many years away. This account is a good start, but if I loose most of my money I can always start from scratch again.  But, what about those individuals who are in their 50s. They only have a couple more years until they will need that money to live off of.  I cannot imagine what they are feeling watching the stock market crash the way it did this summer.

There's got to be a better way to save for retirement!

Social Security barely covers living expenses and it's complicated.  I tried calculating how much money I would get on their wesbite (http://www.ssa.gov/retire2/) and didn't get very far.

I say we bring pensions back for everybody! Why should government bureaucrats & public service people be the only ones who get them?

Prices of things

As I mentioned in an earlier blog, it can be really helpful when you know when you're getting ripped of and I want to prevent you from being ripped off.

So I thought I'd start listing off services/items and prices that I've encountered (and I'll put in parentheses the location of those prices, since they can change dramatically from city to city).

Services:
Car

• Smog Check: $40 (including certificate). After searching around for the cheapest possible smog check I found this place in San Rafael in the Canal Area. A lot of places will advertise a price and then say +certificate, which is always about $10 extra. So for Marin I think $40 is the cheapest you'll find. Other counties are probably cheaper.
• Diagnostic (of an old car): $99. I didn't do as much research as I should have for this diagnostic, but $99 seemed to be the going rate.  They would have given me a free diagnostic if I had a new/fancy car that the computer/machine could read easily, but alas the machine could not read my car's check engine light. =(
• Oil Change: $30. Not many places in Marin County will offer an oil change for $30, but I found one. Though I wouldn't recommend it, my car fell apart shortly after, and I'm just not sure about them anymore. Plus they tried to tell me I needed to get all these things fixed and it was going to cost tons of money. I hate when mechanics do that!

Ok that's it for now. Please, please, please let me know if you have found different rates/prices for things or know something I don't about these services! 

Budget blues update #3

So when I first started writing this post, I was going to talk about how happy I was that my budget plan worked!! I actually saved A LOT of money on groceries. Almost half in August...and how is that possible you may ask. I'm not exactly sure, but somehow knowing what I wanted to buy before I went to the store prevented me from buying extra or miscellaneous things that I really didn't need.

Anyways, now I have a new problem. So even though I did "oh so great" for the month of August, I'm back to square one, because my boyfriend moved in. All my single meals are now turning into double meals >/.
I'm a little disappointed in my-self, because I pretty much just dropped the ball for these last two weeks, being too lazy to figure things out all over again.

I will be updating on, hopefully, some progress soon.

Asset limits prevent people on SSI/SSDI from obtaining financial stability

Most of us have experienced the harsh effects of the financial crisis, but what if you had no savings or 401K to cash in to give you a little buffer? What if you were not allowed to save for an emergency like this? Individuals on SSI or SSDI are in this situation.

At the SparkPoint Marin Center we say that everyone should have three months of expenses in their savings. So when things go wrong, which they eventually do (trust me on this), you have a cushion to fall back on.

When you are on SSI/SSDI fixed income, not only is it close to impossible to put money aside for savings, but the government actually discourages it. Currently, you are not allowed to have more than $2,000 in assets in order to receive disability benefits. $2,000 is not a lot for when, for example, you break a leg or another financial crisis occurs. People’s savings need to be higher.

After talking to several people living on SSI/SSDI, I have learned about the utter lack of resources our elderly and disabled people have. However, even with their limited income and barriers to extra revenue or savings, they were making ends meet…until the financial crisis hit!

So why can’t they save? Asset limits are designed to restrict who applies for benefits and who deserves benefits, but it doesn’t always work. Since assets are technically defined as any personal resource, such as cash, savings accounts, a car, a retirement fund, or a valuable heirloom, benefits programs can strip away someone’s livelihood before beginning to help them.

Not only are these asset limits really inhibiting to individuals receiving benefits, but enforcing them is expensive. In fact, the percentage of people who “trick” the system and get benefits unlawfully is so low it does not equal the amount of money spent on enforcing asset tests. Many states have actually done away with their asset limits. For example, 5 states have gotten rid of Temporary Assistance for Needy Families (TANF) asset tests, and all but 2 states do not do asset tests for Children’s Health Insurance Program (CHIP) (CFED: Eliminating the Incentive to Save). While many state benefit programs are tending to move away from asset tests, the federal social security act has not been updated since 1970 and continues to enforce outdated asset limits.

(I wrote this for the Marin Grassroots Network)

VISTAs looking for good deals

Having been a VISTA for the past 9 months has really helped me hone in on finding and evaluating good deals.  I think it's time I share these with the rest of the world! B/C how annoying is it, when you look at yelp reviews, but have to take everything with a grain of salt, because there are no prices anywhere! Yes, the service may have been great, but did you also pay 3x the amount it's supposed to cost?

This grief, as you may be able to tell, comes from personal experience. Now that it's been over a month since I had to get my car fixed, I think I am ready to share the experience and what I learned.

It all started when I decided to get an oil change for my car - for the first time in Marin County. I have gotten oil changes before and it's been a quick and easy experience and about $20 max (I've found places that did it for $15 in Orange County, but that was a while ago). Anyways, I had no such luck in Marin County. After extensive research on yelp and the internet in general, I went to Wheel Works for $30. Now yelp did warn me, with many negative rumors about their service, but it all had to with the wheels not oil changes. So I went for it anyways, mainly b/c it was cheap!

Well, not only did they give me a list of things that were wrong with the car, but they told me that when they did the tire rotation something got stuck and they had to remove one of the studs or I would have to get the car towed!

So my only plausible option was to have them remove one of the studs. Now, he said that it would be ok to drive like this for a little bit, and for short distances, but at some point, I would need to get it fixed. They were even so nice as to give me a printed estimate of how much it would cost...over $300!!!

I said thanks and left. A day after the oil change, I had the check engine light go on as well. FML

Before I went in there, my car was working fine - now I have numerous things very seriously wrong with it!
and $300 to just to fix one of them!!

I was done with this place that was for sure! There was no way I wanted to go back there- I may not know who was at fault for the stud breaking, but I wasn't feeling generous towards them either way.

Now, this is the point at which my research and perseverance really came in. First of all I called my dad! He didn't fully understand my story, because I didn't fully understand what the mechanic was saying (the mechanic actually changed his story half way though, which didn't help), but he did some research on what needed to be done next.

Turns out, that with a stud missing there are two main scenarios and two main price categories. If it's a certain type of car, it's really easy to replace the stud, and if it's another type car, it's more difficult.

Well to install a stud for my car I found out it's actually easy... if you take it to a wheel specialist. I found a place on Mills and Hoag, in the Canal District. Just two guys working on breaks and wheels. It cost me $60 total for the bearing and the labor to install it.

I couldn't believe it! Wheel works (you'd think they would be a specialist in wheels, but apparently not) wanted to take out the whole wheel/bearing and make things super complicated when all we needed was to install one stud (takes half an hour).

I just felt so abused and taken advantage of. But in the long run, I think I learned a lot from this experience, and I will make sure to take my time researching before hand. You should too!

Budget blues update #2

I'm feeling a lot better about my budget these days.

I'm not saying it's perfect, but yesterday I decided to make my meal planning official - I bought one of those composition books ($3.14 - didn't they used to be a lot cheaper?!).

Anyways, I decided I was going to keep track of my meal plans in this notebook. Not only am I writing down the ingredients I need to buy at the bottom of the page, but I am keeping two columns: one for the plan, and one for the "actual" (what I actually end up eating/buying).

It sounds kind of over the top now that I'm describing it, but I actually think this could lead to other positives besides better meal budgeting...such as exploring different recipes, ensuring healthy and balanced eating habits, etc. As you can see by last week's excerpt - my previous meals were not very sophisticated, and probably not the healthiest, either!

This evening, I am going to try to make this dish my Grandma (Oma) makes really well. It's salmon with spinach and some sort of yummy sauce. First step: ask my mom for the recipe! Next step: go shopping (but stay within budget!)

I've been debating this rhetoric of the american dream for a while now

...and more and more people are starting to see the disconnect.

I just read an interesting article that touches upon it called "American's Don't Resent the Super-Rich Because They Think They Are Super Rich" by Kiri Blakeley (Forbes: Americans Don't Resent the Super Rich.  She introduces the topic by recalling different riots that were meant to start revolutions throughout our recent past, such as the 1992 LA Riots, pointing out that Americans will fight back against injustice.  However, when it comes to the injustice of our tax system the fight is lacking. No one will riot against the super rich not being taxed, because most people believe in the American Dream. The American Dream dictates that hard work alone will bring you success and so it is up to you to become super rich, and once you do you will be rewarded with lower taxes!

Blakeley brings up individuals such as Bill Gates of Jay Z as examples of people who worked hard and became super rich, but she also points out the resources and little bit of luck they had to help them achieve great success.  She mentions the author Malclom Gladwell who "points out over and over again that success is not just a function of hard work, brains, and dreaming big—but of privilege, timing, and often in the form of government help via loans or programs." So while the average american supports lower to no taxes for millionaires, thinking he will benefit from it someday, he is becoming poorer and poorer by not taking advantage or resources that have been proven to help others succeed. 

It seems to me that this "American Dream" is a little destructive.  Instead of valuing the community and what the community can do for the individual to succeed, it values solely the individual and his or her ability to become super rich.  And this relates directly to the whole debt/budget crisis. There is a division between people who believe in the individual and his ability to fix the economy through small business and the people who believe strong communities helping each other in time of need will fix the economy.  One believes taxes will debilitate the economy and the other believes extra taxes will bring more money to programs that are making our communities stronger.

budgeting blues UPDATE

So my meal plan is working... to an extent. I may not always stick to the exact schedule, but I can still budget out what I need to buy for the week, and this is making me more conscious about what i'm buying at the grocery store and how much I'm spending.

But the main revelation of the week...I figured out I need another budget item! - for alcohol! (separate from the entertainment budget) because this drunk person to the left needs a little bit of money allocated to going out, having fun, and exploring the city!

and you know what? for a while now I've been telling myself I am not allowed to go out because I need to have a certain amount of money in my savings and I'm not earning enough to live the same lifestyle as before. But, I had a revelation! Who am I satisfying by this self-deprivation? 

If it makes me happy to go out and have fun with my friends, I need to figure out how I can allocate or even SAVE for these occasions. Maybe I don't go out every weekend since it's so expensive, but I can afford one or two? WITHOUT feeling guilty for going out. Right?

budgeting blues

I thought I was doing great. I thought I was in full control of my finances! until I tried to figure out how much i spend on food.

I have been using mint to track my budget. So i utilized its "trends" section to see how much I was spending on food. It was great because it gives you the option to check out the current month, or compare many months, or give you an average of since you've been using the program. It gives me a nice bar graph depicting my expenses each month. So I typed in groceries and it pulled up how much I spend on groceries each month. Great! I now know I spend about $150 on groceries each month (plus the $50 on prepared foods/restaurant/fast food). Really $150 for one person per month?? That seems like a lot.  Well it turns out there were different reasons for my monthly grocery spending - and each month was different from the next.

To get to the point, all this info didn't really help me figure out how to budget for food. I realized that it wasn't enough knowing how much I spent on food to fix the over spending and carelessness. I needed to come up with a weekly plan for food. How am I supposed to budget for food, if I have no idea what I spend it on?!

It's not that I'm bad at budgeting, I'm bad at planning meals or cooking for that matter!
So here are the steps I'm going to take to fix my carelessness about food spending:

• I'm going to start thinking about my meals at the beginning of the week, and plan ahead. This way I will have a rough estimate of the ingredients I need to buy and I can make decisions on what meals to cook based on my budget. 
• Speaking about staying within budget. Instead of thinking about a monthly budget, I'm going to think weekly. Instead of knowing not to go over $130 a month, I'm going to budget about $30 a week. That number and time frame seems more manageable. 
• Finally, I'm going to make sure I always allocate enough money for milk, bread, and vegetables - to eat HEALTHY! 

I'll let you know how it goes!

college education - is it for everybody?

So I just read an article that I really liked in the Nation called "Should All Kids Go To College?".

I've been mulling over this idea that everybody needs to go to college for some time now and I was not seeing the sustainability. I have mentioned it in my blog in the past. You may remember my complaints about recent grads taking up receptionist jobs. Well you can check out my crazy outburst of emotion under the comments page =) I won't repeat it here!

Giving Financial Advice - how do you make people listen?

So right now I'm all about encouraging people to save. At work I have this new advocacy project through my Equal Voices Fellowship in which I will be focusing on the goal of increasing the amount of money Marin county residents save.

Erupting Mind

Now as a side note, at our office we are always preaching about the importance of savings! There is this phenomenon called the cascade effect. It pretty much suggests that when you don't have a little bit of savings in the bank (and are living paycheck to paycheck) your life can easily take a downfall.  Say you have an unexpected car mechanic bill to pay. You don't have the savings for it, so you take it out on credit. Then you realize you can't pay your credit card. Then all of a sudden you can't cover basic expenses...and before you know it you're being evicted. - Cascade Effect - starts all because you couldn't cover that initial expense!

I wish I could say this argument was convincing enough to make people open savings accounts...but the 1st reaction you get is ... yea saving money is hard.... I need it!

So anyways, back to my project. My first action item is to start a Summer Savings Challenge. I have hashed out the details with my boss and made a flyer. Now all I have to do is advertise it!

What is the Summer Savings Challenge you may ask? Well it is a raffle designed to encourage people to save.  You get one raffle ticket/entry every time you make a deposit of a minimum of $5 (limit: one entry per day).

This goes on throughout the summer until August 31st. On September 6th we will hold the raffle! You can win up to $100!! There are actually 3 prizes to win: $25, $50, and $100.

What we are trying to do here is build people's "savings muscle" (so nicely worded by my colleague Ramona).  It is not the amount you save, but the commitment to save! Even if you can only commit to $1 now; you're still building your savings! It's just like when you start building real muscle. You may start with 1 pound, but after time your arm will get stronger and stronger and you may be able to increase the weight you lift.

women's handle on money ...

So I've signed up to this new newsletter called the Daily Worth and it is quite interesting/awesome!

Women coming together to take control of their finances and become smarter financial planners and investors = awesome!

Check out their website:

Their most recent newsletter was quite "eye raising". Planning for divorce. Talk about things you don't want to talk about! But their tips were really interesting and if I were married I would look into this. Even better, check credit scores BEFORE you get married!!! Get it all on the table before hand!
and when it comes to divorce, make sure you know all the finances beforehand - don't get screwed!

servant leadership

Before attending the grassroots / equal voice leadership academy we were supposed to read an article/essay on servant leadership called "The Servant as a Leader" by Robert K Greenleaf.

Now, even though I didn't finish the article in time for the conference (it took a lot longer than I estimated!), I did make a point to finish it. This article was quite overwhelming so it was probably good I spaced out my reading, but I thought I'd share some quotes with you that really stuck out.

On "How Does One Know the Servant"
"It is terribly important that one know, both about himself and about others, whether the net effect of one's influence on other enriches, is neutral, or diminishes and depletes." (44)

On "Who is the Enemy"
Evil, stupid or apathetic people will always be part of society.
"The real enemy is fuzzy thinking on the part of good, intelligent, vital people, and their failure to lead, and to follow servants as leaders. Too many settle for being critics and experts. There is too much intellectual wheel spinning." (46)

These quotations are just the beginning. I will reflect on other parts of the article once I've digested it completely!

grassroots leadership

Marin Equal Voice Leadership Conference

this weekend I attended a conference at which we learned about grassroots leadership and the equal voice campaign. It was really inspiring, but now what?? I learned a bunch of great tools that would motivate activism in people and could really enact change. The thing is...I need an area around which I can support activism.

I know that I can use my knowledge to start increasing voter turnout throughout my community. But is that enough?

Well either way I have gained knowledge about using media and social media effectively, I know a little bit more about how local government functions, campaigning and organizing winning campaigns, and social organizing.

I hope to explore this pathway soon!!

Frustrations with College funding

Yesterday I attended a presentation by EARN called "Education Debt: the Next Bubble" and realized that we are still not getting it. Initially I was excited to go to this talk because I felt that education debt could very well be the second "housing" crisis. People taking a risk and going into huge debt to invest in their education, not knowing if the returns will actually pay off in the end. Just like with the housing crisis, people believe in being successful after their investment and being able to gain from their investment.  As we saw in the housing crisis, this is not always the case. Investing in something so widely believed as a "good" investment and worth the risk is still a RISK and therefore not guaranteed! and the statistics are staggering!

In 2008, students and their debt equaled over $550000000 for private, for-profit schools.  The average debt a student in California has is 17,000 and in Massachusetts is 24,000, both lower than a student with debt from a private school (such as USC 30,000). Have you seen many entry level jobs paying anywhere near enough to pay for your living and pay this debt off? There may be some, but there are not enough! and what about all those other jobs that don't need a college degree and pay about the same as a entry level job (at which degrees are pretty much a standard) - not because of the actual work performed, just because everyone else applying has a degree as well. But, that is a different
argument altogether!

More to come on this subject later...

When TV Shows hit home

I have been talking a lot about...well retirement and a little about my VISTA experience. But I haven't really touched on the whole reason for writing this blog: trying to figure out what to do after college!

Well, for a long time now, I've been worrying about my future, and the impact of the decisions I make today.  Having options such as the foreign service, working or starting a masters/ph D forces you to think about the whole picture. If I want to join the foreign service, do I do this now? Before I've completed a masters? How long would my time commitment be? Can I explore other careers before I pursue this option? Or will I be "too" old? Will I have kids while I'm in the foreign service or will I quit it before? Crazy questions huh? Deciding whether to do my masters now or push it out a couple years is just as difficult!

The continuing education question brings up a lot of things I'm unsure about. A lot of my friends and class-mates decided to continue studying. As a poli-sci major, there are some very clear pathways people have taken.  A couple friends will be going to law school, pursuing ph Ds, or continuing in poli-sci. I've been thinking that if I continue studying I don't want to learn more of the same, but I also don't want to go to law school.  This means all the options my friends are looking into are not going to be my path. At the moment, I think studying econ or finance would be interesting. The work I've started doing through VISTA has definitely steered my in this direction.

Well anyways - the reason this post is titled "When TV shoes hit home" is because of a character's decision not to go to law school.  In one of my favorite TV shows, Greek, the main character Casey decides to drop out of law school, because she realizes that's not exactly what she wants to do with her life.  Now you may be asking, what does that have to do with me? Well, the law school questions came up quite a few times during "future" discussions and while a law degree can be a great asset for any job, I don't think that should be the reason for getting it.  Practicing law does not appeal to me, and I've ruled it out, even knowing that it could open doors for me, because it just seems wrong to do something and spend so much money on something I do not enjoy! ... Casey's choice to go a different route really reaffirmed my decision for me and I am happy she did it. Especially for an ABC family TV show, it is quite bold to have the protagonist drop out of something! Thank you! for making it acceptable to go into politics without a law degree!

closer to retirement choices

so I finally finished that book on retirement. but now what? I still need to make the choice and dive into the stock market. and I still can't predict it. so from all the information I've gathered I think I will allocate a big chunk to bonds, some ETFs, some cash and then of course some stocks. After all the crazy economic unrest in the past years and the fact that I don't need my retirement money RIGHT NOW I don't think I want to put that much in the stock market, whether it's through mutual funds, options, or stocks. I know bonds are safe and low in return, but it's still money! and it's what I feel comfortable doing right now.

I am however, more interested in learning about trading on the stock market. So we'll see where that takes me! I learned all about gap trading, the january effect, and window dressing, which I am eager to try out.
According to Rule your Freakin Retirement, gap trading is when you analyze the how a stock changes over night (or when the stock market is closed). Since you can still buy stocks when the market is closed, when the market opens the next day the stock price is usually at a different point than when it closed the day before.  However, the volume of trades affects the price and at night fewer people buy and sell stocks, thus the price can change dramatically, while during the day the sheer volume of stocks bought and sold will stabilize the stock price. What does all this mean? Well from what I learned it means that most likely sometime in the morning the stock will jump back to close to its price the day before, and that's where you can make money.  I'm not 100% sure I have completely understood it, but it helps trying to explain it to someone else!

Window dressing, according to my memory, has to do with how fund managers try to make their funds look more appealing, even when they have been doing badly.  Before each quarter these managers will sell off stocks that haven't been doing well and buy stocks that have. This will make it look like the fund has 100% winning stocks.  This will make the price of those stocks that were sold off go down somewhat dramatically. After the quarter, most of the time fund managers will buy those stocks again, realizing that it's a good stock and that it's really cheap (now).  So what you can do, is look out for stocks that randomly decrease in value a week or two before the end of the quarter, buy it, and then sell it a couple days after the quarter's end.  I feel like I'm missing something here, but I can't remember what and I had to return the book to the library. =( I'll have to do some more research.
Well anyways, the January effect is similar, because it has to do with fund managers buying cheap stocks driving up the price dramatically.

That's that for now...I'm excited to start trying these techniques...and the whole retirement saving! are you?

being an AmeriCorps VISTA

so the real reason I am getting so into financial stuff and learning more and more about financial education and asset development is my new job that I found through the AmeriCorps VISTA program.

I must admit AmeriCorps VISTA was not something I was always planning on doing after college. But, I'm so glad I looked into it and found something that fit my capabilities, interest and passion!

An AmeriCorps VISTA is a person that is matched to a nonprofit organization that is either just establishing itself or strating a new program. The VISTA's mission is to build capacity and ensure that the program is created in a way that it can sustain itself and last.

I am the second VISTA to work for this specific organization and so I'm trying to continue institutionalizing the aspects of some of our programs.  The problem we're facing is that the SparkPoint program is a regional inititiative with funding from different sources, dependent on certain outcomes and we have not figured out the perfect process. We are under-staffed and trying to figure out how to expand while being effective and using people's time wisely.

In conclusion, people don't do this for the pay, they do it for the heart warming sort of reward. Not only am I getting this kind of reward, but I am learning and getting trained in different skills constantly, I am gaining invaluable work experience, and I love doing it (even though each day is getting more and more stressful, the more we realize we need to determine our process and start building the capacity to accomplish our goals!)

Retirement: Mutual Funds, Bonds, and other ways to risk your money.

oh yea - I'm tackeling it. I will attempt to sort through my latest reading, though I can't promise a complete picture as of now! It seems like the more I learn the more unsure I am about what I should invest in for my retirement...which is definitely not what I intended.

A short recap of what I've learned:

Mutual Funds
By buying one, I am agreeing to let someone else decide which specific stocks to invest in AND paying that person to do it.  Now, there are pros and cons to this.
Pros: you can blame someone else when your portfolio decreases in value, you can rely on someone else to make pretty important decisions
Cons: smart, intellectual stock martket gurus can't truely predict the market either.

I will definitely put money into mutual funds because I feel like my knowledge about different markets and companies is not up to par...and I have paranoia/stress issues....it's best if someone else worries about the market. Though I'm sure this thinking is not fool proof!

As long as I pick a mutual fund with no loads, and VERY low commission ... and in a perfect world I will also check out the bio of the person in charge of the MF. Generally, if they have been the manager for over 4 years, they're 30+ and successful, I'm happy! But hey, I'm still learning!

There are lots more things to look at regarding mutual funds, and so I will revisit when I'm done with my first book =)

Bonds
I will also add these to my retirement fund. Why? because yes, diversification is key, but ALSO because they are a lot more safe than stocks! and having mentioned earlier that I can get quite paranoid, I think I like this option..depending on what I choose. Also keeping in mind, that when saving for the long term, anything gaining under 4% interest may not be as beneficial as you think, since the average inflation rate is at around 3% or so I've been told. So bottom line, you probably can't rely completely on bonds. =(

So yea, I've pretty much summerized my opinions here. No actual data to help make better decisions - will need to work on that!! I will start including actual research soon. But now that some of my thoughts are on paper, it will be easier to move forward!!

and we'll address the whole other ways to risk your money...

Mint.com

So, I was reading a book called, "Rule your Freaking Retirment" because for some unfathonable reason I am obsessed with retirment. And not because I want to retire as soon as possible, I actually am not planning on retiring until my late 60s. I just want to know that I'm saving my money effectively and besides retirment I haven't decided on any other savings goals. Hopefully this blog will help me figure out what I want to do and thus give me a more immediate savings goal.

well more on retirement later. I wanted to talk about Mint.com, which I googled after having read a section in the previously mentioned book. Since, it's only my first day using it, I can't make a complete assessment. But, as of now, I really like it!

Initially, you have to give the financial management program a lot of trust, because you let it connect to all your bank accounts. However, it says clearly that it's access is for reading purposes only. Another reassuring aspect is that my ING Direct account does not actually use login information, but has a seperate "access code" for such software. This way, Mint does not actually have my login information!

I like Mint.com because it asses your accounts and determines your budgets and savings possibilities. You can make personalized savings goals and you can even manage your investments. I have been wanting to anaylze the amount of money I spend on groceries, gas, clothes, and entertainment to see where I can cut back and how much I can comfortably set aside for savings.

Hopefully Mint.com will be useful for me!

xoxo

introduction

Hello!


Graduating from college!

 this is Rebecca and I've decided to start a blog. It's my first year out of college and the first time in my life I don't really have a plan....and I'm currently an AmeriCorps VISTA. This blog will document my experience as a Volunteer In Service to America, my experience as a college graduate, and my attempt to figure out my "plan", all in the context of finances.

My AmeriCorps VISTA project is in San Francisco and focuses on asset developement and financial education for low income families all within the goal to end poverty.

Pretty much this is a mixture between a diary and an assesment/analysis of my experience with the ultimate goal being to figure out what comes next.....!