Good Personal Finance

Posted by Bux on July 11th, 2010

1. Get generic food: the store-brand food is less expensive and almost exactly the same ingredients as the name brand.

2. Get rewards! Apply for the store rewards card. If you happen to forget your rewards card, ask the cashier to scan the store card for you. They should be more than willing to do so.

3. Buy items in bulk, like at a wholesale food seller.

4. Don’t buy things you don’t need. It sounds easier than it is, but remember you don’t have to keep up with this minute’s fad to have what you need. Marketing experts create a lot of buzz around the next big thing like iPhone…

Saving Money for a Rainy Day

5. Return non-opened items that you know you won’t use. Companies such as Bed, Bath & Beyond and Bloomingdales have very good return policies. Most companies allow you to return unopened goods within a certain time period for your money back-look at your receipt to find the return policy or try to return it anyway.

6. That $5 latte adds up quick. Skip out on Starbucks and brew your own coffee. Buy a French press or a coffeemaker for your room-the basic model will cost about as much as a week’s worth of Starbucks.

7. Carefully track the money you spend. This way you know when you are about to overspend.

8. Dry off razor blades after use. This stops the metal from oxidizing and rusting. Drying them will double the life of the blades.

9. Use the library or other free resources instead of stores to do things like rent movies.

10. Combine cable, phone and Internet. Contrary to popular belief, it is possible to negotiate prices with service providers. If they won’t budge, call cancellation services and tell them you have “financial hardship” or “the bill is too expensive”. Speak with a supervisor if necessary since the account representative likely can’t make those decisions.

11. Always ‘shop around’ and compare prices for big or important purchases, like a television or car.

Cash or Credit – Choosing Credit Cards

Posted by Bux on July 11th, 2010

Credit cards can be a great tool if you know how to use them. With a credit card you’re able to:

Build the credit score that you will need to buy a car, house, take out a student loan, etc.
Get Cash Back or purchase protection and fraud protection—it’s good to know that rewards such as cash back likely aren’t taxable.
Have funds available for emergencies.

That’s more than you can do with cash.

Credit Card

Definitely get a credit card that offers cash back rewards and other benefits, if you’re going to get a card. When you calculate the percentage you get back from using your credit card, you get more

bang for your bux

with cash-back cards than other types of rewards. In other words, you end up with more money in your pocket than you would have with miles, points, etc.

Check your personal recommendations from friends and family to find a card suitable for you.

If you do have a card, but don’t trust yourself with it, cut it up! And pay off the balance as soon as possible. A few tips:

1. Don’t use plastic without completely paying off the balance each month.

2. Worst case scenario: pay $1 more than the minimum required. Paying the minimum sets off a red flag for credit card companies—potentially damaging your credit—and you avoid this by simply paying slightly more than the minimum.

Rates & Fees: Ask and You May Receive

So if you usually pay your credit card bill on time but accidentally make a payment late. Ask the company to waive your late fees. If you have a high interest rate, ask the company if you can have the rate reduced. Credit card companies will often agree to these requests, especially for a reliable card user.

Creative Charging

If you’re in school and have money to pay it off, put a portion of your tuition payment on your credit card. This will both improve your credit score and give you cash back (that is, if you took our tips on the cash-back credit card). You wouldn’t believe how much money you could have back at the end of the year. And you’ll be building better credit so you’ll have better
rates next time.

Do make your big purchases on a quality card for purchase protection and other benefits.

Don’t use your card where you’re likely to overspend—like at the bar throwing money around.

Hope you enjoyed a few of our credit card tips.

Barefoot Running (Almost)

Posted by Bux on August 19th, 2010

Today celebrities and pro runners are starting to run barefoot. We’ll maybe not quite literally but, with minimalist shoes with individual toes also called gloves.

Now these shoes cost around $80 online. That actually beats Nike and other some other shoe models on price. The favored brand is Vibram which has a history of making quality soles. Look for the yellow Vibram text to know it’s the correct brand.

You’re next question is what does this have to do with personal finance? And, the answer is you’ll save money on shoes or gloves or what ever else you’d like to call them. No need for socks so that knocks off $18 for a 3 pack. The total cost of footwear may net you some savings. And, the biggest expense in the long term is potential health savings if you don’t require replacement knees or have other injuries.

I’d say it’s worth a spin!

Finance Calculator

Posted by Bux on August 5th, 2010

YouBux.com is all about helping our readers save money and make money. As such we’re creating financial calculators, focused around money to help you with your finances. Currently, we have an investment calculator of sorts. In order to use it, you enter how much money you want to invest. Then input zero or more if you want to add to it regularly. Next, estimate how much interest you’ll get on your money invested. This could be a savings account or a stock yield. Followed by how long you’re putting the money away (in years). And finally, how what percentage % you will keep in your investment. This should help you determine how much your money grows.

We’re looking into launching a tax bracket calculator, a budgeting calculator, a rent based calculation, credit card interest rate equation and some other ideas. Let us know if you have your own ideas! -Hope this helps.

Online Privacy Protection – 10 Tips

Posted by Bux on August 4th, 2010

We’ve decided to write a Top 10 about protecting your privacy. This is really a list of ideas, not an entire comprehensive approach.

1. Control where you put your information.

2. Be cautious about using public computers. Only use trusted locations when you’re accessing financial information
online, not WiFi.

3. Verify the presence of an SSL lock when you are providing any confidential
information. The address will read https://, not http://.

4. Use different passwords for important items. Use random letters and numbers, not simple words. Words alone are the easiest passwords for hackers to crack. When asked don’t save any passwords.

5. Remember that public information online is available to the whole world.

6. Don’t post your Social Security number or bank account number online.

7. Never follow e-mail links that ask you for personal information. Close the email,
then go to the web site itself.

8. Remember that companies can’t deceive users with their privacy policies. Always read
privacy policies to learn about how the company can and cannot use the
information you provide.

9. Beware of violating a company’s Terms of Service or TOS.
If you violate the terms of service, you will leave yourself unprotected in a
legal action. For example, if you gave out your bank account information to a
third-party web site and that web site was hacked, the bank would not bear
responsibility to compensate you for lost funds. This goes for Mint.com.

10. List-sharing: Always opt out of list-sharing when you sign up for a service. This prevents the
company from selling your information to third parties, which they often do to make more money.

Craigslist Trade of the Year – Porsche Boxster S

Posted by Bux on July 28th, 2010

Yesterday, I heard on the radio that a 17 year old boy started trading items on Craigslist.org. His first trade was an old cell phone that he no longer wanted. Over a period of two years the guy made 14 trades ending by acquiring a Porsche Boxster S. Those cars must be valued at over $30,000 since the model is relatively new. Not a bad use of time. This also means that he started when he was 15! Keep in mind it is likely that no Bux (money) were involved. You can keep your wallet full this way.

He remarked on radio that his best trade was his Apple computer that he swapped for a Toyota 4Runner. How did he do it? At YouBux our educated guess is that he sold items with emotional attachment and made a killing. This means that when someone really needed an item, either quickly or for more rash reasons, the 17 year old did some research and swooped in for the trade. Now, the amount of time spent searching through Craigslist and potentially other sites such as Kijiji.com (owned by Ebay) and Backpage.com, must have been intense, but if you’ve got the time, why not?

So, maybe you should consider cleaning up your place by swapping out unwanted items. There must be a treasure trove of undervalued stuff on these websites. You might just get exactly what you’re looking for, for free.

If you’re interested in seeing what return you could achieve, try our investment calculator.

Financial Crisis 2009

Posted by Bux on July 28th, 2010

Financial Crisis 2009

If you listen to the radio or have read any news recently, you’ve heard about the current economic issues. You may have heard something about a housing crisis. Maybe you read about the stock market crash or banks failing. But how did it happen?

The Basics: What You Need to Know
The bare bones of the situation tracks back to housing. Typically, when a person buys a house, he gets a mortgage–a loan where the property you’re buying becomes the bank’s as collateral for the money you need to buy the house in the first place.

In order to get a mortgage, banks will check a person’s credit to determine if that person is likely and able to repay the debt. The people that don’t have a good credit history, don’t get the loans to buy a home–at least that’s how it was supposed to be. But over the past ten years, more and more banks have been giving more and more loans to people who traditionally wouldn’t have qualified for them, people who were less likely to repay the debt.

This practice of lending to people with less than ideal credit ratings–”subprime” ratings, put the banks at risk. Those that are less likely to pay their mortgages, default more frequently, which means more foreclosures, which means more homes the banks have to repossess. Which is exactly what happened. More homes were foreclosed on, which meant less cash on hand for the banks.

Usually, when banks repossess a house, they just resell it to recoup any losses. But because of the number of foreclosures, the houses couldn’t be resold fast enough or at enough of a profit. So the banks lost money on the interest of the loans and lost bux in the value of the homes that couldn’t be sold.

Intermediate: A Tale of Double Dipping
Beyond the foreclosure risk banks saddled when making subprime loans, most banks are also publicly traded companies. So as banks lost money, investors did too. But that wasn’t the only way the foreclosures affected the stock market.

While banking institutions are traded publicly on the stock market, shares of companies, like Bank of America (NYSE: BAC) and Washington Mutual (NYSE: WAMUQ), aren’t the only securities that are traded. What else is traded on the stock market? Currencies are traded. Commodities–think gold, oil, sugar–are traded. And even futures are traded; based on future commodities (ex. quantities of available grain) or interest rates, speculators basically bet on the how much of a particular item will be available and how much it will be worth.

Make sense so far?
Well, there’s one more form of security that adds insult to injury with the financial crisis 2009 subprime issue: mortgage-backed securities. Mortgage lenders will package together a number of loans then sell them as securities, as investments, on the open exchange to mitigate their own risk. The value of these mortgage-backed items is directly related to how the loans are paid back. If the loans aren’t paid back, as is the case with foreclosures, the investors lose bux and the banks in effect lose multiple times: once on the bad loan, again on the inability to resell the property and another time on these failed securities.

Banks have been in a compromised position because of the subprime debt, and their value on the market has dropped consequently. When banks really get into trouble, when there’s talk of selling the company or of the bank failing, consumers start pulling their money out to keep it safe in the event of a bank collapse. After the Great Depression, the government began insuring personal bank accounts at a certain level, but that still hasn’t been enough to instill confidence this time around, as banks fail (Washington Mutual) and are sold off (Wachovia).

Bux Weekend Report February 8

Posted by Bux on July 25th, 2010

Bux Weekend Report February 8 2009

This last week was an exciting one; the market indexes rallied, ending on a strong note with the Dow up 217 points on Friday. The action was so great that the Nasdaq actually closed up for the year. We had a terrible jobs report on Friday which showed that including January, jobless claims rose to 7.6%. The indexes rallied off this news because the loss in jobs wasn’t as bad as some expected; in addition, this Monday Timothy Geithner will discuss what will be done to clean up banks. Wall Street also came to the assumption that the current stimulus package has too much “”pork”" in it and therefore a new one will have to be drafted.

Last week two sectors which I saw on a tear were basic materials, and technology. Copper prices have been seeing some support from Chinese demand due to their stimulus plan and this helped companies such as Freeport McMoRan (FCX), BHP Billiton (BHP), Vale (RIO), Apple (AAPL), and Research In Motion (RIMM), just to name a few. Along with copper, fertilizer stocks such as Potash (POT) and Mosaic (MOS) probably got some support due to an Argentinean drought which is helping to bolster soybean prices.

Devon Energy reported full year earnings of $8.08 per common share. For the fourth quarter they reported a net-loss of $15.42 per share. This loss was because of Devon’s accounting policy which is called full-cost accounting. Their rigs operating in the first quarter of 2009 will be decreasing as there is a glut of natural gas in storage and it needs to be worked off before it makes economical sense to produce more. On Wednesday the stock got hammered and didn’t recover for the week.

For the upcoming week we’ll be seeing what the Stimulus plan will contain and if it can get passed. In addition, some of the economic data coming out will include International Trade on Wednesday, Jobless Claims on Thursday, and Consumer Sentiment on Friday.

This week the markets will likely focus lots of their attention on government and economic data.

That’s all for today folks.

Bux Weekend Report January 25

Posted by Bux on July 22nd, 2010

Bux Weekend Report January 25 2009

Bux Weekend Report will be discussing the previous week and the upcoming week. We’ll look at individual stocks, economic data, and politics. The W.R. will provide indicator information as to where the markets are headed in the near future.

On Friday the markets opened drastically lower than the close on Thursday. At one point, the Dow futures were trading one point below the 52-week low of the Dow at 7,881. Luckily, when the market opened it only reached a low of 7,909 and from there trended higher.

A good performer last week, Potash (POT), a fertilizer maker, reported strong earnings for the quarter and the company expects the back half of 2009 to be strong as well. The turbulence in the credit markets and crop prices volatility is probably the cause of the rebound. Another plus for Potash, grain prices seem to have begun to stabilize.

For the first part of the week oil wasn’t very active. On Thursday the Energy Information Agency released their numbers on crude oil reserves; they rose by 6.1 million barrels–I had to re-check the numbers because at first I didn’t believe it! A number of analysts were expecting an increase of only 2.1 million barrels. It’s an impressive tribute to the value of oil that even with a massive influx of crude oil into the system, and an initial price drop of roughly $3.00, the day prices stabilized and fought back to end the day down only about $0.60.

The investment world likes to focus on news being “”less bad”" than expected or forecasted. For example, if I expect the economy to shrink by 4% but it shrinks by 8% this turns me negative on the economy; however, if the next time GDP is reported and I expect the economy to shrink by 3% but it only drops by 1%, then my expectations are beat. So if I know numbers for a stock or economic data are going to be bad but the number reported beats my expectation, it’s positive. This is one reason the stock market tends to turn positive 6-9 months before the actual economy turns up. Take a second and think about how hysterical that is, but that’s how it works.

Now let’s take a look at earnings for the upcoming week. Earnings season will swing into full gear with big names reporting their numbers. We’ll be seeing earnings from Caterpillar (CAT), Tyson Foods (TSN), Nucor (NUE) and 3M (MMM).

In addition to earnings season, this week showcases the release of some important government data. Existing Home Sales, GDP and the FOMC meeting and a slew of other data will be released throughout the week. People will be paying a lot of attention to these numbers, as the data will help folks judge where the economy is headed.

That’s all for today folks. We’ll continue our market analysis at the end of the week.

Bux Oil Refiners

Posted by Bux on July 19th, 2010

Halfway through the trading day last Friday, January 16th 2009 and the market is down about 88 points. The market opened higher Friday than on the past few days due to good earnings by Cisco and bailout funds reaching Bank of America to the tune of $20 Billion, and $118 Billion in loan exposure insurance.

Despite some initial good news out of Cisco and BofA, the near-term market outlook does not look good for businesses or employees; in total, about 21,000 people were laid off from companies such as Pfizer (PFE), Mosaic (MOS), and Conoco Phillips (COP) on Friday alone. With unemployment rates still climbing, the economy isn’t getting better anytime soon and stock traders are moving money lightly in fairly wild swings.

Crude oil for the week has been down sharply. The International Information Agency said Friday morning that they weren’t expecting demand to pick up until 2010. This announcement has put further downward pressure on oil, which contrary to popular belief, is not good for the markets. Indexes struggle to have an upswing unless the energies–like oil or electricity–or financials move, because they are so heavily weighted on the indexes.

However, forward-looking gas prices could provide us with a bright spot for the markets, though not for the consumer. The last few months have brought gas to levels we haven’t seen in years, with gasoline in some areas under $1, but this could be short-lived. Oil refiners have been cutting capacity aggressively in order to stabilize the precipitous decline in Reformulated Gasoline futures and slowly but surely futures have begun trading higher. In December, oil futures were trading around $.85; today futures are back up to $1.14.

In the past few months, oil drillers and explorers such as Transocean (RIG) and Halliburton (HAL) have taken huge hits because of the drop off in the price of oil. Simple supply-side economics explain that if the costs to drill for oil in your basement are $120, you will only produce oil in your basement if it your payout is above $120. The same idea applies to refiners but the input is the crude oil and the output has to be higher in dollars than the oil is the gasoline and other refined products. From around May to October it wasn’t profitable to produce gasoline because it cost more to make it than they could sell it for. Now we are starting to see a turn in the industry as the supply of gasoline provided by refiners is being decreased as production is being cut.

Refiners make money off of crack-spreads, which is the arbitrage-the buying and selling of the same commodities in different markets–on a barrel (output) of gasoline from a barrel of crude oil (input). I’ve been tracking the refiner Tesoro (TSO), and the company recently released preliminary earnings reports for the fourth quarter 2008. In the reports, Tesoro expected per-share earnings to be between $.60 and $.75, while analysts expected earnings of $.43. The reports also stated that the company’s gross margin per barrel would be between $12.00-$12.50. This means that per barrel of oil used they are making $12.00-$12.50. For the last several months this number has been negative, which was the reason the stock fell from a 52-week high of $43.11 in February of 2008 to a 52-week low of $6.71 in November. It’s definitely a good sign that refiners like Tesoro are expecting to be back in the black.

Keep an eye on the refiners and remember that it’s all about the crack-spread.

Bux to Buy a Home

Posted by Bux on July 16th, 2010

The process of buying a property especially your first property, whether you choose a condo or house, requires due diligence on your part as the buyer. Most buyers begin their searches using the Internet, but that should not be the starting point. The very first thing a buyer needs to do is to get pre-approved by a mortgage lender in order to know how much the bank will allow him or her to borrow. Currently, banks are much more rigid about the requirements a buyer must meet to get approved for a loan.

It is very important to work with a Real Estate Broker after you have identified the town in which you would like to live. A Broker can represent you as a buyer’s agent. This will provide you with someone who has fiduciary duties to the buyer and the buyer alone. Verify that your Broker is a buyer’s agent.

Buy a Home

One of the most important aspects of real estate is, of course, location. You must consider a wide and diverse array of factors when buying in order to make the right decision, including home condition and inventory. If a property needs a great deal of work, you must think of the cost of renovation and updating. The property may be too expensive when you combine the cost renovations with the purchase price.

When you identify a property, visit it at several times during the night and day. Notice the noise and traffic, and learn all you can about the neighborhood. Speak with the neighbors, as this is a major purchase. Look at it carefully.

Along with having a good buyer’s broker, you should hire a good attorney who concentrates only on real estate transactions. If you are a first time buyer, you will likely be purchasing a condo. This means there are condo documents, budgets, and rules and regulations. Your attorney should review these after you propose your offer, but before you sign a Purchase and Sale agreement.

The next step is inspecting the property. The buyer should hire a qualified inspector whom others have recommended. If there the inspection unearths any issues, the terms will be renegotiated through the brokers. Your attorney will incorporate the changes in the Purchase and Sale agreement for you as well.

The buyer should then compare mortgage rates and programs available. Apply on time and adhere to all the dates and deadlines in your Purchase and Sale agreement. The process of making an offer through going to the closing table usually takes about six weeks.

Prior to closing, have a ‘walkthrough’ of your property. You should complete this 24 hours before the closing to ensure that the property is in the same condition as it was when you saw it at the inspection. You should also make sure all appliances, heat/AC, etc. are in working condition. The closing comes next and your attorney will brief you on what to bring.

If you have a great buyer’s agent, mortgage Broker and attorney, your purchase should go smoothly, and each person should do his or her job in a timely manner. The buyer is responsible for checking in with each person along the way, inquiring about the status of your purchase and making sure that each party is meeting his or her deadlines.

Buying a home is one of the best purchases you can make. Other than tax benefits and financial appreciation of your property, there are many intangible benefits as well. You will experience the pure joy of going home to your own place where you can paint, decorate and enjoy your home and the feeling that you have invested in your future, both emotionally and monetarily.

By Tina Sachs Real Estate Specialist

Psychology Money and Spending

Posted by Bux on July 13th, 2010

What do your shopping purchases say about you?

People buy what they need. Or at least, they buy what they think they need. Marketers and advertisers everywhere know that a perceived need will make them money. And people are constantly influenced by the sales messages of those looking to make a few bux. Social psychologists have a term to describe the sort of culture that is motivated by consumerism and expresses their personality through what they buy; an “individualistic society” like ours is ultra-capitalistic and perceived need is more readily influenced. The key to protecting your pocketbook in a society like ours is to reevaluate our needs.

Psychology Money and Spending

It comes as no surprise that we would have to change the way we think about our needs, in order to spare our bank accounts. Although humans were once driven by essential needs-food, water, shelter-we are now driven by what we are conditioned to want. Wants and needs are easily confused. So when making a purchase, you must ask yourself: does this purchase ensure my personal well-being?

Buy things that you will survive to be passed to your children. Don’t buy consumer goods that aren’t serviceable; instead, buy shoes that can be resoled and cars that have readily accessible replacement parts.
By all means don’t count an asset twice. Meaning, if you’re up by $60 because your parents give you birthday money, you can only tell yourself once, “I’m going to buy this $60 item because I’m ahead $60,” or something like, “I’m getting paid $400 next week, so I can spend $400 now…” The same goes with losses – count them once as well; be even-handed in your financial memory.

When you invest in your financial future, (try our free investment calculator) you’re not just calling your broker about the IT stock that just split. You’re also investing when you buy things you need rather than want-taking care of your physical needs will provide for you over and over again when it’s time to plan for your financial needs. You can’t work if you’re sick, tired and hungry. If you find yourself in a situation where someone has something better than what you have, remind yourself of your own needs… There’s a subtly here -we’re not getting back to the ideals of a “individualistic society.” Now, we’re realizing that everyone has an economic capacity, a footprint of what they need. The less you need given your fixed income, the richer you are.

Lastly, money does not translate to power. If you can get someone to go out with you again without having to pay the entire bill, that’s power. If you can get from point A to point B by having someone else give you a ride every day, you’re even more powerful. If you make more than the next person and are spending less money, then you’re rich.

Contributed by Alex Mueller