Welcome to the March 2, 2009 edition of Kids and Money. It’s been a while since our last carnival, so this is a BIG ONE. I’ve tried to put the submissions into logical blocks for easier reading.
jim presents Ten Recession-Busting Money Tips for Young Professionals posted at Blueprint for Financial Prosperity.
Silicon Valley Blogger presents Lower Your Car Insurance Rates! How To Cut Insurance Premiums In Half posted at The Digerati Life, saying, “If you’ve got kids, driving safely and carefully is a must. And doing so will most likely lower your car insurance rates as well.”
Annette Berlin presents Printable Toys For Pre-Teens posted at Craft Stew, saying, “Older children get tired of toys fast. Rather than spending a small fortune to keep them constantly satisfied, let them create their own playthings from cardstock and a printer.”
Brian McKay presents CD Rates posted at MonitorBankRates.com, saying, “Finding a decent rate on a certificate of deposit account these days isn’t an easy thing to do. CD rates have been coming down so fast recently the average 12 month CD rate is nearing just 2.00%.”
The Shark Investor presents Strategies For Raising Funds: Borrow Your Way To Wealth posted at The Shark Investor, saying, “How and when to use loans for investing”
Len Penzo presents Using a Ledger to Teach Kids Money Management posted at Len Penzo . Com, saying, “Even kids as young as 6-years old can learn personal finance management skills via this simple bookkeeping plan.”
Jacquelyn presents The Wise Parent & Child Money Guide posted at WParent.com – Wise Parenting Guide, saying, “Give your child an introduction to the subject of money by reading this article together. This will give your child a general idea about money.”
Silicon Valley Blogger presents Best Cash Back Credit Cards: Your Rewards For Spending posted at The Digerati Life, saying, “Thank you!”
Finance Tips 101 presents Drowning In Debt? Bad Credit Loans May Need To Be Considered! posted at Finance Tips 101.
Astrid Lee presents Suze Orman posted at World Healing, saying, “Article on advice by Suze Orman, the popular TV adviser on personal finance and about how get out of debt. Article also contains video show where she talks about how to determine how much to give to charities…”
Finance Tips 101 presents Scholarship And Grant Information For Interested High School Graduates posted at Finance Tips 101.
The Smarter Wallet presents Student Loan Programs To Pay For My College Tuition Costs posted at The Smarter Wallet, saying, “Thanks!”
OnlineCollege presents Choosing a College: A Simple Guide for Undergraduates posted at Universities and Colleges.
Preparing for Baby
Madison presents Our Family is Expanding… Financial Resources for Babies posted at My Dollar Plan.
The Smarter Wallet presents Will The Obama Economic Stimulus Check and 2009 Stimulus Plan Save The Economy? posted at The Smarter Wallet, saying, “How will your family be affected by the stimulus bill?”
Brian McKay presents What’s in the Stimulus Bill for You? posted at MonitorBankRates.com, saying, “We have listed all the benefits for individuals in President Obama’s stimulus bill that was just passed.”
Ella Moss presents New Economy, or Buy American, Stupid! « Zodiac Times posted at Zodiac Times, saying, “So, the new stimulus package is passed, hopes are up, markets are down, and recession deepens. Everyone is blaming the housing market, unscrupulous bankers and inept previous administration. But very few seem to understand the true roots of our woes, and how deep our economic problems go.”
Money Tipper presents Bring Proof of Age When Flying With Young Children posted at Money Tipper.
Finance Tips 101 presents Alarming Identity Theft Statistics Are Cause For Concern posted at Finance Tips 101.
That concludes this edition. Submit your blog article to the next edition of Kids and Money using our carnival submission form.
Past posts and future hosts can be found on our blog carnival index page.
With all the talk about the souring economy, job losses, bank failures, and the like, the recession of 2009 is on the minds of everyone.
But I’d like to posit that we never fully recovered from the recession that officially spanned 2001-2002. And that, my friends, puts us into a possible discussion of Great Depression proportions!
Now, before you run off and withdraw all your money from the bank and bury it in your back yard, hear me out!
Typically, after a recession, jobs, sales, and revenues (as well as profits) rise, most often quite rapidly.
Didn’t happen last time.
Here’s a picture to illustrate what I’m trying to describe. The red arrows represent the year of the respective recession. See how unemployment rises after a recession, then drops until the next one, from 1991 to 2001? And see how the unemployment rate dropped below the rate during the year of the previous recession? That is the typical behavior of the labor market. But look at what happened from 2001 on.
Now, I’m not saying we’re in another depression. But we’re approaching Great Depression longevity, if not to the same depths. The Great Depression started in 1929, the economy made a few attempts at reviving itself, and then WWII came along. America wasn’t fully involved in war preparations until 1941. So we’re talking 12 years, at the most.
For this last round of economic downturns, the duration has been 9 years. We’re getting there.
Of course, we’ve yet to see 25 percent unemployment. But also remember that we fudge the numbers nowadays, and there’s a different sort of mindset for what constitutes “employment.” In the 30s, if you didn’t have a full-time job, you were unemployed.
Now, if you’re no longer looking for work, you’re not even counted. Perhaps you’ve been out of a job for 3 years, got fed up, and started selling all your worldly possessions on eBay. You’re no longer “unemployed.” This set of circumstances didn’t exist in the ’30s.
So, I’d say that whatever level of unemployment you see today, raise it by 30 to 50 percent. Yeah, I think it’s that bad. But even at an official 8 percent, we’re no higher than 12 percent. Not that that’s a good thing. But it’s not 25 percent, either.
However, for some pockets of America, where there’s 12 or 13 percent unemployment (take San Joaquin County, California, for example, where home foreclosures are at all-time highs), that figure could easily be over 18 percent. I submit to you that those folks feel like they’re living in a depression! If you don’t believe me, ask them!!!
One last thing: If we hadn’t spent $1 trillion on a war (or something else, for that matter), the economic picture during the 2000s would be even bleaker.
I said all that to say this: We got out of the last depression and we’ll get out of this one (whether you believe it’s a recession or depression).
But our way of life may have to change and that in itself may be the most uncomfortable part of it all.
Jobs you would have never considered before…you may now consider. Wages you hadn’t thought about since high school…you may now reconsider. Hours you thought were only for hookers and security guards…they may be under consideration!
Things “I cannot live without” – you may have to live without them (like computers, cell phones, video games, cable, the list is endless).
All of this will break up some families and ruin lives of countless people. But the silver lining is that dire situations may bring us closer, may give us thought for conserving what he have, and give us a greater appreciation for all those things “I cannot live without” once we get some of them back.
It’s a bitter pill to swallow. But swallow it we must.
One last thought: There may never be a better time to go out on your own. Consider starting your own business. The Internet being what it is, with low overhead costs, fast deployment capabilities, and only your own mental limitations (“I can’t do it,” “I don’t have time,” “I am not that smart” among thousand of other excuses), the sky literally is the limit to your income potential.
It may not come fast, but it will come. And in the end, you’ll have more time, more money, and less stress. Get some ideas here. No pressure, no strings.
Money isn’t everything. It’s the only thing. Wait. That’s only for football.
Enjoy life. Spend time with your family.
Yeah, this is a big post. I haven’t written anything substantial in a while. As you may know, if you’re a subscriber or frequent reader, I work for a company that’s been — ahem — “acquired” and I’m going to be looking for a new job real soon. I could lament about the fact that it’s the 4th quarter, nobody’s hiring, the holidays are near, nobody’s hiring, I’m a single-income family, soon to be zero-income family, nobody’s hiring…but…
You didn’t come here for that!
You, like me and thousands of others, either are looking for new jobs or soon will be. The economy tanking, the government doing its best impersonation of Sergeant Schultz (“I see nuuuthing!!!”), and companies increasingly getting by with less have all lead to higher numbers of unemployed, and an almost-never-uttered underemployed. That is to say, there are thousands, maybe millions, of people who have full-time jobs that don’t pay much or they have several part-time jobs that — again — don’t pay well. In any event, neither group is making ends meet nor are they counted amongst the unemployed (if you’re not looking for a job, you don’t count).
This post will cover three ways of earning an income. Mix and match, go solo, or do all three — it’s completely up to you. There’s the “traditional” way, the “alternative” way, and the “passive” way. First, the traditional way. But with some unconventional twists.
Most of us want a “job” where we trade our time and knowledge (otherwise known as “work”) for money. We produce a product, sell a service, build a bridge, write a book, etc., all in return for a paycheck that either comes once a week, twice a month, or once a month.
Millions of people — the majority, in fact — who consider themselves “employed” (as opposed to unemployed or self-employed) have jobs. It’s supposed to be — and usually is — a symbiotic relationship, in that both the employer and employee gain something from the relationship.
I’ve had lots of jobs. Too many in fact! If there’s one thing I know how to do, it’s how to get a job! And I’ve had many different kinds of jobs. Here’s a short list:
(not in chronological order)
With each job, save for one, I boosted my income considerably from one job to the next. However, that one set back killed my income growth for 3-4 years!
Nevertheless, here’s what you need to do to get a job. It’s a long list. The short list will come later.
The short list:
Nearly every good job I got through knowing the right people. I’d like to think that I got the interview because I had a good recommendation but that I got the job because I deserved it. Maybe. Maybe not. But whatever the case, knowing people and interacting with them bears fruit!
This post is tied to several posts (Learning to Earn, Part 1 of … Many?, Ten Commandments of Personal Finance, 7 Things You Must Do Financially) I wrote a long time ago about alternative income. You’ll find “alternative income” all over the Personal Finance blogs; I implore you to read these articles first, and then come back. I’ll wait.
(Tapping toes. Joyously waiting for your return. Here are a few more from very reputable sources.)
The short story is that there are literally hundreds of alternatives to the traditional job. They all require that you start your own business, or at least require that you earn money outside the typical employer/employee relationship. Here’s a short list of alternative income ideas:
So-called passive income is derived from doing as little as possible. The classic case is income from investments, such as interest and dividends. Wealthy people can afford not to work because they have assets throwing off income. Generally, this comes in the form of cash dividends from stock investments and interest from bond investments. You, of course, probably don’t have this luxury. That is to say, if you had assets like this, you wouldn’t be reading a blog about how to make money (you already have).
But there something to be said about this, from an asset perspective. In any income-generating endeavor, whether it is from working for somebody else, generating affiliate income, or building your own business, all the income you derive comes from an asset. Your ability to labor is an asset. Your ingenuity is an asset. Your capital is an asset.
Strive to make as much as possible of what you own a performing asset. If you’re at home sitting around watching TV, you’re wasting an income-generating asset (your intellect, or your ability to create something). If you’re delivering pizzas, you’re using your car (an asset) to generate income. If you buy a new gadget like an iPod, ask yourself if it can generate any income. If it can’t, think twice twelve times about buying it. See?
For most of us, it’s our time that is our most valuable asset. Time is finite, too. We only have so much of it. But we can turn that thinking on its head and instead of trading time for money, we can use an asset to produce an income. Think about that a bit.
When you think in these terms, your future becomes limitless. Time doesn’t matter any more. It’s what you do in the time you have that determines whether you earn a generous income or not.
I hope that I’ve given you some food for thought. To summarize, most of us just want a fair wage for the time we put in. That’s perfectly acceptable. However, I think I’ve given you some ideas about how to generate more than just a trade of your time for money. You can certainly enhance your monthly take-home pay by incorporating alternative and passive revenue streams into the mix.
Money isn’t everything. It’s the only thing. Wait. That’s only for football.
Enjoy life. Spend time with your family.
I don’t budget. Do you? For those of us in the middle, here’s a great shortcut method to budgeting: Budgeting for Lazy People.
Here’s the even shorter story: Earn more than you spend.
Falling short every month? Get a better-paying job or work on alternative income streams. Here are some posts from Moolanomy about creating income streams.
Remember, you can only cut out so much. Once you’ve canned cable, stopped eating out, and dropped the cell phone plan and switched to Vonage, what’s left: Health insurance, 401k contributions, and food. None of these are good options to cut.
Prime Time Money tagged me with the challenge to “Find one step you can take to make your financial system better or more organized.”
Being the philosopher I am, I turn to Confucius, who is rumored to have said (did I tell you I’m a skeptic, a cynic, and sarcastic?)
My single step was buying a little software program in the late 80s (I was still a kid! Really, I was) called Managing Your Money which led me to the inspiration and contributor to the software, Andrew Tobias. I found out that Tobias was a personal finance author (what are those? You mean there were experts before blogging?); one of his books was humorously called “The Only Investment Guide You’ll Ever Need.”
In this book, I can truly say that I learned at least 95 percent of what I know today about personal finance, investing, banking, and saving money. I also learned 100 percent of what I know about wine (which is still very little, by the way).
Tobias is an advocate of index fund investing, buying in bulk (he provides the ROI calculations, too), yet only investing money that you can truly afford to lose.
And he’s lost a lot! He’s lost his shirt in Broadway and off-Broadway plays, futures and options, commodities of all sorts, real estate, collectibles, and limited partnerships in oil and gas. You name it, he’s invested in it, and he’s lost money in it.
He goes through the various ways he’s lost money to illustrate the idea that you just cannot win in the investing game by going for broke and paying tons of fees. The experts in commodities, for example, will always clean your clock. These speculative “investments” are zero sum games: One guy wins, you lose.
Contrast this with the stock market, where one man’s gain isn’t necessarily another man’s loss. We can all win; or, in other words, a rising sea lifts all boats. The stock market, even though it’s sucky now (financial term for “underperforming”), is your best bet for long-term growth of your money.
I still follow Andrew Tobias. Though he talks a lot of politics on his site, the focus still is on financial planning, frugality, and investing. He’s funny, witty, and smart.
So that was my first step:
Finding somebody to follow.
Many choose “gurus” like Dave Ramsey, Jim Cramer, or Ric Edelman. I found Andrew Tobias. It’s been a great find!
Now, whom shall I tag?
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