Monthly Archives: March 2013

How to Succeed as The Family’s CEO

One of my goals for My Financial Reviews is to highlight personal finance blogs and sites that I think can help you with your finances. This week Julie from The Family CEO. 

When and why did you start The Family CEO?family ceo blog interview

I started The Family CEO in 2006 when I was a stay-at-home mom looking for a way to contribute to our family’s finance. It occurred to me that if I hired myself to improve our family finances, through finding savings and focusing on debt reduction, the result could be the equivalent of taking a part-time job. The Family CEO was started to document my efforts.

You cover a lot of different topics on your site like house & home, found money, and simplifying. Which topic is your favorite? Which topic do you feel like you could work on a bit more?

I love decorating and homemaking and feel that those topics add a little personality to the blog, but I consider the  Found Money concept to be the core of what The Family CEO is about. Found Money has served us so well in first paying down debt, and now building savings.

I feel like the blog has a pretty good balance, so I wouldn’t say that there’s anything I want to work on more.

How do you handle your own finances? What system do you employ with: budgets, investing, and career?

I love to make budgets (I’m a big numbers nerd) but I hate following them, which is why I use things like Found Money as an alternative to budgeting. I track all of our income and expenses in Quicken, so I can keep an eye on where we are putting our money and make adjustments when necessary to make sure that our spending matches our priorities.

Our investing is done mainly through dollar cost averaging into no load/low fee mutual funds. Although I did buy five dividend stocks last year and am enjoying tracking them. I blogged about that experience and update it periodically.

What’s the biggest financial mistake you’ve ever made? What did you learn from it?

family CEO julie

Our biggest mistake, without doubt, was not being debt adverse enough. We were never in trouble with debt – we made all our payments on time and had excellent credit scores – but the amount of debt we allowed ourselves to have really limited our options.

Now we’ve turned that situation around we’re making up for lost time. The lesson is that it’s much more fun to use your income to build wealth instead of qualify for payments.

What are your goals this year and beyond with The Family CEO?

My main goal is always to continue to grow The Family CEO’s readership. I also have several ideas for ebooks and I’d like to complete my first one this year.

Thanks again to Julie for taking time  for this interview! Check her out on The Family CEO and also on Twitter.

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How Ordinary People Paid Off Over $1 Million in Debt

ben edwards jeff rose get out of debt

Are you looking at ways to speed up your debt free project? Would you like to find ways to get extra money to throw into your debt snowball? I finished reading Debt Heroes from Ben Edwards and Jeff Rose on Amazon and it’s a great read. The book’s release is a part of The Debt Movement. In case you missed my previous post about it,  Good Financial Cents and partners like Ready for Zero have teamed up for a massive project – they’re hoping to get $10 million dollars of debt paid off in 90 days.

The book’s goal is to help you get rid of your debt faster with Ben and Jeff sharing several real life success stories to inspire to achieve your dreams. Before I dive into what’s inside, I like to share some basics of the book.

Basic Book Info ben edwards jeff rose get out of debt

Ok, I usually don’t focus on price since I believe purchases should be based on their value, but this is a STEAL at 99 cents. I have no idea how long this will last, but if you’re sick and tired of being in debt and want to read something to not just motivate you, but get you started on becoming debt free.

Why Do We Need Debt Heroes?

What exactly is a debt hero? According to Edwards and Rose, what makes a person a debt hero is:

  • he/she have paid a huge amount of debt
  • shared their story with others
  • seek to encourage others on their own journey to become debt free

They whittled down the list to 21 people who paid off over $1.7 million in debt. That’s right almost $2 million dollars was earn and saved by these ordinary people and used to get themselves debt free.

Why do we need debt heroes? Don’t we have enough personal finance blogs, sites, and gurus to give us the tactics on how to get out of debt. I think that what this books does better than many money books out there is that it give stories us stories to motivate us into getting things done.  Honestly, simply having that information alone doesn’t help many people.

Many people get into debt, not from lack of financial knowledge (99% of us know to spend less than we earn), but they get into habits and behaviors which sabotage their finances. Presenting cases so that people can identify with others who had the same struggle can be incredible powerful. That’s what I see as the book’s biggest strength.

Destroying Debt with Ordinary Income

That said, if  you’re looking for practical ways to find way money in your budget to get rid of your debt, Debt Heroes cover that and more. The heroes shared exactly what worked (and what didn’t) for them and why. Stepping back and looking at the big picture, ReadyforZero found that there were certain factors among users who paid off an extraordinary debt had in common. They had:

  • A Support Network
  • Keep Tabs on their Progress
  • Adjusted Their Habits
  • Focused on Positive Progress
  • Removed Temptations

Ben and Jeff’s book breaks down why these factors are vital and how you can include them in your own life. I think Debt Heroes is a great book for those looking to finally get rid of their debts and build their finances quickly. For less than a dollar, you can have an incredibly helpful tool in your pocket that you can use in your journey to become debt free.

Thoughts on Getting Out of Debt

What tips do you have on keeping your finances in check? What is your strategy for paying off debt? By the way, if you’d like use ReadyforZero to speed up your debt free journey, you can sign up for a free account with them today.

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How You Can Afford Anything

One of my goals for My Financial Reviews is to highlight personal finance blogs and sites that I think can help you with your finances. This week I want to introduce you to Paula from Afford Anything. 

She is the former deputy news editor of a daily newspaper in Colorado, where her work won awards from the Society of Professional Journalists, and her writing is now featured on personal finance web­sites such as MSN Money’s Smart Spending blog and the Motley Fool Blog Network.

When and why did you start Afford Anything?

In 2008, I quit my job, sold my stuff, and traveled across the Middle East, Asia, Europe and Australia/New Zealand for a little more than 2 years.

The most common reaction that I got from my friends was, “Wow, I’d love to do that but I can’t afford it.” That blew my mind. I had earned an entry-level news reporter’s salary (e.g. almost nothing!) and I managed to afford it, thanks to relentless prioritization.

I started Afford Anything to show people that they can, in fact, afford anything.

You cover a lot of different topics on your site like Money Myths and Travel. Which topic is your favorite to write on? Which topic do you feel like you could work on a bit more?

afford anything

When I started the site, most of my posts covered travel and lifestyle design. I’m location independent, which means I can live anywhere on earth as long as I have an Internet connection. I make my own hours and write my own rules. Many of my initial posts covered entrepreneurship, freedom, travel and risk-taking.

In the two years since I returned to the U.S. and started the site, however, I’ve developed a new hobby: buying rental properties. My partner and I co-own 5 rental units, which bring us about $25,000 in passive income each year.

Many of my recent posts have talked about rental property investing, and these days I have to restrain myself away from writing too much about that topic. I don’t want to develop a reputation as a “real estate” writer … I want to more broadly focus on lifestyle, entrepreneurship and wealth!

How do you handle your own finances? What system do you employ with: budgets, investing, and career?

I believe in the Anti-Budget: remove your desired savings amount off the top. Spend the rest. That’s far easier than line-iteming every grocery store purchase.

Last year my boyfriend and I saved roughly 50 percent of our combined income. We’ll be “wealthy” when our passive income is around $50,000, the median household income in America. We’re halfway there, but surprisingly, it seems to be getting harder with time, not easier. There aren’t as many great real estate deals as there were in 2010!

What’s the biggest financial mistake you’ve ever made? What did you learn from it?

Buying into social myths like “Rich people are careless with money” (they’re not) and “I’d rather be happy than rich” (who says they’re contradictory?)

My worst mistake, though, was probably being too frugal. The more time and energy I spent penny-pinching, the less I was able to progress in my career and my investments. The best thing I ever did, financially, was to become frugal with time rather than money.

What are your goals this year and beyond with Afford Anything?

Build a tribe. Start a movement. I want people to see what’s possible. Focus on abundance. Think big. Realize their life is too short for coupon-clipping and penny-pinching. There are (literal) mountains to conquer, companies to launch, books to write, art to create, oceans to sail and people to love.

Thanks again to Paula for taking time  for this interview! Check her out Afford Anything and also on Twitter.

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Building Home Equity Quickly

paying mortgage early on home

One of our goals before we retire is have the mortgage paid off. We originally got a 30 year fixed rate loan a few years ago when the townhouse was built.

When we started our regular monthly payments we sent in an extra payment towards the principal. The goal had been to get our home equity built up as quickly as possible. I thought it would be nice to do a quick review to see how far we came in the last 3 years.

Housing prices are fairly steady now after the drop from last year. For now I’m calculating equity based on the purchase price (which is fairly close to its recent sales in the neighborhood) minus the current balance.

For those tracking all of the numbers, it comes out to: paying mortgage early on home

  • Original Mortgage: $123,239
  • Current Balance: $102,683

That means right now our equity is about $20,556. Not bad, but we’re hoping to get this lowered so we can have 20% equity and hopefully get that mortgage insurance premium knocked off.

Saving Money and Time By Paying The Mortgage Off Early

Paying extra has also given us a few other benefits, including saving tens of thousands of dollars in interest saved with the accelerated schedule. Following the mortgage amoritization schedule, most of the money goes towards paying interest in the beginning of your loan.

As the mortgages draw to a close, the payments increasingly goes towards the principle owed. Extra payments gets us past the earlier portion of the mortgage and more of that money is applied to the principal.

Paying down the mortgage quickly is also about our own peace of mind. We also don’t want to limit our cash flow for the full 30 years by carrying our mortgage the full length.

Building Home Equity

How are you doing with your home equity? What kind of mortgage did you get and why? How much equity to you have right now? Do you plan on paying off your mortgage early?

Photo Credit: woodleywonderworks

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