Wednesday, December 20, 2006

5 Days Until Christmas

I can't believe we only have five days until Christmas. The scary thing is that I've completed roughly 10% of my shopping. I always do this. I wait until the last possible moment and rush to get everyone something. In the end, it always works out.

This year I won't go gift crazy either. This year my family and I have decided to draw names and get gifts for only one adult, the kids are entitled to receive gifts from all the adults. This idea is such a relief because we always end up spending a lot of money, sometimes money we don't have, just to please others.

If your family is large, and money is tight, don't feel obligated to buy gifts for everyone. And remember, spend cash and not credit. If you can't buy it with the money you own, don't get it at all.

Monday, December 18, 2006

A Lesson on Grace Periods

The other day I was at work, at my desk, when I suddenly heard my boss expressing her opinion about one of her credit card companies. They had decided to raise her interest rate since she made a few late payments. She was furious. "How can they raise my rate? There's a 15 day grace period" she uttered. I then asked her, "what do you think grace period is?" She said that grace period was the amount of days late after the due that one could submit a payment without being charged penalties. I tried to explain to her but she just wouldn't hear me.

Hear me now! Grace period isn't the amount of time after a payment is due that you can make the payment. If a payment is due on the 5th, you better make sure that the credit card company receives it on the 5th, and no later. If they receive it later, they have every right to increase your interest rate, charge you a hefty fee, or do what ever else the contract you signed states.

Grace period is number of days between when a credit card bill is sent and when the payment is due without incurring interest charges. Most banks offer credit card holders a 25-day grace period, though some offer more and others fewer days.

My boss isn't the only one who had the definition of grace period mixed up. I asked my mother a few days later if she knew what grace period meant and she told me the exact same thing that my boss said.

When you think of the word grace, you automatically think of exemption, immunity, or forgiveness. Those are all correct, but, you aren't exempt from making your payment on time. You are exempt from accruing interest. Paying a credit card late is the worst thing that you can do when it comes to managing credit card. It only leaves you with a sour taste in your mouth. So next time, make sure you send those payments in on time, before your grace period is over.

Learning About Personal Finance

Hey there, welcome to my blog, Learn Your Finances. My name is J-Rad. Well, that's not really my name, but I would like to remain somewhat anonymous while I post about my personal finances. I am a 24 years old male. I'm currently living in the state of virtue, liberty, and independence. If you guessed New York, Wrong! I live in Pennsylvania. I recently moved here from New York.

I recently graduated from the State University of New York with a Bachelor's degree in Information Systems. Long before I graduated, I had already made my decision to move. Living in New York is simply too expensive. Everything is expensive in that damn city. Yeah, the skyline looks nice, but who gives a ****. I knew that if I stayed in New York, I would forever live paycheck to paycheck.

My Finances

Just like every other college graduate, you probably guessed this already, I'm in terrible financial shape. I'm not in that position because I didn't have any money. I'm in this hole now because of the poor choices I've made in the past with my money. If I could go back, I'd change every single aspect of the way I managed my finances. But this isn't a science fiction blog, and there's no time machine, so I will have to simply learn from my mistakes and start fresh.

I currently have two sources of income. One is my full time job, the other is my part time job/business. I've been working full time for about 2 months now. The job is great. I get to work with computers everyday and help people who have problems with their computers. I couldn't ask for anything better at this point of my life. I wake every morning, and I'm delighted to go to work. Do I want to be a help desk analyst for the rest of my life? Quite simply, NO! But I do believe that I have to start from somewhere, and I know for sure that I can't start at the top. Everyone thinks that because I studied computers in school, I should've landed myself a job that paid $50,000-$100-000, on the first try. You know what, that is the problem with today's graduates. They think that just because they graduate, they are entitled to high paying jobs right out of school. I'm sorry, but things do not work like that.

My second source of income is a website that I started. I started this website almost 4 years ago. The website has been very rewarding. I've made a lot of money from it, but, because of my poor financial judgment, it's as if I never made a dime from it. Coincidentally, the website is about helping people improve their credit. I've learned a lot about personal finance and how to improve one's credit because of my website.

My Debt

Guess what? I'm in debt, and not a few hundreds dollars, I'm talking thousands. I currently have $21,000 in student loans, which does not include interest. If I tack on the interest to my student loans, I would say that I have about $27,000 in student loans. Credit Cards, I currently have about $7,000. I also have a $4,500 loan for my Dodge Durango. So all together, we're looking at about $40,000 in debt. Not bad for a recent graduate, huh? I love America.

Why Blog?

I'm blogging because I want to track my progress. My goal is eliminate as much debt as I could, and start saving money. I also wanted to jump on the "Personal Finance Blog" wagon. Not that I'm a natural follower, I just think that it's good that people are using the 'net to help each other out. In this journey, I will learn as much as I can about personal finance from a plethora of sources, and hopefully, you will learn about some of it, too, from me.

There are a couple of blogs out there that I read, including and I like Ramit's blog because I've learned a lot from him. I like Nev's blog because he's not afraid to try new things. He has a business, and is always looking for new ways to create income.

My Plan

I plan reducing my overall debt by doing the subtle things like eating out less, buying things I really need, instead of buying things that I want. A good example is the TV I just bought. I really didn't need a new TV, but the deal was too good to be true, so forked over the $1,000, on credit by the way, and bought the TV. Don't get me wrong, I love the TV, but, I really didn't need it. I also plan on not using ANY credit during 2007. If I can't afford it with money that I actually have and own, then I'm not meant to have it. I will only use credit in dire situations like unexpected emergencies, and that's only if I don't have the cash to pay for it up front.

I will also stop, or at least curtail my spending habits. In 2006 alone, I've spent hundreds of dollars eating out, buying gas, partying at bars, etc. Just basically wasting money. If I can find ways to save a few dollars here and there, I will save a lot when it's all added up.

If you have any questions or comments, feel free to send me an email or post a comment.