When I was young, I often accompanied my father to work on air conditioning units. He specialized in all things HVAC (heating, ventilation, and air conditioning). Sometimes I found that the customers wouldn't pay him. Once I asked why, and he explained that they simply repaid him with goods or services of their own. Never once has anyone in my family paid for a car repair because of deals like this that he has in place. Growing up I enjoyed the spoils of bartering in ways you couldn't imagine. We got baked goods as we pleased, and I ate like a king. When I left home to face the outside world, I took these lessons of bartering with me.

Figure out what you got.
Before you begin, you should understand what skill you have to barter. One of the most marketable skills in a barter economy is mechanical skills. Think about whatever capabilities you have and make a list. Make sure people need it. The skills I usually try to barter include content writing for websites, article and essay editing, English language tutoring, Mandarin to English translation, and HVAC work that I do with my father (I'm not yet skilled enough to do it myself). Once you know what you have to offer, you can use these skills to pay for things when you need them.

Know your worth.
Place a dollar value on what you're bartering. Research the value of a good or service you plan to exchange. It's important to take into account your experience and knowledge. I do translation for an auto parts company where my friend works. Once I needed new tires for my car. When the factory sent me a new document from China to translate, I calculated the value of my work and deemed it to be roughly the value of three new tires. When I asked for a full set of four tires instead of a check, the manager agreed. It probably saved us both money.

Understand that what you can barter is endless.
Cash may still run the economy, but anything can be bartered. And it's coming back in a big way because it can be mutually beneficial at times when people and businesses are financially strapped. I know two friends that live together. One works at an airline and the other at a finance company. The one that works at an airline uses buddy passes to pay for part of his rent. It's a win-win for both. My father recently fixed the heating unit in a restaurant. The boss paid him in gift certificates to the restaurant that roughly tripled the dollar amount he should have received. Even things that don't cost much can be bartered. Be creative and think outside the box. Who knows? Maybe you'll be trading dog grooms for oil changes. The possibilities are endless.

Look everywhere.
Friends, neighbors, classmates, family, and strangers are all possible partners. I personally like to keep my exchanges to friends and family but have used online marketplaces to trade various goods and services. One of my favorite swaps to do online is language exchange. That's one of the ways I learned Chinese and is currently how I am learning Vietnamese. Think about what you need and where you can find it. If you can find it within your local social network, go with that. If you can't, the wild and large world of the internet awaits. Dive in!

A word about online bartering.
Currently, several legitimate bartering places exist online. Obviously Craigslist is one of these, but one I really like is U-Exchange, a site where you can exchange services with other local people. BarterQuest.com and Swap.com are two I enjoy using if I need a particular good and want to pay with something I don't need anymore. Recently, I was able to get Microsoft Office Software in exchange for an old marketing textbook on Barter Quest. A good way to know you have a solid deal on these sites is to look at pictures of the products being offered and talk with the person offering them first. See what other people on the site are saying about that member and spend some time looking at that person's profile. Also, ask questions to verify that a particular person can actually offer the goods or services being promoted. If possible, sign a bartering contract as well.

Photo by Irina Slutsky via cc. Image was cropped.

 

A payday loan is marketed as an advance on your paycheck -- it's a short-term loan (around two weeks) that typically ranges from $50 to $500, plus a fee.

I know what you're thinking…that doesn't seem so bad. So, what's to fear? I worked for a payday lender right after I graduated college. Sure, many people were able to get a loan, pay it off right away, and be on their way. Unfortunately, I witnessed many others who experienced the negative effects of payday loans.

  1. They Have Incredibly High Rates
    If you're anything like me, the phrase "interest rate" doesn't really sink in until you see how much you're paying. So let's say you take out a payday loan for $100, with a $15 fee. It may seem like a small amount, but that is roughly equivalent to an Annual Percentage Rate of 391%! According to a 2012 Pew Charitable Trust survey, Payday Lending in America, the average payday loan borrower spends $520 a year on interest.
     
  2. It Can Be a Vicious Cycle
    I rarely saw new faces when I worked for a payday lender. Payday loans are marketed for short-term use only, but an estimated 69% of borrowers use them for recurring bills, like utilities or rent. 

    Payday lenders make money by getting you to come back. As an employee, I was trained to actively encourage "rollovers," where you pay back your loan and immediately get another one. In fact, the average payday borrower has a loan out for five months out of the year -- so much for a quick fix!

  3. Lenders Have Access to Your Accounts
    By taking out a payday loan, you give out your checking account information and the permission for the lender to take out the loan and fee amount. I can't stress enough how important it is that you truly can pay it back right away.

    Payday lenders will deposit your check every payday in an attempt to hurry and get the funds. So imagine already dealing with the stress of money issues, only to wake up and check your account to find the payday lender beat you to your paycheck that was direct deposited.
     

  4. They Can Negatively Affect Your Credit
    In my experience, payday employees are trained to aggressively attempt to collect. In fact, I have witnessed employees stopping by past due borrowers' homes or places of employment in an attempt to make contact. And they are often quick to charge off the debt and report you to credit agencies rather than working with you at all.

Payday loans don't solve your financial problems. Act in good faith and reach out to your creditors at the first sign of financial difficulty. Once you're on your feet, set aside small sums of money (like the amount of payday loan fee) into savings so you'll have a buffer. If you absolutely need a loan, a not-for-profit credit union is generally your best bet.

Photo by Taber Andrew Bain via cc. Image was cropped.

When I first left my parents' home roughly six years ago, I truly became aware of the cost of groceries. Possibly because I am tighter than a coat of paint when it comes to certain things, but a few pricey grocery shopping experiences shortly after moving out made me change my food buying ways. After all, I had to make rent. And I had to pay for college.

Rice is a Good Friend to Have
A little rice goes a long way. Or at least that's what I say. Even at $15 to $25 for a huge fourteen pound bag, rice is a substantially cheap way to feed yourself. Through cooking research and by diving into various cuisines, egg fried rice, meats and veggies over rice, and Mexican burritos are now a big component of my home meals. When I'm on the go, hot sauce and rice makes a fine snack to hold me over. Rice gets you full while giving you nutrition. I never used to eat it. Now I see it as an economical option that is both healthy and tasty.

Stay Away from Convenience Stores
Why? Because they aren't so convenient on your wallet. After moving out of my parents' home, I was hungry for cereal my second night in my new apartment, so I drove to a local convenience store to pick up milk and some kind of cereal. "That will be $9.19," the cashier told me. Those words hit me like bird poop splattering on your car windshield. That was more than I made in an hour.

Keep It Fresh and Do the Cooking Yourself
I used to make the mistake of using coupons to purchase things like pre-packaged green beans. Don't do this. I later found that loose and fresh green beans are cheaper by well over one dollar a pound. Coupons are rarely for fresh fruits and vegetables, which are less money than frozen packaged items. Even those quick microvable meals are not as cheap as making something similar yourself. Cut up your own veggies and cook your meals rather than purchasing premade stuff. It will save your body and your wallet.

Only Buy What You Absolutely Need in Bulk
I remember buying about six loaves of bread at the great price of 88 cents a loaf. Never will I do that again. I simply let the façade of big savings get in the way of my actual bread eating capabilities. By the time I ate halfway through that batch, which took about two weeks, the bread had developed a mold and stench bad enough to drive the mice out of my house. I ended up wasting three of the loaves. While the benefit of driving mice away with moldy bread may tempt, it's probably best to only get items you absolutely need in bulk. I tend to keep it to rice, meats--because you can freeze those--and vegetable oil.

Mission Shop
Your shopping mentality can save you money. I abide to my list as if I would get a hand chopped off for disobeying it. And you should too. Don't get sidetracked by seductive bags of chips you didn't even come to the store to get. Get in. Get what you came to get. And get out.

Photo by Matt McGillivray via cc. Image was cropped. 

Track spending to the dime, browse your investment portfolio and save for that trip to Europe, all while standing in line at the post office. Hundreds of finance apps on the market today turn your smartphone into a powerful financial tool, ideal for seizing control of your bottom line. Here's a sampling of some apps you'll love.

  1. The all around app. Intuit's Mint Personal Finance (free on Android, iOS) is a full-featured, powerhouse of an app. The app uses 128-bit encryption to link bank accounts and investment portfolios, making tracking, spending, saving and budgeting seamless, fast and safe.
  2. The app for saving. According to SavedPlus (free on Android, iOS) stats, customers who use their app save an average of $350 per month. The idea is simple: SavedPlus siphons off a small percentage of every purchase, depositing it into a savings or retirement account. Users can set individual savings goals and watch those dollars add up every time they swipe their card.
  3. The visual app. Budgeting is not usually entertaining; but Toshl Finance (free on Android, iOS) does its best to make it so. The software offers fun spending visualizations, helpful reminders and powerful budgeting tools.
  4. The family friendly app. For families that operate on a single budget, HomeBudget ($5.99 on Android, $4.99 on iOS) is a great option. The app has a robust budgeting tool with category customization and expense tracking. And best of all, it allows multiple family members to input data from different devices in real time.
  5. The app for the business traveler. For anyone facing the prospect of a post-travel expense report, Expensify (free on Andriod, iOS) is a must-have. The app effortlessly tracks receipts, and time and mileage while outputting. As the app's creators put it --Expensify creates "expense reports that don't suck."
     
  6. The cash flow meter. Level Money (free on iOS) automatically connects to users' bank accounts to track expenses and income. Users get an up-to-date picture of what they can spend on any given day, week, or month based on their savings goals.
     
  7. The financial prognosticator. Any app can tell users what they have in their accounts right now. DollarBird ($1.99 on iOS) goes that extra step and uses spending history to predict what users will have in their account tomorrow, next week and next month.
  8. The interface app. CoinKeeper ($5.99 on iOS, free on Android) boasts the fastest transaction interface on the market. An innovative drag-and-drop system helps users track spending and monitor their budgets without cumbersome inputting.
  9. The full-featured. MoneyWiz ($4.99 for iOS) is definitely among the most robust finance tools out there with 300-plus features and syncing across all (Apple) platforms. The desktop version will set you back another $24.99. But for those that need something more powerful, this is a great option. Android and Windows versions are coming soon.
     
  10. The app for bill paying. Late bills wreak havoc on a credit score. Don't miss a payment ever again with Manilla (free on Android, iOS). The app consolidates household expenses, stores bills and statements, and offers custom alerts to keep users on top of their spending.

Photo by Vernon Chan via cc

 

Just completed a job on the side, got paid for it, and liked it? Congratulations! You are now a freelancer.

Want to do it again? Even better news -- freelancing is a viable and trending way to regularly supplement your current income, fill in gaps between jobs, or make a living full-time.

Working for yourself can be liberating, but take it from someone who's been and happily stays there, navigating your way around can be tricky. Make your experience a positive one by:

  • Testing the waters. Personal satisfaction is great, but we all have bills to pay and responsibilities to uphold. If you're considering freelancing, start picking up jobs on the side before you quit your day job. There's a solid chance you may find that something you love simply isn't as much fun when it becomes your work. You could discover that you aren't willing to give up the expensive habits that your current job supports, or that you need to bulk up your savings account before you make a big change. You might learn that you need more time to develop the discipline required to freelance successfully. If you dip your toe in the waters, these are simply lessons you learn and file away; if you dive in, these can become the things that sink you.
  • Analyzing the cost of living in your area. "Freelance" is not always synonymous with telecommuting, but the term is generally applied to workers who do their thing off-site. If you are seriously considering making freelance work all or a substantial part of your income, start paying close attention to the cost of living in your area. If you live on the east or west coasts, or in a major city, you may need to move to make freelancing a viable way to earn a living. Remember, now you can work from anywhere.
  • Getting smart on tax implications. When you are the boss, you are also the record keeper and chief accountant. If you earn more than $600 from a single source, or $400 from self-employment, the IRS wants to know about it. Freelancers are also responsible for their own social security, medicare, and other costs typically covered by an employer. Becoming an LLC or filing for "doing business as" can enhance your credibility, but carries its own tax implications. Consult a tax expert to discuss the best way to transition to a freelance career, and what records you need to keep to stay out of the audit crosshairs. My advice? Keep everything, then make copies.

Finally, remember that elephants are eaten one bite at a time. Freelancing is hard. The market is increasingly competitive, the hours are long, and the work is erratic, especially in the beginning. Build up your savings, take a deep breath, and do a happy dance for each and every client you earn. Work fast, provide a good product, cultivate a respectful demeanor, and the jobs will come. You are your own boss now, and that takes a lot of faith.

Photo by Eleaf via cc. Image was cropped. 

 

For decades, the only type of mutual fund that you could buy was a traditional, open-end fund that offered shares directly to you. But many investors have become increasingly frustrated with these over time because of their relatively high expenses, illiquidity and inability to beat the markets over time. Fortunately, a new breed of mutual fund appeared in the late 1980s that offers greater liquidity, lower costs and superior performance. Exchange-Traded Funds (ETFs) represent the next generation of mutual funds, and they can provide you with a more efficient return on your money once you learn what they are and how to use them.

Basic Characteristics
Like traditional mutual funds, ETFs offer diversification and professional selection of securities or asset classes, such as stocks, bonds, real estate, commodities and precious metals. Many ETFs represent a foreign securities exchange. There are also ETFs that allow you to leverage the markets in either direction; that is, they will increase or decrease in value (possibly by several hundred percent) when the markets rise or fall.

Regardless of what they invest in, the tax rules for ETFs are much more straightforward than for their traditional counterparts. Mutual funds are often taxed when they are sold and are taxed based on their accumulated capital gains, which were generated in the fund and given to investors each year. But ETFs do not accumulate gains and losses within the fund in this manner, and investors will simply calculate gains and losses based upon their purchase and sale prices, making them much more tax efficient. ETFs are also much cheaper to buy and sell than traditional funds, which can assess hefty sales charges for purchases or redemptions.

Investing in ETFs
Getting started with ETFs is easy. First, you need to figure out what your investment objectives are. Are you looking for long-term growth, income or some combination of the two? Then you need to search for ETFs that fit your objective. There is at least one ETF available for every investment objective under the sun, so keep looking until you find exactly what you are searching for. Then you will need to open a brokerage account either online or with an investment firm in order to purchase them. ETFs are excellent investments if you want to time the markets because of their low transaction costs. But if you want your ETFs for the long term, then you may be faced with the temptation to sell them whenever they decline in price, which can disrupt your investment strategy and cause you to miss out when the market rebounds.

ETFs provide liquidity, transparency and diversification in a single tax-efficient vehicle with minimal expenses and low transaction costs. For more information on these unique instruments, consult your financial advisor.

 

Photo by Howard Lake via cc. Image was cropped. 

High school. College. Internship. Graduation. Job. We all know the typical path to success and the steps we should take to get there. But many students have chosen a more unique direction to success and that often includes attending college at a later age. These students are usually referred to as non-traditional students. We are not talking about “gap year” students only taking a year off, although many programs that cater to non-traditional students will still accept those with a year or more gap between high school graduation and college entrance.

Students attend college as adults for many reasons. Some had careers that required them to work during their traditional college age years. Celebrities and athletes may not want to interrupt the prime career development years of their late teens and early 20s. Professional dancers might find their career coming to an end earlier than those in most professions and decide to retrain for another career path. Young people may want to complete military service. Or maybe school wasn’t right for them and they dropped out only later to decide they were now ready to complete their formal education.

For some students, returning to school as a non-traditional student opens up opportunities to attend Ivy League colleges that may have been impossible for them coming out of high school. Institutions such as Columbia University School of General Studies, Harvard Extension School, Yale’s Eli Whitney Program and Brown's Resumed Undergraduate Education (RUE) program all have dedicated programs or schools specifically for non-traditional students. These programs usually have different admissions requirements and take into consideration the potential student’s life experience, as well as their academics.

New York University's Paul McGhee Division for non-traditional students will even work with students to turn their life experiences into actual class credits. By proving you have already learned a subject through work or personal study that might be part of the core curriculum, a student can develop a portfolio to present to the school for credit. Another popular way of gaining credit for existing knowledge is the College-Level Examination Program (CLEP) test which is accepted at over 2,900 colleges and universities. By taking advantage of these opportunities, a student will graduate faster and save money.

 

Photo by Stijn Debrouwere via cc. Image was cropped.

 

Searching for an apartment can be stressful. You’re trying to find the best location, a reputable management company, a great apartment, and all while staying in budget. The apartment you choose drastically can affect your finances. But keep in mind that it isn’t just the monthly rent that you’ll be paying for. There are actually many other costs that you might not realize right away. Here are some hidden fees you may encounter while renting an apartment:

  • Application Fee: You may have to pay a fee for simply filing out an application to rent an apartment. This fee can be charged since it takes time for someone to go over your application and approve you to live in the complex.
  • Administrative Fee: This charge covers a background check, a credit check, and so on, that your landlord may perform.
  • Security Deposit: This fee will depend on the value of your apartment and can vary greatly. When you move out, someone will inspect your apartment to see if there were any damages throughout the time you lived there. If there are damages, they estimate the cost and deduct that from the security deposit you gave when you signed the lease. To ensure you’ll get your security deposit back, thoroughly document any existing damage in the apartment before signing.
  • Move-in fees: Some complexes are doing away with the security deposit, but instead, requesting a move-in fee instead. Essentially, it’s the same thing, but you won’t get the deposit back after you leave.
  • First and last month’s rent: Your landlord may require you to pay the entire first and last month’s rent upfront. Even though it’s your rent and not a hidden fee, many people don’t realize this. If after running a credit check, your landlord isn’t pleased with the results, they may ask for additional payment upfront as a security precaution.
  • Parking: You might be surprised to learn there’s a chance you'll get charged for your parking spot, especially in larger cities. Some apartments allow you to park one car per apartment. Also, some apartment complexes offer indoor parking or underground parking that can be an additional cost as well.
  • Utilities: While some apartments include some or all of the utilities, many do not. So keep in mind that heat, electricity, water, gas, and garbage removal may all be items you’ll need to pay for. Ask which utilities are included prior to signing the lease. When you’re checking out the apartment, ask what the average costs for electricity, gas, garbage, and water are so you get an idea of what your budget will be.
  • Pet fees: Chances are if you’re moving into a pet-friendly apartment and have a pet, you’ll be asked to pay a pet fee. This will probably include a monthly fee and a one-time fee when you move in, which can include both refundable and non-refundable deposits.
  • Late fees: Always set a reminder for when your rent is due to avoid any late fees. When you are paying your rent every month, are busy with work, and lose track of your days, you can easily be a day late on your rent.
  • Maintenance fees: You may pay extra every month for maintenance to your apartment or to the community. Find out what you’re paying for prior to signing. This way, if you have a dispute, you can work it out prior to signing anything.
  • Fines: In some cases, not following the rules can cost you. If you have friends over and the party gets a little too loud, you can end up with a fee. Anything that you are supposed to do or not supposed to do is outlined in your lease and can cost you a fee if you don’t obey. I’ve seen fees for keeping an unclean area outside of your door, storing bikes on a patio, using a grill that wasn’t approved, and much more. Know your lease, and abide by the rules to avoid any fees.

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I'll be honest; the Occupy Wall Street movement caught me by surprise. I always knew that in this country, a very small amount of people made big dollars compared to most people that made significantly less. Rather than dismissing this movement as some sort of fad, I took the time to dig a little deeper -- I wanted to know what all of the hubbub was about.

What I discovered remains the subject of multi-day email debates among my closest friends about wealth inequality, a 'fair shake' and possible solutions. Needless to say, we haven't come up with anything…yet. I have spent quite a bit of my time reading about the 1% and how they got there. I tried to find some common ground between them and I. Average annual income of over $1 million? Nope. Involved as a big time financier or real estate developer? Nada. Stock ownership? Yes!!!

Some statistics show that the top 1% owns an alarming 35% of stocks in the country and the top 20% owns about 92%. To add to the madness, only about half of all Americans own any stocks at all. I have owned stocks as long as I can remember and I figured that simply by owning stock, I had more in common with the top 1% than I ever imagined.

Was I part of the problem? Was I one of those people that the 99% were rising up against in protest? I sure didn't feel that way -- my net worth was nothing worth writing home about. And I wasn't even close to earning the magic $250,000 number Obama used to speak of.

I am not turning a blind eye to the wealth inequality problems that exist in our country, but while I wait for our economy to get back into gear and listen to our elected official propose new approaches to solve this, I also want to take care of myself and my family the best I can. Owning stocks is a great way to do so -- finding the right companies can provide you with a steady stream of dividend income and appreciation. Hate the high price of your cable TV bill or electricity? Buy some shares and own a piece of the monster.

Maybe that is too difficult to do, especially if you are having trouble making ends meet. But if you're not at least thinking like the top 1% or even 20%, it's going to be hard to get there. I want to be the person in retirement receiving enough dividends to provide a decent living. I want to have a huge investment hit where I see my original investment multiplied dozens of times over -- it does happen. And for anyone that has aspirations of climbing out of the bottom 50%, if you are not thinking about owning some stock and soon, you don't stand much of a chance. I know for myself, I would not have been able to get out of some personal financial binds without the power of investing and stock ownership. So, I suppose I am part of the problem, but in my mind, it sure beats the alternative.

 

Photo by Emmanuel Huybrechts via cc. Image was cropped.