You have an opportunity to do so much more: Part 1

You have an opportunity to do so much more: Part 1

By Keith Bunn Jr.

April 29, 2012

This morning’s posting is to my fellow service men and women out there...

Folks, there isn't a DAY that I don't kick myself for not getting more out of the time I was in the service. Don't get me wrong, I'm proud that I served, and I'm glad that I got to see and do all kinds of things all over the world, but there is one area I wish I would have done better on & that's in the financial area.

As some of you may or may not know, I was in and out of the Army for a total of 8 years and I've served as both married & non-married in my active duty days and I will break down my financial "regrets" in both those areas separately in a two part blog series.

Part 1: Non-married soldiers

This is where I have my biggest regrets, because as a single soldier living in the barracks, I really did have it made! I know you may not think so right now but you do. You have a roof over your head, a bed to sleep in, three meals a day provided in the Mess Hall, all your medical, dental, and vision care provided, as well as all utilities provided. All that is FREE!!  A lot of people out in the civilian world don't have that. I understand that this varies for you from time to time, depending on if you're in the field training or somewhere in the world on combat duty, but you have an opportunity that most of us out here in the civilian world and some of the married service men and women don't have, and that is, you can bank and/or invest just about your whole paychecks. You don't have to buy a brand new car with a payment attached to it, you don't need to party your tails off each and every free night you have, and you don't need to buy all kinds of crap that you just have to pack up anyway every time you get deployed somewhere.

Now I did some checking on http://www.militaryfactory.com/military_pay_scale.asp  and the base pay for an E-1/Private coming into the military is $1,491 per month. If you just took $400 per month, every month and invested that in good Growth Stock Mutual Funds for just a three year tour of duty, which would be $16,852. That still leaves you with $1,091 a month to live on. Or you could invest $1000 each month for three years, which would be $42,130! In either case, you still have money left over to buy other items you need to live every day.

Now here’s the thing, experts that are way smarter than me have said that if you are to be a true investor of your hard earned money, you should leave it alone for five years or longer to get the full benefit of the investment. So let’s say after the three year tour was up and you stopped putting money into that investment and never touched it until you were 65 years old. For the $400, that would be worth just over $1.3 million and for the $1000 that would be worth just over $3.3 million. Now here’s the kicker… These numbers are for an E-1for 3 years. You’re not going to stay an E-1 that whole time unless you‘re just a loser and even then, you should make at least E-3. And what if you were like a friend of mine who made it to E-9 and retired with over 20 years under his belt. Those numbers would be significantly higher plus receive your military retirement! These are the things no one told me when I was in the military but now wish someone did.

I would very much like to hear the input of the retired and/or active duty soldiers out there about what I’ve posted here today. Also, if you’d like to run your own numbers of what you’d like to invest and where you’d like to be at retirement, I have put a link to the investment calculator I used below.

 http://www.daveramsey.com/articles/article/articleID/investing-calculator/category/lifeandmoney_investing/  

As with all my blog and social media posts, I welcome any comments and feedback on the topics I write about. It is the only way you and I will learn more about ourselves and each other, so ask away! Part 2 coming soon!

Checkout my website, or follow me on Facebook, Twitter & Linkedin for additional money ideas and facts.

www.cavusfinancialcoaching.com , http://www.facebook.com/pages/Cavus-Financial-Coaching/120347681380181 , https://twitter.com/#!/Cavuscoaching , and http://www.linkedin.com/pub/keith-bunn-jr/47/555/145

Giving Gifts without going Broke

Giving Gifts without going Broke

By Keith Bunn Jr.

April 22, 2012

One of the ways people over spend is on gift giving. Christmas, birthdays, weddings, etc… any occasion where you have to give a gift or multiple gifts can be big budget busters. There is nothing wrong with giving a gift; in fact, giving is part of a healthy financial plan, unless you give more than you should.

A lot of times, people give more than they should just because they have big hearts and love to give to others, while other people give more than they should as a way to show others that they are doing well financially even when they’re not. In either case, over spending on gifts is a quick way to the poor house.

Julie and I are both big givers. We love the feeling we get when the person we gave a gift to, opens it up and we see the joy on their face. We also love the feeling we get when we randomly give a gift of money at a store or at a restaurant in the form of a big tip. But we have realized by being big givers, it has landed us many times not having the funds for the things that we need.

Knowing this about ourselves, we devised a plan so that we can keep giving without going broke. Julie and I sat down one day and thought up every occasion where we would have to give a gift of any kind. We broke them up in categories, placed names under each category and then put a dollar amount next to that name that we would spend either in a gift or give in cash. See the example below…

Birthdays  

Mom       $50.

Dad         $50.

Johnny    $100.

Suzie       $100.

Nephews $25.

Nieces     $25.

Once you figured out your categories and amounts, start saving for those amounts. Many banks and/or credit unions have special savings accounts that can help you with your saving and planning. The best time to do that is at the beginning of the year. Tally up all the dollar amounts and divide them by 12 months. Whatever number you get, that’s what you need to save each month for those categories. Now be realistic. Going overboard with your plan isn’t good either and you also have to think about these categories. You’re not going to have a wedding every month but you could have multiple birthdays in one month or a birthday next to a holiday like Christmas. Everybody’s plan is unique to them and once you have a plan in place and you follow it, you will be able to give without going broke.

As with all my blog and social media posts, I welcome any comments and feedback on the topics I write about. It is the only way you and I will learn more about ourselves and each other, so ask away!

Checkout my website, or follow me on Facebook, Twitter & Linkedin for additional money ideas and facts.

www.cavusfinancialcoaching.com , http://www.facebook.com/pages/Cavus-Financial-Coaching/120347681380181 , https://twitter.com/#!/Cavuscoaching , and http://www.linkedin.com/pub/keith-bunn-jr/47/555/145

Debt Collectors and Sports Air Horns

Debt Collectors and Sports Air Horns

By Keith Bunn Jr.

April 15, 2012

I bet you’re wondering what debt collectors and sports air horns have in common. That’s simple. You use it to get the attention of a collector or a group of collectors.

If you have a collector that is calling your home looking for someone you either don’t know or doesn't live there (like a relative of some kind) and you have repeatedly told them that they don’t live there or they have the wrong number and they are being rude to you in numerous ways, this is what you do…

Go to any sporting goods store and buy yourself a sports air horn and the next time they call you again, tell them that you either don’t know the person they are looking for or that person doesn't live there. Let them know that you will be reporting them to the Federal Trade Commission for breaking federal law according to the Federal Fair Debt Collection Practices Act. Then tell them that the next time someone from their company calls, you will deafen them with a sports air horn. The collecting company should be data basing what was said in your conversation so they have been fairly warned. 

Then if they call again, don’t even talk to them, just blast them & hang up. They may call you back sometime, but I doubt it.

You have to take control of these situations other words those butt head collectors will drive you crazy. Have fun with it! Oh yeah, I would report them to the Federal Trade Commission as soon as you hang up from blasting them. Here’s how to get a hold of them…

Federal Trade Commission

600 Pennsylvania Ave. N.W.

Washington, DC 20580

Phone: (202) 326-2222

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Motivating Through the Snowball

Motivating Through the Snowball

By Keith Bunn Jr.

April 8, 2012

There is a reason why Dave Ramsey tells us all that in Baby Step 2: Paying off your debts, you list your debts and pay them off smallest to largest and don’t worry about what the interest rates are. The reason is because personal finance is 80% behavior and for you and I to get those quick little wins by paying off some of our debts, seeing some progress, we get more motivated. But once we start getting into the bigger debts and our momentum starts to slow down because it will naturally take longer to pay those off, we can easily lose our motivation and fall off our debt free wagon. If this is you, we know what you’re going through. It has happened to us many times. So here are a few things we have learned on how to keep that motivation going strong…

1.    Make sure you are allocating some frivolous spending money in your budget for each of you. Let’s just face it, you are going to spend some money on whatever, you might as well budget for it.

2.    Give yourselves some quick wins again, some goals. When you pay off some of your debts, reward yourselves. Buy a DVD or maybe even go out to the movies for example. Break your debts up into groups and then reward yourselves after each group is paid off. Just make sure you budget for it and use cash.

3.    Number three is kind of a continuation from number two, and that is, when you start getting into the REALLY BIG dollar amounts in your Debt Snowball, break those up into smaller pieces. For example: if you owed $20,000, break that up into 5 smaller pieces of $4000, or 4 pieces of $5000, anyway you what to break it down, after each piece is paid off, reward yourselves.

Keeping a list of your debts on the refrigerator at home, by your desk or in your locker at work and crossing each one off as you pay them off is another way to stay motivated.

These are just a few things you can do. Be creative! Remember, the overall goal is becoming and staying DEBT FREE!!!

 As with all my blog posts, and social media posts, I welcome any comments, questions, and feedback on the topics I write about. It is the only way you and I will learn more about ourselves and each other, so ask away!

Checkout my website, or follow me on Facebook, Twitter & Linkedin for additional money ideas and facts.

www.cavusfinancialcoaching.com , http://www.facebook.com/pages/Cavus-Financial-Coaching/120347681380181 , https://twitter.com/#!/Cavuscoaching , and http://www.linkedin.com/pub/keith-bunn-jr/47/555/145

Kids and Credit Cards, Are we sending the wrong message to our youth?

Kids and Credit Cards, Are we sending the wrong message to our youth?

By Keith Bunn Jr.

April 1, 2012

If there has been one good thing about this recession, and that is it has opened a lot of people’s eyes to how much risk there were taking when it came to their household debt load. Unfortunately, it took those people getting financially smacked in the head to see it, for others it took seeing it second hand or hearing about a family member or friend’s issues before they took take a look at their lives.

In either case, for those of you who see the risk now and are doing something about it, I applaud you! All the others out there who don’t see the risk yet, I hope you see it before it’s too late. If you think it’s the “American way” to be in debt, and there is just no other way to live without having some kind of debt, that’s fine, we can still be friends, but what I worry the about most is, what our society is teaching our children about debt and the use of credit cards.

Some of you may not know what I’m talking about so let me explain. Credit card companies spend millions upon millions of dollars each year on marketing to our children. They market to them as young as they can. This is called “Kiddie Branding”. Now a lot of you probably don’t think this is true or don’t realize it so, let me give you some examples of Kiddie Branding. Have you seen the newer versions of the old board games Monopoly® and Life®? Both of these games now come with Visa® cards instead of cash. Even though adults play these games too, the way these games are marketed are for the kids. We don’t own any of those games but I looked them up. The description for Monopoly® is, “Cards, not cash. Now play with millions on your card.” And for Life® (the Game of Life: Twist and Turns® to be more precise) it says, “Slide your Visa® game card into the Lifepod to access your information” also, “Automated Lifepod helps you manage money, houses, cars, and family matters.” What is this saying to our children? If I want millions, I need to use plastic instead of cash. If I want to manage my money, home, cars, and family matters, I need to use plastic instead of cash, and not only do I need to use plastic, I need to use plastic that has a Visa® logo on it.

What this does as this information keeps being burned into our children’s brains over the years and they get older and go off to college and they start getting all these credit card offers in the mail, get into a financial bind, or maybe the credit card companies set up stands on the college campuses telling the students if they sign up they can get a T-shirt or free pizza. What card do you think they’ll sign up for? In our example, if Visa® is the primary logo they have used in the many toys and games on the market today, they will more than likely sign up for a Visa® credit card.

Now Visa® isn’t the only credit card company doing this and Monopoly® and Life® aren’t the only kid games and toys on the market that have some version of credit card usage. But as parents, we need to really watch what is being fed into our children’s minds and as they get older and can understand things better, sit them down and explain to them what all this money stuff is about. Give them a fighting chance to monopolize and be successful in their lives!

As with all my blog posts, and social media posts, I welcome any comments and feedback on the topics I write about. It is the only way you and I will learn more about ourselves and each other, so ask away!

Checkout my website, Facebook, Twitter & Linkedin pages as well.

www.cavusfinancialcoaching.com , http://www.facebook.com/pages/Cavus-Financial-Coaching/120347681380181 , https://twitter.com/#!/Cavuscoaching , and http://www.linkedin.com/pub/keith-bunn-jr/47/555/145