Update: The giveaway has ended and the winners will be announced shortly.

Note: This is a long article containing an in-depth review of the new version of Quicken. If you are just interested in the giveaway of Quicken 2010 Deluxe, scroll to the bottom of this article.

It took me a long time to warm up to Intuit Quicken. When I first saw the software in the early or mid 1990s, I wasn’t very interested. That’s not the software’s fault; at that time I most likely did not see the need for tracking money I did not have. When I finally realized I needed to build some control of my personal financial situation, I first looked for free solutions.

After several months of spending less than I was earning and tracking my progress using freeware, I evaluated Microsoft Money alongside Quicken. Money looked nice and ran smooth while Quicken was clunky and unattractive, so I stuck with Money for a few years. After some time, I came to realize that Money’s features for dealing with investments were not as comprehensive as I would like, and for some reason it interpreted the downloaded data from my 401(k) incorrectly. I decided to give Quicken another shot.

While Quicken wasn’t perfect, it worked better with the transaction data I downloaded from the banks and offered configurable reports. So I stuck with it, and I still use a desktop version of Quicken almost every day. I receive questions about why I haven’t switched to popular Web 2.0 applications like Quicken Online (review here) or Mint.com (review here). These websites offer interesting features, particularly those powered by community aggregate information, but they lack some of the basic investing functionality that I get from the desktop version of Quicken.

Quicken 2010 review, first impressions

I received Quicken 2010 Home and Business in the mail yesterday and gave it a test drive tonight.

The upgrade from Quicken 2009, including downloading updates to the software online, took about ten minutes. Tens of thousands of transaction records needed to be converted to the new version, and this took the bulk of the time for the upgrade.

After the upgrade was complete, the software brought me to Quicken.com to register. Although I am already registered at Intuit, I was required to provide my information again before using all of the software’s functionality. Although required, the registration process was quick.

I was impressed with the new version’s look and feel. The interface is redesigned to be cleaner, and switching from one page to another within the software seems to move faster. One of my biggest complaints about Quicken has been its sluggish display but this seems to be greatly improved.

Quicken 2010 opens to a new main screen with three horizontal sections. The top includes a pie chart describing your spending within categories and the middle of the screen lists your anticipated expenses.

The focus here is on your cash flow: how much is left in your spending accounts at the end of the month. Here is the top half of my screen. Click on the thumbnail to view the image full-size (and note the exceptionally large tax expense thanks to quarterly estimated payments).

The bottom section of this screen is new. According to Quicken, it would take 5 minutes to begin tracking spending goals. I began creating spending goals, which seem to form a softer style of a budget. Unfortunately, because I use sub-categories, Quicken’s “average monthly spending” in categories like “Auto,” “Dining,” and “Entertainment” were inaccurate. As a result, the “suggested monthly goals” were not appropriate. I solved this by choosing my own categories, such as “Auto:Fuel” rather than “Auto.”

After assigning several categories to watch, here are my results so far for October.

I also like the new Net Worth tab. Here is what the top half of my Net Worth page looks like.

Downloading data from banks

The “Direct Connect” feature of Quicken, in which you store your bank accounts’ passwords in the software and send Quicken on a mission to download your latest transaction data, has never run smoothly for me. In Quicken 2009, this process would occasionally lock the software, requiring me to kill the process through the Windows Task Manager. Furthermore, this downloading should be a background process. However, whenever you initiate the data update, you are preventing from performing almost every other task in the software.

Quicken 2010 has not fixed this completely. During the update process in the new version, Quicken will prevent you from moving around the software.

What to look forward to

All things considered, this seems to be a good upgrade with my limited experience so far. But like most yearly, incremental software updates, there is not a lot to justify buying the software if you already have a recent version of Quicken.

The best news from Intuit is not reflected in Quicken 2010. As a result of Intuit’s pending acquisition of Mint.com, the CEO of Mint.com, Aaron Patzer, will be leading the development of the desktop version of Quicken in addition to the online personal financial management software. I expect future versions of Quicken will look slicker and work faster as Intuit leverages the team and the talent behind Mint.com.

Latest prices for Quicken 2010 versions

Before you buy, consider trying to win the giveaway for Quicken 2010 Deluxe. Instructions for entering the giveaway are below. Free is always a better option. Also, Intuit often offers discounts. Right now the software is offered for full price only. But keep watching Consumerism Commentary to find out when new discounts are available.

If you’re a Mac user, hang on until February 2010. A new version of Quicken for Mac will be released next year, and Intuit says the will be a major upgrade from the most recent release. Alternatively, you can run software on the Mac that emulates Windows and allows you to run these updated versions of Quicken.

Giveaways

Intuit sent me two copies of Quicken 2010 Deluxe to give away to readers. Here is how you can win one of these copies. Each of the following will provide you with one chance to win, so you have a maximum of three chances.

• Leave a comment on this post.
• Become a fan of Consumerism Commentary on Facebook and let me know in your comment below.
• Mention and link to this review on Twitter. Your tweet should say:

Pls RT! Review and giveaway: Quicken 2010 from @flexo! http://bit.ly/RjD3y

You must be over 18 years old and must have an address in the United States in order to qualify. The winners will be chosen using the random number generator at random.org. Thanks and good luck! The giveaway will end Friday night, October 23, at 11:59 pm.

Update: The giveaway has ended and the winners will be announced shortly.

The Consumerism Commentary Podcast is in full swing with new episodes every Sunday. Listen and subscribe now!

Quicken 2010 Review and Giveaway

As I’ve mentioned recently, my maternal grandmother passed away a few days ago, my second of two grandmothers to pass away in the past few weeks. A few years ago, she moved out to California to be cared for by my mother and brother who had also moved out to the west coast several years earlier. When my grandmother entered hospice care, I mentioned to my boss that I would be taking a few days off for the funeral with short notice, as I intended to travel to California to be with my family. On Tuesday last week, my mother called me to share the news while I was getting ready to leave work for the day.

I immediately began searching for a round-trip flight that would take me from the New York City or Philadelphia area to the Los Angeles area on Wednesday and back over the weekend. My primary tool for searching for flights online is SideStep, but I also look at websites for individual airlines. Not finding anything and wanting to leave the office to continue searching at home, I notified my boss that I would be out for the remainder of the week.

I decided to give the Visa Signature concierge service a try. I signed up for a Visa Signature card earlier this year for the purpose of putting its service through real-life tests and writing about them here. There is no annual fee, but the card is marketed offering exclusive perks and services, such as a 24-hour concierge and access to exclusive events. I called the Visa Signature concierge during the drive home with the intent of using the service to find and book my flight to California.

The concierge who answered the phone could not have been less helpful. To research flights, a travel specialist needs to be on call, and at the time I called, they had none. The best they could do is take my flight requirements and get back to me within 24 to 48 hours, and the impression I took away from the call is that all travel requests require this excessive turnaround time. Since this was Tuesday evening and I needed to travel Wednesday, this did not meet my needs. A regular travel agent would have been able to take care of my request immediately.

I thanked the representative for her help but I spent an hour or so doing my own research and booking the flight when I arrived home. I determined that bereavement fares, last-minute rates designed for people who need to fly in situations like mine, do no longer exist at most airlines. When they do, the rate is a five or ten percent discount off the full coach fare, not the non-refundable economy fare. I would be better off with the economy rate. I spent more than I would have liked, but the fare I chose was decent for a non-stop flight considering the circumstances.

I’m pleased I was able to be with my family in a difficult time, but I would have liked the process to be smoother, and the concierge service let me down.

Photo: Doug Letterman

The Consumerism Commentary Podcast is in full swing with new episodes every Sunday. Listen and subscribe now!

Visa Signature Concierge: Useless for Immediate Travel

If you’re a frequent reader of this (or any other personal finance blog) you’re familiar with credit scores and credit reports, and the advice to check them often.

These resources detail your financial history and provide a measure of your supposed financial risk. They’re also useful tools to determine the safety of your identity. However, when was the last time you checked your ID Score?

MyIDScore.com is a new company that offers what they call, “a new way to quickly assess your risk of identity theft.”

Your ID Score is:

A statistical score that’s based on technology currently used by leading communications, financial services, retail companies, healthcare providers, government agencies, and consumers to assess your risk of identity theft. These companies use ID Analytics’ scoring technology to ensure that fraudsters do not apply for goods and services in an innocent consumer’s name.

Basically, your ID Score will give you an overall picture of the security of your identity, just as your credit score gives you an overall picture of the state of your finances. Monitoring every single part of your identity that gets tossed around is a big job, and MyIDScore.com wants to help.

The interesting thing is, even though you’ve probably never heard of ID Analytics, you’ve almost certainly had your data analyzed by them, notes an MSNBC.com article:

ID Analytics is not exactly a household name. That’s because most of us never deal with the company directly. But if you’ve purchased a wireless phone, have a credit card or applied for a retail charge card, there’s a good chance the company analyzed the information on your application.

How does it work?

After providing your personal information, ID Score utilizes information provided by retailers, governmental bodies, financial service providers, healthcare companies, communication providers and other companies to determine how you can protect your identity.

What about privacy?

Obviously, if you’re providing all of your personal information, MyIDScore.com will have access to quite a bit of what goes on in your life. By doing this, it’ll be easier to monitor what goes on in your life, but you won’t be the only one doing it. The site does take privacy very seriously, and you can choose how your information is used.

Is it worth it?

Monitoring your identity is becoming more and more of priority, especially since the ways in which someone can access your personal information are increasing exponentially. IDScore may be the right fit for some people, and it seems to be an extremely useful and powerful tool.

Am I going to use it? Probably not right now (knock on wood). I’m comfortable with the “old school” methods I’m using to protect my identity for the time being. I can see myself considering IDScore.com in the future, however.

It’s good to know that there are tools out there that can help you keep your identity safe. Many people would benefit from a product like this, and I’d recommend it to anyone who is even moderately worried about their identity.

The Consumerism Commentary Podcast is in full swing with new episodes every Sunday. Listen and subscribe now!

MyIDScore.com: What’s an ID Score?

See the review of the best online savings accounts – updated August 18, 2009.

A few weeks ago, I noted the interest rates offered by EverBank and decided to open the “Yield Pledge Money Market Account” to take advantage of the generous “bonus” interest offered in the first three months of holding an account. The account opening process, beginning on July 8 and culminating late last night, July 23, was more of a chore than I planned, but there is an explanation for most of my dissatisfaction.

Initial online banking application

The beginning of the process was much like that for any other bank. I visited everbank.com and proceeded to apply for my account online. The first step was to choose the account type. Everbank offers a number of products, including a money market account, a checking account, certificates of deposit, credit cards, and investment accounts. I like starting small, so I chose the aforementioned Yield Pledge Money Market Account, noting the $1,500 minimum deposit required to open the account. (Many online banks do not have any minimum deposit requirement.)

After choosing the account, I provided my personal information. EverBank asked for the same information I usually see on other banking applications including Social Security Number and my mother’s maiden name as security measure. I was also asked to provide an additional security code and hint.

Everbank asked for my employer’s name and phone number, though they offered alternative responses such as self-employed, retired, homemaker, and student. I could not choose both self-employed and name an employer, so I named the company I work for during the day. Questions about employers are occasionally asked on banking applications, so this did not raise any concerns.

The next step required a credit check. Applicants can choose whether to allow an instant credit check during the application process or to delay this part of the process. I was anxious to begin banking quickly, so I authorized a real-time credit check. In order to further validate my identity, a number of questions were generated based on the information on my credit report and I answered all to satisfy EverBank’s requirements. Though I am starting to forget old addresses, employers, and loan issuers, I succeeded in answering the questions correctly. This is a common method for proving identity.

Funding options

Having satisfied all of EverBank’s curiosity, or so I believed, I was offered with the options for funding my account. My initial $1,500 could be deposited with a written check or by bank wire. There were no ACH or EFT options provided to me. This would be explained to me later, but at the time of application, I was disappointed.

With modern online bank accounts, I expect technology to provide me with instant options. I expected the entire account opening process might take three business days at most, with the bulk of that time spent waiting to verify an external account for transfers.

I chose the check option, and wrote a check from my personal account. Note that I wrote the check for $1,500, the amount listed as the account minimum. If my average balance were to fall beneath this amount during any month, I would be charged a fee. I know this because EverBank required me to agree that I read about their rates and fees before continuing. Keep this in mind for later.

EverBank asked me whether I’d like to print the application or received an application in the mail within five to seven days with my information pre-filled. Again, this was too much paperwork for what is supposedly an online bank account.

Filing the application and troubleshooting

On July 12, four days after beginning the process, I received the pre-filled application in the mail. I signed and dated the documents, included my check for $1,500, and mailed the package back to the bank. I received no further communication for more than a week, when on July 20 I received an email to let me know that my application was received and my account had been opened, but I would not be able to access my account until I received a second package from the bank in the mail to welcome me as a customer.

After receiving this email, I expressed my disappointment with the account opening process here on Consumerism Commentary. This article attracted the attention of the bank, and on July 21, the same day I posted the article, I received an email from the Vice President of EverBank in charge of “acquisition marketing” at EverBank. He was concerned with the delay I was experiencing and he said he would look into my application to determine if there was a problem.

The next day, we spoke on the phone. This was Wednesday this week. He explained that my credit report showed that there is a business registered at my mailing address. Although there was a typo in the name of the business, there is certainly a registered business here, representing this blog and other internet development work. As I signed up for a personal account and there was a business associated with my address, that produced a red flag.

Due to the fact that my address is “mixed-use,” I was not able to take advantage of the ACH initial funding option or electronic signatures. According to the VP, most new account holders will not have to go through the lengthy process that I experienced.

I would be interested to hear from those who have had a smoother experience opening and funding their account. I do have to wonder whether I received attention from the bank that other customers without popular personal finance blogs might not receive.

This story is not yet over, however.

Accessing the money market account

I received the welcome packet last night and used the information provided to access my new money market account online. Once logged in and viewing my balance, I immediately double-checked the fee schedule to ensure I would never be charged fees for maintaining this account. To my surprise, the minimum average daily balance for the Yield Pledge Money Market Account was now $5,000 instead of $1,500! The welcome packet I received contained a schedule of fees that does not match the schedule online, which I linked to above and will link to again. At the time I am writing this — because anything can change — the PDF linked here lists $1,500 as the minimum average daily balance required to avoid a $4.95 monthly fee. The document I received in the mail lists $5,000 as the minimum average daily balance required to avoid an $8.95 monthly fee.

I hope that the mailed schedule of fees (with the higher minimum balance and the higher monthly fee) is older than and has been superseded by the schedule I see online. Here is visual proof of this discrepancy.

Does anyone else see the problem here? I’m preparing this article, like I do many for Consumerism Commentary, in the middle of the night. It’s unlikely that customer service is available to settle the dispute between documented fees, but I will update this article once I receive an explanation. Note: I have included an explanation at the bottom of this article.

Linking an external account for transfers

Anxious to ensure I was avoiding a fee for using an account in a banking environment in which it is so easy to find fee-free money market accounts, I immediately began configuring a linked external bank account to transfer $3,500 more into my EverBank money market account, which was looking decreasingly like a good account to maintain. I chose to set up a link between EverBank and ING Direct.

There were two options to create this link. I could either enter my ING Direct login information or wait for EverBank to deposit two small dollar amounts into the ING Direct account which I could then verify later. I chose the instant option, but ING Direct did not accept my login information as I entered through EverBank. I think this is related to ING Direct’s security policy that restricts other applications, like Mint and Quicken Online, from linking to ING Direct. (You can hear ING Direct’s chief operating officer Jim Kelly explain this on this coming Sunday’s Consumerism Commentary Podcast).

I resorted to linking the account via the slower deposit verification method, and it will be a few days before I can complete the process of adding to my balance.

Conclusion, thus far

I decided not to wait for the final transfer before writing this review. While I understand that it is possible that having a business registered at my address will raise warning signs to the bank I realize that EverBank’s anti-fraud policies have been successful for the company, the process has been inconvenient overall.

If you have experiences with EverBank, whether positive or otherwise, please feel free to share.

Update: Explanation of the minimum balance and fee discrepancy

On July 8 when I first accessed everbank.com and began my application for the Yield Pledge Money Market Account, I was re-routed to a back-up or redundant server, and that server had not been updated with the latest fee schedule. With my luck, I managed to access the redundant server when I activated my online access as well. Perhaps this is due to my tendency to work late at night when redundant servers are more likely to be active while the main production servers undergo maintenance.

It was actually this post that brought the issue to the attention of the server administrators at EverBank. At 1:00 pm on July 24, the back-up server was updated to link to the new fee schedule, which includes the minimum $5,000 average daily balance and the $8.95 account fee.

The Consumerism Commentary Podcast is in full swing with new episodes every Sunday. Listen and subscribe now!

EverBank Money Market Account Review

American Express created a frenzy among the wealthy when it decided to take advantage of rumors of an exclusive black-colored charge card, used by movie stars and music celebrities for purchasing jets and other items beyond the financial reach of us mere mortals. In 1999, American Express introduced the Centurion Card, a black charge card with no spending limits and a veritable cornucopia of exclusive benefits, all for a significant fee.

Last year, Visa saw the opportunity to market to the same demographic when this company launched its answer to the Centurion Card, the Visa Black Card which I’ve previously described in detail.

Although the assumption is that the Visa Black Card would compete with the American Express Centurion Card, it actually has more in common with the American Express Platinum Card.

Do you qualify?

If you want to hold a Centurion Card, you must be a Platinum cardholder for at least one year and you must have spent $250,000 on the card in twelve months. Both the Platinum and Centurion Cards are charge cards, not credit cards, so you are expected to pay off your entire charged balance each month.

To qualify for an American Express Platinum Card, the prevailing thought is that you will need an annual income of at least $100,000 and a high credit score in order to be approved.

The Visa Black Card is a credit card, not a charge card, offered to only 1% of the United States population. You and three million other people might qualify for this card. Some current Visa customers have received invitations or have had their existing Visa cards automatically upgraded. There have been reports of people with poor credit and little or no income being approved for this card, and an invitation package was sent to a man who had been deceased for seven years.

Annual fees

The Centurion Card is in a class of its own. When you qualify for the Centurion Card, you will be charged a $5,000 initiation fee and an annual membership fee of $2,500. That’s a total of $7,500 will will owe after the first billing period without having spent any money.

The Visa Black Card carries an annual fee of $495 while the American Express Platinum Card requires a yearly membership payment of $450. This fee comparison makes it clear that the features of the Visa Black Card are more likely to be in line with the Platinum rather than the Centurion.

Concierge services

All three cards offer 24-hour concierge services. The purpose of a concierge is to have a personal assistant with the resources to take care of arrangements you do not have time for yourself. A good concierge should be able to order and deliver gifts to the people you specify, give dining recommendations and make reservations, even in the most popular restaurants. A concierge would be your proxy for shopping.

The Centurion Card goes further by assigning you a personal concierge, so you theoretically always deal with the same employee from the service, who gets to know you and your preferences. Additionally, the Centurion Card reportedly permits you to schedule private shopping at high end stores, such as Gucci, Neiman Marcus, and Sony.

Travel services

The Visa Black Card offers 24/7 legal, medical, and financial emergency travel services, as does the Platinum Card and the Centurion Card. All three cards offer travel accident insurance. The Visa Black Card offers up to $250,000 insurance while the Platinum Card offers $500,000 insurance. The Centurion Card offers $1,500,000 in travel accident insurance.

If your baggage is delayed while traveling, the Visa Black Card will credit you $100 a day for three days, while the Platinum Card will insure your baggage up to $2,000. The Centurion Card will insure up to $1,250 for carry-on items and $500 for each checked bag.

Purchase protection and warranties

If there is a problem with any purchase you make with the Visa Black Card, the card can reimburse the owner up to $500 before 90 days have passed since the date of purchase. The Platinum and Centurion Cards protects holders up to $10,000 per occurrence and $50,000 total per cardholder per year within the same 90 days of the purchase.

Summary

In most cases, the Visa Black Card, despite its appearance, is more competitive with the Platinum Card. Based on these benefits, the Centurion Card is in its own class despite some features in common with the Platinum Card. Many of the Visa Black Card’s services are more aligned with Visa Signature benefits, a level that usually does not carry any annual membership fees.

I’ll stick with a free Visa Signature Card, which also comes with concierge services, purchase security, and all features at levels identical to the Visa Black Card.

Review the details from the sources: Visa Black Card, American Express Platinum Card, American Express Centurion Card, Visa Signature Card.

Your opinions

With fees starting at $450, are luxury credit cards worthwhile? Have you received any offers for the Visa Black Card?

The Consumerism Commentary Podcast is in full swing with new episodes every Sunday. Listen and subscribe now!

Comparing the Visa Black Card With American Express Platinum and Centurion Cards

See the review of the best online savings accounts – updated August 18, 2009.

A brief history of Ally Bank and its parent, GMAC

In the turmoil engulfing General Motors there have been some changes related to banking. 51% of GMAC, which was originally established as a wholly-owned subsidiary of GM to provide financing for automotive purchases, was sold several years ago to private investors. GMAC branched into retail banking, offering savings accounts, certificates of deposit, and money market accounts with an arm of the subsidiary called GMAC Bank. More recently, GMAC became a bank holding company to take advantage of the Troubled Asset Relief Program (TARP), receiving $5 billion from taxpayers through the government.

At the same time, General Motors, which still owns 49% of GMAC, continued to founder towards bankruptcy. In an attempt to distance itself from the GM brand, GMAC Bank rebranded itself as Ally Bank, focused on offering a high-yield interest product, and began actively seeking new customers and depositors.

Click here to see Ally Bank’s current interest rate yield and apply for an account.

Opening an account with Ally Bank

I decided to become an Ally Bank depositor today. Before doing so, I wanted to be confident that my money would be safe amidst General Motors’ impending bankruptcy. Funds deposited with Ally Bank are insured by the FDIC up to the recently raised limits. I won’t come close to exceeding $250,000 in this account. The Treasury recently provided an additional $7.5 billion to GMAC, so Ally Bank’s immediate parent company is well capitalized at the moment.

Here are my experiences from the bank account opening process thus far. As I visited the website to begin my application, Ally Bank warned me that I would need my driver’s license (or an alternate state or military identification number) in addition to my social security number to proceed.

Like some other banks, Ally performs a credit check to verify identity, but they may also reject your application if you are viewed to be a credit risk. The possibility of rejection based on credit history is unusual for banks, but considering this bank is owned by a financing company that has lately become a bank holding company and this type of structure might increase in popularity, requiring credit checks for bank accounts may be part a new reality.

It look less than two seconds once I submitted my application for Ally Bank to inform me my application was approved. Once inside this virtual gate, I was able to choose whether I wanted to receive paper or electronic statements. I always choose electronic to cut down on paper waste, and I wish more services would offer this option from the beginning.

Here’s another great feature. Like ING Direct’s subaccounts, I could create as many separate savings accounts, with their own account names and numbers, as I wanted. At this point in the initial set-up, I could also add money market accounts and certificates of deposit.

I set up two separate savings accounts, both to be funded electronically from my ING Direct Electric Orange checking account. Like setting up linked accounts at any other bank, I will be required to verify two small deposits to ensure I am the owner of the linked account. Options for a one-time initial deposit or a recurring automatic savings plan are available.

Ally Bank then required me to create my security settings for viewing my account information and activity online. The bank has combined most of the security features that have become commonplace over the past few years. I created a user name and a strong password, including mixed case letters and numbers. I selected some secret code words, an image I can expect to see each time I log in, and three security questions and answers. Ally also provides the option for registering the computer you mainly use for accessing the website to avoid repeated security questions at each online session.

If Ally Bank does not recognize the computer you are using to log into your account, they will send you an email with a single-use password to further confirm your identity. I have not seen this feature implemented anywhere else.

Using the Ally Bank savings account

Once logged in, I was impressed with the clean look of the interface. Click on the example below to zoom in.

Ally Bank supports Intuit Quicken and Microsoft Money through Web Connect, which means you can log into the bank’s website and download your activity. At this time, you cannot automatically download your Ally accounts’ activity through Quicken directly (”Direct Connect”). If you like Excel for reconciling your account, Ally offers a flat comma-separated values spreadsheet for download.

Transfers among your Ally accounts, and between your Ally accounts and your linked bank accounts, are free, but keep in mind that savings accounts and money market accounts are limited to six withdrawals per period.

Ally Bank charges no account maintenance fees and there is no minimum balance. If you exceed the six withdrawals mentioned above, Ally will charge a $10 fee. Cashier’s checks and wires carry an additional cost. A returned deposit item, if a check you send bounces or if you don’t have funds in an external account to cover a transfer, will cost $7.50.

The bank is also drawing attention to their 24-hour customer service availability and the plain language used throughout their website. I have not yet worked with Ally’s customer service, but I will be sure to report any future frustrations.

Conclusion

Opening my account with Ally Bank was painless and quick, and I like how the website operates so far. After my initial deposit is transferred, I will have a better idea of how quickly funds are available and can be transferred back to external accounts. I will return with more information at that time.

The main question I have moving forward is how long Ally Bank will be able to maintain their position as one of the highest among high-yield savings accounts. Bank have long used high interest rates to lure new customers only to drop the rates when they become confident in their position as leader, like ING Direct, or when the bank changes ownership, like Washington Mutual.

The American Bankers Association (ABA) sent a letter on May 27, 2009 to the FDIC requesting that Ally Bank be forced to lower their deposit interest rates, citing the bank’s unfair competitive advantage. It is unfortunate that the ABA would take this stance with savers forced to settle for interest rates that will not reach the rate of inflation going forward. The ABA has since removed the letter from the organization’s website.

Like I said above, I am not concerned with risk to the liquidity of my deposit despite Ally Bank’s association with GMAC and General Motors. If the worst happens to General Motors, Ally Bank should remain relatively unaffected.

If you are interested, apply for an Ally Bank savings account here and let me know about your experience by commenting below.

The Consumerism Commentary Podcast is in full swing with new episodes every Sunday. Listen and subscribe now!

Ally Bank Savings Account Review

A number of bloggers who write about personal finance have branched into the world of print. Here are some of the latest offerings.

Ramit from I Will Teach You To Be Rich has published a book by the same name. I reviewed the book back in March.

Trent from The Simple Dollar has written a document in the form a 49-page PDF called Everything You Ever Needed To Know About Personal Finance On Just One Page (note the irony). The book has every-day, common-sense ideas based on the post from several years ago in which the blogger outlined basic personal financial concepts on the backs of five business cards. This eBook is available for free via download.

The authors of Wise Bread have collaborated on 10,001 Ways to Live Large on a Small Budget.

Kerry K. Taylor, known around the blogosphere as Squawkfox has compiled 397 Ways to Save Money, in the form of a book currently available for pre-order on Amazon.ca. Kerry will be a guest on an upcoming episode of the Consumerism Commentary Podcast.

The Consumerism Commentary Podcast is in full swing with new episodes every Sunday. Listen and subscribe now!

Books and eBooks by Personal Finance Bloggers

A little over a year ago, Russell Bailyn, an investment adviser who crossed the barrier into the blogosphere with his Financial Planning Weblog, contacted me to let me know he was beginning work on a book. As Russell and I were both music education majors in our respective undergraduate universities, I was eager to support his endeavor. I’m happy to report that Navigating the Financial Blogosphere: How to Benefit From Free Information on the Internet was published earlier this fall.

In Navigating the Financial Blogosphere, the author takes twenty-six of the most popular financial questions and dedicates a chapter or two to each. The questions run the gamut from basic financial knowledge to intermediate investing techniques, professional financial designations, and the mystery of variable annuities.

Russell takes a real-world approach to answering financial questions, such as, “Are Credit Cards My Enemy?” and “What Are My Chances of Getting Social Security?” In this book, the author is able to present two sides of a story, particularly when addressing a hotly debated issue. For example, Russell tackles the question of dabbling in real estate as an important part of an investment portfolio. He discusses the pros and cons and allows the reader to decide how real estate can fit into their own overall investing scheme. I applaud Russell for not making many blanket recommendations other than the most basic. He understands that financial advice is personal and the right answer for one investor is not always the right answer for another.

I have not yet mentioned this book’s strongest selling point and what makes Navigating the Financial Blogosphere unique. It’s apparent from the title, however. Not only does the book cover the essential aspects of financial planning, but it is full of references to online resources, all free. These resources can be used by the reader with an Internet connection to research any issue. Many of the resources are personal finance blogs, like Consumerism Commentary, Free Money Finance, and My Money Blog.

Russell goes beyond blogs as well, pointing the reader towards Motley Fool, FinAid, and BankRate. Each chapter concludes with a summary of the online resources available for that chapter’s topic. All of the resources listed are still active as today, and they are the types of websites that should be around for a long time. These summaries function as a filter. One could simply enter the topic about which they wish to read more into Google, but the quality of these results will vary. Russell has picked the best for you.

The methodology of including current websites also provides the author with a reason to publish updated editions periodically.

If you’re familiar with the world of free online information, particularly personal finance blogs, and you feel you are confident in your ability to pick the wheat from the chaff, then you might not be the primary audience for this book. However, if you are just starting to become aware of the importance of personal finance and enjoy online research, this would be an excellent book for you. The value of this book is in the financial advice and information coupled with the best online resources.

Russell’s first paragraph on the hardcover sleeve explains his philosophy in writing this book:

While many of us trust the advice of so-called “experts” when it comes to our financial well-being, the fact is that many of these professionals either aren’t objective enough or simply have an opinion that they want to push on us. This is ironic in that finance is a very subjective discipline, and many financial issues can be resolved by combining a few simple rules with a solid understanding of your own personal preferences.

I’m quite flattered that Russell included Consumerism Commentary as a resource in several of the chapters, and it’s an honor to be mentioned alongside the other great financial resources available for free online. I highly suggest reading Russell Bailyn’s Financial Planning Weblog if it’s not all ready part of your personal finance blog reading.

The Consumerism Commentary Podcast is in full swing with new episodes every Sunday. Listen and subscribe now!

Review: Navigating the Financial Blogosphere by Russell Bailyn

The other day, I arrived home to see two boxes, one large, one smaller, waiting for me on my doorstep. A quick inspection verified that the shipment came from Sumo Lounge, who were sending Consumerism Commentary some product samples for review.

Sumo Lounge sells hip, urban furniture in the form of huge nylon sacks filled with some kind of bead product. I’m not sure why they wanted to have Consumerism Commentary review their product, but I agreed with the stipulation that they also provide one to give away to readers. (That comes later, so keep reading.) It turns out that MyMoneyBlog reviewed the Sumo Lounge Omni and Otto last year, so personal finance blogs are apparently within their target market.

Anyway, since the boxes were blocking my front door, I carried them up to my apartment (see photo). Surprisingly, the boxes were very light.

They stayed unopened until I was ready to dedicate the time necessary to deal with more “furniture.” The larger box contained the Sumo Omni, the “chair,” and the smaller box contained the Sumo Otto, the ottoman.

I pulled the Sumo Omni out of the box, and it was already “assembled.” It is a bright red bag, made of what appears to be very strong nylon. I tried unsuccessfully to rip the material with my bare hands, and decided not to pursue the endeavor with sharper objects. My illegal resident cat, Rupert, spent some time playing with the Omni at this time, and his claws had no damaging effect. This was actually one of my primary concerns before receiving the chair, but I see that I don’t have to worry about damage.

The foam beads which give the chair a unique feel are sealed in by a strong zipper and the zipper is hidden from view with strong velcro. This image shows, though it may be difficult to see, the beads inside the bag.

What’s neat about the Omni is its ability to hold its shape. It’s actually quite comfortable. The official website describes eight different shapes and supplies images of ten different colors. My girlfriend and I tried out as many of the positions pictured on the website without getting tired. Yes, the Omni is big enough for both of us to be comfortable at the same time.

It’s actually much more comfortable than I expected for sitting, whether in the Omni with my feet up on the Otto, or just sitting on the Otto itself. Laying the Omni flat and pushing the beads around a bit to even out the support, the chair converts to a small bed. Sumo calls the configurations a “floor pillow.” It’s nothing like a pillow-top mattress, but it’s comfortable enough, even for sleeping.

Pictured below are the Omni and Otto in some of the more standard shapes.

At $149 for the Omni (currently $129 with free shipping) and $75 for the Otto (free shipping), it’s a bit pricey. This is high-quality material, however, and these seats are not even reminiscent of the old bean bag chairs you may remember from the first episode of 3-2-1 Contact. You’re more likely to see Playboy bunnies lounging on the Omni. This would have been great for back when I was in college, but it still looks nice in my more “adult” apartment. I considered putting it upstairs in my loft, but I’m going to keep the set in my living room to show it off to and be used by more visitors.

Sometime later this week, I will kick off a contest to give away one Sumo Omni to a lucky reader. The winner will get to choose the color from the ten choices listed here. If you think this might be an interesting addition to your household decor and furnishings, I suggest you enter once the contest begins. You have nothing to lose.

The Consumerism Commentary Podcast is in full swing with new episodes every Sunday. Listen and subscribe now!

Sumo Lounge: Not Your Average Beanbag Chair

Seven years ago, you would have found me blissfully unaware of my spending practices and their impact, flourishing my credit card without a second thought as I ran up my tab at restaurants and shops. I defined living life fully as having the things and experiences I desired, and I thoroughly enjoyed myself, imagining that I could travel anywhere and do anything I liked.

There was a catch, though. Only through intentional ignorance could I stand to keep it up, refusing to look my finances straight in the wallet. When I was confronted with bills I’d flinch, pay what I could, and hope to straighten things out later.

It was a frightening day when I finally faced my situation. During such “rich” living, I’d not realized the weight that my debt added onto my life. I was tipping the scales way out of balance, and the only way to even begin to fix things was to gather my finances and face the situation head-on.

Now, I watch my finances daily, with a slight degree of paranoia. I suspect that any moment I’m not paying attention, a spending mishap or stock fluctuation will sneak in and alter my financial landscape. I am obsessed with a constant need to know where I stand against my goals, planning strategies and swelling with pride at every small stride forward. I thrive as I watch my debt dwindle.

Besides my mindset, my biggest obstacle to financial awareness was my hatred of math. There, I’ve said it. I despise balancing checkbooks, tallying accounts, and performing almost any analysis involving a calculator. And though I’m starting to get to know them better, balance sheets, cash flows, and other documents which look like corporate financials make my eyes glaze over.

I have outlined my own budget and expenses several hundred times in Excel, only to find I never want to look at them again. It’s just how I am.

While I had high hopes for MS Money and Quicken, I found them to be expensive and somewhat burdensome to work with. I spent hours categorizing things only to realize that I didn’t have the time at home to keep it up, nor did I find the reports all that helpful.

I kept wanting it to be simpler, clearer, cheaper. My finances at a glance, in one place, but accessible online from anywhere without needing to remember scores of passwords.

I found this to some degree in Yodlee’s account aggregation, encountering the service first as Wachovia’s “One Stop” and then as Fidelity’s “Full View“. Some use Yodlee MoneyCenter directly, I’ve heard, but I always access their services via one of my account providers.

Though the service can look and work differently based on implementation, it’s relatively simple. Essentially, there’s a one-time setup phase, where you add your accounts, and then each day you log in and refresh your data to view a snapshot of exactly where you stand financially.

Bank accounts, loans, brokerage, credit cards, 401K and other investments tally up to a neat net worth, with transaction information easily accessible. Even insurance, frequent flyer miles and my billpay service can be added to this view. I set it up once, and now log in every day, sometimes two or three times a day. I told you it’s an obsession.

The problem? It’s great to get such a high-level at-a-glance view, but it hasn’t grown with my needs. There are no analytical tools, no way to categorize and tag items and get different views or reports of the information presented or any helpful tips to improve my situation.

Until Mint, that is. Launched last week, this free online money management service features the security and ease-of-use of the Yodlee platform with a host of simple yet effective tools for categorizing, analyzing and ultimately improving one’s relationship with money.

Their web site makes some impressive claims:

Mint is the freshest, most intelligent way for you to manage your money online. Not only is Mint free, it saves you money. While existing personal finance software “solutions” require hours to set up, a passion for accounting (is that possible?) and hours of weekly maintenance, Mint is virtually effortless.

Can it be true? Can it really save you money? Most importantly, can it save me from the things I most dread, mathematics and accounting?

I’ve been beta testing their service for a few months now, and have formed some strong opinions so far. So, let me introduce you to Mint.

The Setup
Signing up is extremely simple – enter your e-mail, zip code and password and you’re ready to begin adding accounts. The site advertises “Two minutes to financial organization”, and I found that to be true once the traffic surge resulting from Mint’s recent TechCrunch 40 award win finally subsided.

The Add Accounts page itself is set up like a virtual wallet with each account on its own “card”, so you click a card to find your financial institution from the over 10,000 banks and credit card companies Mint currently supports and then add away until your finances are fully represented. You enter your access information and answer any security questions once, and Mint stores this information for future retrievals.

While some may have concerns about the security of this setup, I feel comfortable with it because of my experience to date with Yodlee. Plus, most of the access information is not stored in clear text so it would not be easily harvested if the account was compromised. Overall, I find that daily monitoring of one’s accounts is the best way to ensure that damages are limited and quickly controlled if unauthorized access occurs.

Mint does not currently allow users to add brokerage and investment accounts, however since the Yodlee platform offers this I am expecting it to be part of a future release. My bank and credit card accounts alone were sufficient to give me a taste of what Mint can offer, but I feel that including all types of financial assets is what will make the service a true success.

For now, this is what my Add Accounts page looks like:

The Service
As depicted in the screenshot below, Mint has one of the friendliest, clearest net worth depictions I’ve seen to date, with a clear outline of accounts and a “financial health” meter that shows cash versus debt in a high-level, easy to understand way. The dashboard displays important alerts for things like low balances or deposits, bringing these to your attention. E-mail alerts are available as well, keeping your money on your mind even when you’re not logged in.

But that’s not all. Within the Transactions tab, all transactions from these accounts are displayed and pre-categorized for you, although you can change categories or add notes at any time. A handy chart shows your spending history for the last three months when you highlight any vendor, and a similar income history is provided for deposits. Labels can be added for additional clarity and classification, but the whole interaction is very easy.

The Spending Trends tab offers some great graphs and charts, showing spending by category and, once a category is selected, provides percentages of spending by vendor. The bottom of this page features a section called “How is my spending changing?”, especially valuable for those seeking to benchmark progress on altering spending habits. The graphical approach makes interpretation extremely simple.

The feature which really distinguishes Mint from its competitors, however, lies within the Ways To Save tab. Unlike Wesabe, which when I tried it offered a small group of user-provided comments intended to be hints, Mint points out exactly what kinds of savings can result from simple changes in account providers, whether in terms of interest earnings or credit card interest rates. This, too, is clearly illustrated, as shown below:

As Mint is still growing its offering, I expect these suggestions to grow more extensive and robust over time. I am a bit of a rate-chaser and have spent hours on bankrate.com trying to determine where I should move my money or credit account and what my savings can be if I do so. If Mint can provide sufficient information for me to do a true comparison within their service, I won’t have to search elsewhere for rates and will remain on the pulse of what’s competitive.

Unlike Yodlee, I don’t need to constantly refresh my account data with Mint. Mint updates this information automatically and can e-mail alerts regarding unusual activity, low balance or other bank fees and more, making sure that I’m kept aware of important happenings even if I forget to log in and check up on things. Features like this help people like me to be a bit less obsessive about checking my accounts – I can hand-pick the alerts I’d like to receive and even have them sent to my mobile phone or wireless device if I’m traveling.

Mint delivers on its promises to help users better understand their spending and financial habits and highlight opportunities for savings. Their web site boasts that they can help users “stop overpaying” and “start oversaving” by locating lower prices and higher interest rates, and it seems the architecture is in place to accomplish this if Mint develops a strong and varied range of partners.

I believe Mint provides a great, easy and best of all FREE way for people to begin a daily relationship with their finances, and if the service continues to grow over time to encompass my entire financial picture, I’ll be completely sold.

I may never do math again.

The Consumerism Commentary Podcast is in full swing with new episodes every Sunday. Listen and subscribe now!

Account Watchers and Account Ignorers Anonymous, Meet Mint

Wall Street Journal Complete Real-Estate Investing Guidebook
David Crook
(9/10)

Occasionally, publicity agents, publishers, or sometimes even authors, send me books with the request that I read and review what they send. That was not the case with this book.

A few months ago, I wrote about the cost of owning a home over 30 years based on information in the Wall Street Journal, and it generated a fairly intense discussion. The data presented show that ownership of your primary home is not a good investment. When people talk about their home appreciation as a function of current market price minus purchase price, they’re forgetting about the thousands of dollars in maintenance, repairs, and upgrades, which in any real investment would be added to the cost basis, reducing their real return.

The author of the article showed, from his own experience as well as extensive external data, that you could easily be $1 million into your home after 30 years.

I took some questions from Consumerism Commentary readers to the article’s author, David Crook, the editor of The Wall Street Journal Sunday. We exchanged emails and I presented a follow-up post outlining a realistic picture of the cost of home improvements. I added Crook’s latest book, Complete Real-Estate Investing Guidebook, to my Amazon wish list so I would remember to look for it while browsing a bookstore some day.

Not much later, a friend of mine (and occasional Consumerism Commentary commenter) who works at Dow Jones presented me with a copy of the book signed by the author. Thanks! Distracted by my move, I have finally finished the book.

David Crook’s Complete Real-Estate Investing Guidebook goes into the kind of detail “gurus” like Robert Kiyosaki make you believe you have to pay thousands of dollars at a seminar to receive. Don’t get me wrong, the book does include a requisite hook: “The 20 Things Every Real-Estate Investor Needs to Know,” but thankfully Crook doesn’t toy around with this concept. Instead there are specific, actionable ideas surrounded by examples and case studies throughout the 241 pages.

There are no get-rich-quick schemes here. Crook routinely warns the reader against promises of no-money-down investments and “something-for-nothing hucksters.” The author’s advice is meant to be taken by a novice investor over a period of time, perhaps up to 12 months or longer just to get started on the first property.

After Crook sets the premise that the house you live in is not an investment for the purpose of income, he goes on to explain how to find the money to get started, emphasizing the importance of leverage. The author presents detailed formulas for evaluating properties in order to find good values in real estate, suggesting that the best purchases would be at a 30% discount from the property’s market value.

A significant chapter is devoted to explaining in detail the tax benefits of real-estate investing. The government in this country starting with the Founding Fathers has always encouraged land development, and this continues to the current day. Here is Crook’s comparison:

A person making a $135,000 salary would probably end up paying $20,000 to $25,000 a year in federal income taxes, plus $7,000 more in Social Security and Medicare taxes. A stock investor earning $135,000 a year in dividends would pay $20,000 a year in taxes. The landlord’s tax bill [on $135,000 rental property income]? About $1,800.

In the next few chapters, David Crook writes about smaller residential investment properties, larger residential properties like apartment complexes, and commercial buildings. Each type of investment has its own benefits and drawbacks and an investor may be a good fit for one type while not the others. For example, Crook discusses the need for staff, including “supers” and rental managers, when it comes to investing in multifamily buildings.

The author explains the differences between six different forms of ownership (sole proprietorship, general and limited partnership, C and S corporations, and a limited liability company) and what investment situations call for which types.

I found it interesting that Crook gives the reader a “way out,” asking for the would-be investor to question whether he or she truly wants to be a landlord. He admits that the type of work necessary to be successful is not a piece of cake. Other gurus would be happy to let you believe that all you have to do is wish, and you can make money in real-estate investing.

The section on Real Estate Investment Trusts (REITs) is informative. These investments are presented as a way to use the stock market to invest in real estate, perhaps for those who can’t stomach being a landlord. He discusses recent REIT performance and explains what type of investments to look for based on recent performance and growth opportunities.

The final chapter includes the aforementioned 20 Rules, but rather than being built up throughout the book as a secret to be revealed, it is basically a summary of the most important points already discussed in detail.

Crook takes a page from Stanley and Danko’s The Millionaire Next Door in his description of real-estate millionaires.

The vast majority of rich people are distinguished by one overwhelming, dominating trait: They’re frugal. They drive old cars, live in modest houses and wear average clothes. They are rich, not because they are lucky or they have found some secret formula to wealth, but because they work hard, keep a long-term perspective and spend little.

Readers who get comfortable with David Crook’s Complete Real-Estate Investing Guidebook have a good chance of determining which type of real-estate investment (if any) is right for them and becoming successful after the appropriate time and effort.

I will be giving away one copy of Complete Real-Estate Investing Guidebook from Amazon.com, so stay tuned for an announcement of how you can be the lucky winner.

The Consumerism Commentary Podcast is in full swing with new episodes every Sunday. Listen and subscribe now!

Review: Complete Real-Estate Investing Guidebook by David Crook

When I decided that I didn’t want to break my back moving my heavier furniture down one flight and up at least one more, I also decided that I wanted someone else to do that for me. I could have done more research when choosing a moving company, as I was hoping for a recommendation from a friend or co-worker. No one was able to quickly provide any information, so I did what most people do, I checked the Yellow Pages.

I felt I’d be more comfortable going with a national company with name recognition, and my eyes focused on the listing for Two Men and a Truck. I had seen their trucks around before, white with black lettering, and the simplicity of their concept and the student-on-the-cheap attitude invited me to do more research.

Thanks to Epinions, I was able to find out more about the company from past customers’ perspectives. There were, as I would have guessed, many favorable and many unfavorable reviews, with the positive outnumbering the negative. One thing I had to keep in mind is that each office of Two Men and a Truck is independently operated and therefore wildly different experiences would be expected from location to location. There were no reviews for my local office specifically.

I filled out a form online and quickly received a quote. The move would be $120 per hour, plus one hour drive time. They don’t charge by the pound, so there’s no risk of weight fraud. The hourly rate was a little high, but it’s comparable for the area. A move on a Saturday carried a minimum of 4 hours while a Sunday move required 6 hours. To schedule the move on a weekday, the minimum charge would be “only” for two hours. I decided that it would be worth it to work from home a half day and schedule the move on a weekday afternoon.

When I called for more details about the quote, their office manager exteaplained that their crewss were fully booked for the day I scheduled, but they would be able to pull a crew from the North Arlington office — farther away — without any additional travel charge.

On the day of the move — yesterday — I received a call about 30 minutes before their scheduled arrival time. The directions they received from the office were not very good and they were getting lost. I directed them properly and they arrived 15 minutes early. After explaining what I wanted to have moved and filling out the paperwork (liability waiver, etc.), the crew, two men named N. and K., went to work.

They did a decent job protecting my furniture, not that what I have is worth much. I was concerned that they didn’t wrap my mattress in plastic, but once it was lifted onto the truck, they did a good job of protecting it. To my surprise, rather than carrying the lighter items down the stairs outside my old apartment, one man passed items over the balcony to the other.

After the truck was fully loaded, I gave each guy a bottle of water and they followed me to the new apartment. When they arrived, they drove around to reposition the truck and began unloading. During the whole process, the crew was friendly and conversational. They saw my bicycle on the balcony and we talked a little about riding.

As they were finishing up I offered a couple of cans of soda. K. reassembled my dining room table, adding in the leaf, and I did the closing paperwork with N.

The entire process took a little less than the two hour minimum charge, so I’m very pleased with my decision to schedule the move on a weekday, “saving” at least $240. After they were finished, I offered them soda, provided them directions back to the Turnpike, and sent them on their way. The only problem I had was with my entertainment center. I noticed it was scratched up badly after they left. I could just repaint the black shelves, but I probably won’t. The center was passed down to me from a friend, and I’ll likely get rid of it when it’s time to buy a new television.

Here’s the full breakdown of the cost:

All in all, it was a good move, and I would recommend them to anyone else in the area who needs to move, keeping in mind that any branch of the office — or any crew — might provide an experience that is not quite as good.

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Experience Review: Two Men and a Truck (North Arlington, NJ)

Cash, Cars & College: A Young Person’s Guide to Money
Janine Bolon
(6/10)

When it comes to book reviews, I am usually contacted by the publishers, press agents, or public relations teams. When an author takes the time to email me directly, I pay more attention. I was contacted a few weeks ago by Janine Bolon, the author of Money…It’s Not Just for Rich People!, to review her latest book, Cash, Cars and College.

The book is more like an oversized pamphlet, at 91 pages (including appendices) with large print. The intended audience consists of students between the ages of 12 and 19, but I think the book is most effective for the young end of that range. There are only a few major concepts in the book, and they are explained well for the reader, even taking into account a wide variety of experiences and parental lessons a young teen may have.

Bolon explains that money doesn’t move in a straight line (in, then out), but rather in a cycle of living, saving, and giving. With this idea, money is more likely to come into your life when you give it away. To take full advantage of this cycle, Bolon instructs through some age-appropriate activities to split any income you receive (except for money from your mom for buying clothes, for example) into five buckets based on her 40/60 Principle.

* 40% goes to living. This, the “40%” in the 40/60 Principle, is the money you spend on yourself.
* 20% goes to short-term savings. The description in the book matches what I’ve written about in the form of an emergency fund: savings for unexpected expenses.
* 20% goes to long-term savings. While it’s not completely explained in these terms, this is your retirement fund. If I had known to save money for retirement when I was 12, I’d be much further along than I am now, having started when I was 26 or so.
* 10% goes to a philanthropy of your choice. From the book: “This cash demonstrates your willingness to share the good things that the Universe has given you — thereby showing that you can be trusted to continue receiving (and sharing) the good thingsof the world.”
* 10% goes to a spiritual institution of your choice. While again not explained in the terms we’re familiar with as adults, this is the typical tithing that is taught in the Bible. More importantly, this money is used for giving back to the community of which you’re a part. Bolon does suggest for those who have no religious affiliation to use this 10% for additional philanthropic donations to keep the cycle flowing.

The above points form the basis of the book. They are in fact “points,” as Bolon has created a five-pointed star to illustrate each destination for income. Around these five points, Bolon fills the book with good advice, perfect for a young teenager. For example, Bolon imparts the lesson: “Do what you like, the money will come.” This certainly encourages kids to improve their skills for whatever type of activity they are most interested in.

Bolon also explains the virtues of frugality, and for some kids, this will be the first they’ve heard of the concept. She also tackles credit card debt and compound interest in such a way that young adults will understand but not find boring. These concepts, as well as others, are reinforced with exercises at the end of each chapter, similar to — but yet much different than — exercises at the end of the school text books with which readers of this age will be quite familiar.

The goal of this book is to set these young adults on the path to financial maturity, and here’s her list for getting started on that path:

* Break the (piggy) bank. This refers to the money destinations listed above, based on the 40/60 Principle.
* Plow the ground. Open up two accounts at the bank with your money for short-term and long-term savings, and let compound interest go to work.
* Catch a porpoise. Bolon wants everyone to determine their passion in life — “porpoise” being a pun on the word “purpose” — which will guide them through their choices.
* Drive on. Continue learning about money by reading more books that will lead towards financial independence.
* Branch out. I addition to books, find other resources, such as magazines and, dare I say, websites.
* Stay engaged. Learn all kids of new things continuously, and never stop exercising your brain.
* Relax! Let the world do what it is supposed to do while you take care of your responsibilities, but it will take a long time. Be patient.

Janine Bolon’s Cash, Cars & College is a good introduction for kids getting an allowance or babysitting, with a small income coming in. Now that they have money to call their own, they can benefit from the author’s suggestions for spending, saving, and giving. Bolon handles the section on giving without preaching and without overly emphasizing religion, which I appreciate. All in all, Cash, Cars & College will set young adults on the right path towards financial maturity, if they follow the exercises and make her suggestions part of their permanent philosophy.

Why did I give only 6 stars out of 10? I think teenagers in the work force for the first time, say as a waitress or a fast food worker, might have some questions not covered by the book. For example, how do taxes fit into the 40/60 Principle? Are taxes paid from the 40% “living” category or does the entire pool of cash consider only after-tax income? A 12 year old may not be concerned with this question, but a 19 year old might be. Also, I don’t remember much discussion of cars and college in the book, though they are included in the title. Nevertheless, this short book is full of quality suggestions and exercises that can provide good talking points for parents with their children.

As always, I give away the books I receive for review. Look for a contest of some sort in the next few days. If you’re the parent of a teenager, pay close attention.

The Consumerism Commentary Podcast is in full swing with new episodes every Sunday. Listen and subscribe now!

Review: Cash, Cars & College by Janine Bolon

Excuse Me, Your Job Is Waiting: Attract the Work You Want
Laura George
(7/10)

A few days ago, I finished reading Excuse Me, Your Job Is Waiting, by Laura George. This book follows in the footsteps of another, Excuse Me, Your Life Is Waiting. The premise of both books is the “law of attraction,” which is generally interpreted in popular culture as the idea that events are influenced by the attitude of those involved. Positive thinking helps encourage positive outcomes.

Of course, none of this is scientifically proven, at least not within this book. However, there are enough anecdotal testimonies to convince people the concept is “true.” In this convincing, positive outcomes can be attributed to positive thinking and negative outcomes can be negative thinking.

I’m convinced, for the most part. Whether positive thinking actually influences outcomes in a cause-effect relationship, I’m not entirely sure. Positive thinking certainly makes one feel better, and this attitude can be picked up by others involved in active communication, and can be perceived as a connection, making everyone feel better about the relationship. If you’re on a job interview, this is a good thing.

The book goes much farther with this idea.

Laura George focuses on the act of finding a job and the way positive thinking can increase your chances of being successful. Even the act of sending out résumés can deliver different results depending on the mindset the job searcher has.

Despite the airiness of the concept of the “law of attraction,” Laura’s writing is down to earth and connects to the casual reader, who is perhaps becoming increasingly frustrated in her or his job hunt. While this individual is the primary target audience, this book is good for anyone who is not happy and searching for a possible reason happiness continues to be elusive.

The author sees the problem money and the feelings money evokes have on your success.

If you only work for money — and you don’t have a healthy relationship with money — you are working for a negative feeling. Many people who only work for money don’t work long. They get easily bored with a job and move on to some other job. Sometimes they get fired. Sometimes they simply walk away from their jobs. People who work for money attract flawed jobs — jobs that they want to leave as soon as their coffers are filled. So if your energy about money is all over the place, it’s no wonder that a job hasn’t fallen into your world.

I take this to mean that if your attitude about money involves jealousy (of those who have or display more) or financial insatiability, you will always attract jobs that satisfy the wrong part of the mind. Later on, Laura admits that people work for money, and even the most positive thinker would be looking for another job if their paycheck disappeared. The author provides some important tips for dealing with financial issues of a job at the right time — when you’re searching for work, not after you’ve been on the job.

Excuse Me, Your Job is Waiting, in addition to the touchy-feely concepts, is stuffed with great, practical ideas for landing the job you really want. Laura George has extensive experience as a human resources manager and consultant, as well as just as much practice being on the other side of the HR desk as a job seeker.

As frequent readers of Consumerism Commentary might expect, I have three copies of this book to give away to lucky readers, one of which is the copy I read for this review. (The cover is slightly creased and some pages have corners bent as bookmarks.) I’ll announce the “contest” to win a copy some time in the next few days, so check back soon.

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Review: Excuse Me, Your Job is Waiting by Laura George

Cameron Johnson features testimonials from T. Harv Eker and Donald Trump on the dust jacket for his new book, You Call the Shots. The book also includes a foreword by David Bach. However, this book outshines in many ways what I am used to seeing (over and over) from the typical financial gurus like Trump and Bach. Like the others, this book promises something unique: the 19 essential secrets of entrepreneurship. Unlike other books I’ve read, Cameron approaches the book through sharing personal stories about growing up, dealing with expectations, learning about the world of entrepreneurship, and building a wide variety of businesses.

I won’t summarize Cameron’s complete entrepreneurial résumé, but it’s interesting to see his development from an eight-year-old fan of Donald Trump, unafraid to put himself “out there” and get the attention of an individual who likely had better things to do than go out of his way to make a random kid happy, to a savvy business owner. Donald Trump was only one of Cameron’s inspirations, however.

Cameron’s family was in the Ford dealership business for several generations, and seeing his father run the business influenced the way the young entrepreneur thought about operations, customer service, networking and advertising. He started small, printing greeting cards from his family’s PC and branching out into sales of Beanie Babies. He jumped onto the Internet bandwagon early on and founded several web-based businesses which he later sold.

I thoroughly enjoyed the various stories within You Call the Shots. While the cover of the book promises 19 secrets of entrepreneurship, Cameron does not feed the reader overplayed generic ideas and abstract themes. Cameron related every thought to pieces of his experience despite the fact he’s barely 21 years old, and weaved the “secrets” through a narrative which for the most part followed his life chronologically.

Much of Cameron’s experience relates directly to online businesses, specifically his ability to grow the businesses through their initial stages and in many cases sell the assets for a significant (but always undisclosed) profit. Even though there are some exceptions, even the Internet-based activities provide lessons that can be useful when managing any kind of business.

This book should be required reading for any young adult showing an interest in entrepreneurship, but those with significantly more experience may find the stories within the book a bit quaint. These stories of Cameron’s specific and entertaining experiences allow this book to go above and beyond the call of duty.

Here are the 19 straightforward “essential secrets of entrepreneurship” presented in You Call the Shots. While I can share this overview with you, to truly understand Cameron’s point of view you must read his stories within the book.

• Put yourself out there
• Start small
• Make your money work for you
• Look close to home for great ideas
• Balance work with life
• Surround yourself with great people
• Make yourself your brand
• Don’t be afraid to negotiate
• Make your own tough decisions
• Adapt or die
• Find great mentors
• Seek out knowledge every day
• Use the power of the press
• Stick to your guns
• Get experience on the ground
• Never underestimate the value of your customers
• Creatively build on your experience
• Remember what it’s really all about
• Be the entrepreneur you want to be

As I’ve said above, the power of this book is in the extensive details surrounding Cameron’s experiences, whether he is working a lemonade stand putting his preteen peers out of business, managing sales for his father’s dealership, traveling to Japan to give speeches, or consulting. Cameron has his own blog, naturally, and he has agreed to be a guest blogger on Consumerism Commentary in the near future. His publisher also agreed, at my request, to provide several extra copies of You Call the Shots, which I highly recommend if you haven’t gathered that, to be given away.

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Review: You Call the Shots by Cameron Johnson

The introduction of The Maui Millionaires by David Finkel and Diane Kennedy, CPA read like a sales pitch. This turned me off immediately. I felt like I was sitting in one of those free seminars with one of those energetic, motivational speakers, whose goal was nothing more than to sell me some abstract concepts and more future seminars. Seminars, like this book’s introduction, are all about the “up-sell.” If I were to give in, this would be quite expensive…

In this case, they authors want me to drop $30,000 on a retreat at which I can network with other businesspeople who follow the techniques mentioned in the book. I was happy to finish the completely unnecessary, self-congratulatory introduction and move on to the meat.

Like most wealth programs, this book starts out with a first step of changing mindset. I do agree that if you want extraordinary results from your life, you have to be able to conceive extraordinary ideas. The other part of changing mindset is reconditioning, in which ideas are repeated until they become part of a person’s inherent philosophy. The Maui Millionaires approach reconditioning as “upgrading your wealth operating system.” This is the first of several metaphors I enjoyed throughout the book, although I could do without the trademark symbol (™) which appeared after every Clever Phrase™.

The book contains mental exercises in every chapter, and the authors claim that the exercises must be completed in order to receive the full benefit of the text. There are frequent references to the book’s website, where the reader can complete the exercises online and access other “special offers.”

Here are the six steps to the “fourth dimension of wealth,” detailed in the book.

Step 1. Upgrade your wealth operating system. As I mentioned before, this is the step in which one begins thinking differently about wealth. It’s not a bad thing to have money. During this step, the prospective Maui Millionaire rids the brain of negative thoughts that stand in the way of success.

Step 2. Dream big. As we’re busy with life, trying to make a living, it’s easy to forget about the big dreams. The authors have seven categories of dreams: health, financial, relationship, self-development, adventure, spirituality, and sharing. The message is that your big dreams are attainable, if you follow the authors’ advice.

Step 3. Mastermind your way to millions. The Maui Millionaires is all about networking, especially at the $30,000 retreats. The authors suggest associating reguarly with a group of like-minded individuals who can function as mentors to and with each other.

Step 4. Build level three wealth and enjoy a Maui lifestyle. What does this mean? Well, Level Three Wealth is the state of being financially free and being able to pay for an extraordinary life through truly passive income. This is the promise that pulls people in.

Step 5. Tap into Maui giving to create a legacy. Giving and social responsibility is a big part of the authors’ philosophy, and I like that. A major reason Maui Millionaires desire to increase their personal wealth is to have more to give away. What I really like is the authors’ ability to speak about responsibility to give back to the community without evoking religion-based beliefs. Some examples they provide involve church, but divine declaration is not cited as a reason for sharing wealth with the world.

Step 6. Connect with the Maui wealth-building community. The last step is awarded the shortest section of the book, because it is nothing more than the instruction to pay $30,000 to register for the Maui Millionaire wealth retreat.

If you get past the “sell, sell, sell” attitude of the book, you will find some quality pieces of advice. I particularly like some of the ratios they describe to be used for evaluating your financial position. Beyond measuring just net worth and income, they authors introduce the trademarked R-Score, an individual’s net passive income divided by total net worth. For example, if you have a net worth of $500,000 and you generate $10,000 in passive income each year, your R-Score&treade; is 2%. They also stress the importance of trending; you want that R-Score™ to increase each year.

Obviously, this is just a measurement device, and not an actual suggestion for establishing passive income. The book is a little short on practical money-making techniques, relying heavily on mindset and networking. Examples from several self-professed Maui Millionaires are peppered throughout the book, and most of their wealth comes from real estate, as one would guess.

The Maui Millionaires claims to allow the reader to “discover the secrets behind the world’s most exclusive wealth retreat and become financially free.” The book likely covers the basics of the $30,000 retreat, but doesn’t capture the important part, the networking and mentoring. It is a huge advantage to be able to surround yourself with like-minded people when you’re involved in any endeavor. The price tag is a bit hefty in this case.

I’d like to see how many retreat attendees end up not becoming wealthy by their own description. $30,000 is a big investment for most people, and is a lot to spend on a dream without any real guarantees. It seems to me the money making scheme here isn’t what is in the book, but it is the book and seminar.

If you’re interested in seeing what’s inside the book for yourself, stay tuned. I’ll be giving away my copy in the next few days.

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Review: The Maui Millionaires by David Finkel and Diane Kennedy

I recently finished reading The Smartest Investment Book You’ll Ever Read: The Simple, Stress-Free Way to Reach Your Investment Goals [Amazon affiliate] by Daniel R. Solin. It’s a relatively short book with one simple point: For most people, investing in index funds is smarter than investing in actively managed mutual funds.

The chapters are short and it’s a quick read. Avid readers with a few hours could get through the book in one sitting; with my dedicated reading time of 20 minutes a day post-midnight, it took me a few days to finish.

The Smartest Investment Book outlines, in each of its chapters, the difference between Smart Investing and Hyperactive Investing. Smart Investors understand, through seemingly unlimited research, that over the long term, the market always wins the fight against Hyperative Investors (also known as traders, brokers, stock pickers, etc.). Therefore, index funds whose goal is to match market benchmarks while charging low fees offer investors the best opportunities for growing their money.

Solin also focuses on asset allocation. The distribution of funds between stocks, bonds, and cash, between growth and value, and between small, mid, and large cap is what determines the likely long-term return. The book ends with a comprehensive questionnaire to help determine any individual’s appropriate asset allocation. The questionnaire is also available online on the book’s website, but unfortunately requires an email address and phone number.

I completed the online questionnaire (with a fake phone number, obviously) and I was told my asset allocation should consist of 90% stocks, the highest amount recommended by the book. The author feels (and shows through examinations of historical data) that any more than 90% of investable assets in stocks adds too much risk with no return over a portfolio with 90% stocks.

Is this, as the title claims, the smartest investment book you’ll ever read? While the quality of past books I’ve read does not predict future selections, I can say it’s the smartest so far. However, I would have preferred more hard data. I enjoyed the book and would recommend it to anyone who is ready to invest but wary of salesspeak. I’d also recommend the book to people who have already sipped the Kool-Aid, although they might not be open to what Solin claims. While the author puts a great effort into presenting the data to sway investors to become Smart about their investments, I don’t think everyone will be convinced. That’s not necessarily a bad thing, especially for those who do believe what this book has put forth.

The author, Daniel Solin, is a principal of Academic Wealth Management, LLP, a registered investment advisor that offers low-cost 401(k) plans that follow the philosophies laid out in the book.

Later this week, I will give away my copy of the book, so check back here often for your chance to get something for free.

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Review: The Smartest Investment Book You’ll Ever Read by Daniel R. Solin

The other day, I received a new book in the mail from a gracious publisher who is happy to trade a copy for the attention of a blog like Consumerism Commentary, be it favorable or unfavorable. Over the next few days I’ll be reading the self-referential The Smartest Investment Book You’ll Ever Read: The Simple, Stress-Free Way to Reach Your Investment Goals, by Daniel R. Solin. The book promises to “change the way you invest.” We shall see.

Once the review is posted, I will give the book away to one lucky blog reader, so keep your eyes peeled. If I can get through the book and post the review quickly, the lucky winner might have the book in hand before it is released on November 7, but it is unlikely.

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Upcoming Review: The Smartest Investment Book You’ll Ever Read

Yesterday marked the last day of October and the last day of JLP’s Bogleheads’ October Project, in which one chapter of the new book, The Bogleheads’ Guide to Investing, was reviewed by a different blogger each weekday.

On October 11, I participated by reviewing Chapter 8, Asset Allocation. Thanks, JLP, for setting up that opportunity. I also ran a little “contest” to give away my copy of the book, and the winner was Mattc. (Mattc, you should receive the book shortly.)

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The Bogleheads’ October Project is Complete!

This is a look at the eighth chapter of The Bogleheads’ Guide to Investing, by Taylor Larimore, Mel Lindauer, and Michael LeBoeuf. This chapter focuses on asset allocation, the “most important portfolio decision.”

The authors start by reviewing empirical research from the 20th century, including the studies that resulted in the development of Efficient Market Theory and Modern Portfolio Theory. The academic studies lead to the realization that most of which Wall Street sells is overpriced, index funds provide higher returns with less risk than managed funds, and there is no way to “beat the market” despite all Wall Street’s promises. Academics do not have the money to advertise, and thus their opinions aren’t popularized.

Most of a portfolio’s long term performance depends on the focus on a “strategic asset allocation policy.” One of these policies can be developed by evaluating an individual’s answers to four questions:

* What are your goals?
* What are your time frames?
* What is your risk tolerance?
* What is your personal financial situation?

Answers to these questions allow the investor to decide how to allocate his or her funds between various sock types (large cap, small cap, value, growth, international, and others like REITs) and various bond types (short-term, high-yield, inflation-protected, etc.).

The authors also provide eight different model portfolios for four different categories of investor (young, middle-aged, early retirement, and late retirement) with a focus on low-cost index funds from Vanguard.

The chapter is fairly short and manages to lightly touch the important aspects of asset allocation. An entire book can be written on the topic, though I’m sure only a few would be interested in reading it. The chapter covers the basics and is enough to inspire someone to evaluate their own asset allocation, as I did last night. Hopefully the taste of the chapter I provided whets your appetite for the entire chapter, which is unsurprisingly available within the book.

And now for this week’s giveaway! Here’s a discussion question for you to respond below (or just write any comment you feel like). How much thought have you put into your asset allocation strategy and how did you decide upon your choice? For example, did you use a certain “rule of thumb” that dictates your percentage of bonds should be your age?

A random winner will receive a copy (my copy) of The Bogleheads’ Guide to Investing and another copy of Elliott Wave Principle: Key to Market Behavior, by A.J. Frost. Both books are hardcover and in perfect condition. By the way, if you’re a “long time reader, first time commenter,” say so, and you’ll get two entries in the contest for the “price” of one.

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Review and Giveaway: The Bogleheads’ Guide to Investing: Asset Allocation

This month, I’ll be participating in JLP’s mass review of the book, The Boglehead’s Guide to Investing, by Larimore, Lindauer, and LeBoef. One blogger will review one chapter of the book throughout October. Look for my review of the Asset Allocation chapter next Wednesday. Here’s the entire schedule:

Monday, October 2
CHAPTER 1 – Choose a Sound Financial Lifestyle
All Financial Matters

Tuesday, October 3
CHAPTER 2 – Start Early and Invest Regularly
Five Cent Nickel

Wednesday, October 4
CHAPTER 3 – Know What You’re Buying Part 1
Young and Broke

Thursday, October 5
CHAPTER 4 – Know What You’re Buying Part 2
Penny Foolish

Friday, October 6
CHAPTER 5 – Preserving Your Purchasing Power With Inflation Protected Bonds
Mighty Bargain Hunter

Monday, October 9
CHAPTER 6 – How Much Do You Need to Save?
Caustic Musings

Tuesday, October 10
CHAPTER 7 – Keep it Simple
Blueprint for Financial Prosperity

Wednesday, October 11
CHAPTER 8 – Asset Allocation
Consumerism Commentary

Thursday, October 12
CHAPTER 9 – Costs Matter
Free Money Finance

Friday, October 13
CHAPTER 10 & 11 – Taxes Part 1, Part 2
Don’t Mess With Taxes

Monday, October 16
CHAPTER 12 – Diversification
MyMoneyForest

Tuesday, October 17
CHAPTER 13 – Performance Chasing and Market Timing are Hazardous to Your Wealth
I Will Teach You To Be Rich

Wednesday, October 18
CHAPTER 14 – Savvy Ways to Invest for College
Pragmatic Finance

Thursday, October 19
CHAPTER 15 – How to Manage a Windfall Successfully
Get Rich Slowly

Friday, October 20
CHAPTER 16 – Do You Need an Advisor?
Stop Buying Crap

Monday, October 23
CHAPTER 17 – Track Your Progress and Rebalance When Necessary
Tired but happy

Tuesday, October 24
CHAPTER 18 – Tune Out the “Noise”
MyMoneyBlog

Wednesday, October 25
CHAPTER 19 – Mastering Your Investments Means Mastering Your Emotions
It’s Just Money

Thursday, October 26
CHAPTER 20 – Making Your Money Last Longer Than You Do
Frugal For Life

Friday, October 27
CHAPTER 21 – Protect Your Assets by Being Well-Insured
Financial Freedumb

Monday, October 30
CHAPTER 22 – Passing It On When You Pass On
Udandi

Tuesday, October 31
CHAPTER 23 – You Can Do It!
Political Caluclations

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Group Review: The Bogleheads’ Guide to Investing

Last weekend at the wedding I attended, I spoke for some time with Matt from Consumer Reports. He works in the auto division, and he filled me in on how Consumer Reports does its research.

When CR evaluates products, employees approach the companies as typical consumers. For example, rather than the companies sending CR souped-up “review models,” like they do for other consumer review outfits, CR employees will go to a dealership “under cover,” haggle with the salesman, and purchase a car. This way, they’re getting the same deal and the same car everyone else gets.

This is how the non-profit organization operates for all of its products. From their mission statement:

To maintain our independence and impartiality, CU accepts no outside advertising, no free test samples, and has no agenda other than the interests of consumers… We buy all the products we use as test samples. We receive no special treatment. We accept no free samples. If a manufacturer sends us a free product, we return it.

Tomorrow I’ll post a quick blurb from their latest issue about what their undercover consumers discovered about “data brokers” like ChoicePoint — companies that sell your personal information without allowing you complete access.

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Consumer Reports’ Unique Approach

I’d probably grow a beard if my girlfriend let me. She obviously has way more sense than I do. I have been brainwashed into the general consumer thinking that I need a major brand razor with expensive refillable blades. Thus, I shave with a Gillette Mach3. Doobie has found a lesser-known razor that he feels is superior, the Equaline Matrix. Equaline is a brand developed by the Albertsons chain of stores, and the product can only be purchased therein. (Alas, no Amazon.com link to the product is available.)

Here’s a bit of Doobie’s review:

The first shave seemed decent. Not blow me away decent, but good. Of course, I had a two-day growth on my face, so that may have factored in. But after that it was smooth sailing. The shaves were as good as the Gillette Sensor, if not better. But that’s not the best part. My stubble can render a new Gillette Sensor blade inoperable after two shaves…sometimes three. Ever since I’ve been using the Matrix, I’ve been able to squeeze out up to a *week* of shaves before changing the blade. A WEEK.

Read Doobie’s full review on American Idle.

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Doobie Reviews the Equaline Matrix Razor

Every once in a while, I may share my thoughts on a particular purchase I made that I feel is worthwhile. In this case, I’m writing about the BRAUN Oral-B Braun 980TX Bright Advance Power Electric Toothbrush. I purchased it for $30 from Macy’s and Amazon.com has it for the same price.

It was sort of a spur-of-the-moment purchase — I do one of these about once a month. However, it is something I’ve wanted for a long time. When I was younger, I didn’t pay much attention to my teeth, but after I left college I decided I didn’t want to hear my dentist chastize me. I gained better habits, eventually had my wisdom teeth removed, and focused on giving myself a nicer smile.

While I haven’t measured this scientifically, I believe I’m getting better results from the electric toothbrush than from the regular brushes I used to use. My gums are less sore, and combined with flossing and occasionally using an interdental pick, my teeth appear healthier. Don’t get me wrong, my teeth and gums were always healthy, but I wanted some improvement.

The only drawback to the electric toothbrush is the need to occasionally buy new brush tips. It’s no worse than buying new blades for a shaving razor.

A quick search on Amazon.com tells me the price I paid was appropriate. My choice was neither the fanciest nor the most basic brush, and so far, the brush has operated flawlessly.

No one paid me to write about this item, nor did anyone suggest to me that I do so. With all the “paid web content” incentives gaining popularity, I think it’s important that readers know.

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Favorite Purchase, June 2006: Braun Electric Toothbrush

After arriving in southern California, I was treated to an In-N-Out burger (a “double-double”) for the first time last night. The burger and the chocolate shake live up to the hype, for the most part. While I’m not normally a fast food afficionado (too expensive and usually gross and unsettling), I was told I could make an exception.

It was a little messy but surprisingly tasty.

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In-N-Out