This is a guest post by Kathryn Marion, author of Grads: Take Charge of Your First Year After College. Last week, I posted Transitioning to the Real world and asked for questions for Kathryn.  Today, Kathyrn provides her answers:

I know that saving money is important, but I also love traveling/vacationing which gets expensive. Some friends tell me to save all that I can and have fun later, while some other friends tell me to have fun now and that I’ll make money later in life. What’s a good balance of saving vs. spending when I’m just starting out and not making a lot? — Diana

That’s a great question, Diana! Both sets of friends have good points. Most financial advisors would probably side with the save-now-travel-later approach. More free-wheeling types would definitely lean toward the travel-now-make-up-for-it-later strategy. But my first inclination is to ask: do you really have to choose? I don’t, necessarily, see this as an either-or proposition. Take a close look at your skills (both technical and functional) and see if you can create a way to combine your love of travel with paid work.

The possibilities are virtually endless-it just takes a creative person to get the two interests to dovetail. Here are just a few possibilities that come to mind:

• teach English in another country, or even more than one! Check out www.TeachAbroad.com or CIEE’s site for information and opportunities;
• teach anything you’re good at (cooking, crafts, music, sports) through schools, non-profits, Chambers of Commerce or their equivalents-around the US, the continent, or the world;
• exchanging a few hours’ work per day for room and board through www.WorkAway.info or www.GoNomad.com (see their article on Short-Term Vacation Work Abroad);
• making a name for yourself in a field like photography, writing (including blogging), or speaking, then finding a way to sell your services along the way or even get a company to sponsor trips.

You sound like a good candidate to get Tim Ferriss’ book, The Four-Hour Work Week. Tim’s approach is a little different: he created a business that runs so automatically that he spends little time on it each week while he travels the world doing all the fun things he wants, but many of the strategies he lays out are very applicable to your situation. I’m sure you would find some good ideas in the book.

It’s easy to paint an exciting or romantic picture of this kind of lifestyle. Many people may think they want to live that way, but in reality few are probably well suited for it. There is little feeling of financial security because no one ‘gig’ lasts for long or pays a large lump sum to cover expenses during gaps between jobs. I think it takes an entrepreneurial spirit as well as a true sense of adventure and a high comfort level for risk to make a successful go of it.

All that being said, I would recommend that you not jump either way too quickly. If you think you can stomach the lifestyle (even get energized by it), find and talk to as many people who travel in their work as you possibly can. Find out how they created a way to get paid and travel at the same time. Write down what you would like to do (and where). Then set goals, figure out what you need to do to make it happen (such as save a minimum amount of cash or polish up an important skill), and work your plan.

The most important piece of this process is the self assessment-be honest and realistic about what you can, and want to, handle as far as risk and adventure. When you’ve made your decision, commit to it and throw yourself full force into making it a success.

My brother in law recently graduated with a degree in accounting and finance and, with the job market being what it is, he is thinking about staying in school to get an MBA.

From what I’ve heard recently, an MBA doesn’t necessarily open any more doors for people anymore because they are a-dime-a-dozen these days. His parents think he should get the MBA, because his father did and it really helped to spark his career, but that was a different time when not everyone had MBAs and also his father’s company paid for him to get it. My brother in law will be paying out of his own pocket.

He has a steady job (blue collar) that pays sufficiently that I recommend he stick with and keep applying for accounting jobs, and then when he does get one, see if they will pay for the MBA.

Any insights into this would be much appreciated. — Jeffrey

You’re a good brother-in-law, Jeffrey, and I commend you on trying to help. I also like the way you think. You’re right that an MBA does not automatically spell more opportunities or higher salaries these days. And not all MBA degrees are equally valuable, either. Spending two or more years out of the job market, paying tuition at a second-rate grad school, is more likely to land someone in the unemployment line with a load of new debt. If your brother-in-law wants to pursue that degree, he needs to get into the best program possible-which, of course, is going to be more expensive. Not to mention that while in school full-time he will likely not be covered under a health insurance plan-what will happen to his finances if the unexpected were to happen during that time?

There’s something else to consider as well: entering an MBA program right on the heels of earning an undergraduate degree is not an ideal plan. He will get much more from the program after he has at least two years of related work under his belt. His experiences, coupled with the coursework, are what will make him a more valuable candidate upon graduation.

Has your brother-in-law looked into making a change right inside his current company to a finance or accounting position? Or would his current employer be willing to let him spend some time in the accounting department on top of his normal hours as a sort of trial period or on-the-job training before making a switch? It would be longer hours, but the experience would be valuable, no matter what the outcome.

Alternatively, he could offer to work for free for a limited time at another company in their finance or accounting department as a way of getting his foot in the door. If he did his research and made this offer to companies that provide education benefits to their employees, so much the better, since he could then pursue the MBA if he got the job.

If those options don’t work out, your brother-in-law’s father has to realize that the world of work is very different than it was when he was in his twenties-his son has to deal with the reality of today’s market. Sticking with the steady, blue-collar job while searching for other opportunities is the wisest course of action. If he still wants to work on an MBA, that can always come later, either full- or part-time, if it’s really needed to move up in his chosen field.

This is a guest post from the blogger behind Studenomics a personal finance blog that offers common sense advice for college students and recent graduates. Studenomics is the ultimate resource for young people looking for advice on how to survive this current recession, grow their careers, manage their
finances, and still be able to enjoy the weekends.

Summer of George Introduction

Four hours of sleep, five exams worth 40% of your final grade, three cups of coffee a day. Sound familiar? Well that’s all over now- well for at least the next four months. The first day and usually the first week after the end of the semester is always odd because you all of a sudden have massive amounts of free time. You always assume in your mind that when you finish the semester you will be so productive and be able to get so much more done. Well that’s the complete opposite of what actually happens. You sleep in until 2pm and stay up all night catching up on your favorite tv shows and checking Facebook to see the status of your friends. The purpose of this project is to act as a guide for college students that want to have a highly productive summer.

The Summer of George is an idea derived from the popular Seinfeld episode where George Costanza claims that he will have the summer of George. Unfortunately Costanza ends up having the least productive summer ever and sadly the same usually goes for most college students. All of those big plans to have a productive summer will end up forgotten by July. The summer of 2009 will be different and by reading through this series of quality articles you will be able to have the most productive summer in every aspect of your life.

Do not worry the articles are not “boring” or filled with “industry information.” There is something for everyone in this series so please give all of the articles a quick look. Every article is easy to read and the information is easy to apply. Please enjoy and spread the word about Studenomics.

Learn a New Language

For whatever reason you have not really bothered looking for a summer job but you still want to have a productive summer. No problem you could spend your summer learning a new language. It doesn’t matter where you live it is always beneficial to be bilingual. There are two popular methods of learning a new language.

1. Language courses. I used to hate it as a child but now when I look back I’m glad that my parents FORCED me to take second language classes. I didn’t mind learning the language but there was one major problem, the classes ran every Saturday from 9 in the morning until noon. As long as you don’t have to wake up early on a Saturday morning for your second (or third or fourth) language courses then you should have no troubles.

2. Books on CD. Before a trip to the Dominican Republic a buddy of mine listened to Spanish tutorials every morning while taking the bus to his college campus. After a few months of this he knew enough of the language to get his point across. Unfortunately the second language in Canada is French not Spanish.

If you are not completely sold on the idea of learning a new language this summer then here are some of the main benefits:

1. More work opportunities. Remember the episode where George Costanza was out of work and considering his options? After a few minutes he realized he didn’t have too many skills to offer the workforce. Well by learning another language you can work as a translator or hold a decent government position (granted you possess the other qualifications). I have met many individuals that earn a decent living with their bilingual skills and you could be one of those people.

2. Ability to communicate with relatives. If you’re like me then you have many relatives that don’t speak English. Thankfully I speak their language so we are able to communicate. If you have a communication barrier with your relatives because of your inability to speak their language then this summer is the time that barrier comes down.

We all want to have a productive summer but we just don’t know where to start. Here’s a little secret: you can start by reading The Summer of George- The Most Productive Summer a College Student Will Ever Have:

Summer of George Introduction @ Studenomics.com

Take Up a Sport and Become Good At It @ FreeFromBroke.com

Help Your Local Church @ GatherLittleByLittle.com

Take Some College Courses This Summer @ PoorerThanYou.com

Summer Jobs With Little Startup Funding Required- Part 1 @ MoneyNing.com

Summer Jobs With Little Startup Funding Required- Part 2 @ PTMoney.com

Take Control Of Your Financial Situation @ Bargaineering.com

College Works Study Abroad@ CashMoneyLife.com

Cheap Summer Activities@MoneySmartLife.com

This is a guest post from Grant Baldwin, the author of Reality Check, a book about helping students transition into the real world.  His new website, BrokePiggy.com, answers questions from teenagers about personal finance, savings, and all things money.

This series “12 Things Every Teenager Needs To Know About Money (And How To Teach Them)” is a community blog experience.  This post is only one of the 12 points in the series so to view the other 11, please visit the list of links below.

Living On A Budget Isn’t An Option

Ah, it’s time to discuss the dreaded ‘B’ word.  Not that ‘B’ word you filthy animal…get your head out of the gutter!

In order to be successful with money, you really need to have a budget.  It becomes a roadmap to guide your decision-making and your spending habits with your finances.

But I’m sure like most people, you and your teenager probably aren’t math nerds who stay up late into the night coming up with new ways to solve expert-level Sudoku puzzles.

I don’t do that either just so you know!

But whether you’re a math whiz or you still count on your fingers and toes, you need a budget. Most teenagers are more like free spirits who prefer not to live in the confines of a budget (I wonder if they learned that from their parents…hmmm…I’m just saying).  So how do you teach a teenager to budget?  Let me help young grasshopper…

·     Start Now With What You Got – Budgets aren’t just for millionaires or people who make over minimum wage.  Budgets are for anybody and everybody who has ever had a dollar (that would be all of us in case you missed it!).  Same with the concept of giving, if you don’t budget when you make $100 per week, you’ll never budget when you make $10,000 per week (don’t forget about me when you do).  I know expenses are limited and income is small, but establish that habit now to make a budget.

·     Do It On Paper – I like gadgets and gizmos. And oddly enough, I kind of like spreadsheets.  Spreadsheets are great for creating budgets, but don’t start off there.  Start with good ole’ fashioned pencil and paper. Why?  Something changes when you have to do the math by hand and see where your money is going.  It forces you to really think it all through and make better decisions with your finances.

·     Use The Envelope System – If you’re unfamiliar with this idea, basically the concept is to pay for as much as possible with cash.  After you’ve helped your teenager to establish their budget, find categories that can be paid for in cash.  Things like gas, eating out, movies, etc.  Make an envelope for each of those categories and put the budgeted amount of cash in each.  Then pay for items from their respected categories out of these envelopes. Paying with cash is tougher than swiping a piece of plastic and will also help your child to better manage their money, because when that envelope is empty, their spending is done.
Here are the rest of the articles in the “12 Things Every Teenager Needs To Know About Money (And How To Teach Them)” series:

• Money Doesn’t Grow On Trees @ Bargaineering.com
• Two Words: Compound Interest @ PoorerThanYou.com
• Delay Gratification To Succeed @ GatherLittleByLittle.com
• Credit Cards Will Steal Your Lunch Money @ PTMoney.com
• Should You Earn A College Degree @ TheDigeratiLife.com
• Spend Money Based On Needs Not Wants @ MoneyNing.com
• There Is More Free Money Than You Realize For College @ FreeFromBroke.com
• Taxes Are A Necessary Evil In Life @ MoneySmartLife.com
• Do What You Love, Love What You Do @ GenXFinance.com
• Don’t Be A Tightwad: Give Generously @ CashMoneyLife.com

This is a guest post from Grant Baldwin, the author of Reality Check, a book about helping students transition into the real world.  His new website, BrokePiggy.com, answers questions from teenagers about personal finance, savings, and all things money.

Today is a rare guest post from Trisha Wagner, a freelance writer for DestroyDebt.com. If you’d like to write a guest post (I am leaving the ice and snow for a week in about a month, let me know!)

If you are looking for guidance managing your finances you must take into consideration that hiring a financial advisor is not just hiring someone to manage your money.  The individual that you bring on to help with financial decisions will end up having a huge influence on your life and the future of yourself and your children.  Before hiring anyone to assist you in controling your financial future take the time to interview and follow through on reference checks.  You wouldn’t hire a caretaker for your child without checking references or hire someone to work for you without confirming their past performance on the job, yet many individuals fail to check out the references of potential financial advisers.  Like any other industry there are good and bad representatives and financial advisors are no exception.  Another factor to consider is for what exactly you need a financial advisor?  In order to find the right person or firm to handle your accounts you need to first know what problem solving skills and experience are needed for your specific goals and problems.

Who is qualified to offer financial advice?
There is an abundance of job titles that indicate financial planning is a booming business.  You may choose to work with any of the following but keep in mind a title alone does not indicate qualification; remember to check references to be sure the individual you work with has the knowledge and experience to provide the help you need.
•    Certified Financial Planner
•    Wealth Management Firms
•    Independent Broker-Dealers
•    Retirement Planners
•    Investment Planners

Know what kind of financial advice you need.
If you are in your 20’s and looking to build a diverse portfolio that will serve you for the next few decades your needs will be different than a married couple in their 60’s facing retirement.  Perhaps you are looking to donate money or make arrangements for estate planning?  For each individual the circumstances and goals are different so they must be taken into consideration before seeking out a professional to help you reach your goals.
Questions to ask your financial advisor.
When searching for the right advisor to help make financial decisions communication is key.  Your advisor will likely ask you to submit a profile and answer questions prior to your first visit so they can get an overview of you situation.  Your advisor should not be the only person asking for information, here are a few important questions you will want answers to.
•    Go over your situation and ask the advisor for ideas on how it can be fixed and if they have ever handled the same situation in the past?
•    How long will it take to develop a strategy and put it in place?
•    How will we communicate throughout the advisor/client relationship?  Can you send an email or leave a message whenever you have a question or does your advisor prefer having a sit down appointment to go over all questions?
•    What is your advisors investment philosophy? Are you comfortable with this thinking?
•    How will your advisor keep you updated on the your progress?

It is important that you take the time to research your personal needs, situation, goals and potential advisor before handing over control of your finances.  The purpose of an advisor is to make you feel more at ease about your financial decisions not to increase your worry-take the time in the beginning to find the right person that will work with your best interest in mind.

Trisha Wagner is a freelance writer for DestroyDebt.com, a debt community featuring debt forums. Trisha writes regularly on the topics of getting out of debt and personal finance.

Shea K., a Beyond Paycheck to Paycheck reader, asked to write a guest blog post. I loved her pitch: What better occasion to save a little time than a post about America Saves Week? Worked for me. I hope you enjoy her post as much as I did:

Although America Saves Week is not as exciting as Talk Like a Pirate Day (But how can anything compete with the rare 21st century opportunity to leave the house donning a bandana, eye patch, and hook, all the while shouting “Avast me hearties!”?)

Still, America Saves Week is a whole week compared to just one day; so, by implication is seven times more important than Talk Like a Pirate Day. Plus, although it lacks the pillaging, America Saves Week is a fair bit more practical and better for you. Want both? Think of Talk Like a Pirate Day as dessert. Tasty, sweet, indulgent. But too much can give you a stomach ache. Think of America Saves Week as your vegetables. Good for you and ultimately not nearly as dreadful as you initially feared.

Why?

By using America Saves Week as your excuse to get started, you’ll have a lot. In just a week! Perhaps a plan to cut back on coffees or forego expensive lunches. You’ll come up with ideas on how changing just a few things can really add up. At the end of the first week, you may find you’ve already put some savings away. More importantly, long after the glory of America Saves Week has faded, your new habits mean you will continually add to that savings.

What will it mean for you, personally?

Perhaps it will fund a new car, a new TV, better preparation for a financial emergency, or your child’s college education. It may even allow you to retire in your 50’s instead of your 60’s. Whatever you do with the savings, you are better off taking advantage (dare I say “celebrating?”) America Saves Week. So have fun, go wild! But most importantly, start today. Eat dinner at home instead of spending your way to grow someone else’s bank account.

With a little dedication and a slightly offbeat sense of humor, you’ll have enough money for some good pirate garb when it’s time for Talk Like a Pirate Day in September!

Arrrrgh!

Here are some tips from the Vanguard Retirement Planning Web Site page about America Saves Week:

• Opt for a more modest cup of coffee instead of your regular gourmet blend.
• Bring your lunch to work, even if it’s just a few days a week.
• Cancel any subscriptions that you no longer use or enjoy. This includes premium cable channels.
• Rent a video or see a matinee. Avoid those talkative evening theater crowds.
• Book your vacation travel online, including hotels.
• Pay with a debit card instead of a credit card. If it’s not in your bank account, you can’t spend it

What do you think? Got any ideas you care to share? Are you going to do anything special about this year’s America Saves Week or will you just blow it off? Any plans for September 19?

“personal finance” “financial education”