Best of the week – August 16, 2014

Here are some articles that caught my eye this week…

How Much Auto Insurance Do You Need? Don’t Guess
If you are looking to lower your insurance costs and you have an emergency fund, a great place to start is raising your deductible. This can often yield significant savings. Be very careful though with lowering liability coverage. A bad accident can easily result in thousands of dollars of medical bills if there are serious injuries. Don’t bankrupt yourself because you were trying to save a few dollars on your monthly insurance bill.

Make your kid rich for $1 a day
What if your child could retire someday as a multi-millionaire and it would cost you less than the cost of a soft drink or coffee per day? It actually isn’t that far fetched. Even more important, this really points out how important it is to start soon. When we are in our 20’s the last thing we usually think about is retirement, yet the sooner you start the easier it is to really make life changing progress.

Potential downsides of cashback and rewards
One argument that people often use for holding on to their credit cards is the reward programs. The problem is often these rewards programs aren’t as simple as they seem when they are promoted. Even beyond that, I think the most dangerous part of these rewards programs is they entice you to spend more than you might have otherwise. Many studies have shown that you spend more when using credit than when you use cash, and I have found this true in my life as well. Cash causes you to feel your purchase in a way that swiping a card never does.

The 10 Things You Need to Do If You Want to Quit Your Job
If you are looking at changing jobs it is very important that you handle the process carefully. No matter how dissatisfied you are with your current employer make sure you are doing your job hunting on your time not their’s. When the time of transition comes, make sure you follow the golden rule and treat your former employer and co-workers as you would hope to be treated if the situation were reversed. And most important of all never burn bridges. It may feel really good in the moment to tell that nasty boss where he can shove that old job. Don’t do it. It isn’t worth it. You never know what connections there might be that could bite you even years down the road.

The Four Walls
It is great to pay off debt and to save and invest. But what if you are in a position where there simply isn’t enough money to pay all the bills this month? If you find yourself in this position, it is important that you prioritize what you pay. Dave Ramsey talks about building the four walls first. This short video provides a good explanation of what he means by the four walls. Obviously, you want to pay everyone, but if you just can’t, don’t find yourself in a position where you are current with your credit cards but your house is about to be foreclosed on and they are coming to turn off your electricity.

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