September 2010 Archives

As someone who's lived in Texas for nearly five years, it's bad enough to see studies that say the South is more impoverished and fatter than the rest of the country. Now data suggests we Southerners have the nation's worst credit, too.

Recent data shows those U.S. cities with the highest average credit scores are all in the Midwest or North, according a map of the country's highest and lowest VantageScores created by credit bureau Experian. Those cities the with lowest average credit scores, meanwhile, can often be found in the South, with five of the six lowest-scoring cities in two particular states: Texas and Louisiana.

Why is that? "It's hard to say exactly why certain cities or regions of the country are faring better than others, but good credit scores are the product of having a strong credit history," says Maxine Sweet, vice president of public education at Experian.

Last weekend, my fiance and I went and saw "Wall Street: Money Never Sleeps." Although the plot had a few flaws, I really enjoyed it. What took me by surprise was how current it is and how much of the plot it based on the beginning of our country's recession.

The movie is a sequel to the 1987 film "Wall Street," but this film is set just a few years ago, right when the economy first buckled. It shows the despair felt by the first major investment firm that realized it was going down and the panic it caused the stock market. It also shows the private meetings between the Fed and its board of bankers and investors who discuss the concept of "too big to fail" for the first time.

The movie concludes by making the case that much of our current economic system is unsustainable and will continue causing cycles of bubbles and bursts if left unchanged. The narrator reminds us that the definition of insanity is doing the same thing over and over again and expecting a different result. I'm interested to see if President Obama's Wall Street reform initiatives will produce different results.

On that note, I hope you will read on for my roundup of my favorite personal finance blog posts from the past week.

I read an article on CNN.com this week about how President Obama is beginning to lose some of his clout and the magical mojo that surrounded him pre-election. He ran on a platform of change, and while he has fought to reform everything from health care to Wall Street in his two years as president, his ratings have fallen and continue to slide. It seems this is due to a combination of him inheriting a terrible economy and two controversial wars, in addition to starting off with many ambitious goals.

It's easy to get very ambitious with personal finance goals when we as individuals decide we're ready to finally face our debt or begin budgeting. I've seen people decide overnight that they're going to stop eating out, cancel unnecessary services, start riding the bus to work, only buy used goods and so on.

Those are fantastic goals to have, but it can be unrealistic to conquer too much at once. It can be overwhelming and difficult to stick to all your promises. That's why many people with debt spread across multiple credit cards decide to tackle one card at a time. Trying to pay it off all at the same time in small amounts can make you feel like you're just treading water.

And that's something I'm going to try to take with me as I begin my budgeting adventure. Please read on to learn about how you can pace yourself to financial freedom and several other topics in this roundup of my favorite posts from the past week!

President Obama, sometimes criticized for an excess of coolness, had something close to an "I feel your pain" moment Friday -- and that pain was caused in no small part by his personal credit card use.

The moment came as he announced he had appointed Elizabeth Warren as a special Treasury adviser, a role in which she will shepherd into existence a new federal consumer watchdog agency.

I have a confession to make: I don't budget. I know what you're thinking. How can a personal finance blogger not budget? It's a little embarrassing, and something I've avoided far too long.

My sweet fiancé sighed when I told him this. He said it was time to make a budget, especially since this is how he wants to do things once we get married. He showed me his budget system -- an extremely detailed Excel spreadsheet that overwhelmed me.

He is currently working on creating a very similar Excel budget for me, and I'm going to start using it on October 1. I'm nervous that it is going to make me feel too restricted, but I know it's a wise move to force myself to be truly accountable for my spending and figure out how much money I really have to work with each month. It will help keep me out of credit card debt and make it easier for me to save money. And I'll have some time to get it down pat on my own, so by the time we do combine our finances, I'll feel like a good financial partner. I guess it's actually kind of exciting!

If you're looking to get your finances together, or you just want some good reading, checkout the roundup below of some of my favorite posts from the personal finance blogosphere from the past week. Enjoy!

Are congratulations in order?

Consumer groups are applauding the news that Harvard University law professor Elizabeth Warren may soon take over the early development of the new Consumer Financial Protection Bureau.

It isn't official yet and the whole thing seems like a kind of back door way to get Warren into a position to run the consumer financial agency -- or influence its early startup.

Just in time for the start of the 2010 regular football season, the National Football League and Visa Inc. have teamed up to release a new educational video game: Financial Football 2.0.

Designed to help young and old test their knowledge of credit and debt, student loans and retirement accounts, the game is a step in the right direction for helping us all increase our financial literacy.

The staff at CreditCards.com wanted to see how challenging and educational the new game actually was, so we played it -- lots of times. Here's what we found...

A hearty hat tip to Danielle Liss, whose eponymous blog is the host of this week's Carnival of Personal Finance. A blog carnival is a roundup of other items from around the blogosphere, usually with a topic and a theme.

This week's topic, as always, was personal finance, and she themed it around the ninth anniversary of Sept. 11. She was kind enough to include my item from last week, "Old credit card brochure reveals age of innocence." So a hearty cheer (definitely not a Bronx one) to Danielle, and if you want a lot of good personal finance information packed in one place, sashay over to Carnival of Personal Finance No. 274: The I Love New York Edition."

I'm a history buff, and I work for CreditCards.com, so I got a kick out of finding the brochure whose cover is pictured at right. It shows a bit of credit card history from an innocent time when credit cards were a new concept.

It's a long story, but I ran across the brochure when cleaning out a house in South Florida.
I just love the wide-eyed look on the face of the stereotypical '60s woman, pearls and all: Wow! Free money! Little does she know.

This week, Tropical Storm Hermine arrived in Central Texas, where I live. It slammed areas of Central Texas with up to 15 inches of rain in some parts in just two days. The flooding in its aftermath killed eight people.

Why is this newsworthy? In Austin, we are almost never affected by tropical storms or their big brothers and sisters, hurricanes. We're not even near the coast! It really does go to show how the unexpected can happen, especially with natural disasters, and the importance of saving up for emergencies.

It's one thing to set aside money for a "just in case" emergency fund, but what about planned expenses? A friend just mentioned ideas for a Halloween party, which made me realize it's nearly fall, which means the winter holidays will be here before we know it. For most of us, that means big, fat debt.

Although I automatically deposit $15 a week from my checking to a savings account for an unknown future emergency, I find that I never end up saving enough for the holidays in advance. I (and most other people I know) wait until the last minute to buy gifts for all of our friends and family, but come February or even later, we question why we still have credit card debt due to holiday gifts.

The time to begin saving for the holidays is now! Unlike an unexpected hurricane, you can plan for the holidays, but many of us don't. It may sound crazy to start setting aside money for the holidays in September, but you will thank me come January.

For more personal finance tips and information, check out 10 of my favorite money-related blog posts from the past week!

Big ups to Jeff over at the Sustainable Life Blog for including my post, "Brother, can you spare a swipe? Contactless card reading guitar unveiled," in this week's Carnival of Personal Finance.

My post, which details a wireless, touchless credit card accepting guitar by Barclays, is nuzzled into the ever-popular theme of Labor Day. Because what says Labor Day more than a raggedy bum asking for change and strumming "Like A Rolling Stone" in the corner of a busy intersection? Well ... maybe that's not the best example.

The holiday, according to the carnival, is "dedicated to the social and economic achievements of American workers." So congratulate yourself, kick up your feet and head on over to the carnival for a short history of Labor day and loads of great personal finance articles. At least I think he was talking about the item, not me.

Time.com just featured a piece on 10 odd insured body parts. Pittsburgh Steelers football player Troy Polamalu hasn't cut his hair in years. He stars in Head & Shoulders commercials, and it was just announced that the shampoo company's parent company, Procter & Gamble, has taken out a $1 million policy to protect the safety's trademark hair as part of the endorsement deal.

Time says there have also been policies on David Beckham's whole body, Dolly Parton's breasts, Bruce Springsteen's voice, the crossed eyes of silent film comedian Ben Turpin, and the booty, knees and ankles of a Brazilian Playmate. I have to wonder whether this was actually money well spent. Some of us can't afford health insurance, while Australian cricket player Merv Hughes had his famous mustache insured for a cool $370,000. Is it really worth it for these companies paying to insure body parts? Nothing lasts forever. Voices change, body parts begin to age and droop. What if Polamalu goes bald? I've read some commentary that the Polamalu story may be more of a publicity stunt than a signal of true concern over his hair, but some of these have to be real. What do you think?

Read on for my roundup of my favorite personal finance posts from the past week!

Banking regulators did everything by the book in closing down the bank run by the family of Alexi Giannoulias, the Democratic candidate for President Obama's old seat in the U.S. Senate.

Politics played no role in the timing of the April closing of Broadway Bank in Chicago, a Federal Deposit Insurance Corporation investigation concluded.