My Experience with Personal Capital

I'm kind of a sucker for pretty user interfaces...
I’m kind of a sucker for pretty user interfaces…

Personal Capital is another of the great personal money management websites out there. It pulls information from all connected bank, investment, and credit card accounts to give you an easy-to-digest summary of all your financial activity. I just started using it two weeks ago, deciding whether to switch to it from Mint, and wanted to write a little about my experience with the tool. Being able to visualize the distribution of your money in colorful graphs–whether that’s income, spending, or investments–is a fantastic experience that will help make managing your money easier and more intuitive. With a great companion mobile app, Personal Capital could be a great option for you… but not for everyone!

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How an IRA Can Help You

You may remember from my 401k post that there are several good reasons to invest in an IRA (Individual Retirement Account). These include:

  1. Maximum Flexibility: Invest in anything, with any investment manager/bank
  2. Avoid Taxes: Gains in an IRA are not taxed like they would be in a regular taxable account, so you’ll pay the government less.
  3. Penalty-Free Contribution Withdrawals: You can withdraw the money you put in at any time without penalty (though you can’t withdraw the investment gains that have grown on that money). This is good thing, just in case you ever need that money (though please remember that the stock market is NOT the place for your emergency savings).

Let me walk you through some of the basics of your IRA.

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Short-Term vs Long-Term Goals

Sorry for the delay on this latest post, I had some exciting real-life stuff happen: I got engaged! My conversations with my fiance (still so weird using that term!) regarding how to save for wedding expenses are actually what spurred this post.

Balancing your goals is never easy

So often in life, and especially in finance, we are asked to put off our short-term desires in favor of long-term goals. It can take a lot of effort not to buy that fancy Starbucks latte and save your dollars toward that new car instead. Self-control when it comes to finances is something that many find extremely difficult, but without it, you can never achieve big goals. However, big goals can vary in their “bigness”–for example, you may want to save for a house, and also save for that sexy new gaming rig; or maybe you know your car’s going to kick the bucket, so you need to start saving for a newer model, but you also really want to upgrade that college wardrobe of bad T-shirts and that one hoodie you wore for a whole semester straight once.

Sometimes two desired spending goals present themselves at the same time. One might be bigger and longer-term (on the horizon of a year or few years), and the other may be shorter-term (a few months) and a little bit smaller in scope. How do you balance these goals?

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Your Credit Score and You

Do you know your score?

With the birth of online credit score tracking on sites like CreditKarma, CreditSesame, and Mint, everyone wants to find out: what’s my number? However, many of us have no idea what that number means. In this post, I’ll cover the following topics:

  • How Your Credit Score Works
  • Why You Should Care, and How Much You Should Care
  • How to Improve Your Score
  • How to Check Your Score

Credit scores are a great way to keep yourself in good standing with various lending institutions. They also help you protect yourself from credit fraud and identity theft. Sometimes even your landlord will care about your credit score when deciding whether or not to let you rent an apartment, using it as a heuristic for trustworthiness. Clearly, it’s important, and is an essential part of learning to handle your finances as an adult.

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Reducing Restaurant Spending (and February Update)

My February spending, visualized by
My February spending, visualized by

As you may have read in my orginial status report, I like keeping this blog updated with the amounts I spend on various things. Here’s my February check-up. Last month, I spent:

  • $600 on Rent
  • $160 on Groceries – pretty standard
  • $200 on Restaurants – Oops, this is a little high
  • $46 on Car-related expenses – Gas and parking for class
  • $78 on Shopping – needed a pair of jeans, some miscellaneous items
  • $29 on Bills – Didn’t pay electric or water yet for Feb. usage

=$1113 spent
For someone who claims to be frugal, $200 is a lot to spend on restaurants in just one month. My excuse is that I went back to my alma mater to visit friends, and being away from home really messed up my usual routine. This is definitely one area in which I need to do some damage control in March, and a challenging aspect of the budget for many people, especially young people. You want to be able to go out with your friends (or maybe you just don’t want to cook), but the costs add up pretty quick.

How do you get a handle on restaurant spending? Keep reading for my suggestions.

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RSUs: Restricted Stock Units

Pretty soon, you’ll feel comfortable with all this stock market stuff!

I spent most of my life before now knowing nothing about the stock market or investing. However, when I graduated, I had investment thrust upon me because of RSUs: Restricted Stock Units. RSUs are a form of alternative compensation which is often included in job offers, particularly in the tech sector. They serve several purposes:

  1. Acting as a delayed bonus which you can cash out after a set period of time (known as a “vesting period”). This helps companies retain employees since if you leave before the end of the vesting period you lose out on your bonus.
  2. Forcing employees to invest in the company’s stock so they will have more motivation to do their jobs well, because if the company is doing better your stock is worth more.
  3. Serving as an alternative to increased salary when trying to piece together an acceptable offer for a new engineer (see my post on salary negotiations to learn how you can use this to your advantage).

It can sometimes be pretty confusing to figure out how RSUs work, and what RSUs should be worth to you. I’ll guide you through those thought processes in this post.

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How to Play the Scholarship Game

Paying over-inflated tuition costs often feels like flushing your money and your future down the toilet.

The rising cost of college is one of the first big adult challenges that millennials like me run into. Suddenly, you are faced with the fact that the life you want costs money. A lot of money. If Mom and Dad are helping out, this can ease the burden (though you’ll still see them turn a bit pale when it comes time to pay the bill). If you’re on your own, the huge chunks of change draining from your savings and mountainous loans can make you feel like you’re crippled before you even got your start in life. Even with a solid, money-making degree like engineering or computer science, student loans will hinder your ability to be financially successful in the first few years of your career. Desperate for relief, you turn to the holy grail: scholarships.

Determined to win these elusive scholarships, students and parents take to the internet with hope in their hearts. They scour the big scholarship search engines from dusk til dawn, searching for anything remotely relevant to them. For weeks and weeks they fill out application after application, and wait with bated breath to receive the blessing of their mysterious online benefactors. But as the months roll on and the seasons change, they hear nothing. Discouraged, they eventually resign themselves to paying that big tuition bill some other way.

It doesn’t have to be this way! There is a strategy to winning scholarships, a strategy I used to win over 25 separate awards during the course of my undergraduate education. In this post, I will share with you the 7 key components of my scholarship-winning method so that you, too, can have someone else pay your way.

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