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We all have them.  Dinners out, the newest gadgets, clothes.  Our financial weak spot, our Achilles’ heel.  Find out what we can do to strengthen them. It might not be just a spending problem though.  Maybe you’re afraid to invest because it seems so intimidating.  Maybe you have the money to pay all of your bills but you aren’t organized and always pay late. Andrew is willing to take a leap that some people wouldn’t and it has gotten him in trouble in the past, failed business ventures, risky investments that didn’t pan out.  He also spends too much on food and booze. Matt spends too much on food and booze as well.  Books too but I share that addiction so I approve. He has fallen into a common trap.  He didn’t have a lot of cash for a long time.  Now that he does, he’s been a little undisciplined with his spending. It’s easy to justify over spending when you’re spending on experiences rather than things.  We preach this philosophy a lot because experiences bring more happiness than things.  But if you’re spending too much, it doesn’t matter philosophically what you’re spending on.  You still have to stop. Maybe your weak spot is asking for money whether that means asking for a raise, charging what you’re worth to clients, or asking someone who owes you money to finally pay it back. You might suspect your weak spot but not know how bad it is.  Check your Mint account.  You’ll see how much you’re spending on Seamless writ large.  Feels bad man. We want you to spend some time reflecting and identifying the weak spots.  Once you’re done navel gazing over the situation, you need to start making a change.  The formula is not complicated.  Stop spending money. Maybe your lack of planning costs you.  Booking a flight the week before a trip will almost always cost more than if it had been booked several weeks ahead.  You know when and where you want to go.  Just book the flight when you decide! Maybe lack of goals holds you back.  If you don’t have a goal, you don’t know what steps to take to achieve that goal. Sometimes you think you’ve patched your weak spot only to keep falling back into the same trap.  That’s ok, as long as the time it takes you to realize you’re doing it again gets shorter each time, you’re making progress. Show Notes War Horse Royal Kilt Inspector:  A Scottish ale. Mint:  The easy way to track your spending. Betterment:  The easy way to invest. Learn more about your ad choices. Visit megaphone.fm/adchoices

Buying a home is uncharted territory for many of us. Both Matt and Andrew have done it and will tell us what to expect before, during, and after you buy a home. Before Your mortgage payment shouldn’t be more than 30% of your take home salary.  Don’t buy a home with a person you are not married to.  Property is hard enough to untangle when you have some legal protections, it’s much worse when you don’t. The bank wants to see more than your down payment liquid in your checking account.  They want a buffer.  If you’re putting 20% down, you need more than 20% in your account. You will be paying property tax.  You will need home owner’s insurance.  You will have closing costs unless you negotiate for the seller to pay that.  You may need an appraisal and an inspection. During Being very optimistic, this process will take at least thirty days.  You will fax a rain forest worth of paper.  This will be the most paper work intensive under taking of your life. You will negotiate.  Don’t let yourself fall so in love with a place that it clouds your ability to negotiate.  When you’re spending hundreds of thousands of dollars, $5000 doesn’t seem like much, but it is. After You will have to pay moving costs.  You will have to pay utilities you didn’t even know were a thing like water and sewage.  You might need to renovate.  You might find a nasty surprise once you start renovating, mold, foundation cracks.  It all means more money than what you had planned on. Buying a house is a hassle and it may or may not be worth it.  Consider it carefully.  A home is not the guaranteed investment it once was. Show Notes Gunny Mac American Black Ale:  A smooth, full bodied black ale. Betterment:  The better way to invest. LMM Survey:  We ask for some demographic information to help get sponsors for the show. Learn more about your ad choices. Visit megaphone.fm/adchoices

 A  listener joins us for a financial check up in our This Financial Life episode.  Jeff Wilson finds out what he’s doing well and what he could do better. Jeff lives in the Midwest where he works for the Department of Natural Resources, it’s an outside job where he helps care for wild life sites.  He burns down stuff for a living! Jeff is 26, he has $24,000 in student loans.  He’s paid off about $12,000 so far.  His rent is $300 a month.  His loan payment is $400 a month.  He’s making about $1600 a month with some fluctuation. He has avoided credit card debt, a big plus.  But he’s paying the minimum on the loans.  Even still, they could be paid off in about six years.  His cost of living is very, very low and Jeff hopes to retire early. He has about $24,000 in cash saved, the same amount he has in loan debt.  It’s daunting though, to wipe out your savings in one fell swoop.  At the very least, Jeff has to get that money out of a crap interest savings account. This is the ideal time for Jeff to pay off those loans.  He has a low cost of living, no credit card debt, a good line of credit if there were an emergency.  Kill the loans! Jeff has an IRA with $10,000.  He also has a Betterment account.  The spanner in the works is that Jeff is laid off for three months of the year.  During that time he’s receiving unemployment but it’s not a lot. Jeff is doing well and he knows what he needs to do.  He just needs a little convincing.  He could potentially be retired at 40. All of our This Financial Life guests are savvy and doing pretty well and Jeff is no exception.  At just 26 years old, he’s already on the path to financial freedom. Show Notes Betterment:  Investing made better. Mint:  The better way to budget. Learn more about your ad choices. Visit megaphone.fm/adchoices

You know we at LMM want to help you any way we can to reduce your student loan debt.  David Klein joins us to discuss refinancing to save you money. CommonBond is a student loan lending platform that provides lower cost financing to graduate students and graduates.  They started out as a pilot program at one school and now they have expanded to over 109 programs. The federal government holds over 90% of student loans.  They set the same rate which inflates them for credit worthy borrowers.  When David went back to school in 2011, his rate was 8%.  He saw an opportunity and with his two partners started CommonBond. CommonBond works a bit like Lending Club.  Borrowers save money when they refinance, on average, $10,000 over the life of the loan and investors have access to a kind of investing that was largely closed to them in the past. What should you look at before deciding on grad school?  First, the median salary for the field you’ll be studying.  Then look at your loan options.  You want a low interest rate but also calculate what your monthly payment would be. CommonBond offers a hybrid loan, the first of it’s kind on a national scale.  It’s a fixed rate loan for the first five years and variable thereafter. There is a cap on the variable rate of 10.99%. CommonBond also offers forbearance for three months at a time, up to twelve months in cases of economic hardship.  They will also help you find a job within their community.  They also offer paid consulting work. There is no reason not to refinance other than the hassle.  CommonBond has streamlined the process to make it as quick and easy as possible. CommonBond has partnered with Pencils of Promise to help fund education for students who would otherwise not be able to afford it.  More Millenials doing good things in the world! What can you do if you’re having problems paying your loans?  Call your lender directly and inform them of your situation.  They should be able to help you out.  If they won’t, refinance with CommonBond because they will.   Show Notes CommonBond:  Refinance your graduate school loans. Betterment:  The easy way to invest. Learn more about your ad choices. Visit megaphone.fm/adchoices

  It’s the episode devoted to your questions.  Today we talk about the stack vs snowball methods of debt reduction, college wisdom, and Comcast ETF. 1.  What is your advice for an 18 year old with a part time job about to start college?  College Info Geek is a great resource for college kids.  Make as many connections as you can, join clubs, get to know your professors, join a fraternity.  Apply to every scholarship known to student kind.  We did an episode about that. 2.  If you have one student loan at 7.15% do you attack that first or pay across both loans? If you want the emotional win, pay the smaller one first and then use that payment towards the larger one.  Mathematically though it makes more sense to attack the loan with the higher interest rate. 3.  I have $50,000 in cash in a savings account earning .85% interest.  Leave it, move it to Betterment, or pay loans?  Oooh, I felt you all cringe.  I cringed too.  Someone jump him in.  You’re paying 7.15% on your loans, pay that off first!  Then invest.  Then close the savings account. 4.  I know the stack method is superior to snow ball but I have a small debt of $500.  Should I continue to stack or just pay it off?  For something that small, just pay it off and then throw the payment at the higher interest debt.  Unless your interest rate is very high on the other loan.  But since you just have two debts, getting rid of one would simplify things. 5.  I want to dump Comcast but they want to charge me $300 for early termination.  Should I just eat it?  If you have more than two months left, eat the fee.  If you can pay on a credit card, cancel the card and screw Comcast! They’re evil so fuck them. Show Notes Betterment:  The easy way to invest.  Sign up here and get up to six months free investing. War Horse Royal Kilt Inspector:  A dark hued ale. Flying Fish Red Fish:  A hoppy red ale. Betterment:  Sign up here and get up to six months free investing. Featured Image Photo Credit: “Question Box” by Raymond Bryson on Flickr Learn more about your ad choices. Visit megaphone.fm/adchoices

It was Leonardo Da Vinci who said, simplicity is the ultimate sophistication. He is right! Minimalist living isn’t a new trend, it has been with us for centuries. So why is it making a comeback these days? In 2005, Tim Kasser, a psychology professor at Illinois’ Knox College conducted a study on minimalism and its impact on happiness and wellbeing. The study found that despite factors such as geographical location, gender, and age, those who simplified their lives reported significantly higher levels of positive emotions and life satisfaction. So what exactly is minimalism? No, not that kind of minimalism, more like this… Minimalist living is all about owning less, having fewer distractions, and most importantly for Listen Money Matters fans, spending less. Less is more, according to minimalism. A cluttered life leads to a cluttered brain, and ultimately an unhappy life. Minimalism is mental framework about how you go about your daily life, avoiding the trappings of modern consumer culture. Although there’s nothing wrong with owning things, minimalists would (rightly) argue that we have gone overboard with our materialistic lifestyles, to the detriment of our mental health and wellbeing. Enough said, moving on. Minimalists believe that we give way too much meaning to things, to the detriment of our financial, emotional, and physical health. Are things like homes, cars, and video games important to you? If they are, great. But, if being a good person, family relationships, and physical health are more important, why do so many people forsake these for material wants? This is the mantra of the minimalist, and there is some truth to it. So how does one begin to live a minimalist lifestyle? Leading a simple life through minimalism doesn’t have to happen in one leap. You can take small steps until you get to a place that is comfortable for you. Here’s how to get started. Becoming minimalist One of the most challenging aspects of adopting a minimalist lifestyle is figuring out where to start. If you are excited about all the benefits that minimalism has to offer, you may be tempted to make several big changes right away. However, if you are not careful, a rapid transition can make you feel burnt out and cause you to lose momentum. Before you take any concrete steps to minimize, it is essential that you adjust your mindset. Minimalism is all about reducing stress and clutter in your life, and it’s much easier to begin this outward transition after you have adjusted your mindset to be more organized. When you embark on your pursuit of minimalism, prepare to take your time with the transition. A slow and steady approach will reduce the adjustment you must make to your new minimalist lifestyle. How to be a minimalist As you start your journalist, here are a few steps on how to be a minimalist: Take stock of your possessions Before you can make changes in your home, you need to understand exactly how much you own. Walk through your house or apartment and take a look at the items you have in different rooms. Make sure to take note of areas that you want to pay special attention to, such as overflowing dressers or cluttered bookshelves. It’s also a good idea to identify repeat items that you could easily downsize, such as multiple copies of the same book. Work through your emotional connections to stuff If you feel some anxiety when you think about getting rid of some of your possessions, you’re not alone. Most people have emotional connections to their possessions that can make letting go difficult. Learn more about your ad choices. Visit megaphone.fm/adchoices

Hal Elrod is a keynote speaker and best selling author.  He joins us to discuss his latest book, The Miracle Morning.  This book may change your life! What is so miraculous about the morning? Plenty. If you want to improve your life, your morning is the place to start. Hal’s secret is that your level of personal development will match your level of success.  He began devoting an hour a day to personal development.  He researched the six most powerful methods of personal development and vowed to do all six each day. Why Morning? Mornings get such a bad rap. Everyone seems to want to stay in bed rather than get up and start the day. If this is you, you are giving up the best part of the day. Mornings are the most distraction free time you will get. If you get up early enough, you are probably the only one in the house who is stirring. No one is asking for breakfast or if you remembered to pay the car payment or where their other sock is. You have the whole house to yourself! If you go to the gym, it’s almost empty! You don’t have to wait around for the machine you want or get annoyed because some cretin didn’t re-rack their weights. If you drive or take public transit, there is less traffic and less people to crowd and annoy you on the bus or train. When you get to work, you can get things done without the phone ringing, e-mails coming in, co-workers bugging you. Unless you are staying in bed for sex, there is really no reason to keep laying there hitting the snooze button wasting your miracle morning. Morning is the best time to get things done because we are at our freshest. We’ve had at least some sleep, even if it was a bad night of sleep, it’s as rested as you are going to feel all day. The day also has a habit of getting away from us. You don’t work out in the morning and promise to do it after work. But then you remember you have a dentist appointment or agreed to meet a friend for dinner. The day is over and you never worked out. When we don’t do things in the morning, the rest of the day can get away from us and those things just never get done. In the morning, you don’t have the events of the day weighing you down. Sometimes we do have bad days and we just don’t have the energy or we are just in too bad a mood to care about doing things that will help our personal development. That is why morning. The Six Most Powerful Methods of Personal Development This are the things Hal starts his day with. All it takes is one hour. Silence Our world is loud. I lived for a time on 78th Street and Second Avenue. There were a row of bars across the street. Bars close late in New York City, not until 4:00 am. It wasn’t the bar patrons that was the problem, apart from the occasional “Whoooing” bro or drunk chick. It was when the bars when drag trash bags full of empty glass bottles to the curb. When you managed to fall back to sleep after that, the garbage trucks would pull up and toss them into the back, making another huge sleep destroying clatter. I used to lay in bed almost bawling from anger and frustration. There is something about certain noises or noise that is interrupting our sleep that triggers some kind of oddly disproportionate anger in us. The World Health Organization declared noise pollution a “modern plague” and there is overwhelming evidence that it is detrimental to physical and mental health. The antidote to the stress causes by the cacophony of life is to start your day with silence. This could be “formal” silence like meditation or just sitting quietly for a few minutes before turning on the radio or television. Silence reduces blood pressure. Silence can regenerate brain cells in the hippocampus, the part of the brain tasked with memory, learning and emotion. Learn more about your ad choices. Visit megaphone.fm/adchoices

   We have a listener guest today!  Zina Kumok joins us to share her financial life and find out what she is doing right and what she could be doing better. LMM met Zina at Fincon.  She vowed to pay her student loan debt off in three years and started a blog to document her progress. She did it too.  As of this month, she has paid off her entire loan balance.  She put any extra money, free lance money, birthday money, towards the debt. Like many of us, Zina had very little finance education.  Whatever she made, she spent.  At one point, she ate out three meals a day!  When she had to borrow money for a security deposit on an apartment, she realized she had nothing to show for the pretty good money she was making. Zina’s parents were fans of Dave Ramsey and that was her introduction to personal finance. Get Rich Slowly was another big influence as it was for a lot of us. Student loan debt was the only debt Zina had.  No credit card or mortgage debt.  She is engaged to be married and is planning on joining finances with her fiance soon.  Now that she has some breathing room, she can be less strict on her budgeting.  Her fiance is as money savvy as Zina and is also debt free. Both partners have an emergency fund but want to build it up to six months for of expenses.  They have a dog that may need surgery in the future.  Pet insurance may be something to consider for Zina. Zina started an  IRA while in college.  She now does matching in her 401K.  The money that no longer needs to go towards the loan will go towards the emergency fund and retirement.  The emergency fund is now stashed in the savings account but Zina realizes this needs to change. Zina uses Mint and an Excel spread sheet to budget.  New tech and old school.  The idea of buying a house is not really on her radar right now.  Her parents had three offers in four years when they tried to sell their house.  That would put anyone off. Good luck to Zina and her fiance on their wedding and combining their finances.  Zina hopes to start a podcast soon so check her site for updates. Show Notes Abbey Ale:  A golden, Belgian style ale. Flying Fish Hop Fish:  An English style IPA. Debt Free After Three:  Zina’s story of paying of her student loans in three years. Mint:  The easy way to budget. Betterment:  The easy way to invest. Learn more about your ad choices. Visit megaphone.fm/adchoices

Matt Rothstein of Get Final will discuss a new kind of credit card for the 21st Century designed to be a consumer ally rather than a consumer predator. The card will go Beta soon with a wait list of over 30,000 people.  It’s a physical credit card that assigns a different number to each merchant, giving you more control over your account. And it’s chip and pin, at last!  There is still a magnetic stripe because not all retailers are set up for chip and pin yet. You can assign a dollar amount limit to each merchant.  So if your gym charges $100 a month, no more can be charged.  This way if there is a data breech, not only can the charge not exceed your limit, but it can’t be used at any other merchant.  The transaction would automatically decline. Because you are setting a dollar limit, this can also be a helpful budgeting tool. Final was founded due to data breaches the founders suffered.  They realized credit cards haven’t changed for decades and wanted to design a credit card for the internet age.  Banks and credit card companies are terrible at communicating vital information such as cutting off your card while you’re on vacation abroad. Final plans to start a rewards program soon, most likely a cash back system.  So many of the really good rewards are only available with type tier cards and Final would like to make rewards more democratic. Final expects to go live around mid 2015 in Beta. Final want your feedback.  E-mail at info@getfinal.com and let them know what you want and don’t want in a credit card. Show Notes Betterment:  The smart way to invest.  Get up to six months free. Get Final:  A credit card for the 21st Century. Learn more about your ad choices. Visit megaphone.fm/adchoices

When you learn something new, you can’t wait to share it.  Money matters should be the same.  Spread your knowledge to the less financially savvy among us. It doesn’t just have to be something good you’ve learned.  Some bank or company screw you over?  Let everyone know that too so they can avoid the same fate. We encourage you to surround yourself with financial friends but you don’t have to ditch the friends who are bad with money.  You can be the financial friend that helps them improve their habits. Money is such a taboo subject though.  How do you bring it up?  Lead by bleeding first.  Tell your friends all the dumb mistakes you made and how you fixed them.  It will make them feel less judged when they share their mistakes. It doesn’t matter if you learn something by reading it from a bathroom wall or Stephen Hawking told it to you over cocktails.  The important thing is that you know it.  So if you learned from our podcast or another, a book, a blog, share your source of knowledge with those around you. And be sure to follow up.  Ask if they listened or read the book.  Then you will have a jumping off point and you can show them all kinds of cool stuff like Mint, Betterment, and Acorns.  Once they’re a little savvier, you can introduce them to Vanguard if they haven’t already discovered it. Do you have a story on how you helped a friend or family member improve their finances?  Share your story in the comments. Show Notes Mint:  Mint will tell you when your bank screws you with bullshit fees. Betterment:  Investing for beginners. Acorns:  Invest your nickels and dimes.   Learn more about your ad choices. Visit megaphone.fm/adchoices