Investing: live, learn and then live better

We all rely on an occupation to make it in this world. What we spend our hard earned cash on is our decision. However, as with any decision we will reap what we sow. I need to work on sowing because I love to reap.

Now, I will admit that I am no where close to a financial genius, but I do like to hear what the geniuses have to say.

Basically, here are a few quick rules to live by.

1. Spend less than you make.
2. Be generously charitable.
3. Avoid enslavement to Credit Cards and Debt.
4. Enslave your Credit Cards and Debt.
5. Make money work for you.
6. Diversify
7. Give the government what it's due. (Not a penny more, nor a moment to soon)
8. Take advantage of retirement plans, e.g. 401(k)s, Roth IRA's, IRA's, 529's.

Though I'm sure that I will add to this list over time, I hope to write what I have learned and am learning while I try to live by these rules.

Credit Cards can eat you alive. Why? If money burns a hole in your pocket, then a credit card will blow your pocket right off taking a pound of flesh with it to Shylock's delight. Have you checked you rate lately? According to the Credit Card Monitor:

• Average consumer credit card rate (non-reward): 13.01%
• Average reward credit card rate: 14.97%
• Average student credit card rate: 14.84%
• Average business credit card rate (non-reward): 10.83%
• Average business reward credit card rate: 12.16%
  

If you have rates that are at or above these then it is time to call your credit card company. Before you have the pleasure of navigating your creditors automated attendant, make a plan. Ask yourself a few questions. Have you been paying your credit card bill on time? More importantly, have you been paying off the balance in full? If you can't say yes to these 2 questions then you have some work to do.

I would suggest that if you have the funds then pay off the whole card now. If not, work on paying as much as you can afford over the monthly minimum payment. The sooner you gain control of your balance the sooner you gain leverage that you can take to the bank.

When your balance is zero, make your call. Be sure that you talk to a live person ASAP in order to preserve the necessary patience that this process will require. I usually do this by either saying the words; help!, attendant!, agent!, or pressing the # sign and/or the number 0 repeatedly. Next I bypass my cohabitants of this newly flattened world by asking repeatedly for a manger. You may get some resistance, but they will eventually relent. Relent! Recoil! Reverse! The call is now transferred via satellite or undersea cable thousands of miles to someone that you can fully understand and actually has the authority to do something. (Disclaimer: I have actually had great experiences with overseas customer service. 50% of the time)

Tell the manager that you have been making your payments on time and then you have received offers from other institutions. (If you don't receive these offers then you are accessing this blog from either the crib or the grave. In which case I would strongly encourage you to leave a comment) Tell them that you are considering this other offer and though it would be an inconvenience to transfer all of your automatic payments, etc. you are thinking about doing it.

At this point hold tough and wait for them to offer you something you can agree to. Make sure to follow up and ask questions so that you are receiving what you believe they are offering. Make sure there is not a time limit on the offer.

After you have lowered your rate make sure your payments are on time and that you pay off the balance as often as you can. Remember, if you pay off the balance every month you pay no interest. This amazing credit card function will be the focus of my next entry.