Surprising Things That Can Kill Your Credit

Posted on February 3, 2012 by admin| Leave a comment

When it comes to credit scores, we’re all very familiar with the damage a late payment can do to your credit “worthiness.” We also know that having too much debt is bad as is having no credit references at all.

But surely that can’t be all that affects your credit score, right?

The truth is, there are several things that can tank your credit, some of which just might surprise you. (See also: 6 Credit Card Services You Don’t (Usually) Need)

Sneaky Inquiries

When you apply for a new credit card, you expect an inquiry to show up on your report. This is known as a “hard” inquiry, and too many of these within a 12 month period will lower your score.

But filling out that Visa application isn’t the only way to generate a hard inquiry. If you use a debit card when you rent a car for example, many rental agencies will check your credit before approving the transaction, and since few of us read all the fine print, you may not realize it’s happened until it’s too late.

Likewise, opening a new checking account will also typically generate a hard inquiry (even though you’re not applying for credit) as will applying for new phone service and — surprise! — requesting an increase on an existing account. Unfortunately, many consumers assume that credit card companies simply look at their own payment history to determine approval for increases, but the fact is that your existing creditors are monitoring your credit score on a regular basis.

Now, only the hard inquiries generated by a request for an increase will ding your score — those periodic “checkups” are considered soft inquiries and don’t cause a penalty. But that doesn’t mean that they can’t still hurt your credit, bringing us to the next item on this list…

Changing Your Ratio

When a creditor approves an application for credit, they will continue to monitor your score to ensure that your credit worthiness doesn’t change. And again, these soft inquiries don’t count against you. But should the creditor decide that you no longer meet their requirements, they can lower your credit limit or worse, close your account. By the time you realize it, the damage has already been done.

Your credit score depends greatly on the ratio between how much credit you’ve used and how much you have available. So, if you have an account with a $ 2,000 balance for example, and you’ve charged $ 400, then you’ve used 20% of your available credit, and anything up to 30% is considered to be responsible credit management.

But let’s say that the credit card company decides that you no longer meet their standards and as a result, they lower your limit to $ 250 (yes, they can do that — I speak from experience). Now, instead of having a credit ratio of 20%, you’re suddenly maxed out as far as your credit report is concerned, and your score will drop considerably as a result.

If they decide to close the account instead (yes, they can do that too), you not only suffer the ding for a high credit utilization ratio, but you also lose the benefit of that available credit once you’ve paid the balance off. Remember, your utilization ratio is based upon your total credit available, so when an account is closed, it reduces the amount of credit you have access to. And the less available credit you have, the higher your utilization ratio will be.

This is also the reason that financial experts discourage balance transfers. Debt-conscious consumers will often transfer their credit card balances to a new card with a lower rate, thinking that they’re making a smart move, but this can actually have an adverse effect on your credit.

Not only do you suffer the ding for a hard inquiry to secure that new, lower-rate account, but you’ll also skew your utilization ratio if — like many consumers do — you close those higher-rate accounts after the balance transfer is complete.

Let’s say for example, that you have two cards, each with a $ 1,500 limit and a $ 200 balance. That gives you a utilization ratio of about 13% ($ 400 used / $ 3,000 total available). Then let’s say that you get a new, lower-rate credit card with an additional $ 1,000 limit, and you shift your $ 400 outstanding balance to that new card. You now have a credit utilization ratio of just 10% ($ 400 used / $ 4,000 total available), but the minute you close those two older accounts with the higher interest rates, your ratio goes down the tubes.

Instead of having $ 4,000 in available credit, you now only have $ 1,000. Your ratio goes from an impressive 10% to a whopping 40%, and that’s bad, bad, bad.

Applying for the Wrong Type of Credit

Many consumers think that any kind of credit is good, and for those trying to rebuild their credit scores, getting approval on in-house financing plans might seem like a step in the right direction.

Unfortunately, that’s not the case.

These “local” finance plans — like those you see advertised by furniture stores and car dealerships — are considered to be “second class” credit…that is, credit for those who can’t get it anywhere else, and this makes you look like a high risk to potential creditors.

In addition, because these in-house programs don’t issue you a revolving limit, your available credit is typically the amount of your purchase. So, when you finance $ 1,000, it appears as a maxed-out account on your credit report and affects that all-important utilization ratio we were talking about before.

Skipping Out

When it comes to late payments, it’s not just your credit cards that you have to worry about. Those old library fines, parking tickets, and unpaid balances on your book club can also hurt you if the company decides to use a collection agency to resolve the account.

And once the collection hits your credit report, you and your score are stuck with it for seven years.

Swearing Off Credit

After having a few bouts of credit card debt in my early twenties, I swore I would only pay cash for my stuff and never use a credit card again. But knowing the importance of having credit, I kept a few accounts open and just locked the cards away. I thought I was being smart… I thought wrong.

When you don’t use your credit — as in, ever — there’s no payment history for potential creditors to evaluate and after an extended period of time, your creditors may close your account because of inactivity, both of which can make it harder for you to secure credit when you need it.

In addition, if you do ever decide to use one of those cards, you may find that your purchase is declined because it’s outside of your “usual” spending habits. Of course, this can be resolved, but not without some embarrassment as you step out of the checkout line to call your credit card company.

The Moral of This Story?

Managing and protecting your credit score is most certainly a pain, but it’s a necessary one. Use your credit, but use it wisely, and always ask about credit checks before securing new services…even (and especially) when those services seemingly would have nothing to do with your credit.

But most importantly, monitor your score. The only way to know what’s being reported is to check it yourself and then dispute any information that’s incorrect.


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Ask the Readers: How Often Do You Evaluate Your Budget?

Posted on February 1, 2012 by admin| Leave a comment

Having a budget is one of the key ways to keep your finances in check. Budgets help you create a clear picture of how to live within your means. It’s important to evalute your budget from time to time to make adjustments as income sources change and expenses fluctuate. Some people evaluate their budgets on a weekly or monthly basis while others do a budget check up once a year.

How often do you evaluate your budget? Once a week? Once a month? Once a year? When was the last time you evaluated your budget?

Tell us how often you evaluate your budget and we’ll enter you in a drawing to win a $ 20 Amazon Gift Card!

We’re doing three giveaways — one for random comments, one for random Facebook “Likes”, and another one for random tweets.

Mandatory Entry: 

  • Post your answer in the comments below 

For extra entries (1 per action):

  • Go to our Facebook page, “Like” us, and leave a comment on this article telling us you did, or
  • Tweet your answer. You have to be a follower of our @wisebread account. Include both “@wisebread” and “#WBAsk” in your tweet so we’ll see it and count it. Leave a link to your tweet (click the timestamp for the individual URL) in a separate comment.

If you’re inspired to write a whole blog post OR you have a photo on flickr to share, please link to it in the comments or tweet it.

Giveaway Rules:

  • Contest ends Monday, February 6th at 11:59 pm Pacific. Winners will be announced after February 6th on the original post. Winners will also be contacted via email.
  • You can enter all three drawings — once by leaving a comment, once by liking our Facebook update, and once by tweeting.
  • This promotion is in no way sponsored, endorsed or administered, or associated with Facebook.
  • You must be 18 and US resident to enter. Void where prohibited.

Good Luck!


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A Beginner’s Guide to Homemade Bread

Posted on January 30, 2012 by admin| Leave a comment

I’d venture to say there are very few people who can resist fresh, homemade bread; when I pull a loaf out of the oven, a crowd inevitably forms around it, and we wait for it to cool so we can slather it with butter while it’s still warm. A fresh loaf of bread seems a bit miraculous when you make it yourself, as you watch a few simple ingredients rise into a golden dome under the oven light. It always led me to assume that making bread was difficult or complicated. What I found out is that it can be very simple — if, unlike me, you choose the right approach.

How Not to Start

When I decided to start making bread, I was charmed into it by a beautifully illustrated book and followed book written by a famous artisan baker. I followed the instructions for making sourdough starter — essentially a smelly, homemade yeast, created by allowing grapes to ferment with flour and water for several weeks. Then I proceeded to dive into artisan bread recipes that involved several painstaking steps — and many days — to complete. (See also: How to Bake Sourdough Bread)

I produced countless loaves of bread that were so flat and dense you could hardly cut into them. One loaf of raisin brioche rose to monstrous proportions in the oven, pushing raisins out of its billowing sides; another burned black on the outside and oozed wet dough in the center.

After flipping around in that first book, I realized that there’s a method to learning how to bake more complicated recipes successfully. The first page of the book dealt with making a simple white bread.

Step 1: Start Simple

Making bread is chemistry, which means there’s a certain ratio of ingredients that will produce that soft, chewy, texture. Most baking books start with white bread. This is because a simple loaf of white bread is the easiest kind to make successfully. When whole-grain flours are added in large proportion, things get a little more complicated, and you’re more likely to end up with a brick than anything that resembles real bread.

Start with white bread or wheat breads with a low proportion (less than 30%) of whole-grain flour until you get the hang of things. Once you master this, you’ll have the basic skills that are required to make more difficult recipes work.

Step 2: Know Your Ingredients

If you haven’t made bread before, you might assume that flour is flour. Not so. Bread flour isn’t a gimmick; it’s flour that contains a higher proportion of protein, or wheat gluten. This is what gives bread dough its elasticity. If your recipe doesn’t state the kind of flour you should use, consider trying each once. Some people like the airy texture all-purpose flour can create. If you are sensitive to gluten, getting the right texture will be more difficult, but a good gluten-free cookbook should help.

Yeast is another key ingredient in bread baking. Make sure you get the type the recipe calls for — either active dry yeast or instant yeast. You should also keep your yeast in a sealed container in the fridge or freezer to keep it fresh for longer. It’s alive, so treat it gently by letting it warm to up to room temperature before adding it to a recipe.

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Step 3: Understand the Basics

Making a simple loaf of bread involves the same basic steps: mixing, kneading, rising, shaping, and second rising. This sounds like a lot, but most of it is actually hands-off; just set your timer and let the flour and yeast mingle in privacy.

Mixing

This generally involves combining all the dry ingredients and all the wet ones, then combining the two and mixing until a kneadable dough forms. Just follow the directions in your recipe, and pay attention to any instructions about temperature — lukewarm liquids are often requested and will affect how the yeast responds.

Kneading

This is the fun part, and it generally needs to be done for 6 to 10 minutes, or until the dough is smooth and elastic, but still pliable. You can also do the mixing and kneading in your bread machine using the dough cycle. Just be sure to put the yeast on the bottom, followed by the dry ingredients and then the liquid. This prevents the yeast from being activated too early.

First Rising

Once you’ve kneaded the dough, you can make it into a ball, cover it with plastic wrap, and put it in a warm place to rise. I like to put it in the oven and turn the light on; the warmth from the light bulb provides just the right amount of heat. This takes 30 minutes to an hour, or until the ball has swelled to twice its size.

Shaping

This is when you deflate the dough and shape it for baking, either by putting it into a bread loaf pan or shaping it freeform on a pizza stone or cookie sheet. Then, cover the loaf with a towel for its second rising.

Final Rising

After being deflated, the bread should double in size again. This should take a little less time than the first rising — about 30 to 45 minutes. Preheat the oven to the temperature specified in the recipe during this time.

Once these steps are completed, put the bread in the oven, set the timer, and wait for what seems like forever.

Step 4: Learn When It’s Ready

I’ve cooked bread to a deep, acrid brown. I’ve also pulled it triumphantly from the oven when it looked just right — only to discover it was still raw in the middle. So how do you know if your loaf of bread is ready? Use the time and temperature specified in the recipe as a guide. When the bread is a deep, golden brown and smells like toast, it’s probably ready. To be sure, take it out of the oven, flip it over, and tap the middle of it with your finger or a spoon. If it sounds hollow, it’s cooked through.

Try, Try Again

Bread is alive, so learning how to consistently make great bread takes practice and patience. Over time, you’ll learn to know when the dough is the right consistency and when and how to make adjustments to fix it. You’ll probably also learn that loaves that rose a little too much, rose not quite enough, or are a little overcooked still taste pretty fantastic, especially compared to the dry, uniform slices from the supermarket. Learning to make bread is a process that takes time to perfect. Fortunately, the process is far from painstaking as even an imperfect loaf of fresh bread demands to be eaten.


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5 Best Gas Rewards Credit Cards

Posted on January 27, 2012 by admin| Leave a comment

Americans are having a tough time adjusting to the reality of purchasing gasoline at $ 3.00 a gallon or more.  When possible, we’ve bought more efficient cars, moved closer to work, and taken fewer road trips. Nevertheless, gasoline continues to consume a disproportionate amount of our budgets, and we are always looking for a way to save anything we can in this critical area.

How to Pick the Best Gas Card

First, you want to consider the savings you will realize from each card. Some products offer a percentage off your total purchase, while others grant a fixed amount of savings per gallon. Next, think about where you buy gas and which stations in your area have the lowest price. Some cards are specific to a brand, while others allow you to choose most stations except for warehouse stores. Finally, consider the other benefits of each card. Several of the cards on this list offer excellent rates of cash back for purchases beyond gas, while others do not. This is important if you plan on using this card for more than just fuel purchases.

A few years ago, I signed up for a SimplyCash American Express Business card that offered fantastic 5% cash back on all gasoline purchases. Sadly, that deal is no longer offered, but I was able to save a few hundred dollars using that card. These days, a credit card that offers higher rewards for gasoline purchases can still slash your price at the pump by 15 cents a gallon. Here are my top picks.

1. Visa Platinum Cashback Rewards Card From PenFed

ChasePenFed is the Pentagon Federal Credit Union. While they are not well known, and they are not even a bank, they do offer some of the most consumer friendly products on the market. Their Platinum Cash Rewards card offers 5% cash back on all gasoline purchases. Unfortunately, this card offers a paltry .25% back on other purchases. On the other hand, PenFed has a great reputation for low fees. This card has no annual fee, cash advance fee, foreign transaction fee, or over the limit fees. To apply for this card, you must be a member of the credit union, which is open to current and former members of the military, many government contractors, their relatives, and household members. Even if you do not qualify on this basis, you can do so by making a one-time, $ 15 donation to a military charity.

Click here to apply now

2. Costco TrueEarnings Card (Business and Personal)

ChaseFor those familiar with this brand, the word Costco is synonymous with savings. The consumer version of the Costco TrueEarnings card offers 3% cash back on gasoline, while the business version offers 4%. Costco limits the higher returns on gasoline to the first $ 3,000 each year for the consumer card, and $ 6,000 annually for the business card. Other benefits included 2% cash back on travel and at restaurants, along with 1% cash back everywhere else. Strangely, the 1% rate also includes purchases from Costco, an odd feature in a world where extra rewards are typically awarded for purchases from the co-branded merchant. Another odd fact about thing about this card is that the rewards are issued in the form of a voucher each February. You can use your voucher for purchases at Costco stores, or redeem it for cash at their customer service counter. If your account is closed before February, your forfeit all of your rewards. There is no fee for this card with your paid Costco membership

Click here to apply now

3. Amex BlueCash Preferred

ChaseHere is a top notch, all around rewards card that happens to offer a competitive 3% reward rate on gasoline purchases (it is also the best credit card for groceries). While there is no limit to the amount of cash back you can earn, this higher rate does not apply to fuel purchased at superstores and warehouse clubs like Costco and Sam’s Club.  Other rewards include 6% cash back at supermarkets, 3% cash back at department stores, and 1% cash back on all other purchases.

Click here to apply now

4. Citi ExxonMobil Mastercard

ChaseCiti and ExxonMobil are two giants of banking and energy, and their ExxonMobil MasterCard offers competitive cash back on both gasoline and other purchases. Cardholders will receive a 15 cent per gallon rebate on Exxon and Mobile purchases at over 10,000 nationwide locations.  Essentially, customers receive a larger percentage of cash back when the price of gas goes down, and relatively fewer rewards when the price goes up. Customers will receive another 2% cash back on their first $ 10,000 of eligible purchases each year, and 1% cash back after that. Cardholders receive a free Speedpass device to make quick purchases, and there is no annual fee for this card.

Click here to apply now

5. Chase Marathon Mastercard

ChaseWhile Chase is a major national credit card issuer, Marathon only has stations in 18 states in the Southeast and Midwest. Nevertheless, this card offers a competitive 5% rebate on all purchases that is applied to future Marathon charges. Other charges also return a reasonable 1% cash back. There is no annual fee for this card.

Click here to apply now

The Downsides of Gas Cards

Now that you know about all the great deals out there, pause for a second and consider if one of them is really right for you. As with all reward cards, you are not saving any money unless you are paying each statement in full and on time. To do otherwise ensures that you will owe more in interest that you ever earn in cash back. Also remember that you are not saving much money if you have to pay a higher initial price or drive further to take advantage of credit card rewards. Finally, consider how much money your household can save with one of these cards over the course of the year. That amount has to easily exceed the cost of any annual fees, or the point is moot. 

Note: Some links contain affiliate codes.


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14 Tasty and Cheap Meals for One

Posted on January 25, 2012 by admin| Leave a comment

I’ve always loved to cook, but when I was single it was chore. I mean, what’s the point of spending all that time in the kitchen cooking — then cleaning — if you’re the only person who’s going to enjoy the meal? 

That was a poor philosophy to have, mostly because I didn’t put any effort into thinking of delicious dishes to prepare. I deserved better than ramen and ham-and-cheese roll-ups — you know you’ve made that for dinner more than once — and so do you.

To help you get cooking, here are two weeks’ worth of meals I go to when it’s just me, myself, and I enjoying the fruits (and veggies) of my culinary skills. (See also: 6 Tips for Making Cheaper, Faster, Better Meals)

1. Spinach and Parmesan Omelet With Hash Browns

Anderson Cooper and I have a few things in common, one of which is a hatred for greens, especially spinach. Maybe that’s because when I was younger my mom made me eat (force fed is more like it) canned spinach, which is absolutely disgusting. I was on a trip to California once when I saw this healthy-ish omelet on the menu, so I decided to order it — totally out of character for me. When in Rome, right? To my delight, I loved it — and it’s totally easy to make at home. Prepare an omelet the way you normally would — whole eggs or just the whites — and when it’s still just a tad undercooked, add in the spinach and Parmesan cheese, flip, and season with salt and pepper. For a quick starchy side, peel and grate one potato and sauté it in butter on one side on low-medium heat for about five minutes or until golden brown. Flip to cook the other side to perfection.

2. Beet Salad

You can use canned beets for this recipe, but I wouldn’t recommend it; at many markets you can find fresh, cooked beets in the produce section. Build the salad with mesclun greens, the sliced beets (perhaps even quartered), orange slices (a smaller type would be ideal, like a clementine), walnuts, and Parmesan cheese; and top with a citrus vinaigrette that you can make with the juice from another orange, olive oil, and salt and pepper to taste.

3. Carrot and Ginger Soup With Oyster Crackers

Have you seen this soup maker and blender from Cuisinart on TV lately? Even though I don’t need it — and you probably don’t either — I live for anything that pulls double duty. In any case, for this carrot-ginger soup recipe you’ll need chicken broth, carrots, fresh ginger, parsley, onion, sour cream, sweet cream butter, and whipping cream. If it sounds rich, that’s because it is — taste-wise, anyway; it’s fairly easy on the wallet. Top with oyster crackers, because, well, who doesn’t love those? This recipe yields eight servings, but freezes very well.

4. Lemon-Pepper Grilled Shrimp With Mixed Greens

This may be hard to believe, but shrimp are relative expensive, depending on the size and quantity you’re purchasing. For a meal for one, pick up about six medium-size shrimp, which will probably cost you less than three dollars. At home, sprinkle the shrimp with a lemon-pepper seasoning salt and grill in a pan while brushing with a bit of butter. When the shrimp are cooked through — one to two minutes per side is all it takes — arrange them on a bed of greens lightly dressed with a lemon vinaigrette that you can make with lemon juice, olive oil, salt, and pepper.

5. Grilled Cheese and Bacon With Tomato Soup

Everybody knows how to make a grilled cheese sandwich, but this one gets extra oomph by placing slices of cooked bacon between the bread before putting the sandwich together. You can use any kind of cheese you want, but I believe that there isn’t a better tasting grilled cheese than one made with good ol’ Kraft American Singles. Once your sandwich is grilled, golden, and bubbly, dip it in a bowl of warm tomato soup (Campbell’s condensed, of course) that will take you right back to your childhood.

6. Chipotle-Cilantro Quesadillas With Mexirice

All you need to make quesadillas is tortillas and cheese, but to kick this version up a notch, add a few chopped chipotle peppers and cilantro. Place one tortilla in a 10-inch skillet — no butter; that’ll make it greasy — and top it with the ingredients. When it’s all good and melty, top with the other tortilla and flip until that side is crispy and golden brown too. Cut the quesadilla in quarters so it’s dippable in salsa or sour cream, and serve alongside a Mexican-style rice, like Uncle Ben’s.

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7. Baked Potato With Broccoli and Cheese 

A friend of mine in Hawaii says I make the best baked potatoes in the world — and that’s probably true (I’m patting myself on the back right now) — but the problem with making the best baked potatoes in the world is that it takes time. Cut the time it takes to make yours in more than half by poking holes in the potato with a fork and microwaving it for whatever time your microwave recommends. While it’s cooking, steam a handful of broccoli florets and heat up a bit of Cheez Whiz. When the potato is tender inside, cut it open, add the broccoli tossed in butter, and top with the Whiz.

8. Turkey Club With Homemade French Fries

Here’s how this goes — toast three slices of bread (preferably whole wheat) and spread one side of two slices and both sides of one slice with mayo. On the bottom piece of bread (one with only one mayo-ed side), layer turkey breast, lettuce, bacon, and tomato, and top with the slice of bread that has mayo on both sides. Repeat the process until you have a double-decker sandwich. Before that, however (because making the sandwich doesn’t take long at all), cut one large Russet potato in wedges, season with olive oil, salt and pepper, and cook on 400 degrees for about 30 minutes.

9. Prosciutto and Melon

I was in Spain when I had melon and jamón for the first time, and that’s all it took for me to fall head over heels for this incredibly delicious and quick dish. In fact, among these dishes on the list, this is the fastest. You can buy a whole cantaloupe, but unless you’re going to eat the entire fruit before it goes bad, I would recommend buying a slice or two of prepackaged melon. While you’re at the store, go to the deli and pick up about four slices of prosciutto or another salty, thin ham. When preparing this dish, all you need to do is drape the ham over the sliced prosciutto and dig in.

10. Tuna Tartine

Tartine is French for an open-faced sandwich. For this version, toast a slice of bread, and top with tomato, cucumber, mixed greens, and a scoop of prepared tuna. If you want to get real fancy, you can crumble feta or blue cheese on top if you have it.

11. Pork Chop With Sautéed Cauliflower and Raisins

You have to go to high-end market or butcher to get single slices of pork (or any meat, for that matter), so to cut costs, buy a pack of two chops and put one in the freezer. Pan fry or grill the chop — your preference — and serve along side steamed cauliflower and raisins. The latter may seem like an unusual combo, but trust me, it’s good.

12. Mussels Provencal

I know what you’re thinking — mussels are expensive. And, like most seafood bought in a large quantity, they can be. But if you’re eating for one, you only need to purchase as many mussels as you think you’ll consume; my recommendation would be 10 to 12. When you’re ready to eat, prepare the mussels with this recipe that calls for ingredients that you probably already have on hand. This dish is a real treat for those who want to eat like a prince on the budget of a pauper. 

14. Beef With Brown Rice and Gravy

This is a no-frills, very affordable dish that I used to make in college. My roommates would laugh at me because it’s one of those meals that you eat when there is nothing left in the house, but I had the last laugh when it was in my belly. Stew meat, which is totally cheap, is what this dish calls for. Sauté the meat in olive oil, salt, and pepper while boiling one pouch of brown rice; I buy my fast-cook rice in pouches so it’s perfectly portioned, by the way. Prepare the brown gravy from an instant mix as directed and pour over the combined beef and rice. The mix makes enough gravy for two, but I use it all. Mikey don’t share his gravy.

Have even more recipes or tips on how to make meals for one? Let me know in the comments below.


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Reverse Bucket List: Look Back Before Looking Forward

Posted on January 23, 2012 by admin| Leave a comment

Everybody has a bucket list — a random list of things we’d like to do, be, or have before we “kick the bucket.” Some people make due with rough mental compilations, while others prefer their bucket lists typed, formatted, and prominently displayed. (See also: Goal Setting, Defined and Deconstructed)

But what of the bucket list? Where is the context? How satisfied will we feel about our lives today if we’re constantly studying a list of things we haven’t done? Where do we even begin with a list like this, instigated no less by a big clock in the sky counting us down towards an unknown “bucket date?”

I get panicky just thinking about it.

Although a bucket list can be motivational, I believe that in and of itself it can be more crippling than empowering. In order for a bucket list to reach its true potential, I think we should first start with a Reverse Bucket List.

What’s a Reverse Bucket List?

In order to gauge where we’re going, it’s always good to know where we’ve come from. Creating a context of our journey thus far is imperative to understanding why we want the things we want, and ultimately, how to get them.

A Reverse Bucket List is a list of things that we think are “bucket list worthy,” but that we’ve already done. It’s a creative way of reflecting on your life thus far and taking note of the some of the experiences that really sang to you.

Not only is it fun, but you might be surprised by what you’ve already done in your life. (Conversely, you may realize you need to get out of the house more.)

Either way, it’s all good.

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Reverse Bucket List Exercise

You may want to structure the exercise of making your Reverse Bucket List using the method for devising 100 ways to change your life.

By doing it as a fast-paced brainstorming exercise, you may be surprised at what makes its way on to your Reverse Bucket List. There are no right or wrong answers — only your own answers. It’s your life, and your reverse bucket list; write down as many things as you can, without worrying about what you’re actually writing. We’ll get to that later.

Here are a few general ideas to get your reflective juices flowing:

  • Achievements or awards you’ve received
  • Fears you’ve conquered
  • Careers you’ve had
  • Friends you’ve made and people you’ve met
  • Places you’ve traveled to
  • Anything that’s worthy of a story you tell other people
  • Goals and milestones you reached
  • Childhood dreams (no matter how silly in retrospect) you achieved
  • Bizarre or fun things that have happened to you or that you’ve done 

What to Do With Your List

This isn’t a pesky to-do list or a vision board that requires prominent display as a reminder of what you need to do or where you’re going.

Instead, it’s more in the act of constructing and initially reviewing your Reverse Bucket List that you will see the benefits.

Once you’ve finished writing out your Reverse Bucket List, read through it. What do you think? Do you notice any themes? Are there any gaps? How does reading this list make you feel?

Regardless of whether you feel there’s too little or too much on your Reverse Bucket List, you might discover some of the things on it are surprising, even illuminating. And they might lead you to your next step.

The Next Step

Using the observations you made above, now is a great time to project your Reverse Bucket List forward. To reverse the Reverse Bucket List, as it were.

Here are some exercises you can do from here:


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How to Find Unlisted Jobs and Win Every Salary Negotiation

Posted on January 21, 2012 by admin| Leave a comment

Ramit Sethi, the New York Times bestselling author of I Will Teach You To Be Rich, recently did an amazing Q&A session on how to land your dream job.
 
He has given Wise Bread permission to highlight his best answers to these popular job hunting questions:

  1. How do I find and land unadvertised jobs?
  2. How can I grow my network when I don’t know anyone with connections?
  3. How do I explain a resume gap where I was a stay-at-home parent for 8 years?
  4. How do I negotiate my salary when they said it isn’t negotiable?
  5. How can I get a job at a company with a strict GPA cut off?
  6. How can I find out during the interview if a company is a great place to work?
  7. How do I land my dream job in a declining industry?
  8. What is the best way to ask for a raise?

1. How do I find and land unadvertised jobs?

This is a great question because the best jobs are not advertised. They are often gone before they even reach the market. 

Constantly have your network find jobs for you

The most important thing is to find powerful mentors with great connections to find the dream jobs for you. Reach out to your network systematically. Let the people in your network know that you’re looking for a job, and most importantly, exactly what kind of job you’re looking for.

Your key network contacts are very busy people. Make sure you do your homework before contacting them. Know exactly what you want and communicate it succinctly. 

What if I don’t have a network?

Some people might say they don’t have a powerful network because they didn’t go to a fancy school or came from a rich family. That is a poor excuse. Your network is a lot bigger than you think. They include:

  • friends and peers
  • older people
  • alumni from your college
  • people who used to work at the company you want to apply to

The last group is great because they are more likely to tell you the truth about the companies you want to work for.

2. How can I grow my network when I don’t know anyone with connections?

Create friendships with people by helping them out and adding value to their lives. This way people will know that you are able to perform and deliver as an employee. How do you do this? Make sure people know you are dependable and reliable.

How do I get started?

Start with coffee shop meetings with people to ask for their advice. Follow up with them to let them know you utilized their advice then be sure to contact them from time to time to find out if there is anyway you can help them. Listen to people to find out what the challenges are in their lives, then try to help. Networking requires that you give in hopes that one day it may come back to you. At it’s core, it is about helping someone else before you ask for anything in return.

Also, start reaching out to understand the lay of the land. Find people who work or worked at companies you are interested in and take them to coffee. Ask them for their advice, not a job. Doing this will help you find who you can help and who may be able to someday help you.

Isn’t using your connections “cheating?”

It is important to cultivate relationships with the people you know because top performers know that the people around them help them.  If you’ve got an advantage, don’t think twice about using it.

3. How do I approach the job search after being a stay-at-home mom for the last eight years?

One of the most important things about finding the job of your dreams is to differentiate between what to pay attention to and what not to pay attention to. You have to be able to focus on what is important to you right now. Right now what’s important to you (and the hiring manager) is the fact that you are trying to get a job. 

How do you show the hiring manager you are worth hiring and get the job?

Do your research! Have a solid understanding of the potential job titles you are interested in as well as companies you are interested in. Then narrow it down to one job title at one company and do elaborate research. Take people to coffee and ask questions. Do research online. Know the challenges of the position and everything else about the it so when you sit down in front of a hiring manager you can talk about the position better than the hiring manager can. Demonstrating why your experience is incredible has more weight and relevancy than the fact that you were a stay-at-home mom. Focus on your research and the person you are trying to get a job from.

4. How do I negotiate my salary when they tell me the salary isn’t flexible?

This is a classic scare tactic companies use because people are naive and terrified of negotiating. 

Why does a company tell you this?

If a company tells you this, chances are you did something wrong during the interview process. Average candidates put the company in control of their salary during the interview process by making it clear they have no other options, other offers, or maybe even telling the interviewer how much he or she was compensated before. It’s game over before the negotiation process even starts.

Top performers set the stage in advance for salary negotiation because they say things like “at my last job I was very well compensated and I am certainly looking for compensation that is a good fit for me but I’m also looking for a better fit in terms of my values and what I want to do with my career.” Subtle comments like this make an impression on the interviewer so that the interviewer knows when it’s time to negotiate salary, it’s game on.

How do you make your salary negotiable?

  • Have multiple offers. Do your job search with multiple companies and time the offers so that you can get a bidding war going.
  • Make it clear throughout your engagement with the company that you want to be evaluated on the value you bring to the company.

If you have already been told your salary is non-negotiable, how do you negotiate?

You have to make a case for why you should be given a higher salary. How do you do that?

TIP FROM NY TIMES BESTSELLING AUTHOR RAMIT SETHI

  • Get comparable salaries from payscale.com, salary.com, and glassdoor.com.
  • Show them why you are worth the money and why you deserve to be at the top range of the pay spectrum by talking about what you are planning to do with the company.

If this doesn’t work because you were an average candidate and put yourself in a non-negotiation bind, make an agreement with the interviewer that if in six months you have done an extraordinary job for the company, they will revisit negotiating your salary. Make sure they put that in your contract. In your first 30 days at your job, ask the company what would constitute you doing an extraordinary job. Have them write it down and be ultra specific about things. Ask them for numbers, hit those numbers, then blow past them.  This will show you are a top performer and salvage your salary negotiation.

5. How can I get a job at a company with a strict GPA cut-off when I have a low GPA?

Unfortunately, you can’t. It is better to focus your time and energy on jobs that are more appropriate for you than to go for the one in a million chance you might get a job despite your low GPA. If you excel at the jobs you do qualify for, you may be able to go back one day and apply for opportunities that are currently out of your reach.

6. How can I find out during the interview process of the company is a great place to work?

This is a great question because young people should focus on making better decisions about their career as opposed to how much money they are going to make. During the interview process it is important to find out if the company is a great place to work by doing your research. How do you do your research?

  • Use websites such as glassdoor.com, salary.com, and payscale.com to read reviews from current and former employees.
  • Use Google to search for reviews and interviews about what people are saying about the company.
  • After doing basic online research, reach out to people who work or have worked at the company, take them to coffee, and get their advice. People love talking to young people because young people are viewed as more innocent and they like to stay abreast of what young people are doing.

7. How do I land my dream job when it’s in a declining industry?

This is a great question because many young people dream of working in a glamorous job such as media, journalism, or entertainment. Because these jobs are in such high demand and there are many people looking to fill these jobs, employees don’t get paid a lot and many of the jobs are getting outsourced.

The bad news: You will be competing against hundreds of thousands (if not millions) of people for these jobs.

The good news: Many of these people are average (or even terrible) at what they do especially when it comes to their job search.

So how do you make it to the big leagues?

A lot of it boils down to luck. But you also need to get out there and talk to the people you admire. Find people who have your dream job, reach out to them or get a warm introduction to them, and ask them how they got to where they are. Give them a little background on yourself in regards to who you are and what your career aspirations are, then offer to meet them at their convenience to talk. Offer to take them to coffee or dinner at a restaurant of their choosing. Ask them for five minutes of their time so they can tell you what decisions they made to get where they are now.

The overall strategy: Don’t be an average candidate.

Talk to the top people. If you can’t get to someone in the top tier of your industry, go for the second or third tier and work your way up. Ask then what differentiates them from the rest of the people in their field, then try to do what they do.

8. What is the best way to ask for a raise?

Here are the five steps to follow to ask for a raise:

  • Find out what your boss wants. Make your boss look great. Does your boss want his boss to see the results of what’s going on on your team? Or does he want to go home at 5pm to play golf?
  • Let your boss know you want a raise. Ask what it would take to get a raise and what ultimate success would look like to him or her.
  • Let your boss know you are working towards that. It is vital to tell your boss what you want and that you are gunning for it in a positive way.
  • Execute what it would take for you to get a raise and exceed what your boss wants.
  • Ask your boss to discuss your raise based on the fact that you have done what he or she has asked and more.

Keep in mind that there is one characteristic that will help you get a raise: having other options. If you have other job options available to you and you aren’t getting your raise the second or third time you ask and you deserve it, follow the lead of other top performers and seek out your other options.

This is just small sample of Ramit’s tips on how to land a dream job. He provides a lot more actionable advice in his free newsletter. For example, did you know that 93% of your job interview’s success depends on nonverbal cues? Click here to get additional free job hunting advice from Ramit.

 


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Join Our Tweetchat on Thu 1/19, 12pm Pacific for a Chance to Win Prizes

Posted on January 19, 2012 by admin| Leave a comment

Join our Tweetchat this Thursday at 12:00 pm Pacific for lively conversation and a chance to win prizes! Use #WBChat to participate.

This week’s topic: Frugal Travel. Learn about saving airfare, keeping food expenses down, and cheap accomodations. Share tips on making a budget, getting around your destination without breaking the bank, and getting good deals on activities.

This week we have a special guest  joining us:

Nora from The Professional Hobo joining us for our chat! Be sure to check out Nora’s article Financial Travel Tip #2: Supermarket Savings!

For an easy way to keep track of the conversation, try using our special Tweetchat Chatroom.

Anyone can participate, but you must be following @WiseBread and RSVP below to win our prize!

To make it easier for us to keep track of attendees and pick our winners, please RSVP below with your twitter ID (put that in the “Link Title” field), email address, and your twitter URL (put that in the “URL” field, do not put your blog’s url in there). Winners will be selected at random from RSVPs. If a winner is chosen who RSVPed but did not attend a 2nd winner will be chosen.

New Parenting Chat Immediately Before #WBChat

Our sister blog Parenting Squad (@ParentingSquad) will be hosting a parenting chat every Thursday at 11:00 am Pacific. Drop by for fun parenting conversations and a chance to win prizes! Use #PSChat to participate.


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6 Credit Card Services You Don’t (Usually) Need

Posted on January 17, 2012 by admin| Leave a comment

Everyone who has opened up a credit card in the last five years has been pitched on various supplementary “services” from the company in question. The offers sound enticing and even logical at times, but are they really justified from a hard dollars-and-cents standpoint?

Everyone’s financial situation is different, but generally speaking, the answer is NO.

Here are six credit card services that you (usually) do not need. (See also: Best Credit Card Perks)

1. Identity Theft Coverage

This is typically framed as a way to avoid liability for fraudulent charges made after your credit card is stolen. It sounds appealing, but many consumers fail to realize they are essentially ALREADY covered from this by 1968’s Truth in Lending Act. This law states that if you report the stolen card immediately, your maximum liability for fraudulent charges is $ 50. As such, it makes zero sense to pay $ 5 per month (or anything) when, even in the worst case scenario, you are only out $ 50.

While some identity theft plans offer coverage for more extreme circumstances (such as losing other cards or your Social Security number), you would generally be better served investing in a paper shredder and monitoring your credit report than paying the fees your credit card company would charge.

2. Missed Payment Insurance

This was actually offered to me a few days ago while activating a credit card. The salesperson gleefully exclaimed how I could “put my payments on hold for up to two years” in case I lost my job or ran out of money. The cost? Something like $ 5 per every $ 100 on my outstanding balance. It actually sounded moderately appealing at first, until I paused and thought about it.

“Why would I ever be unemployed or unable to make credit card payments for two years?”

For one thing, I (like many credit card holders) rarely carry balances month-to-month. It might make sense if you carry huge balances, but even in that case, you probably ought to ask WHY you’re carrying those balances. Furthermore, a modest savings account would seemingly provide all the missed payment insurance you would need in a cash crunch.

3. Credit Score Tracking

Given the overall importance of your credit score, this is definitely a number worth knowing. Do you really need 24/7 access to it, as many credit card companies now offer in exchange for additional fees? It’s debatable (and there are definitely circumstances where it COULD make sense), but probably not.

Although credit scores do change dynamically to reflect your most up-to-date activity, obsessively monitoring it every single day is unlikely to reveal anything of importance. You would be much better off simply getting your free yearly credit score and report from AnnualCreditReport.com in the beginning of the year, and then perhaps paying one of the major credit bureaus (Experian, Equifax, and Trans-Union) for second and third peeks later on. Experian, for instance, offers $ 1 access to your score in connection with an easy-to-cancel trial.

4. Debt Consolidation

Typically offered by third-party organizations rather than credit card companies themselves, debt consolidation is far from the silver bullet its supporters make it out to be. Consolidating debt lowers your immediate monthly payment (which we always hear), but it also lengthens the amount of time you stay in debt and enlarges the total amount that you pay (which we almost never hear.)

Think about it — what creditor would voluntarily rewrite debt if it only benefited the borrower? No one would. Taking this into account, you should realize that debt consolidation doesn’t lower your debt. It simply moves it around and makes it (temporarily) more comfortable. Approach debt consolidation with caution.

5. Credit Score Repair

A number of credit card companies (sensing that many consumers have low credit scores) are beginning to offer credit score repair services. The offer is appealing to people who don’t understand credit and thus believe “the experts” can push a few buttons to raise their score overnight.

Yet in truth, credit scores are no mystery. As myFICO explains, your credit score is comprised of five things and five things only:

  • Payment history (35%)
  • Amounts owed (30%)
  • Length of credit history (15%)
  • New credit (10%)
  • Types of credit used (10%)

Repair services don’t have any shortcuts or special tricks. All they can do are the same common-sense things you could do yourself by consulting the list above (paying your bills on time, repaying outstanding balances, ceasing to apply for new credit for a while, etc.)

6. Balance Transfers

Before someone rushes to say how insane I am for calling balance transfers unnecessary, let me state that I do find them worthwhile sometimes. More often than not, however, they amount to little more than a band-aid on a bullet wound.

Because those highly sought 0% “teaser periods” often last just 3-6 months (and most borrowers will not pay off their entire balance that quickly), credit card holders might be left to either stick with the astronomical new APR or “rate-chase” by balance transferring to a new 0% card. This can actually compound your credit problems because constantly applying for new credit reflects poorly on your score.

If you can pay off a balance IN FULL during the teaser period, it can be a smart move. If not, it’s likely a waste of time and money.


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Chase Freedom Visa Review: $200 Cash Back Bonus

Posted on January 14, 2012 by admin| Leave a comment

I have been a Chase Freedom credit card holder since 2007. I use the Chase Freedom card for my day-to-day spending and always pay it off in full each month. Based on these six years as a cardholder, here are my thoughts on the card — including The Good, The Bad, The Ugly, and The Bottom Line. (See also: 5 More Ways to Earn Cashback Rewards)

The Good

Here’s what I like best about my Chase Freedom card.

Rewards Percentage Back

The Chase Freedom card offers 5% back in several categories every quarter and 1% on everything else. (Read about the rotation scheme below.)

  • January – March 2012, the card offers 5% back at gas stations and on Amazon.com.
  • April – June, you’ll get 5% back at movie theaters and grocery stores.
  • July – September the 5% back is good at restaurants and gas stations.
  • October – December (just in time for holiday shopping) 5% back at Best Buy and Kohls, and on hotels and airlines.

5% back is a great percentage back that few credit cards can beat. 

Cash Back Rewards

The Chase Ultimate Rewards program is truly one of the most flexible rewards programs that I’ve seen. I almost always use my points for cash back, in the form of a check or a statement credit. The ratio of points to cash is 1/1 (so for every $ 100 you spend on 5% category items, you get five points — which then you can use for $ 5 back.). The rewards programs also offers redemption for gift cards, travel, and products. And if you have multiple cards earning Chase Ultimate rewards points, you can combine the points from both cards together to redeem for a higher priced reward.

Visa Is Accepted Everywhere

Let’s face it — Visa truly is “everywhere you want to be.” Any place I’ve ever been that accepts credit cards takes Visa. It’s nice to carry a card and not have to worry that the cashier will say “Sorry, we don’t take that card.”

Occasional Bonuses and Coupons

Several times a quarter I receive coupons in the mail that I can use if I use my Chase Freedom card at a merchant. For example, in the past few months I’ve received coupons for $ 10 off of $ 50 at Old Navy and 10%-30% off at Barnes and Noble. While these aren’t places I frequently shop, occasionally the coupon will be for something I need at that time, and I will take advantage of it.

Easy-to-Navigate Website

I’ve had bank accounts or credit cards with nine banking institutions in the past 10 years and do 95% of my banking online, so I have a good sense of what makes a good banking website. The Chase Freedom site is overall very easy to use. It’s simple to login, set up payments (automatic or regular), track your spending, and generally do anything that you need to do on your credit card’s website. I appreciate not having to click around to find what I’m looking for each time I sign on.

Great Sign-Up Bonus

You can almost always get a great sign up bonus when you sign up for a new Chase Freedom card. When I signed up, I got $ 250 and $ 200 (respectively) back. That’s a nice chunk of change just for getting a new card.

The Bad

Despite all the positive aspects to the Chase Freedom card, here are a few things that I’m less than happy with.

Rotating Rewards

I am not a fan of the rotating rewards. While it’s nice to get rewarded for different categories of purchases, I would much rather have consistency in my rewards. I don’t do much “rewards hacking” — using a different card for different purchases in order to get the highest reward — so I would rather just know that I will always get a set percentage back no matter what month it is. I have enough else on my mind that I don’t want to try to remember which categories are worth more at that time. That said, I look forward to getting 5% back at Amazon, which I won’t get anywhere else.

Fewer Protections Than Other Cards

The Chase Freedom is a regular old Visa card. It doesn’t offer the high caliber of credit card perks that American Express cards or Visa Signature cards do. These perks include purchase protection if a recently purchased item gets stolen or damaged within a certain time frame after purchase and price protection if the price on a recent purchase drops. Because of this I always use my American Express Zync card (which offers these protections) when buying tangible things and not consumables like gas, meals at restaurants, or groceries. The Chase Freedom still offers some perks (like car insurance for rental cars) but I know that my other credit cards do better.

The Ugly

The “bad” items listed above are minor annoyances, but here are the two things I truly hate about the Chase Freedom card.

Opting In to the Rotating Rewards

Not only do the 5% rewards change every quarter, you must also re-opt in each time. If you don’t opt in, you don’t get the 5% in those categories. Granted, Chase makes it easy by sending you an email with a link that requires just one click, but still, I find it absolutely obnoxious that I have to re-opt in each quarter just to get the higher rewards. I’m guessing they do this because there’s a psychological/marketing principle that says that when you have to opt in or interact with something, you value it more and are more likely to use it. Regardless of the reason, I’m not a fan of the opt in rewards.

Changing the Game on Customers

I previously held a Chase Ultimate rewards card that paid 5% back at grocery stores, gas stations and pharmacies — all of the time. Unfortunately, the Ultimate Rewards card was discontinued last year, and the account was transferred into the rotating Chase Freedom rewards. Similarly, the original Chase Freedom card that I have had since 2007 changed their rewards program for the worse last year. When I first signed up for the card, I always received 3% back on the highest categories of spending in any given month. So, for example, if my highest categories in a month were restaurants, utilities, and pets, I would get 3% back in those categories. If during the next month my highest categories of spending were restaurants, utilities, and clothing, I would get 3% back in those categories. Previously, I earned about $ 400-$ 500 a year in rewards. Unfortunately, the program was changed — now I get a higher percentage back (5%), but only in set categories. So, now in the past year I’ve only received about $ 175 in cash back rewards. I don’t appreciate having something changed on me after I’ve signed up and been a loyal customer. But, I guess that’s business.

The Bottom Line

ChaseDespite the shortcomings of the Chase Freedom credit card, I would still recommend it as a rewards cards for someone who is looking for an everyday cash back card. I use it as my everyday card for mundane purchases like gas and groceries. The Chase Freedom card is an excellent rewards card for the reasons I’ve previously listed, especially because:

  1. Visa is accepted everywhere
  2. The rewards redemption (including for cash) is excellent
  3. Even if you don’t shop in the 5% category, you are always guaranteed 1% back

Current Promotions

Click here to apply now and get a $ 200 cash back bonus

Note: Some links contain affiliate codes.


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