How to Spot a Rich Person

I was talking to a Jaguar salesman last week and asked him what the hardest part of his job was.

“You can’t tell who’s rich anymore,” he said. “It used to be if someone walked in with jeans and a T-shirt I could ignore them or ask them to leave. Now that guy could be a billionaire. You have to be nice to everybody these days.”

Tim Blixseth, the billionaire timber tycoon, once told me about the time he visited a men’s clothing store near Palm Springs to buy a suit for his son. When they walked in, wearing work boots and jeans, the salesman headed them off at the door and said “I think you’d be better off at the mall.” They eventually bought a suit, but Tim made sure to drive by the front door in his Rolls Royce and wave goodbye to the salesman.

Identifying the rich used to be fairly simple: They dressed, talked and looked a certain way. They had iconic last names like Hutton or Hearst or Phipps, often with Roman numerals at the end.

Today, wealth has been democratized and individualized, and the rich come in all ages, shapes, sizes and ethnicities. People often ask me, “What do the rich wear? How can you tell by looking at someone today if they’re rich?” Such questioners are usually recalling old myths about watches and shoes, but my answer is that there is no way to tell. The rich don’t have a uniform anymore. Today, they all wear their wealth differently, from the dot-commers in T-shirts to the hedge-funders in khaki to the CEOs in classic pinstripes.

In her Journal column today, Christina Binkley takes a stroll down Rodeo Drive to do an “emotional audit” of salespeople — i.e., to find out how nice and welcoming they were. A woman at jeweler Van Cleef “sent us out the door with little more than her scowl,” she writes, while a woman at Yves Saint Laurent didn’t offer a smile but a “single upturned corner” of her mouth. In other words: not welcoming.

As Christina writes, “Many luxury companies are finding there’s a fine line between positioning themselves as lofty — to signal just the right amount of exclusivity — and being so haughty they alienate their customers.”

I think it goes beyond balance. When that guy who walks in your art gallery wearing jeans and a sweater could be David Geffen, you need to be nice to everyone. It’s especially true for retailers trying to peddle “mass luxury.” Once you start selling $50 silver trinkets and $60 sunglasses and calling them “luxury,” you can no longer be as choosy with your customers.

http://blogs.wsj.com/wealth/2007/11/01/how-to-spot-a-rich-person/trackback/

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Markets Tumble As Dollar's Fall Adds to Anxiety

The credit crisis sparked by mortgage problems reared its head anew, as stocks tumbled on fears about shaky financial institutions. This time, the dollar's fall to record lows and oil's flirtation with $100 a barrel added to the worrisome brew.

The Dow Jones Industrial Average fell 360.92 points, or 2.64%, to 13300.02. The index has now wiped out all of its gains since the Federal Reserve on Sept. 18 made the first of its two recent interest-rate cuts, sparking a short-lived rally that sent the Dow to a record high Oct. 9.

Wall Street is once again nervous about how much damage remains from subprime mortgages and other bad credit, even after tens of billions of dollars in write-downs. The wave of credit-rating downgrades on mortgage securities continued yesterday, and bank shares were especially hard-hit. Shares of Washington Mutual Inc., a major lender, lost 17%, and after the market closed American International Group Inc. and Morgan Stanley reported new write-downs connected to housing problems. (See related article.)

Something else is beginning to nag at investors. The dollar and oil are pushing to opposite extremes, one to record lows and the other near record highs. Gold, an age-old refuge in times of financial turmoil, is once again above $800 an ounce. The combination of economic worries and market movements is reminiscent of the chaotic 1970s, when the U.S. was beset by inflation, recession and a stock market going nowhere.

The global economy is much different today than it was then. Inflation is generally under control, and most investors trust central banks to keep it that way. The U.S. economy, though slowing, has kept growing even as higher energy prices hit consumers.

Still, the parallel points to some challenges that policy makers are trying hard to manage. One is the threat of inflation. Another is the risk of a broad international loss of confidence in America and its currency, which has long been the place where countries with big foreign reserves put the bulk of their assets.

"This is a critical juncture," said Jim O'Neill, head of global economic research at Goldman Sachs. "The dollar is behaving in the past couple of days as though the market is testing its reserve-currency status."

On Wednesday, the dollar took a sharp turn lower against several major currencies, sliding to a new record low against the euro and hitting its lowest level in decades versus the Canadian dollar. One dollar now buys only about 93 Canadian cents. At one point in 2000, the euro was worth only 85 cents. Now one euro buys $1.46.

One spark behind the dollar's latest downturn was a comment by a Chinese lawmaker suggesting that the country should buy more euros. Although the lawmaker isn't responsible for financial policy and later amended the remark, the comment fueled pessimism about the dollar's prospects amid slowing U.S. economic growth.

The price of oil, meanwhile, is pushing toward $100 a barrel, a price that just a few years ago most economists agreed could fuel a nasty recession. Strong demand from developing countries, constrained supplies around the world and speculative pressure are joining to push it higher. And gold closed yesterday at $831 an ounce on the New York Mercantile Exchange, its highest level since 1980, as investors sought its perceived protection against inflation.

The combination of movements in the dollar, oil and gold was similar in the 1970s. Back then, the dollar became unhinged after President Nixon abandoned the gold standard and the global system for regulating exchange rates collapsed with it. That was one factor behind oil's rise during that decade. Because oil is traded in dollars, exporters were earning less in other currencies for every barrel, and had a big incentive to restrict supply to drive up prices.

The world is far different today. The 1970s were wracked by recession and double-digit inflation. Today, strong global growth is a major force pushing the price of oil and the dollar in opposite directions. Central banks are acutely aware of the danger posed by inflation, and declare their readiness to move quickly to combat it. U.S. consumer prices in October were up 2.8% from a year earlier.

"Economies are much more resilient and much less prone to a creeping inflation process," says Eric Chaney, an economist at Morgan Stanley in London.

Fears of a falling currency were likely a factor when the Fed signaled last week, at the time of its latest interest-rate cut, a reluctance to cut rates again. The dollar's decline "could lead to higher prices for imported goods," Fed governor Kevin Warsh said yesterday. "If these same forces cause inflation expectations to become less reliably anchored, then inflation could increase in the longer run as well."

So far, the dollar's decline has benefited U.S. exporters by making their goods cheaper abroad and boosting the value in dollars of money earned overseas. That has helped lift the share prices of many multinationals. Taken too far, however, a dollar slide could hurt stocks broadly, if investors become unwilling to hold U.S. dollar assets.

"If you get a dollar rout and people start dumping quickly, that will complicate monetary policy and undermine the Goldilocks scenario that investors are hanging on to," said Russ Koesterich, head of investment strategy at Barclays Global Investors.

George Magnus, a senior economic adviser at UBS AG, notes some echoes of the past in the way some international investors are treating the dollar. Back in the 1970s, Germany and Japan, which had supported the dollar, tried to demand gold in exchange for their burgeoning reserves.

Today it's oil-producing countries and emerging economies like China that find themselves sitting on mountains of dollar reserves that are losing value. Some are looking to diversify their reserves, for instance by creating sovereign wealth funds that turn those dollars into other real assets. China has purchased a stake in Blackstone Group, the private-equity firm. "Some of the storylines are the same but the characters are obviously different," says Mr. Magnus.

As before, a sliding dollar gives oil exporters an incentive to keep prices high to avoid eroding their own purchasing power, although the major causes of high oil prices are soaring demand and constrained supply as key producer nations are unable to raise output.

The dollar's swoon means that consumers in different parts of the world don't feel the same pain. Since the start of 2003, oil prices in dollars have tripled, but in euro terms, they have a little more than doubled.

Some economists fret about a vicious cycle in which Persian Gulf countries put more of their oil earnings into the euro and other currencies, which drives down the dollar and leads the oil producers to keep a tighter leash on production. That drives up oil prices and brings in even more money for the countries to convert into nondollar currencies.

Some analysts say oil markets have attracted investors specifically looking for a hedge against the rapidly falling dollar. "The perception is that you want to own whatever benefits from the dollar weakening. And commodities are an ideal play on that," says Ben Dell, an energy analyst at Sanford C. Bernstein & Co.

John Taylor, head of FX Concepts, a New York-based hedge fund that specializes in currency trading, was a foreign-exchange analyst in 1970s. Then, he says, the U.S. was also struggling with budget deficits due to war spending and with a spike in commodity prices. One advantage the dollar enjoyed in the 1970s was that the U.S. still saved more than it spent. Now the country depends on foreign money to finance its debt, which could keep the dollar under pressure.

But Mr. Taylor is also more optimistic about the ability of leading governments to coordinate action to stop the dollar's slide if needed. The Group of Seven developed nations, which had its first meetings in the 1970s, has built three decades of experience responding to currency gyrations.

http://online.wsj.com/article/SB119448572112285960.html?mod=mostpop
By JOANNA SLATER and CRAIG KARMIN
November 8, 2007; Page A1

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Making Money in Bad Companies

How Counterintuitive Investments Can Improve Your Results
Sometimes, you can make more money by buying the least attractive stock in a particular industry if you believe the sector is due for a turnaround. Although it is counterintuitive, a little bit of simple math can show why it makes perfect sense and can leave the shrewd analyst with a much fatter pocketbook. These types of operations are for investors that have already built their complete portfolio and are on financially sound footing; they should not represent a substantial portion of your assets and are best left to those who have a good grasp of the economics and risks of the situation.

An Example in the Oil Industry
Imagine it is the late 1990’s and crude oil is $10 per barrel.
You have some spare capital with which you wish to speculate. It is your belief that oil will soon skyrocket to $30 per barrel and you’d like to find a way to take advantage of your hunch. Ordinarily, as a long-term investor you would look for the company with the best economics and stick your capital in the shares, parking them for decades as you collected and reinvested the dividends. However, you remember a technique taught in Security Analysis and actually seek out the least profitable oil companies and begin buying up shares.

Why would you do this? Imagine you are looking at two different fictional oil companies:

• 
  
• Company A is a great business. Crude is currently $10 per barrel, and its exploration and other costs are $6 per barrel, leaving a $4 per barrel profit.
  
• Company B is a terrible business in comparison. It has exploration and other expenses of $9 per barrel, leaving only $1 per barrel in profit at the current crude price of $10 per barrel.
  

Now, imagine that crude skyrockets to $30 per barrel. Here are the numbers for each company:

• Company A makes $24 per barrel in profit. ($30 per barrel crude price - $6 in expenses = $24 profit).
  
• Company B makes $21 per barrel in profit ($30 per barrel crude price - $9 in expenses = $21).
  

Although Company A makes more money in an absolute sense, its profit only increased 600% from $4 per barrel to $24 per barrel compared to Company B which increased its profit 2, 100%. These differences are likely to be reflected in the share price meaning that although the first enterprise is a better business the second is a better stock.

More Information
Typically, these operations are most successful in industries that are dependent upon underlying commodity prices for their profitability such as copper producers, gold mines, oil companies, etc. The wild fluctuations in the underlying commodity can result in huge swings in the earnings of the business, making them good candidates. Of course, unless you are a professional, you should not engage in these types of transactions, instead focusing on building long-term wealth through value based, intelligent, and discipline investments that focus on getting the most earnings at the least risk.

From Joshua Kennon
beginnersinvest.about.com

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Iran gives green light to five foreign investors

Iran’s Ministry of Economic Affairs and Finance Saturday approved five foreign-financed projects -- three valued at $950,000 and two worth €8.9 million.

To enforce Article 6 of the law on supporting foreign investment, the permission was granted to Georgian Mining-Geological Project Ltd.

The company was allowed to invest in exploratory projects of basic metals such as copper. The whole capital is $250,000, of which 90 percent is invested by the Georgian company and 10 percent by Iran’s private sector.

Two Afghan nationals received the nod to establish an independent Iranian company to process and package sesame. The company’s capital is equal to $500,000.

Two other Afghan investors were also permitted to invest in Mashhad clothing companies. Totally $200,000 will be invested in the project.

The other permit was given to Austria’s Voest-Alpin Intertrading Company that is to invest in the Caspian Cereals Trading Company by €90,000, 48 percent of the stocks, to construct warehouse, and loading and unloading installations.

Three Iranians are the others who were allowed to invest in paper manufacturing project via establishing an independent Iranian company by an €8.7 million investment.

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Survive a market drop - and make it work for you

Survive a market drop - and make it work for you
Losing money never feels good. But keep things in perspective and you can boost long-term returns. 

 It takes nerves of steel to shake off a stock drop like the one that came Tuesday - even conservative index-fund investors are more than 3 percent poorer.
But the world's best investors not only shake them off - they thrive on them.
They know sell-offs are common, perfectly normal (see table), and even healthy. When stocks go way up in a hurry, their prices become unrealistically high. Only by falling occasionally (and even sharply) in the short run can stocks continue to rise in the long run - without the agony of today's drop, the ecstasy of tomorrow's good returns becomes impossible.
Consider the terrible slide of 1973-74, when the S&P 500 index lost 48 percent of its value. Richard Nixon had resigned the Presidency, oil prices had quadrupled, Cleveland and New York City were on the verge of bankruptcy, and inflation had flared up to 12 percent.
If ever there's been a good time to panic, that had to be it. But as the old saying goes, things are darkest before the dawn. If you'd sold out of stocks at the end of 1974, you would have missed 1975's 37.2 percent return and 1976's 23.8 percent gain - two very strong years for the stock market.
Even after the Dow's wrenching plunge in Oct. 1987, remember that the index actually ended up rising 2 percent in value that year. And it took only 15 months (until January 1989) for the Dow to make its way back above 2246.73, the closing price on the last trading day before Black Monday.
In fact, there's such a thing as paying too much attention to your money. In the late 1980s, Paul Andreassen, a psychologist then at Harvard University, conducted a series of laboratory experiments to determine how investors respond to financial news.
He found that people who pay close attention to news updates actually earn lower returns than people who seldom follow the news.
When you think about this a little more, it actually makes good sense. News coverage tends to make market movements seem even bigger than they are - and to make them seem likely to persist just when they are most likely to reverse.
 
Fortunately, there are several simple and effective steps you can take to turn a stock market crash to your advantage.

Amp up your 401(k). Since a down market can be a great time to buy solid investments at bargain prices, contribute as much to your 401(k) as you can, because you'll be picking up more shares for the money, which will pay off when the market rebounds.
If you can't contribute the maximum your plan allows, at the very least contribute as much as is required to receive the company match. Typically, companies match 50 cents on every dollar you contribute, up to 6 percent of your compensation.
That means for each dollar you invest up to 6 percent, your employer adds another 50 cents, instantly transforming your investment into $1.50. This will not only help cushion any fall in stock prices, but it will amplify your gains once the market recovers.

Adjust your risk. A market sell-off is a good time for a gut check. Did the mutual funds you own take too much risk and fall much more than their respective indexes?
Obviously you would have wished you'd known before this decline. But at least you'll know which funds you want to ride into the next one.
It's also a good time to make sure you have the right mix of stocks and bonds, which can add ballast to a portfolio during downdrafts. Even if you have a lot of years to go, a decent dose of bonds - say 10 to 20 percent - is a good idea: you'll still get a lot of the growth stocks offer without as much volatility.

Determine your deadlines. Ask yourself when you will need the money you've invested. For example, if you have a newborn child, it's a good idea to invest some money to pay college tuition down the road - and you can put most of it in stocks, since 18 years should be long enough for the market to recover from a crash.
But if you're about to make a down payment on your dream house, that money should go in a safer bucket, where a stock market crash can't hurt it; there, you want to hold mainly cash and bonds. Tuesday's drop was relatively small and you can still make those adjustments.

Spread your bets. If all you owned was U.S. stocks or stock funds, the crash has just reminded you that being diversified is the best offensive - and defensive - weapon in any investor's arsenal. Even if you're young and like to take risks, you should have some cash, some bonds, and some foreign stocks, which, over the long run, will combine with your U.S. stocks to lower your risks without crimping your returns.

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The Best Time to Buy Everything

The Best Time to Buy Everything

AT 50 CENTS a roll — instead of the regular retail price of $4 — buying wrapping paper after New Year's is an easy way to save. The same holds true for buying half-price inflatable pool loungers and patio furniture after Labor Day weekend.

In fact, bargain lovers know that there's a smart time to buy just about anything. For example, those looking for a great deal on a car should shop on weekday mornings in September. Groceries are cheapest on Sunday evenings.

We talked to the experts, and found the best time to buy everything from wine to wedding dresses.

Airplane Tickets

 When to buy: On a Wednesday, 21 days (or a couple of days earlier) before your flight.

 Why: Airlines make major pricing changes (and run fare sales) every week, typically on Tuesday evenings and Wednesday mornings. About 21 days out from your flight, you'll see plenty of deals out there as airlines scramble to fill seats, says Anne Banas, executive editor of SmarterTravel.com, a consumer travel advice Web site. Don't wait much longer, she cautions; prices jump significantly from 14 to seven days ahead of departure.

Appliances

 When to buy: During a holiday weekend.

 Why: You'll find sales on select models all year long, but retailers bring out the big guns for holiday weekends, says Carolyn Forte, homecare director for the Good Housekeeping Institute. But don't worry about spending your Fourth of July and Labor Day weekends shopping for a new fridge — smaller holidays like Columbus Day and President's Day have their share of sales, too.

Baby Clothes

 When to buy: During your pregnancy.

 Why: Once you know your due date, keep an eye out for end-of-season clearances, recommends Alan Fields, co-author of "Baby Bargains." "If you're [newly] pregnant now, you know you'll be having a baby next summer," he says. "Well, right now, stores are closing out all the summer clothes." You can pick up newborn essentials like onesies for less than half price. (For more ways to save, see our column Oh Baby!)

Broadway Tickets

 When to buy: Hours before the curtain rises.

 Why: How does a $25 front-row seat to the smash musical "Wicked" sound? Several musicals offer same-day ticket lotteries that offer up orchestra seats at inexpensive prices. If you'd rather not gamble on getting a seat, wait in line at the famous TKTS booth in Times Square. There, you can get tickets for hit musicals for up to 50% off. On a recent night, prime seats were available for "Hairspray," "Rent," "Sweeney Todd" and "Beauty & the Beast."

Cars

 When to buy: Weekday mornings in September.

 Why: By September, all the next year's models have arrived at the lot, and dealers are desperate to get rid of the current year's leftovers, says Phil Reed, consumer advice editor for Edmunds.com. It's the prime time of year for incentives and sales, not to mention bargaining. "Any car that's been on the lot for a long time loses its value in the eyes of the car salesman," he says.

Heading to the dealership on a weekday morning also helps because there's low foot traffic, meaning you'll have ample time to negotiate and fewer people trying to buy the same car. The more demand, the less willing a salesman is to go down on price, says Reed.

Champagne

 When to buy: December

 Why: Most people assume that because everyone wants a good bottle of Champagne for New Year's Eve that prices go up during the holidays, says Sharon Castillo, director of the Office of Champagne, USA, which represents the trade association of growers in the Champagne region. But due to fierce competition among the Champagne houses, prices are actually lower during the holidays than they are at any other time of year.

Clothing

 When to buy: Thursday evenings, six to eight weeks after an item arrives in stores.

 Why: After an item lingers in stores a month or more, retailers start dropping its price to get it out the door, says Kathryn Finney, author of "How to Be a Budget Fashionista." These season-end clearances tend to be the same month that designers host fashion weeks (February and September) to preview the next fall or spring collections. So smart buyers can check the catwalk to see if any of this season's trends — say, leggings or military-style jackets — will still be hot next year, and then scoop them up on clearance.

Hitting the mall on a weekday ensures you'll get a good selection. "On the weekend, you'll only get picked-over stuff because the stores don't have time to restock," she says. By Thursday, most of the weekend sales have begun, but everything available is on the floor.

Computers and electronics

 When to buy: Just after a new model is launched.

 Why: When the latest and greatest of a product is released, you'll often see prices drop on what had previously been the best thing out there, says Tom Merritt, executive editor for CNET, an electronics review web site. Case in point: When Apple released the Nano last September, prices for the now-discontinued Mini dropped 12%, from $199 for a 4GB to about $175. So keep your eyes open for announcements from major manufacturers. Want a little less work? Time your purchases for after big annual technology show like MacWorld (next held Jan. 8-12, 2007) and the International Consumer Electronics Show(next held Jan. 8-11, 2007).

Gas

 When to buy: Early morning or late evening on a weekday.

 Why: Time your trip based on whether prices are rising or falling, advises Marshall Brain, founder of HowStuffWorks, a consumer guide. Gas stations tend to change their prices between 10 a.m. and noon, so hit the pump in the early morning if gas prices are on the rise. Go later in the day if prices are falling. Tipsters on GasPriceWatch.com reported that on Sept. 3, a WaWa gas station in Lanoka Harbor, N.J., was offering regular gas for $2.85 a gallon. One day later the station's price had dropped to $2.65. In that case, going early would have cost you 20 cents more per gallon.

Try not to buy gas on the weekends, Brain says. Gas prices are often slightly elevated, as stations try to profit from leisure travelers.

Gift Cards

 When to buy: A day or two before you give it.

 Why: These days, gift cards carry a plethora of hidden pitfalls, from expiration dates to dormancy fees, says Dan Horne, a professor of marketing at Providence College known as the "Gift Card Guru." That countdown to fees starts as soon as you buy the card. "You don't want to short-change the recipient," he says.

Groceries

 When to buy: Sunday evenings.

 Why: Store sales tend to run Wednesday through Tuesday, says Teri Gault, founder of The Grocery Game, a consumer savings program. On Sunday, you'll also have the latest round of manufacturer's coupons from your morning paper. "You can maximize your coupons available for that shopping week," she says. Heading to the store close to closing time means you'll have access to sales on fresh items that must be sold by the end of the day, such as meats and baked goods.

Of course, you'll also benefit from in-season items that can be frozen for use later in the year, says Gault. That means turkeys at Thanksgiving and hams at Christmas and Easter. During the spring and summer, buy fresh produce. Peaches bought at $1 per pound now can be kept frozen for smoothies and pies throughout the winter, she says.

Shrubs, Trees and Other Plants

 When to buy: Fall

 Why: Take a break from raking up leaves to purchase trees, shrubs and other perennials for your yard. Prices nosedive after midsummer, as garden supply stores and nurseries try to clear out their stock. You can also get great deals on bulbs during the fall. Just store them according to the package instructions for best planting results next spring.

Televisions

 When to buy: Six to 12 months after a particular model is launched.

 Why: A new TV drops in price after a few months on the market, says CNET's Merritt. Although there will be newer models out there, it's unlikely they'll offer any significant improvements to justify that brand new price. "The technology is proceeding at such a pace that the models out there are not going to be obsolete anytime soon," he says.

Wedding Dresses

 When to buy: Between Thanksgiving and Christmas.

 Why: Boutiques are stocked up on dresses for the post-Christmas rush (many people get engaged over the holidays), yet traffic is low, says Fields, who also co-authored "Bridal Bargains." "It's not a busy time to buy a wedding dress because people are thinking about the holidays," he says. You'll also have room to bargain.

Wine

 When to buy: Early fall.

 Why: For best selection, you can't beat the fall harvest season. That's when most vineyards release their latest vintages. Buying in August and September is also your best shot at snagging so-called "cult wines" — those with limited production and high demand, says Kathleen Schumacher-Hoertkorn, CEO of New Vine Logistics, an online interstate wine retailer. (

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102 Personal Finance Tips Your Professor Never Taught You

 

If you're anything like me, you graduated from college and perhaps even took a finance class or accounting class here or there, but you didn't learn anything about managing your personal finances. In fact, there probably wasn't even an opportunity to take any such class in either high school or college. But if college is partly about training us for a job, shouldn't we learn what to do with the money we earn from a job? Especially in a country where 45% of college students are in credit card debt and 40% of all Americans say they live beyond their means, I think it's time to wise up to some of the challenges of money management. A few (say, 102) simple rules can help get your financial life (back) on the right track.

The Painfully Obvious But Rarely Followed Tips

1. Pay yourself first. Try to put away at least 10% of your pre-tax income into a savings account.
2. Spend less than you earn. While this seems obvious, Americans are notorious for doing just the opposite. Stop spending and start saving.
3. Pay your bills on time. Avoid needless late fees and know how much money you actually have.
4. Avoid debt to the extent possible. Student loans and mortgages can be "good debt", but even then, make paying them off a priority.
5. Set a budget. And live by it. Use a computer program or just a paper and pencil. Whatever works.
6. Set concrete goals. Know when you want to buy a new home, when you want to retire, and how much you are expecting each to cost you.
7. Have an emergency fund. Have at least three months' income (some say six) in a high-yield savings account that can be easily accessed.

Career and Education

8. Get educated. A college education always pays for itself and more. In 2004, bachelor's degree holders earned an average of $51,206 per year, while high school graduates earned only $27,915, according to Census data compiled by HighBeam Research.
9. Your career is your most valuable asset. Manage it with a higher priority than you would with any other investment. Remember that without this asset, you couldn't survive.
10. Save enough. You should try to save enough to cover at least one-third of your kids' total college costs.
11. Consider public schools. Especially for college, state schools can often times be just as prestigious, if not more, than private schools.
12. Consider community college or online college for your first year or two. You can then transfer these credits to a more expensive (and prestigious) school to finish your final two or three years.
13. Invest in a 529 college savings account. It's tax-free. What more needs to be said?
14. Ask for a raise. Use the Salary Wizard Calculator to see if you're making as much as you should. If not, consider asking for a raise, especially if you've been at the company for more than a year.
15. Get a professional certificate. Some professions offer a certificate that, if earned, will generally provide you with a higher salary.
16. Don't major in English. If you love studying English, there's nothing wrong with that. Just be aware that English majors generally don't earn very much. Six of the top ten list of majors with the highest salaries are engineering majors, with chemical engineering topping the list.

Credit and Loans

17. Get a rewards card. If you need a credit card, the best type to get is a no-fee rewards card that you pay in full every month.
18. Borrow no more than 30% of your available credit. Borrow any more, and your credit score won't look too good.
19. Pay off your credit card debt. Credit card debt is usually the debt with the most interest. So pay it off first. Better yet, don't accumulate it in the first place.
20. Don't use your credit card for cash advances. It will harm your credit score and the interest rates are outrageous.
21. Know your credit score. Order your credit score from Equifax, Experian, and/or TransUnion.
22. Protect yourself from identity theft. Obtain your free credit report at least once per year and follow these tips.
23. Pay all credit card balances in full each month. Leaving a balance on a credit card account will leave you susceptible to a very high APR. You may as well be throwing cash into the fireplace.
24. Consolidate your loans. Especially those student loans. With a student consolidation loan, you can lock in several loans at a fixed interest rate and have just one lender to pay each month.
25. Avoid payday loans. Bottom line: they're scammy and they charge high interest rates. If you do need an emergency cash loan, just be aware of the risk of high interest rates.
26. Beware of scams. There are a lot of scams that deal with credit. Debt suspension offers, paying fees in advance, buying credit protection, and rebuilding credit usually sound too good to be true. There's a reason for this: they are.
27. Be cautious with home equity loans. If you can't make a payment toward a home equity loan, you could lose your house.

Frugality

28. Buy a used car. The most expensive miles on a car are the first 10,000. Let someone else drive those for you. Buying used can save a lot of money considering how little value the car has actually lost.
29. Be patient. Don't buy that new gadget today. Wait a month or two and the price will certainly go down.
30. Buy airline tickets as far in advance as possible. The cheapest flights are the ones the are bought at least two months in advance. For holiday travel especially, buy as soon as you can.
31. Get the most bang for your airline miles. Be sure each airline mile you redeem is providing you with at least 1 cent toward the price of a ticket.
32. Never buy the extended warranty. Often times, your new product already comes with a 90-day or 1-year warranty (when most "faulty" things will break, anyway). There's a reason everyone wants to sell you an extended warranty: they're hugely profitable (for the business, not for you).
33. Make your own meals. Eating out gets to be expensive if you do it too often.
34. Make your home more energy efficient. Bankrate.com has a list of 17 ways to do so.
35. Get a better cell phone plan. If you've had the same cell phone plan for a couple of years, chances are there's something better out there. Look around or call your current provider and ask for a better deal.
36. Banking fees are for suckers. A lot of banks will charge you checking fees or minimum account balance fees. Find a bank that does not.
37. Keep track of your spending. At least for a month, keep a journal of everything you purchase. At the end of the month, review your spending priorities and make adjustments.
38. Ditch your car. Walk, bicycle, or take public transportation. You'll save on car payments, gasoline, parking, and speeding tickets.
39. Use your frequent flier miles often. They may expire before you know it. There's no sense in stockpiling them. If you have enough for a free flight, use them.
40. Buy through your favorite airline's partners merchant store. AA.com, for instance, has multiple retail partners from whom you can earn frequent flier miles with each purchase.
41. Negotiate fees. For example, ask a bank to waive late fees. Often enough, they will.
42. Get your free money. Money might be owed to you. Get it.

Homeowning

43. Upgrade your old bathrooms and kitchens. These are often selling points on a house. A modernized bathroom can provide over a 100% return, while a modernized kitchen can return about 90%.
44. Refinance your mortgage if you can cut at least one point. The costs of refinancing are considerable, so it should only be done if you can trim your interest rate by at least 1%.
45. Never spend more than 2 1/2 times your income on a home. Know what you can afford and what you cannot.
46. Put at least 20% down on a home. Making a down payment of less than 20% will usually result in a private mortgage insurance (PMI) fee being added. This is usually 0.5%, meaning it could cost you about $1,000 a year on a $200,000 principal.
47. Use a mortgage broker. The better your mortgage, the more you'll save. Shop around.
48. Investigate different types of mortgages. There are dozens of mortgage options out there. Find the one that suits you best.
49. Buy a house that needs repairs. Buy for cheap and then add to the value with repairs. You'll save money
50. Deal directly with the seller. Avoiding agents' fees is a good thing. If you do decide to hire an agent, do your homework and get one who will be on the same page as you. You should be the one calling the shots.
51. Find out about homeowner taxes. Know what the property tax is in your area and be prepared to have enough to pay it.
52. Find out about secondary costs. In addition to monthly payments, be prepared to incur some secondary costs, including repairs, notary, escrow fees, and title insurance.
53. Get the house inspected by a professional. Have the house thoroughly inspected before making an offer.
54. Negotiate the selling price. Home prices are almost always negotiable. Never offer the asking price, but rather a few percentage points below it.

Insurance

55. Insure yourself against financial ruin. There should be no higher financial priority in your life than health insurance. Without it, if your health takes a turn for the worst, hospital bills could easily bankrupt you and your family.
56. High deductible is your friend. Keep those monthly premiums as low as you can.
57. Don't use insurance as an investment vehicle. Liquidity and certainty are not on your side.
58. Have enough. Have enough life insurance to replace at least five years of your salary, ten years if you have kids or significant debts.
59. Don't have too much. You need health insurance. If you're single and have no dependents, you don't need life insurance.
60. Think about insurance before you buy a car. Typically, the more expensive your car, the higher your insurance cost will be. Take this into account when buying a car.
61. Choose the right car insurance. Don't assume you should get the cheapest auto insurance or the one with the most protection. Find out exactly how much coverage you need.
62. Consider dropping collision coverage. Especially if you have an older car, there's not much sense in protecting it against getting wrecked if it's already a wreck.
63. Buy homeowner and auto coverage from the same insurer. You'll usually get a better deal than you would if you bought the two separately.
64. Write a will. If you have any dependents, you need a will. Write one and protect your loved ones.

Investing

65. Be wary of mutual funds. Few mutual fund managers can beat both the market and the expense fee that they charge.
66. Don't try to pick stocks. Picking stocks can be a very dangerous game, unless you know what you're doing.
67. Avoid fees. With long term investing, fees are a primary factor in total return. Avoid brokers who take high commissions and avoid funds with high management costs.
68. Stocks are high risk, high reward. Over the long term, stocks have historically outperformed all other investments. But over the short term, they can be risky if they lose a lot of value in a short period of time. So, do invest with stocks, but only with funds you won't need to withdraw over the short term.
69. Stocks first, bonds later. Invest in stocks when you're young, and then move into bonds are you grow older. Stocks are a good long-term investment strategy. If you're still young when the market turns south, you'll have plenty of years left ahead of you to make it up. As you get older, invest in bonds. They're less risky.
70. Past performance is not a guarantee of future success. Just because a stock has been up for the last six months does not mean it will continue to go up tomorrow.
71. Diversify your portfolio. Never invest more than 10% of your portfolio in any one company. Even if it's a "sure thing".
72. Build a nest egg that is 25 times the annual investment income you need. Don't think you can rely solely on social security.
73. If you don't understand how an investment works, don't buy it. Research an investment vehicle thoroughly before you get into it.
74. Don't borrow from your 401(k). Think of it as robbing yourself. You'll get hit with high fees and taxes, too.
75. Invest for the long term. There is no such thing as a guaranteed get rich quick scheme. And in investing, there is no high reward without a high risk. Use caution and diversify your portfolio for the long run.
76. Seek professional help. Don't feel the need to turn yourself into a day trader. Hire a personal financial advisor if you can afford to.
77. "Fee-only" is your friend. Go with a fee-only financial advisor, not a fee-based or a commission-based. Only fee-only advisors are legally obligated to act in your best interests.
78. Index funds are your friend. Index funds are passively managed and are generally cheaper and more tax-efficient than actively managed funds.

Retirement

79. Optimize your 401(k). If your employer offers employer match, you must set your 401(k) contribution to at least that amount.
80. Play the IRA game smart. Max out your 401(k) first, your Roth IRA second, then your traditional IRA.
81. Increase your 401(k) contribution. Especially when you get a raise. Some employers even give you the option of having your contribution automatically taken out of your paycheck.
82. Don't buy stock in the company you work for. This is the opposite of diversification. What happens if the stock tanks, and you lose your job and pension because of downsizing?
83. Don't be afraid of stocks. More than two-thirds of 401(k) money is in low-yielding bonds. Especially if you're still young, invest in stocks. Over the long-run, they perform the best.
84. Sign up for Medicare. Don't forget to sign up for Medicare before you turn 65, even if you haven't retired yet.
85. Plan. Use the Social Security Retirement Planner to ensure that your retirement goes smoothly.

Saving

86. Save now. It doesn't matter if you're six or 60. You should be saving a little bit every month, aside from retirement savings. The sooner you start, the better.
87. Pay off high interest debts before you start saving. Earning 5% in your savings account isn't going to do much good if you're accruing 17% interest on your credit card debt.
88. Save at least 10% of your annual salary for retirement. This should help to provide a nice retirement fund when you need it.
89. Keep at least three months' worth of living expenses in a savings account or high-yield money market account.
90. Open an online savings account. Online savings accounts, such as Emigrant Direct or HSBC Direct, offer yields of greater than 5%.
91. Set up an automatic savings plan. You should be able to set up your checking account so that a certain amount is automatically transferred to a savings account each month. It's a good way to force yourself to save.

Taxes

92. Know when to file your taxes. If you expect a refund, file your taxes as early as you can. If you owe money, file as close to the due date (usually April 15) as possible.
93. Consider itemizing your deductions. If all of those tax breaks receipts you keep add up to more than your standard deduction, it is definitely worth filling out all of the extra paperwork to itemize.
94. Be aware of other tax deductions. Contributions to a traditional IRA, student loan interest payments, alimony payments.
95. Save money on tax credits. Some tax credits to look out for include the Hope Scholarship Credit, Lifetime Learning Credit, Child Tax Credit, Earned Income Credit, and Child Care Credit.
96. Bunch your deductions into one year. If you're taking the standard deduction this year, consider making charitable contributions and office-related purchases after January 1, so you can possibly itemize your deductions next year.
97. Recheck your withholding every year. If you get married, have kids, or become the head of a household, you'll want to add these allowances on your W-4 so you can have fewer taxes withheld.
98. Keep your receipts (especially on big ticket items). You'll want them if you plan to itemize, or in case you get audited.
99. Concentrate on tax-free investments. Tax-free investments, like bonds, allow you to earn interest without being taxed.
100. Buy a hybrid vehicle. Hybrids tend to be more expensive than their traditional counterparts, but you can save money on gasoline and possibly receive a tax credit of up to $3,400.

Lastly

101. Take a deep breath. Even if you're only able to follow the first seven tips, which are the real basics, you will have already succeeded in making a huge positive difference in your financial life.
102. Money isn't everything. Health, family, and happiness are important, too. And remember, money can't buy you love

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