Bloggers Vs. Financial Gurus - Who Helps More?

Image by Casey Serin via FlickrYou know their names Suze Orman, Dave Ramsey, Robert Kiyosaki, Liz Pullman, and David Bach. They are today's financial gurus. We hang on their every word and gage all our actions by their wise advice. 

Online we have thousands of personal finance bloggers relating their own advice and experiences. Which group is better suited to address your situation?

Both sources have much to give to financial education and advice. The Guru's advice does help many people and by the numbers, help many more than bloggers in general. They have access to an audience through TV or by books they have written. The Guru has access to millions of followers and can reach more everyday. The blogger has limited followers and limited access to promotional services. Their audience is smaller but they can help people as well. 

Check out Businessinsider.com "Who are You Listening to?"

If both are able to help people with financial advice and education, which one is more effective.

The Guru has more followers but is limited because they have to spread their wisdom to a mass audience. Why limited? Their books and television appearances have to appeal to a mass audience. This limits them to a general message or plan. It has to be a one size fits all. They have to appeal to the most people to maximize their message so they can sell books and merchandise. Their advice is correct in general. But what if their advice doesn't cover your specific problems?

There are as many different financial situations, as there are people. This is where the financial blogger is better than the financial Guru. Many bloggers write about their own specific situation and experiences. They relate to their readers how they overcame a financial problem in their life. What could be a better way to help someone with a problem, when you already had the problem and overcame it. That's what makes the financial bloggers better than the Gurus.

With all the financial bloggers out there, you should be able to find one that speaks to your situation. Your average blogger doesn't have a manager or book to peddle. They are able to get real with their audience. The hype is very low and the experience is very personal. Many bloggers write about their financial journey from being broke to getting out of debt. Their stories are personal and inspiring. They make you actually believe you can overcome your financial problems.

A Different Reason For Refinancing Your Home

Image via WikipediaWith interest rates at historical lows, refinancing is on the minds of many homeowners. Weighing the benefits against the costs is the only way to determine if it makes sense. We all are looking for that lower mortgage payment so we can use the savings for other things, it's the usually the only reason that someone refinances their home. But maybe there is another way to think about it?

When thinking about refinancing, a better way to weigh the decision is to evaluate the "net benefit". Net benefit represents the overall impact on your personal wealth from refinancing your home mortgage. With that in mind, CreditSesame.com has an infographic spotlighting a new way to think about refinancing your mortgage.

The infographic explains net benefit and an example case study of a proposed refinance. In the infographic, the proposed mortgage refinance has the homeowners making a larger payment over a shorter term. Raising your mortgage payment sounds counter productive but for the example, it actually doubled the net benefit and equity of the home for the home owners.

Should I Refinance My Mortgage? Here’s a New Way to Think About It [Credit Sesame]

When Did The Thanksgiving Day Holiday Begin and Who Was Sarah Josepha Hale?

We all know the Thanksgiving story when the Pilgrims landed the Mayflower on Plymouth Rock. But when was the actual legal holiday established? 


Right in the middle of the Civil War, President Abraham Lincoln took the time to proclaim Thanksgiving a national holiday. 

But little is known of who really was behind influencing Lincoln and the government to make Thanksgiving a holiday.

Sarah Joespha Hale

Little is known of the women who petitioned Lincoln and the four previous presidents to establish the holiday. Her name was Sarah Josepha Hale and she is credited as the individual most responsible for making Thanksgiving a national holiday in the United States; it had previously been celebrated only in New England. 

Each state scheduled its own holiday, some as early as October and others as late as January; it was largely unknown in the American South. Her advocacy for the national holiday began in 1846 and lasted 17 years before it was successful. In support of the proposed national holiday, she wrote letters to five Presidents of the United States -- Zachary Taylor, Millard Filmore, Franklin Pierce, James Buchanan, and Abraham Lincoln. 

Her initial letters failed to persuade, but the letter she wrote to Lincoln did convince him to support legislation establishing a national holiday of Thanksgiving in 1863. 

The new national holiday was considered a unifying day after the stress of the American Civil War. Prior to the addition of Thanksgiving, the only national holidays celebrated in the United States were Washington's Birthday and Independence Day.

Lincoln's Proclamation Establishing Thanksgiving Day:

The year that is drawing towards its close, has been filled with the blessings of fruitful fields and healthful skies. To these bounties, which are so constantly enjoyed that we are prone to forget the source from which they come, others have been added, which are of so extraordinary a nature, that they cannot fail to penetrate and soften even the heart which is habitually insensible to the ever watchful providence of Almighty God. In the midst of a civil war of unequalled magnitude and severity, which has sometimes seemed to foreign States to invite and to provoke their aggression, peace has been preserved with all nations, order has been maintained, the laws have been respected and obeyed, and harmony has prevailed everywhere except in the theatre of military conflict; while that theatre has been greatly contracted by the advancing armies and navies of the Union. Needful diversions of wealth and of strength from the fields of peaceful industry to the national defence, have not arrested the plough, the shuttle, or the ship; the axe had enlarged the borders of our settlements, and the mines, as well of iron and coal as of the precious metals, have yielded even more abundantly than heretofore. Population has steadily increased, notwithstanding the waste that has been made in the camp, the siege and the battle-field; and the country, rejoicing in the consciousness of augmented strength and vigor, is permitted to expect continuance of years, with large increase of freedom. 

No human counsel hath devised nor hath any mortal hand worked out these great things. They are the gracious gifts of the Most High God, who, while dealing with us in anger for our sins, hath nevertheless remembered mercy. 

It has seemed to me fit and proper that they should be solemnly, reverently and gratefully acknowledged as with one heart and voice by the whole American people. I do therefore invite my fellow citizens in every part of the United States, and also those who are at sea and those who are sojourning in foreign lands, to set apart and observe the last Thursday of November next, as a day of Thanksgiving and Praise to our beneficent Father who dwelleth in the Heavens. And I recommend to them that while offering up the ascriptions justly due to Him for such singular deliverances and blessings, they do also, with humble penitence for our national perverseness and disobedience, commend to his tender care all those who have become widows, orphans, mourners or sufferers in the lamentable civil strife in which we are unavoidably engaged, and fervently implore the interposition of the Almighty Hand to heal the wounds of the nation and to restore it as soon as may be consistent with the Divine purposes to the full enjoyment of peace, harmony, tranquillity and Union. 

In testimony whereof, I have hereunto set my hand, and caused the seal of the United States to be affixed. 

Done at the city of Washington, this third day of October, in the year of our Lord one thousand eight hundred and sixty-three, and of the independence of the United States the eighty-eighth. 

A. Lincoln

So when you are sitting down to have your Thanksgiving dinner give thanks also for Sarah Josepha Hale, for all her perseverance and hard work in making our national holiday a permanent part of our culture and history.

The Smart Way for Daily Deal Shopping

Image by Glikò via FlickrAuthor Bio: Kevin is the author of the DebtEye Blog. He is the co-founder of DebtEye and a certified credit counselor.

Daily deal websites have taken the web by storm over the past few years. I usually advised my readers to unsubscribe from the newsletters, but I soon came to realize that some of the deals can actually save you money.

At first, I was against subscribing to some of the daily deal sites because it created a lot of impulse shopping. I was buying “coupons” for items that I didn’t need, and a lot of these actually went unused. A prime example of this is when I bought a $25 Virgin America voucher which was valued at $100. I didn’t read the fine prints, and didn’t know I had to book a reservation within a certain date.

Budgeting is all about saving money right? When you come to think about it, this is what daily deal sites are trying to do. If you’re able to keep disciplined in purchasing the coupons, it can definitely make a difference. Here are some ways you can prevent yourself from going a bit too crazy with daily deals:

1) Spend money wisely – If you’re a fan of daily deal sites, make sure you include this in your budget. It can count towards your entertainment category or your food if you intend to only buy coupons for restaurants. Set a limit on how much you’re willing to spend on it every month. If you can stick to your budget, then it shouldn’t be a problem!

2) Take your time- If you see a deal that you like; take a second to really ask yourself if you really need it. Is it a necessity, or is it a luxury? The truth of the matter is that it’s not going to go way forever. There’s a high chance that a similar coupon will resurface. If you have regrets on not buying it the first time around, you’ll always have a second chance!

3) Niche Markets- As I mentioned, the boom of this industry caused a handful of niche daily deal companies to emerge. Some of my favorite ones are (Aisle50 & CampusCred). Aisle50 focuses solely on grocery items, and have partnerships with some of the major grocery chains. You’ll end up buying items that you need, and they probably won’t go to waste (unless you don’t end up eating your food). CampusCred focuses on daily deals for college campuses which includes tons of restaurants. This is deal for college students who tend to eat out often.

4) Extreme Deals – Once in a while, a new daily deal sites will emerge and giveaway pretty useful coupons. Some of these include a $10 for $20 Amazon gift card or a $4 AMC movie ticket all in hopes to gain subscribers. Jump on these deals before it gets sold out, because these are items that you’re definitely going to use in the future.

5) Use Your Coupons – Lastly but not least, use your coupon! If you’re the type of person who forgot to use your coupon, that’s exactly the reason why a secondary market for unused coupons emerged. If you don’t think you can use your coupon within the expiration date, make sure you sell it to get something out of it at least.

So there you have it. I confess that I started to subscribe to some of the daily deal websites, but I’m definitely more cautious on what I purchase. Use common sense when purchasing coupons, and make sure it’s a necessity, not a luxury!

Does Government Intervention In The Housing Market Ever Turn Out Good?

Image via WikipediaWe are in an economic funk that just doesn't seem to want to go away. With a credit crisis caused by excessive debt secured by over priced property does it make sense to have tougher lending rules or looser ones?

It's going to take a while for real estate values to stabilize. At the same time the economy needs to recover. In time normal market forces will bring thing slowly back to normal. Responsible government spending and responsible private sector spending and saving habits will bring the economy back online. It's going to take some time for all this to happen. Patience is the key.

We are not a patient people. The politicians know this and fear the public will take their pain out on them. Which means they get the blame for the economy and get voted out. The politicians must do something and out of their bag of tricks they pull out an idea, the problem is the idea is usually going to make things worse.

Our friends in the U.K. are getting a plan, by the Prime Minister, to help first-time buyers of new homes to carrying part of the risk of their mortgage loan. They also propose subsidising the construction of 16,000 homes by giving £400 million of taxpayers’ money to property developers. Also they are working on a scheme under which billions of pounds of money in pension funds will be used to finance the construction of power stations, wind turbines and roads.

The Prime Minister, David Cameron says, "This strategy, will unlock the housing market, get Britain building again, and give many more people the satisfaction and security that comes with stepping over their own threshold.”

Propping up the housing market by lending money to people who couldn't currently get a mortgage loan on their own doesn't seem to make sense. But the mortgage guarantee, the first time such a scheme has been attempted in the UK, will result in lenders providing loans with significantly lower deposits than the 20 per cent or more that is typically demanded. This means taxpayers will be liable for losses when borrowers default and homes are repossessed.

On this side of the Atlantic the plan concerns many people. They see government trying to get people into homes they normally couldn't afford, the taxpayers who will be the ones to pay for it if all goes wrong, and the human tragedy of families encouraged to live beyond their means when all come crashing down.

The question is: Does Government Intervention In The Housing Market Ever Turn Out Good?

6 Money Mistakes The New Business Owner Makes

Image by _Davo_ via FlickrMany new business owners get so consumed by their new business venture that they make common personal finance mistakes that may crash their business. It can be not setting up proper tax I.D.'s, getting proper financing, or not keeping good financial records. The new entrepreneur is sometimes caught up to much in the product or service and not whats going on in the office.

1. Overspending for the Business.
The start-up cash that new businesses have can sometimes be wasted on useless things. Overspending on office rent or having to many employees can eat into your initial start-up money. Your buying an expensive office phone system, network or PCs can eat up cash fast. It's best to grow slowly and space out and budget these highly expensive office costs.

2. Get Professional help when needed.
To cut costs many new businessmen will avoid hiring an accountant or lawyer. An accounting or legal mistake early on can get you in hot water with the I.R.S. or set you up for a law suit later. Professional help can help keep you out of trouble. It's like a type of insurance.

3. Pay Yourself Along the Way.
Sure you want to save money and reinvest all profits back into your business. The new businessman usually makes the mistake of letting the company pay his expenses. If Uncle Sam sees you are paying personal expenses with company money, there could be trouble. The best thing to do is pay yourself a salary and keep your business and personal expenses separate. Also make sure to keep the salary at a manageable level. No big salary at the beginning. The company will need the money.

4. Set Up A Rainy Day Fund.
As in personal finance, a rainy day fund is very important. It's your cushion from trouble . So must your company have one to. It's easy to think it can never happen to you but when you think that it usually does. Having the cash on hand to weather any storm will make you a better decision maker because your prepared for the worst.

5. Keep your Business and Personal Assets Separate.
Borrowing money from people in your personal life is a bad idea. Using your personal assets as collateral for a loan is a really bad idea. You need to consider what would happen if your business failed. You would not only lose your business but creditors would come after your personal assets leaving you with nothing.

6. Using a Personal Credit Card For Business Expenses
This is the way most new business people get into trouble. Credit cards in your name used for business. Bad move, you are on the hook if things come crashing down. You can be personally sued for their repayment. Again, don't mix personal and business. Apply for credit cards on the companies credit rating or not at all.

Many start ups today need to concentrate on making money and taking care of the office at the same time. When you are new start up you are at your most vulnerable time you can't afford not to be careful.

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