While driving home the other day, I heard the Bon Jovi song “Wanted Dead or Alive” and somehow became inspired to write a version of the song that would be good for The Personal Finance Program.

On that note (no pun intended) I came up with the following lyrics to “Wanted Debt or Alive,” which is about how many of us over spend using money that isn’t even ours to begin with.

Enjoy!

It’s all the same
Only the stores will change
Everyday
It seems I’m spendin’ away

Another store
Where the sales are so bold
I shop all night
Because I’m easily sold

I’m a spender
On a Visa I ride
I’m wanted
Debt or alive
Wanted
Debt or alive

Sometimes I’m cheap
Sometimes it’s not for days
To the cashiers I meet
I’m glad to hand my pay

Sometimes you tell the day
By the bill that’s on the brink
And times when you’re alone
You buy everything but the kitchen sink

I’m a spender
On a Visa I ride
I’m wanted
Debt or alive
Wanted
Debt or alive

I’m a spender
On a Visa I ride
I’m wanted
Debt or alive

When I walk these streets
A loaded AMEX string on my back
I buy for keeps
‘Cause I might have to pay it back

I’ve spent everywhere
Still I’m spendin’ it all
I’ve seen a million offers
And I’ve bought them all

‘Cause I’m a spender
On a Visa I ride
I’m wanted
Debt or alive

I’m a spender
FICO’s not on my side
And I’m wanted
Debt or alive
And I’m wrong
Debt or alive
I still spend
Debt or alive

Debt or alive

What did you think?  Any good?  Worth putting together a YouTube video over?  Leave your comments below.

Per FTC regulations, please note that the above link to Amazon.com is an affiliate link.  Should you purchase anything from Amazon.com after clicking the link, I may receive a commission.

Most of us – men especially – view Valentine’s Day as a “Hallmark Holiday.”

For those of you who have never heard this term, it means that Valentine’s Day is pretty much just a corporate sponsored holiday created to force us to spend money on our significant others.

We go along with it because – let’s be honest – if we didn’t, we’d never hear the end of it. This being the case, here are some simple and inexpensive ways for you to get the most of the “holiday” and show your girlfriend or wife that you actually spent a little time thinking about what you ultimately give them.

1) Write your boyfriend, girlfriend, husband, or wife a sincere love letter, explaining why and how much you love them, and why they’re the best thing in your life. Taking the time to write a letter like this will mean a lot and melt their heart!

2) Give him or her something other than the cliche gifts like teddy bears or roses, especially if roses aren’t her favorite flower and he has no need for a new stuffed animal. This will help to save you money, and it shows that you care enough to know what her favorite flowers are.

3) Plan out and cook a dinner at home, and, if possible, make it your significant other their favorite meal. As stated above, it’s cheaper to make a meal at home than it is to go out and eat, plus it will show you’ve listened when he or she has talked.

4) End the night by offering to giving your partner a full body massage. Don’t act like you’re offering this based on alterior motives, and it just might work out in your favor!

Follow this advice and you can have an inexpensive but still very sweet and thoughtful Valentine’s Day.

Despite living in the wealthiest nation in the history of the world, it seems as if more of us are stressed out and at our wit’s end due to concerns about money.

Kind of ironic, although, due to The Great Recession, I suppose it sort of makes sense. At some level, we’re all a little afraid of losing what we’ve worked so hard to acquire.

Given the current circumstances, gaining a grasp on reality, finding your sanity, and putting your finances in order sounds like a monumental task.

It’s not.

By following the following three very simple to understand principles, you can be on your way to saving a ton of money over your lifetime, while coming to the realization that material possessions, while nice, might be one of the biggest stressors in your life.

1) Learn the difference between a “need” and a “want.”

Long story short, if you don’t need it you shouldn’t buy it. Take a look around your house: look at your collection of DVDs, the clothes in your closet, the junk collecting in the garage. How much of it do you use, wear, or watch on even a weekly or monthly basis?

If you grab something that’s lying around and can justify its existence only by saying, “I might use this someday,” then you, my friend, wasted your money on something you clearly did not need. Stop doing this.

2) Vow to never keep up with the Jones.

If you try to keep up with the Jones, all you will end up doing is buying crap you don’t need in an effort to impress people you probably don’t even like.

What’s the point of paying $40,000 for a car when a comparable $18,000 car will do just fine? Are you using your car as transportation or as a status symbol?

Did you pay tens of thousands of dollars to furnish your home so you can show off the three times a year you have people over? Why didn’t you spend a tenth of that on less expensive furniture and put the rest towards paying down debt, retirement, or your rainy day fund?

If people don’t want to hang out with you because you don’t have expensive stuff, do you really want them hanging out with you?

3) Live below your means.

Don’t spend money just because you can. Chances are pretty good you can not only get by, but live a fun, happy, and productive life by spending a lot less than what you bring home.

Learn to appreciate what you already have, and not only will you save a ton of money, but you’ll likely feel happier with your life and less stressed out.

I know this message is pretty simplistic, but it’s not one that needs to be complicated.

Don’t let money shouldn’t stress you out.  Make good decisions, save for a rainy day, and enjoy your life.

First of all, happy New Year!

Like most everyone else, you’ve probably come up with some New Year’s resolutions, some of which may include some financial goals. Maybe you want to pay down some credit card debt, save up for a house, or just be “better with money.” Whatever financial goals for 2010 are, I want to help make sure you see them through.

In order to make sure you follow through on your goals for all of 2010 and not just for the first few months, you need to do two separate things, which, if done right, will dramatically increase the chance you’ll complete your resolution.

1. Determine the what, why, and how of your goal/resolution
2. Write down the what, why, and how of your goal/resolution and carry it with you

Both of these steps are pretty straight forward, and leave you little room for excuses!

WHAT: state what you want to achieve, trying to be as specific as possible. For example, don’t just say, “I want to pay down some credit card debt.” Instead say, “I want to pay down $1,000 of my credit card debt by June.” The more specific and absolute you can are, the easier it is going to track your progress and hold yourself accountable.

WHY: state what you stand to gain from accomplishing the goal, again, being as specific as possible. Using the above example, you could say something like, “in order to achieve more financial stability and to improve my credit score.” When you review your goals from time to time, seeing the “why” will reinforce the goal and help to keep you moving forward.

HOW: this is where you outline your battle plan, being (you guessed it) as specific as possible. In taking the credit card debt example, you might say, “by going out to eat only once per week and not buying any new electronics until I’ve met my goal,” as opposed to saying something like, “by spending less.”

Now that you have your fully formed goal(s), go ahead and, on a small piece of paper, write down all of the pieces of your goal(s). When you’re done, stick the piece of paper some place you look at frequently in order to keep the goals fresh in your mind. Because these are financial goals, I find it useful to stick the piece of paper in my wallet.

I wish you a very happy and healthy 2010, and hope that by following this advice you achieve all of your goals – both financial and non-financial – throughout the year.

Want to share your resolutions? Have a better way to plan out and track your goals? Leave your comments below!

First, let me state that I’m not entirely proud of what I’m about to say, but at the same time I hope that you’ll learn from what I’m about to say.

Early this morning, when I couldn’t stand to watch ESPN any longer due to the Tiger Woods “news,” I flipped to one of my free movie channels and started watching Confessions of a Shopaholic, staring Isla Fisher, the crazy sister in Wedding Crashers.

Anyway, Confessions centers around a woman, Rebecca Bloomwood, who as you’ve probably already guessed, is a shopaholic.  She is in massive consumer debt and has a collection agency hounding her, and to make matters worse, she doles out advice consumers while writing for a financial magazine.

Ok, I’ll confess, I thought it was a cute movie and was worth watching purely for entertainment purposes (not to mention Isla Fisher is very nice to look at).

Despite the entertainment factor, I thought there were actually some pretty good financial lessons to be learned from the movie.

1) Know the differences between needs and wants. For those of you who are regular readers of The Personal Finance Program, you know this is something I talk about regularly, and is critically important to getting your finances in order.

In Confessions, Bloomwood is constantly buying new clothes and fashion accessories, despite having closets full of clothes, scarves, purses and shoes.  Whenever she sees something she wants, she gets it, even though it’s certainly not something she needs.  Over time, these purchases put her tens of thousands of dollars in credit card debt.

2) If you’re in consumer debt, you should make paying it down as quickly as possible a high priority. One of the things that gets Bloomwood into such a huge financial hole is doesn’t make paying down her debt a priority.  While the movie never talks about what sort of interest rate she’s paying, we can assume that because she’s in deep credit card debt, the interest is at least 18%, if not more.

Over time, the interest continues to accrue, and eventually snowballs into such a giant number that it’s very hard to get out of.

Obviously, the best thing to do is avoid getting into this debt in the first place.  If you weren’t able to avoid it, try your best to make more than the monthly minimum payments.  This will allow you to pay off your debt much faster, and could ultimately save you thousands of dollars in interest costs.

3) Don’t delude yourself into thinking you don’t have a problem. The final thing that ends up hurting Bloomwood is the fact she refuses to admit that she has a serious problem.  Instead of admitting her issues, she continues to avoid the debt collection agency all while continuing to spend money she doesn’t have on things she doesn’t need.

Had Bloomwood admitted her shopping and spending issues and put together a plan to pay off the debt, she would have been in a much better situation.

Just remember, lying to yourself won’t make your debt go away.

Anyway, if you’re looking for a cute movie that actually has some worthwhile advice, by all means, check out Confessions of a Shopaholic.

Can you think of any other movies that have good financial advice?  Leave a comment below and share your thoughts.

Per the new FTC regulations, the above links are affiliate links (via Amazon.com), and should you purchase anything after clicking the above links, I will receive a small commission.

The other day I was reading an interesting article by Liz Pulliam Weston on MSN Money in which she talks about whether or not “underwater” homeowners should simply walk away from their mortgage.

For those of you who have never heard the term “underwater” used in housing, basically it means that a homeowner owes more money on their mortgage than their house or property is worth. For example, if you owe $250,000 on your mortgage but your home is worth only $200,000, you would be “underwater” by $50,000.

Considering how far and how fast real estate prices have fallen in the past three years, it’s easy to see why so many home owners with a mortgage – nearly 25% according to a recent poll – are in a situation like the one described above.

In Weston’s article, she references a paper written by University of Arizona Law professor Brent T. White in which he asserts that if you’re underwater, you should walk away from the home and mortgage, even if you are able to make the monthly payments.

White argues that underwater borrowers would be better off financially over the long-term, not to mention the fact that the current system isn’t exactly set up to provide much help to those who need it.

White also asserts that the morality regarding walking away from a home and mortgage shouldn’t be taken into consideration as this is purely a financial decision.

Weston, on the other hand, argues to not walk away from your obligations, and to try everything possible to make your payments.

She states that aside from the fact most of us believe we have a moral obligation to continue making payments, letting your home slip into foreclosure will ruin your credit score, and will continue to foster the downward spiral in the real estate market that our country is trying so hard to pull out of.

Weston ends her article by recommending that troubled borrowers attempt to work with their lenders and considering all options prior to deciding to simply walk away.

So, in which camp do you fall? Should underwater borrowers walk away from their home and mortgage because it’s better for them financially, or do they have a moral obligation to stick it out regardless of the financial impact? Let me know what you think by leaving a comment below!

The other day while I was driving home from work, I heard a radio ad for a debt consolidation company that, for lack of a better term, made my blood boil.

I don’t remember the exact wording of the commercial, but the basic gist of it was there’s a vast conspiracy by the banks and credit card companies of the world to punish you and ultimately keep you and your family in debt for time and eternity.

In short, the ad made it seem like your debt wasn’t your fault.

Don’t get me wrong, for people who are in debt because they’ve had to charge basic living expenses due to their own or family health issues, being out of a job for a prolonged period of time, or anything like what I’ve just mentioned, the debt is certainly understandable, and I completely sympathize with your situation.

However, if you are in credit card debt due to nothing more than imprudent spending,  I’d like you to click on the video below to watch a Saturday Night Live skit that should be able to help solve your money problems.

DON’T BUY STUFF YOU CAN’T AFFORD

I know that because the video above is from SNL, it probably won’t be taken seriously.  That being said, the skit’s message is something that any good consumer – or someone who strives to be a good consumer – should live by.

In fact, these words should be expanded to say don’t buy stuff you can’t afford or don’t really need.

Whether we don’t know a need vs. a want, make a lot of impulse purchases, or buy things to impress people we don’t even like (i.e. keeping up with the Jones), far too often we waste our money, having nothing to show for it, and end up in a financial bind.

So, the next time you go shopping – whether or not you’re in debt – really think about both whether you can afford and need what you’re about to buy.

If the answer is no for either, put your wallet back in your pocket and walk away!

Somewhere along the line you’ve probably heard the expression “time equals money.” It seems simple and obvious enough, but have you thought about how true that statement really is?

After reading this post I think you’ll see how the “time equals money” phrase applies to you and why it’s important to take the phrase into consideration whenever you purchase something.

Most of us earn our spending money by showing up to work each day and punching the clock. By doing this, we are trading our time -however many hours you work in a given day – for our employer’s money, which becomes our paycheck. In simple terms, we’re giving them our time with the expectation that they will give us their money in return.

When you spend the money you’ve earned, you are essentially using the time you spent at work for whatever it is that you’re buying. Sound a little bit confusing? Let’s take a look at a real world example:

Jane works as a store manager and makes $25 per hour. After all of the taxes and benefits are taken out of her paycheck, Jane’s take home pay is $18 per hour.

Now, let’s look at some typical purchases Jane makes relatively frequently and without much thought:

Large Starbucks specialty coffee – $4
Lunch at McDonalds – $8
Case of Beer – $20
Tank of gas – $30
Happy hour with friends – $40

Now, let’s look at these rather mundane purchases in terms of how much time Jane had to give up in order to get the money necessary to make these purchases:

Large Starbucks specialty coffee – 14 minutes
Lunch at McDonalds – 27 minutes
Case of Beer – 1 hour and 7 minutes
Tank of gas – 1 hour and 40 minutes
Happy hour with friends – 2 hours and 13 minutes

(Math Formula: $ spent / $18 * 60 = # minutes worked to make the spent $)

When you look at these ordinary purchases by how much of your life you have given up in order to have necessary money, it puts things in an entirely different perspective. When Jane buys that Starbucks coffee, she has given up 14 minutes of her life to be able to make that purchase. While 14 minutes may not seem like much, if she bought a $4 cup of coffee every day of the year, she would have “traded in” roughly 3 days and 12 hours of her life.

Now, let’s look at what some less ordinary but more expensive items will cost Jane in terms of time:

Blu-Ray Player – $400, which equals 22 hours or just under 1 day
Widescreen LCD TV – $1,800, which equals 100 hours or just over 4 days
New mid-level car – $14,500, which equals 805 hours or roughly 33.5 days

When you look at Jane’s spending in terms of time, it certainly seems like she’s giving up quite a lot in order to make these purchases. For me personally, if you told me I had to give up 4 days of my life in order to buy a new TV, I would definitely think twice about making the purchase.

Don’t get me wrong, I’m certainly not telling you to not spend your money or occasionally splurge on yourself or your friends and family. After all, what’s the point of having the money if you’re never going to do anything with it?

That being said, I think that if you were to realize what you were giving up in order to make these purchases you’ll be a little more careful with your money.

Creating and sticking to a budget can be a pretty difficult thing to do. However, I’ve found that asking yourself one simple question before you make any purchase can drastically increase the odds you’ll stick to your budget, cut back on impulse purchase and save yourself from buyer’s remorse:

“Am I about to buy something I need, or just something I want?”

By going through this quick needs vs. wants analysis with each purchase – and when I say each purchase, I really do mean each purchase – you’ll become a smarter consumer, and ultimately save a lot of money.

A frequent misperception regarding this analysis is that you should only use it when you’re making a big purchase, and not necessarily during when buying inexpensive items. Unfortunately, this thinking will have you blowing through your budget in no time.

You should ask yourself with each item you purchase whether you are fulfilling a need or indulging a want.

I know it seems tedious (and at first it will be), but while you’ll see large one-time savings on big ticket items, over time you will net the biggest savings by reducing impulse purchases of smaller, everyday items.

Here are some examples of both big ticket as well as every day purchases that you might run into:

• Do I need this PS3 or do I just want this PS3?
• Do I need these name brand sunglasses or do I just want these name brand sunglasses?
• Do I need this cappuccino from Starbucks or do I just want this cappuccino from Starbucks?
• Do I need to take the car to the carwash or do I just want to take the car to the carwash?

I think you get the point and could probably do a good job of running through a simple needs vs. wants analysis in your head.

Now comes an extra layer of complexity – after you’ve determined that you definitely need something you have to make sure that your wants don’t come back into the picture cloud your decision making.

For example, your car has died and needs repairs that will cost more than the car is worth. You know you need to purchase a newer car because you need reliable transportation. So, does that mean you should get a relatively new used car or go for broke and get that brand new S-Class Mercedes you’ve had your eye on?

In this situation, you’ve done a good job of determining that you need something, but are you going to undo that good work up by letting your wants take over?

I know I’m making it seem like indulging yourself is a terrible thing. It’s not. It’s good to reward yourself from time to time and go ahead and buy something you want. The point I’m trying to illustrate is you can’t let your wants rule your decision making.

However, if you live within your means and practice some self restraint, you’ll probably find yourself in a much better financial situation than someone who throws caution to the wind and buys whatever they want whenever they please.