Money Tip – Stop Eating Out So Much

October 1, 2014 | Posted in Debt, Money | By

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Money Tip – Review Your Cell Phone Plan

October 1, 2014 | Posted in Debt, Money | By

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His perfect FICO score obsession (via

April 29, 2014 | Posted in Credit, Finance | By


(photo from

by Polyana da Costa

A good credit score is usually nothing more than a financial necessity for most people. For David Howe, good wasn’t good enough. He wanted a perfect credit score and obsessed over it for years.

“In the last six or seven years my score was into the 800s and I knew I was getting close,” he says.

Howe says that a few weeks ago, his dream came true: an 850 FICO score. FICO scores range from 300 to 850 and achieving the highest score is extremely rare. Many people in the financial industry say they have never seen one.

“For me this is an absolutely stunning accomplishment,” Howe says. “I worked on it for so long. I will continue to make sure my credit is very strong but will not obsess over it anymore. I have had a few sleepless nights because of this. It’s a sense of relief for me.”

Why the obsession?

Howe says the pursuit of the perfect credit score was a personal and professional goal. He is a credit manager at a company based in Massillon, Ohio, and founder of a consumer credit reporting agency that serves cable and telephone companies. But on a personal level, he has always been fascinated by the credit scoring system.

“FICO doesn’t discriminate,” he says, adding that income and age aren’t part of the calculations that determine your score. “You can be a janitor at Walmart and have exceptional credit or a CEO with bad credit.”

‘Howe’ did he do it?

Howe warns that he is not a FICO expert, but for those who want to improve their credit scores, here are his tips, based on his journey to achieving the perfect credit.

  • Watch your score like a hawk: Howe spent thousands of dollars over the years buying credit reports and monitoring his score. “I have my scores going back at least seven years,” he says. “In the most recent three of four years I have watched every single detail.”
  • Manipulate the balance and payment date on credit cards: “I know exactly when my statement is going to cross,” he says. Credit card companies usually report your balance to the credit bureaus on the day of or a few days after the statement date, which is different than your due date. So even if you are paying off your credit card every month on the due date, but maintaining a high balance through the month, this can impact your score negatively, he says.
  • Avoid unnecessary inquiries: Hard inquiries can make small dents on your credit score and they appear to affect your score for up to a year, Howe says. While it’s impossible to avoid inquiries when you have to apply for an auto loan, a mortgage or even a new cellphone account, don’t go wild opening new credit cards, because doing so may affect your score. “I have not opened a revolving credit card account in almost a decade,” he says.
  • Have a decent amount of credit: Avoiding too many credit inquiries doesn’t mean don’t ever open a credit card account. You’ve got to start somewhere but you have to know when to stop. Howe says he has 11 credit cards but uses only about four of them. On a day-to-day basis, he uses one.
  • Keep a small balance but not a zero balance: Paying off all of your credit cards won’t get you a perfect credit score, Howe warns. But an extremely low balance will help. Howe says he made sure to keep a small balance on one of his credit cards. How small? He says he kept it under 7 percent of the available credit. “I always pay before my due date but I would leave, say, $30 on there,” he says.
  • Pay down the mortgage: Howe says paying down his mortgage was a key factor to achieving a perfect credit score. He has paid down more than half of his 1-year-old mortgage.
“Just a month ago I was getting 845,” he says. “I paid down another $6,000 on the mortgage and that additional $6,000 was the magic threshold.”You don’t need a perfect score to get the best rates as a consumer. To lenders, as far as rates, there’s really no difference between a 780 score and an 850. But if you are pursuing an excellent score, Howe’s tips might help you.

His score wasn’t always great

About 10 or 15 years ago, Howe says, his credit score was as low as 630.

“I’ve had some missteps,” he says.

He says even if your credit history is tainted by collections, foreclosure or bankruptcy there’s still ways to fix your credit if you are patient and persistent.

“If you have a bankruptcy or a foreclosure let time heal that,” he says. “I’ve had some serious issues in the past and here I am.”

Follow him on Twitter @Polyanad.


Is Paying an Annual Fee on a Credit Card Really Worth It?

April 22, 2014 | Posted in Credit | By

Credit and Financial Mgmt

By Mike Jelinek, Contributor at

You probably know that paying an annual fee for a credit card typically means you’ll get more benefits. Whether or not it’s truly worth it comes down to your purchasing decisions and spending habits.

In most cases, my research has shown that the annual fee is worth the extra rewards — unless you simply don’t use your credit card that often. Also, keep in mind that just about every credit card with an annual fee will waive the fee for the first year.

There aren’t many cards that have a no fee version and an annual fee version, but some of the best credit cards do have this option. If you are considering the no fee version vs. the annual fee version of a card (or if you’re just trying to decide on paying an annual fee at all), this breakdown should help answer your questions.

To illustrate my point, I’m going to conduct a brief case study of two very popular cards by comparing the no fee version and the annual fee version. I’ll compare both versions of the best travel credit card as well as the top cash back credit cards from American Express.

Barclaycard Arrival™ World MasterCard®

The Barclaycard Arrival™ World MasterCard® offers two versions: Earn 1x or 2x on all purchases. As you guessed, the 1x version comes with no annual fee, while the 2x comes with an $89 annual fee that is waived for the first year.

Let’s start by taking a quick look at the rewards overview for each card.

Barclaycard Arrival™ World MasterCard® – Earn 2x on All Purchases

  • Earn 40,000 bonus miles when you spend $3,000 or more on purchases in the first 90 days from account opening (equals $400 off travel).
  • Earn 2X miles on all purchases
  • Get 10% miles back when you redeem for travel statement credits (i.e. redeem 25,000 miles for travel and get 2,500 miles back)

Barclaycard Arrival™ World MasterCard® – Earn 1x on All Purchases

  • Earn 20,000 bonus miles when you make $1,000 or more in purchases in the first 90 days from account opening (equals $200 off travel).
  • Earn 2X miles on travel and dining purchases
  • Earn 1X miles on all other purchases
  • Get 10% miles back when you redeem for travel (i.e. redeem 25,000 miles for travel and get 2,500 miles back)

Real Life Comparison

I’m going to use a model that assumes you spend $15,000 on your credit card each year. I’ll break that down into specific purchases in detail in order to get a more accurate representation.

In the first year, you spend $5,000 on travel and dining purchases (but let’s assume you spend $3,000 in the first 90 days). You also spend $10,000 in other miscellaneous (non-travel and dining) purchases for the remainder of the year.

In the next three years, you spend the same $5,000 on travel and dining, but let’s assume you earn more money and spend $15,000 on miscellaneous purchases per year.

Rewards Earnings After 1 Year

In the first year, you’ll accumulate the $400 bonus, plus an additional $300 in rewards and you’ll pay no annual fee. With these spending habits, you’ll earn $700 redeemable for travel with the 2x card.

The first year with the 1x card will get you a $200 bonus, plus $200 in rewards for a total of $400 redeemable for travel.

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20 Habits of Financially Successful People (via

April 18, 2014 | Posted in Credit, Debt, Education, Finance, Money, Savings | By


This is an article I found to be very insightful with regards to habits practiced by financially successful people. How many of these do you incorporate into your life?

The secret to finding financial success has been something that has eluded many of us for our entire lives. Yet there are multitudes of individuals who enjoy a comfortable life due to their financial success. As it turns out, many of these financially successful people all have certain habits in common with each other. Here is a list of the top 20 key habits that financially successful people employ.

1. They establish and follow a budget.

Being able to plan ahead for your financial needs and setting limits on certain spending types will almost always result in better results in the long run. Anyone can make a budget, but staying disciplined enough to follow it is more difficult.

2. They keep their recurring, monthly expenses to a minimum.

Along with making and keeping that budget, they also evaluate their monthly costs and reduce them when possible. By avoiding this unnecessary spending they allow a larger portion of their income to go towards saving.

3. They have a healthy financial education.

Financially successful people are well aware of the current economic trends and are constantly increasing their knowledge so that they are able to make the right decisions when it comes to managing their money.

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How to save hundreds of dollars this month

April 2, 2014 | Posted in Money | By

I generally don’t post the weekly sessions for my $250MM Debt Challenge group. However, I believe the session from last night will assist those of you who are looking for tips to reduce your expenses.

Feel free to join the $250MM Debt Challenge by signing-up at

(points below referenced from the article How to save $500 this month on Yahoo Finance)

1. Be a diligent saver
If money is tight and you need to drastically reduce your budget, here are some strategies to start saving right away. Putting even one of these ideas into practice should give your finances some much-needed breathing room, but if you adopt all of them, as long as your income remains steady, you could be looking at an extra $500 – or more – this month.

2. Curb eating out
It sounds basic, but discretionary expenses add up. Last year, a Visa survey of 1,005 adults found that on average, American consumers eat lunch at restaurants almost twice a week, spending about $10 each time. Putting a moratorium on dining out could save you $80 a month – and perhaps much more.

3. Eliminate Cable
Swearing off cable could net you an extra $90 monthly – the average bill for a U.S. household, according to The NPD Group, a market research company. Instead, find ways to watch your favorite shows for free on network websites and services like Hulu.

4. Adjust your commute
According to the California Energy Commission, commuters would save an average of 30 percent on their fuel costs if, instead of driving alone to work, they carpooled, took a bus, rode a bicycle or walked. Considering that the average household spent $2,912 on gasoline in 2012, according to the U.S. Energy Information Administration, a 30 percent savings could equate to more than $70 a month.

5. Modify your auto-insurance
If your car is getting old and you’ve paid it off – and especially if it hasn’t retained anything close to its original value – both comprehensive and collision insurance may be a waste of money. Someone with a 2008 Toyota Camry who switches to only liability insurance might see their insurance costs drop by 30 or 40 percent. “Depending on where you live, [that could be] $200 to $600 per year,” says Craig Lozofsky of That’s $17 to $50 a month.


6. Give up a guilty pleasure
The average consumer spends more than $1,200 a year on beer, according to Survey Analytics. And according to the American Lung Association, the average retail price of a pack of cigarettes is $5.51. If you’re a pack-a-day smoker, you’ll save $167 in a month if you give up this vice, and a little over $2,000 a year. Maybe you gamble? There’s got to be something, from a serious vice to a relatively innocuous habit (like soft drinks), you can cut back on.

7. Grocery shop smarter
According to the U.S. Department of Agriculture, the average family of four with tweens spent $1,258 at the grocery store in December 2013. An adult male or female spent between $300 and $400. So if you’re spending more than that, you could probably do a lot better. Strategies to help you save: Don’t shop when you’re hungry; take a shopping list; look at the unit price as well as the actual price tag; bring coupons; shop at deep-discount grocery stores.

8. Tighten-up your finances
This isn’t just budgeting – it’s looking at when bills need to be paid and having a system for keeping your financial life on track. It’s crucial to avoid late fees and slash unnecessary expenses. “You get a late fee, a negative mark on your credit report,” says Gail Cunningham of the National Foundation for Credit Counseling. “And then there’s the gym membership that’s on automatic pay, and you haven’t seen the gym in six months. How about habitually picking up fast food on the way home from work because you’re too tired to cook? … All of these could add up to over $100 a month or over $1,000 a year. Now that’s real money.”


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