1/22/18

#MileageMonday: Chase Ultimate Rewards

1/22/2018


Welcome to the inaugural #MileageMonday! This will be a recurring series of blog posts where I will go deep into the world of credit card, airline & hotel rewards programs. For those of you that don’t know already, I am a huge proponent of the “travel hacking” world. This involves signing up for credit cards with the intention of earning the bonuses associated with the account. 

Often times, 1-2 credit card bonuses can easily pay for an entire vacation’s worth of travel & lodging, shaving hundreds to thousands of dollars off of my total bill. If you need a refresher on the methods I use to earn these credit card bonuses, check out the “Vacation Like a Baller” blog from a few months ago. You'll have a great base to build on as we gradually build #MileageMonday into a travel hacking machine!

Chase Ultimate Rewards: An Introduction

When I was deciding what to write about for our first Mileage Monday post, I could think of no better place to start than the Chase Ultimate Rewards program. This is the points system that Chase uses for all of their own Chase-branded cards, which include:
  •          Chase Sapphire Reserve
  •          Chase Sapphire Preferred
  •          Chase Freedom
  •          Chase Freedom Unlimited
  •          Chase Ink Plus (Business)
  •          Chase Ink Cash (Business)
In later Mileage Monday posts, we’ll do comparisons on each of the three pairs of these cards and whether the card makes sense for you when considering an application. Keep in mind that when contemplating applying for multiple cards on the list above, Chase has a hard 5/24 rule, meaning that your application will automatically be denied if you have been approved for 5 credit cards within the past 24 months.

 This is why it is important in the “travel hacking” world to document when you applied/were approved for credit cards, keeping track of when you will be under the 5/24 stipulation that Chase sets.  Since the Chase-branded cards tend to be the most sought-after cards in the market, it is vital that we develop the habit of documenting our application & approval/denial process.

Value Of Chase Ultimate Rewards Points

The important thing to note is that no matter what card you choose from that above list, they all earn the same currency: Chase Ultimate Reward points. These points are earned through everyday purchases on your credit card, akin to “cash back” cards you typically see in the market today. Depending on the type of purchase (think dining, travel, etc.) & the corresponding card you are using, you can earn anywhere from 1x-5x UR points/$1 spent. There are multiple ways you can redeem the points you earn through these cards, listed below:

1)      Straight cash, homie:  At bare minimum, you can redeem Chase Ultimate Rewards Points for cash back at a rate of 1%. Therefore, if I had 10,000 Chase UR points, I could redeem these for a $100 statement credit. While I’ll go into why this is not the best use of Chase UR points, there is certainly value in getting quick cash when you are in a pinch.
2)      Gift Cards: Chase Ultimate Rewards can also be redeemed for a wide variety of gift cards at most mainstream retailers. This includes Nike, Amazon, The Home Depot, Best Buy & pretty much any retailer you can think of. The redemption rate is typically the same as cash (1%); however, Chase often runs deals where you can get 10% off gift cards from select stores. Here’s the discounted selection I have to choose from:



3)      Transfer to Travel Partners: This is where we start to find value in redeeming our Chase Ultimate Rewards. Chase has a wide array of travel partners that you can transfer points to at a 1:1 rate, meaning that my 10,000 Chase UR points work as 10,000 miles/points for the corresponding travel partner. I’ve included a full list of Chase’s travel partners below:

Airlines
Hotel Programs
Southwest
IHG
United
Hyatt
British Airways
Marriott
Korean Air
Ritz-Carlton
Flying Blue
Singapore Airlines
Virgin Atlantic
Aer Lingus
Iberia

Keep in mind that ALL POINTS ARE NOT CREATED EQUAL! For example, transferring 10,000 points to the Marriott hotel program might not cover half a night at the property you are looking to stay at. However, those same 10,000 points could be transferred to Southwest to book a roundtrip flight from Columbus-Atlanta, depending on your dates & flexibility. Needless to say, there is a TON of value in using your hard-earned Chase UR points on their growing list of travel partners.

Chase points can also only be transferred to travel partners if you have one of the Chase Sapphire cards (Reserve/Preferred) or the Chase Ink Business Preferred. You can still earn points with your Chase Freedom/Freedom Unlimited & then combine point balances with your other UR-earning cards; you’ll just have to select that “premium” card when trying to transfer points.



4)      Book Travel Through The Chase Portal: If you are the proud cardholder of a Chase Sapphire Preferred or Reserve, you also have the option of booking travel through the Chase travel portal for a discount. The Chase Sapphire Preferred offers a 6:5 ratio on your Chase UR points, while the Chase Sapphire Reserve offers a 3:2 ratio (effectively 20% & 33% off your travel, respectively).  This does not limit you to the travel partners listed in the previous point & also extends beyond flights & hotels. Rental cars, excursions and much more are available through the travel portal!

The process to use your points in the travel portal is quite simple. Once you’ve selected the card you want to use, click “Explore and Book Travel” in the “Use Points” dropdown menu.


Let’s make our own example-say I want to take a flight from Columbus-Los Angeles for a long weekend in April.  After punching in my dates & traveler information, this is the screen I’m greeted with:


As you can see, I have multiple options for my airline (there’s many more than just these) & I can immediately see my savings in the flight by booking with Chase. In the Delta option, I’d save $80 by using my Chase UR points for travel rather than booking with the airline directly. Easy savings-what’s not to like?

You also do not need to use all of your miles to book that flight. There is a points + cash option, meaning I could simply use 10,000 of my UR points at the discounted rate & then pay the remainder in cash. This is especially helpful when you don't have enough points to cover the entire purchase but still wish to take advantage of the better exchange rate.

Finding the Right Redemption

Now that we’ve described how to use these points in the most effective manner, it’s time to evaluate when a redemption makes sense. When looking at travel, we need to keep in mind that many airline & hotel programs offer reward nights at figures lower than the discounted travel through the Chase portal would give you.

Let’s take a United flight as an example. In the Chase UR portal, a one-way flight from Columbus-Chicago may cost 12,000 miles ($120) after taking the discount. However, United offers 10,000 saver award flights for flights less than 700 miles originating & ending in mainland USA (aka those quick 1-1.5 hour flights).  A simple award search on United’s website could find you that cheap saver award availability and save you 2,000 UR miles by transferring the points to United.

This may seem like a lot of work to book a short flight to Chicago…but what if we were flying to Italy? Flights to Europe routinely cost $1,000+ & still would be expensive through the Chase portal. However, did you know that United has 30,000 saver award space for flights to Europe? Most people don’t-and this is where the value of our points goes a long way. I could book that $1,000 flight for only 30,000 Chase UR miles, getting much more value out of the 30,000 points as MILES vs. redeeming them for cash or a gift card.

It’s the little things like this that pay off when planning any trip. If you can make your rewards program work for you, you’ll be saving hundreds of dollars on your next trip. With that money we saved, you could pay for those bleacher seats at Wrigley Field or take a nice excursion at your tropical destination.  Ultimately, saving money is the name of the game!

Final Thoughts

Everybody is going to have different goals when deciding what they want to do with their Chase UR points. I’ve used every method I described above (even the gift cards before I got into travel hacking!) & found all of them to be incredibly straightforward.  Chase Ultimate Rewards have gotten Kayleigh & I all-inclusive vacations in Jamaica, countless flights across the United States & two Disney extravaganzas, all at least partially paid through this simple rewards program.

As we wrap up the first-ever #MileageMonday, I’d love to hear from you guys about what mileage or loyalty programs you’d like to know more about. I plan to cover all of the major credit card companies, airlines & hotels but I only really care about what YOU want to know. Let me know your thoughts in the comments section or through Smart Money Seed’s social media platforms.

Until next time, happy saving!

Ty





1/18/18

1/17/18

The Ultimate Success Guide For Graduates Who Want To Kill It: Part I

1/17/2018
You were right. In case you haven't figured this out by now, I'm giving you permission to pat yourself on the back. All those times you sat in class thinking to yourself why the hell am I learning calculus when I'll never use this again or I can't wait until the day someone hands me a million bucks just because I can name the periodic table by heart were not completely misguided. I can truthfully tell you that I somehow find a way to succeed in my job by negotiating contracts and service rates without the use of those tools.

Our education system, while doing a fairly decent job of teaching us how to think and problem solve, doesn't do enough to address the real world situations we'll find ourselves in after school. Even those of us who get a degree use a small fraction of our education in our day to day lives.

I'm not here to bash the education system. Educating people from all walks of life collectively on the real world issues they might face would be an impossible task. What I am here to do is to do my best to fill the void as best I know how in four main areas of life: Money, Career, Wellness, and Development.

We'll talk about money & career today and finish up next Wednesday with some discussion on wellness & development. The point of this is not to fill every gap we see (that's kind of our whole purpose for the blog which we hope to continue for quite some time) but to provide quick, easy things you should keep in mind and focus on from day 1.

Christian, Ty, and I aren't some crazy Forbes 30 Under 30 types who are just killing the game and leaving you all in the dust. But we are living our lives with success in these four areas as a prominent goal we work toward every day.

The post grad life is pretty damn sweet in part because you still get to do all the things you loved to do in school but now you (hopefully) have a little money to crank things up a notch. Just make sure you're substituting your Ramen with burgers and not steak too often and you're not substituting your Natty Light with $200 bottles of wine every week.

1. Money

Obviously if I thought I could fit all my money tips into a couple paragraphs, I wouldn't have this blog. Yes, personal finance can be a complex topic full of stressful decisions. But if you really don't know much about money and don't ever care to know much, I have two tips that will go a long way in helping you achieve long-term financial success.

     1. Save at least $1 per work hour to become a millionaire.

A normal 40 hour work week translates to 2,080 hours worked per year. If you're able to squeeze out $1 of your hourly wage and invest that toward retirement, that translates to $173.34 per month (I'm banking on you finding an extra penny every month for the roundup -- keep your head down when you walk). 

Even if you don't get an employer match on a 401(k) or any additional retirement benefits at all, you can retire a millionaire. If you're investing this money in a Roth IRA or Roth 401(k), 100% of the money will be yours. The best part? You didn't even contribute $100k of your own money to get there. 

Year Annual Return Hourly Payment Retirement Amount Total Contributions Total Returns
2018 10% $1 $2,178.12 $2,080 $98.12
2019 10% $1 $4,584.31 $4,160 $424.31
2020 10% $1 $7,242.46 $6,240 $1,002.46
2021 10% $1 $10,178.96 $8,320 $1,858.96
2022 10% $1 $13,422.94 $10,400 $3,022.94
2023 10% $1 $17,006.62 $12,480 $4,526.62
2053 10% $1 $729,199.99 $74,880 $654,319.99
2054 10% $1 $807,734.88 $76,960 $730,774.88
2055 10% $1 $894,493.39 $79,040 $815,453.39
2056 10% $1 $990,336.65 $81,120 $909,216.65
2057 10% $1 $1,096,215.95 $83,200 $1,013,015.95

If that's not enough to prove my point, maybe my graph will be more of a jaw dropper.


The moral of the story is that compound interest is your friend. I'm not saying $1M is your magic number -- it might be more, it might be less. What I am saying is you need to be saving for retirement, and $1 an hour isn't a bad goal to start with considering it'll net you a cool million.

     2. Keep your fixed costs as low as possible for as long as possible.

Lifestyle creep can be a major issue in our working lives, but where we put our stake in the ground is even more indicative of our future financial success. Going from making low wages during college and spending it all at the bars to making money at your first real job can cause temptation to drastically upgrade your lifestyle.

Maybe you want to rent a place at that fancy brand new apartment complex downtown and buy a brand new BMW so you can keep up with the Joneses in the garage. If you've got a great job, you've done the math, you know you can afford those things, and you don't have other financial goals you really care about achieving anytime soon, then by all means, live it up!

For the majority of us, that's not exactly the case. If you care about achieving your financial goals, then you need to keep your fixed costs down. Fixed costs include all the payments you make to live on a monthly basis including any loans you might have (student loans, car loan, credit card debt), your rent (or mortgage), utilities, cable, internet, and even your minor monthly expenses you've made a commitment to such as a gym membership.

When I graduated college, I moved back in with my parents. This worked out for me because I have a wonderful relationship with my parents, but it's not exactly every college grad's dream. I could've easily gotten a nice apartment in Findlay or even bought a house after a short while, but I chose to stay at home, thus lowering my fixed costs.

I saved that money I would've been paying toward rent and paid off all my debt which consisted of my car and student loans. This meant the only real fixed costs I had to worry about were my car insurance, my gym membership, and my phone. Just about $200 a month to live wasn't so bad!

Even now after I've moved to Findlay, I split a 2 bedroom apartment with my friend Jordan and pay a monthly grand total of $400-$450 depending on our electric bill. I purchased my gym membership up front, so I don't even consider that a fixed monthly cost anymore. This lifestyle design has allowed me to run substantial cash surpluses month after month allowing me to pay off $30k in loans and setting myself up for flexibility and the ability to achieve the next goals on my list in the very near future.

My lifestyle design consisting of low fixed costs has allowed me to live with a great deal of freedom to do pretty much exactly what I want to do. That's worth way more than any car, house, or other material object could ever offer.

2. Career

This is quite possibly the toughest transition you're going to make during this time in your life. You may expect to be prepared after 16 years of school give or take, but you're most likely going to get blindsided.

Several factors contribute to this lack of preparation. One factor is that you're used to a pre-determined schedule and an opportunity to study (cram) before a big exam. At work it's more like you have multiple quizzes every day many of which come with no warning. Although most of the quizzes are open note, this may cause you to start worrying about what's coming next.

In your career and most anything that you really care about succeeding in, you're most likely going to struggle with bouts of self-doubt. You may wonder whether you deserve to be there and whether you have what it takes to succeed.

Let me be very clear with you that you absolutely deserve to be there and you have everything it takes to succeed. Companies are very savvy with their recruiting practices and don't like to take huge risks. You wouldn't be there if you weren't more than qualified to be doing an exceptional job in what you're doing. Now it's up to you to put in the hard work and conduct yourself in a manner necessary for your own personal success and the success of your organization.

     1. Bide your time.

Regardless of how well you think you may be prepared for this job, you have a lot to learn. Don't walk around like you're hot shit and know everything there is to know. At least for your first couple months or so, you need to shut your mouth and take it all in. 

Your ability to make an impact is largely predicated on your ability to build trust with your coworkers, your bosses, and your customers (the people benefiting from your work outputs). You need to spend your first several months really focusing on shutting your mouth, putting your head down, and working hard so you can build that trust.

Nobody is outstanding at their job the first day they show up. Organizations understand that there's a learning curve every new employee experiences, and it's on you to understand that as well. I had an Organizational Behavior class in college where my professor taught me one of the most important life lessons I even learned in all my years of education.

Basically nobody is a truly high performer at their job right away. Companies hire college grads because they like their potential, and also because they have a high likability factor. If your boss likes you, it's difficult to make a decision to fire you, even if you never actually become a truly high performer. Since you're not outstanding at your job right away, you need to be focused on building your trust and likability factor within your organization.


     2. Ask Questions

Once you've put in a good amount of time taking everything in through training and daily observations, it's time to ask questions. If you don't ask questions early, then you'll most likely going to feel too embarrassed to ask what seems like basic questions later on. Generally speaking, people want to help you succeed, so they're happy to answer questions for a new employee. Asking questions shows you're eager to learn and you care about developing yourself into a high performer.

The important thing to keep in mind is to actually find an effective way to remember the answers. Asking a question once is perfectly acceptable. Twice is okay but a little annoying. Three or more times is definitely in the annoying territory, and you do not want that label. 

Also, make sure you take a second to utilize your resources and tools available to you before asking a question. You don't want to get into a habit of asking questions just because you're being helpless and using your coworkers or boss as crutches. Again, that becomes annoying real quick.

     3. Find Ways To Do More Than Your Job Description Requires.

Chances are you don't want to stay in your entry level job with your entry level salary very long. But checking boxes in an entry level job is not going to get you the promotions and raises you desire. You need to create more boxes and provide an extraordinary level of value to your organization. An entry level job is essentially an audition that will go a long way in determining just how high you might be able to climb in your organization and how quickly you'll do so.

Once you've spent your first few months biding your time, learning, and asking questions, not it's time to get strategic and offer a fresh perspective. The only way to establish a true competitive advantage is to do different things than your competitors or to do the same things differently. You can't just rely on doing the same things better than everyone else for 40 years. You need to apply this philosophy to the way you conduct yourself in your own position and to the proposals you make for changes within your organization.

Once I had finished my formal training and spent a few months applying what I had learned to my job, I noticed my training hadn't really done a great job of setting me up for success in my position. I had put in a good deal of effort building trust with my coworkers and bosses, so I decided to cash in by creating a whole presentation of how the training was inadequate and how it needed to be improved. This could've easily come across as cocky or brash, but I was very careful about the timing and manner with which I presented this to management.

I thought my presentation had been forgotten about, but then almost a year later I was asked to participate on a team that would be evaluating our training needs and would be responsible for proposing a change. I spent several months on that team with other new hires in the past couple of years, and we made a proposal that was ultimately accepted by management and is currently being implemented. I can't take 100% of the credit for the change, but I do believe I sparked some thought and kicked the change into hyper-drive.

Next Up. . .

Next week we'll dive into how we should be focusing on ourselves through focused efforts toward our Wellness & Development. In the meantime, we want to hear from you!

What are you doing with your Money & your Career that has worked for you? What questions do you have or future strategies are you taking that the rest of the Smart Money Squad might benefit from? Let us know in the comments!

1/15/18

Do you need a new outlook on your work life? Try starting with better questions.

1/15/2018

Positivity is a Mindset

Two people can have the exact same job, same boss, same office, same commute, same everything, but yet when asked how to describe their job, they will give two completely different descriptions. For one person, the boss is too nit-picky; for the other person, the boss doesn't give enough feedback. One enjoys the short commute, but the other wants to live further from work.

Let me give you another example: the death of loved one or pet. Nearly everyone is initially overcome with grief and sadness after the passing of a loved one, but emotions in the following weeks and months can be dramatically different. Some people struggle to accept the loss and may even blame themselves or others for what happened, but other people are quicker to come to peace with the death.

I'm not a psychologist and I don't claim to be one, but I think these examples show just how powerful our perspective and perception can be. Certainly there are many factors than can influence how someone describes their job or deals with the loss of a loved one, but undoubtedly your perspective and mindset plays a major role on your perception of the situation.

The good news is your perspective is in your control, and if you can control your perspective, you have the power to control your perception. In the book The Questions Behind The Question, author John Miller explores how asking better questions can lead to more positive perspectives by eliminating blame, victim thinking, complaining, and procrastination.


The Idea in Short

The questions you ask can frame your point of view, change your perspective, and control your perception.

Questions behind the question (QBQ's for short) are all about promoting personal accountability, or in simpler terms, only worrying about things that are within your control. Throughout the easy-read book, Miller explains that we often have the tendency of asking negative questions that promote pessimistic thoughts. For example, if you have a difficult boss, you might think "Who put this guy in charge?" or "Why do I have to work for him?". The problem is these questions don't solve a damn thing; they just make you hate your boss even more.

QBQ's don't ask why or who; these words just promote blaming. QBQ's focus on solution-based "I" questions such as "How can I improve my relationship with my boss?" or "What can I do to better communicate with my boss?". 

Don't ask why or who; ask how or what.

Like anything in life, practice makes perfect. Reading this book can definitely change your perspective for a few hours while it's fresh on your mind, but to really reap the benefits of QBQ's you need to practice. The thoughts and questions that come to mind during difficult times are instantaneous; the only way to make sure you're asking QBQ's when it counts most is to practice.

Closing Thoughts

The Questions Behind The Question is a super easy read with tons of great tips and tricks for practicing personal accountability by asking better questions. The advice in this book is easily applicable to your work life, your home life, and of course, your financial life.

Now get out there and start asking better questions to have more positivity in your life!

"The wise man doesn't give the right answers, he poses the right questions." - Claude Levi-Strauss

1/12/18

Five Finance Friday - 1/12/2018

1/12/2018


What's up, Smart Money Squad! We hope you're off to an amazing start to the new year! And if you're getting snowed and iced on all weekend, stay safe out there (or how about we all just stay safe in general).

It's that time again for another edition of our weekly series, Five Finance Friday. We're bringing you 5 articles that we've come across throughout the week and particularly enjoyed and think you will enjoy as well. The topics will vary between all the different topics we write about, blogging, entrepreneurship, hot topics or really whatever we happen to be drawn to that week (basically we'll do whatever the hell we want).

Don't forget to let the authors know that you enjoy their content!

1. Negotiating A Raise

Who doesn't love getting a raise? Chances are, most of us aren't exactly swimming in 10% raises year after year after year. If you think you deserve a raise and you want to have that conversation with your boss, Forbes has some amazing content for you brought to you by The Muse

Preparation is key especially for a conversation like that, and The Muse wants to make sure you're more than prepared by providing you with The Woksheet You 100% Need To Fill Out Before Asking Your Boss For A Raise. Even if you're not ready to ask for a raise quite yet, this worksheet and article will definitely help you stay focused at work and make sure you're spending your time and effort doing the right things that your organization values.

2. Get Real With Yourself About Your Money

Erin from Broke Millennial is one of the first bloggers Christian and I started following and learning from when we relaunched as Smart Money Seed. She always brings solid content, and she certainly did not disappoint this week with My Embarrassing #RealMoneyTalk Moment.

Sometimes the reason we're held back from success in money or other areas of our lives is because we're afraid to face our fears. We sweep those little problems under the rug until they become bigger and bigger problems and we're forced to put out a fire. Although Erin is an extremely knowledgeable and responsible money manager, she was having a hard time consistently budgeting after a switch to an unpredictable freelance income. Instead of hiding from her problem, she had a tough conversation about this and is taking steps to correct it.

3. Resume Of Failures

Sticking with Erin's theme here, J. Money from Budgets Are Sexy opens up with us in My Resume of Failures. Being afraid of failure is the biggest and sometimes the only factor holding people back from making changes in their lives that they're passionate about. A good place to start in getting over those fears is to be open and honest with yourself and others about your failures and start working towards making sure they're not failures next time!

4. Take Control Of Life

Quit drifting, people! It's so easy to get into a rut where life is just happening to us and we're reacting to our surroundings instead of taking life by the horns and being proactive about the way we want to live. Jillian from Montana Money Adventures does a great job of putting this in perspective for us with her post Show Up and Lean In.

The formula for being proactive in our lives requires two key ingredients: being present in our lives (show up) and working hard to manage and improve the most important aspects of our lives (lean in). Jillian takes us through specific examples of showing up and leaning in in four important aspects of life: marriage, money, health, and friendships.

5. Take Control Of Life 2

This is a very themed (and unintentionally so) Five Finance Friday! Mystery Money Man brings some great perspective in the latest post Your Most Important Task Probably Isn't. I need to throw a disclaimer out before I go on that my perspective is that of a person who does not have children. I understand children change the equation of priorities in life, and my perspective will (hopefully) change one day.

I absolutely can't stand when people complain about how busy they are outside of work hours or if they're retired. If you're one of those people, I have a message for you. The time away from work is your time. So you should spend it how you want to spend it! Why people spend their own time doing trivial things that bring them no happiness, I will never understand.

I write my intentions for my day every day for at work and outside of work. Sometimes my intentions are to write a blog post, sometimes work on marketing efforts, and sometimes just play video games or watch sports. I then write a quick paragraph at the end of my day to talk about how my day went and whether I successfully completed what I had intended. This practice allows me to spend my time almost exactly how I want to! Yes, things come up from time to time that cause me to change my intentions, but unless it's a horrific emergency, usually things are changing because I found something else I would rather do. Be proactive and spend your time doing what you want to do!


Thanks for stopping by, squad. Go give these authors a shout and have a kick ass weekend!

We usually come across articles browsing through our Smart Money Seed Twitter. If you'd like to be featured in a future Five Finance Friday, first write a kick ass post then tweet it at us or email to info@smartmoneyseed.com

1/9/18

Who Needs Engagement Ring Advice? The Ultimate Guide to Buying the Perfect Ring.

1/09/2018


Ladies, look away. We drew you in here with the picture of a diamond for page views, but now we need you to stop reading. Smart Money Seed is about to drop some TOP SECRET tips for buying the perfect engagement ring. Warning: if you keep reading, you're going to find our how your special someone was able to find the perfect ring.

....

Now that the women are gone let's have some real talk, guy to guy. How about that College Football Playoff final the other night? No one likes the SEC and even fewer people like Alabama, but at least it was a heck of a game. Don't worry, the Buckeyes will be back next year!

Okay, okay... All joking and football aside, buying an engagement is one of the biggest purchases you're ever going to make. Maybe it's not the most money you're ever going to spend (or at least I hope its not), but how many other things that you buy are you going to spend the rest of your life with? An engagement ring signifies your love and commitment to the most important person in your life, so you'll want to take some time to pick out the perfect ring. This isn't a case of beer or a loaf of bread that you can just go pick up at the grocery store. If you haven't already come to the realization, the first step in buying a killer ring is understanding that it takes time.

How Much Should I Spend?

There is no doubt about it; this is the question I wrestled with the most when I first started to think about getting engaged. 

Do I need to spend two month's salary? What about three month's salary? Should I just ask Google how much people typically spend?

Yes, these are all questions I asked myself. To be honest, most of the "rules" about how much you should spend on an engagement ring are bogus and were probably made up by the ring companies that want you to feel pressured into buying something more expensive. Don't fall for the two or three month salary crap, and don't worry about what the average person spends on a ring. You need to spend what feels right to you. I know, easier said than done. Here are some tips to help get you in the right ballpark:
  • Don't take out a loan or use credit to buy a ring (unless you're paying off your credit card in full at the end of each month); in other words, don't use debt to finance a ring. This a step that can lead to the bad habit of buying stuff you can't afford. This is not the way you want to start the next chapter of your life!
  • Ignore the pressures of the internet - there are so many myths out there to try to get you to spend more.
  • Think about personal expenses that you can forego to save up some extra cash. Maybe you can wait to buy a new set of golf clubs, a country club membership, or a fishing boat. This may sound crazy, but if you save on a few of these things now, maybe your soon-to-be wife will let you spend more time hitting the links or fishing once you're married!
  • Try not to borrow from your family, even if they want to help. This is admittedly my personal opinion, but if you borrow a bunch of money from your family to buy a ring, you're going to lose out on the great sense of pride and accomplishment that comes with buying your own engagement ring. Whether you can afford $500 or $15,000, knowing that you paid for the ring that she'll wear for the rest of her life brings a great sense of achievement.

The bottom line: spend what you can afford. No more, no less.

Picking and Purchasing the Rock

Hit the Books - Diamond 101

Cut, color, clarity, caret, polish, symmetry... the list goes on and on. I'm not a geologist, but diamonds have to be the most complex rocks to learn about. I'm not going to pretend to be a diamond expert and tell you how to choose the right color or clarity, but I will tell you that you better plan on spending as much time researching diamonds as you would a new set of irons. If you're not already familiar with diamonds, do some research and get familiar.

Know Her Preference

Don't go into this purchase blind. An engagement ring is something she has probably been dreaming of since she was a little girl and by now she probably has a few preferences. Don't be afraid to talk to her about what she likes and doesn't like, but the key is timing. Find a time to bring it up when it won't feel forced or awkward, such as when another friend gets engaged or at a wedding. For a more covert operation, consider stalking her Pinterest account and other social media. Chances are she's left a few clues along the way.

Get it Certified

Want to sleep easy at night knowing you're not getting fooled into buying some knock-off diamond? Make sure it is certified. Most jewelers provide a certification from a 3rd party that inspects and grades the diamond to validate and ensure its authenticity. Here are a few of the most well-known agencies that certify diamonds:

  • Gemological Institute of America (GIA)
  • American Gemological Society (AGS)
  • European Gemological Laboratory (EGL)

Try Shopping Online and In Stores

I highly recommend to try shopping both online and in stores for the right ring. Both experiences are vastly different, and its hard to tell which you will like better until you try. Shopping online gives you a great deal of comfort since you don't have any time constraints and have no pressure of interacting with any high pressure sales tactics. On the other hand, shopping in stores allows you to see some of rings in person and you can readily talk to an expert.

Whether you decide to purchase your ring online or in stores, be sure to shop around and check out the prices of similar rings from different jewelers.

I ended up purchasing my (Rosie's) ring online through James Allen. I looked at a handful of online retailers as well as some local jewelers in Columbus, but I couldn't find anyone that could compete with James Allen's prices. I never thought I'd end up using an online retailer, but it was a great experience! They also have an awesome online interface that allows you to see how thousands of diamonds look with different settings.

Don't Forget Her Ring Size

Knowing her ring size is one of the easiest steps to forget, but it's one of the most important to remember! You want to make sure that ring fits on her finger and doesn't fall off. The easiest option is to just ask her, but again, be selective with your timing to keep it from blowing your cover. If you want to stick to a stealthy plan, borrow a ring she wears on her ring finger and take it to a jeweler to get it sized. You could also try phoning a friend to see if her mom, sister, or friend knows the answer. Don't worry, most rings can be resized if you get the wrong size, but getting the right size will save you some time and stress.

We might have dated for 7 years, but I was still able to surprise her!


Relax, you've already made the most important decision.

Don't let the decision of buying a ring get the best of you. Sure, it's an important decision, but you've already made a much more important decision. You've met someone that you've decided to spend the rest of your life with - don't lose sight of that. If she cares for you as deeply as you care for her, she'll love any ring you choose. Don't put too much pressure on yourself. Embrace this new chapter of your life and enjoy every step of the process. 

"I wish there was a way to know you were in the good old days before you've actually left them." Andy Bernard (The Office)



1/8/18

Success Story: How I Paid My Student Loan Debt

1/08/2018

Smart Money Squad, welcome back! We last spoke about different ways to manage debt in our  post “Attack Mindset”,where we dived into the snowball & avalanche methods to effectively eliminate balances on your loans/bills. Both of these are solid approaches to approaching the debt equation & I’ve personally tried both while managing my own finances. I’ve continued to monitor how I approach my total balance to my creditors while being cognizant of keeping overall debt down. 
I hope to continue to update this journey to being debt-free throughout 2018 and beyond, checking in periodically when I hit another personal milestone. With that said, please enjoy the first few miles on this long highway ride to eliminating my debt!

A Little Background…

2017 was a wild year filled with twists and turns in both my personal & financial life. I got engaged to my best friend and had my best financial year-to-date in terms of net wealth. Of course, with personal growth comes added stress. With a fast-approaching wedding in the cards in October 2018 + car & student loans, you could say my financial situation has been hectic over the past year.



Needless to say, I’ve been busy “balancing the checkbook” while trying to figure out what debt to attack first. There are many factors that play into this: interest rates, total money owed, personal satisfaction, to name a few. To better grasp my personal situation, let’s first take a look at the total balances I have when deciding what debt to ultimately pay.


Debt Breakdown

Ty's January 2017  Active Debt
Debt Type
Dollars Owed
Min. Payment
Interest Rate
Car
$10,000
 $299
3.10%
Student
$11,000
 $129
5.30%

Before we get into my debt, this doesn’t include the monthly expenses for food, rent, utilities, etc. These are strictly balances I have with creditors, where I’m not using my liquid cash to pay a bill up-front. As you can see above, I have two loans to choose from when deciding where to divert my funds allocated for monthly debt payment. This number differs for every person, but for me, I clock in at roughly $1100/month I can pay on my loans and still live comfortably within my current lifestyle. Keeping that lens, I know that I have $428 in minimum payments that I must make every month. This leaves me with an additional $672 that I can divert towards either loan-but how do I choose which one?

My Decision-The Avalanche Method

When deciding which debt payment method I wanted to use, I went with the option that will ultimately save me more dollars-the avalanche method. If you don’t recall from our previous post, the avalanche method uses your remaining money to pay the loan with the highest interest rate after taking care of the minimum amount owed on all existing balances. When we take a look at my two loans, the option was simple; throwing the remaining $672 towards my student loans (5.3% interest rate on average) was the best option.

I have been doing a miniature version of this method with my student loans already, as I have multiple student loans with different creditors.  I simply have paid the balances with the highest interest rate first, eliminating loan after loan until finally I was able to make the last payment in November. The avalanche method ultimately knocked my remaining student loans out in 2.5 YEARS, something I did not think was possible.

While this method may not be the best option for everybody, it was the best option for ME, and truthfully that’s all that matters. As long as you are paying down your debt to the best of your ability while making informed financial decisions, who is going to fault you? You’re saving yourself thousands of dollars in interest down the road- a figure I do not take lightly. Paying my student loans off in 2017 was a goal I set at the beginning of the year and I’m proud to report I achieved it.


Reflection

Needless to say, it was a freeing feeling leaving that debt in the rearview mirror. Paying my student loans and gaining that feeling of satisfaction ultimately was worth pinching some pennies in 2017. To those that are on the fence of aggressively paying your debt, I hope this is a testament that discipline pays off. I am the closest I’ve ever been to being debt-free (until that pesky mortgage kicks in) and the most in-touch I’ve been with my financial wellness.

As we kick off 2018, I hope to continue on the path that I’ve laid out here and inch ever closer to that freeing feeling again. Hopefully I’ve inspired you to help set those financial goals at the beginning of the year and stick to it. Trust me, life is much sweeter on the other side!

Cheers,
Ty