Monday, September 6, 2010

Next Blog>> Blog Surfing

At the top of this page, there is a hot link labeled Next Blog>> that I rarely click upon. The other day, I did, spending an hour "surfing" different blog sites. The result was interesting.

The blogs that Blogger sends me to are not always the same (they seem to randomize) but are topically "related" in that they deal with financial matters, budgeting, credit card debt, and the like. Some are funny, some are sad, some are full of bad advice, others are dead blogs. Here are some interesting highlights:

1. False Economy: One fellow has a blog where he posits that he will make enough money to retire on $125,000 a year by 2025 (that's 15 years away, bub). If I presume that is the year he turns 65, he and I are the same age. He says his "net worth" is currently $450,000. That's pretty scary to me, as I have a net worth more than double that, and I seriously don't think I'll be living on $125,000 a year when I'm 65. No way! His last blog entry, from May of 2010, tells how he scored a "great deal" on a brand new Lexus. Maybe he decided to screw retirement and live for today.

In case you missed it, here and elsewhere, buying "luxury" cars is a silly waste of money, when you can buy the same car in more standard trim. And buying a brand new car is never, ever a "deal" - no matter how savvy you think you are in negotiating with professional salesmen. He could have paid HALF of what he did for the Lexus by purchasing a 2-year-old Toyota Avalon, still under warranty, which would have lasted just as long, with proper care. We're talking savings of $20,000 or more - perhaps much more.

If you really want to retire on $125,000 a year, you'd better stop spending money TODAY on unnecessary luxury items whose sole purpose is to impress people you don't know.

Frankly, I would be happy to retire on $65,000 a year. Once you stop working, the need for money diminishes. And if your house is "paid for" - which it should be - your only expenses are food, clothing, and taxes.

2. Expert Advice: A whole slew of blogs are written as though the writer is some sort of financial expert or organization that knows all - and is not just some schmuck like you and me trying to figure it all out. One harps ""Finance Central is the blog that can help you to manage your finances effectively and get out of debt! Take a look at the latest finance hints and tips for getting out of debt!" The advice given, however, is sort of mediocre or vague at best ("Save money!" - that sort of thing).

Others claim to offer "expert" advice on buying and investing in stocks. But as we have discussed before - and as a helpful reader pointed out - "picking" stocks by amateurs is a zero-sum game. No matter how much research you do, you are buying the stocks at the highest price, generally, and getting the worst sort of deals. That you occasionally make money on the market (like I did with AVIS stock last year, 1200% gain) only serves to encourage the casino mentality. The best any average Joe can hope to do is to diversify his portfolio, pay down debt (including mortgage) and save money - with increasing amounts in "safe" investments - for a happy and stress-free retirement.

I don't claim to be a financial expert. Far from it, I am just a schmuck like everyone else. In fact, I seriously doubt or care that anyone READS this blog. It is just something I write down for my own sake. And as you can see, I like to write.

Day Trading Stocks: There are a host of sites out there that talk about day-trading schemes, similar to the above. I am not sure why these folks post blogs. Perhaps they are linked to various day-trading scams.

4. Monetized Blogs: A lot of these financially related blogs are monetized, and I think they hope to come across as some sort of "expert" or packaged product (the next Huffington Post or something) and become famous and make lots of money. But most of the postings are vauge and bland at best, so I wonder why folks read them. For example, a blog that is just links to financial articles - what good is that?

5. Penny-Pinching Blogs: There are a number of blogs similar to mine in that they detail the efforts of average Joe Consumers to get themselves out of credit card debt and become "debt free" and get a hold of their finances. Some of these are funny, others are tragically sad, as the consumers just don't "get it".

For example, one fellow details how he wants to pay down his $31,000 in credit card debt, and over a year, he does knock it down to $14,000. Good for him. But he goes out and decides to get Lasik surgery ("because I deserve it") and then fences in his yard for "the new puppy". And he talks about getting "a new car" because his old one is continually needing repair.

Um, talk about not getting it. If you really are struggling with debt, cosmetic surgery is not the answer. $79 pair of glasses from BJ's wholesale is. Once the debt is gone, think about surgery. But the $1000 or more for elective surgery would go a long way to paying down $14,000 in credit card debt.

And if you are really struggling with debt, getting a pet is a bad idea. As I noted in this blog, pets are not cheap. Just basic veterinary bills, heartworm pills, flea and tick treatment, and pet food can total over $1000 a year - easily. If your pet requires any special medical needs (and they all do, it seems, on occasion) or you have to pay to fence in your yard, well, add on to that cost even more. Again, $1000 a year goes a long way to paying down $14,000 in debt.

You can't become debt-free without getting off the consumerist bandwagon. The first step is to stop wanting "things" in your life and thinking of owning things as a sign of wealth. Not watching TeeVee is a good first step in that direction.

The fellow in that blog complained about his broken washer - and paid a repairman to come fix it. Buy a used washer in the Pennysaver or on Craiglist for $100 - it is cheaper than a repairman, and will likely last longer. He also complained about car repairs - take a night course in basic auto repair and learn how to save money doing your own work.

Of course, this does mean you will miss all those episodes of "America's Idol".

* * * * *

There are a lot of other blogs out there. Some are almost commercial in nature - a law firm that is trustee for some busted Real Estate uses Blogger to post data on foreclosure sales. Some re somewhat bizarre - like the Mom who posts on allergies (allergic to everything, you know the type - we used to call it hypochondria) but also financial matters, including schemes to buy things at CVS and somehow make money (??) by using coupons to get more money back than you spent...

Most of the blogs have very short entries, that are mostly links to other blogs, regurgitation of what is said on TeeVee. Most are little more than extended "tweets".

It was an interesting experience, surfing these sites. I may have one more post on the subject, to refute one specific commercial site....

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