Shit Happens.

I went to get a loose crown checked out at the dentist this week.  It quickly turned into a $250 tooth extraction and sheer panic over the $1800 dental implant I would need to replace it.  Shit happens.  And when shit happens, you need to have an emergency fund in place to cover the cost.

An emergency fund is an easily accessible stash of money for “shit that happens”- or emergencies.  It’s NOT for taking a vacation or buying ANOTHER new phone.   It’s the money you live off of when you’ve been laid off unexpectedly, the money you use to fix the leak in your roof, the money for your medical bills when your teeth, your bones, or God forbid your heart give out on you.

The sad reality is that something unexpected and expensive is going to happen.  You are not immune.  So if you’re thinking, “I can’t afford to have an emergency fund”, start thinking, “I can’t afford not to”. It’s been shown that those who don’t have emergency funds are more likely to amass debt.  Start saving now before you find yourself in a hole you can never get out of.

Experts recommend setting aside anywhere from $1,000 to 9 months worth of living expenses for your emergency fund.  The suggestion that I would have an extra 9 months of living expenses just lying around is laughable to me as it probably is to all the broke and beautiful; so let me offer my suggestion.

Open a high yield savings account with an initial deposit of $1,000 to start.  If you don’t have $1,000, make it happen.  Look back at the post “What Do You Have To Offer?” for some ideas.  Now in my opinion $1,000 isn’t going to get you very far in an emergency, so once you’ve made the initial deposit, contribute weekly, bi weekly, or monthly to your emergency fund until you’ve built a nice cushion.

I have about three months of living expenses saved up.  In an ideal world, I’d have six.  After getting my teeth fixed, I’ll probably have one.  Time to prioritize the emergency fund.   I recommend your emergency fund contributions being your top priority after basic needs like housing, food, and transportation until you hit the three to six months of expenses mark.

If you have trouble saving, set up direct deposit to your emergency account.  If you like to spend impulsively, don’t get a card attached to the account.  While your emergency money needs to be accessible (not tied up in a retirement account or risked in investments), you don’t want it to be so readily available that you blow it all on the new iphone with one swipe of a credit card.

Now start saving- and be safe.  Shit will happen, but at least you’ll be prepared.

AFFORDABLE NYC HOUSING

Affordable housing in the New York City Metro Area.  What a contradiction.

The search for a place to live is never easy- regardless of whether you’re looking to buy, rent, or sublet.  But add to that being broke in one of the worlds most expensive cities and you’ve got a serious challenge.

Experts recommend spending about one third of your take home pay on your rent.  Unfortunately, while the city’s median household income has barely moved in the past ten years, the average apartment rent has climbed by 27%.  In July 2012, the average Manhattan apartment rented for $3,461.  That means you’d have to be making over $10,000 A MONTH (over six figures annually) to live there and be “living within your means”. Thirty percent of New Yorkers wind up spending over HALF their income on rent.  Don’t be in that thirty percent!  That’s money out of your savings, your emergency fund, and your retirement- places where you really can’t afford to cut corners.

So, do you sift through the endless crap, scams, and unpredictable roommates on craigslist or spend a fortune on a broker?  Do you splurge on a convenient studio or couchsurf from place to place? 

For the purposes of this post, let’s assume a down payment is nowhere in your immediate future and you’re not applying for subsidized housing (a possible future post).   

So “For Rent”. The rental market typically slows down in the winter months.  To get the most bang for your buck, consider waiting till the holidays.  The move may not be pleasant, but the savings will be worthwhile.

Now, let’s start with priority number one, location, location, location.

If you want to get real about saving money, get real about location.  With the exception of Washington Heights, Harlem, Inwood, and a few other northern extremities, Manhattan is not really in the picture for the broke and beautiful.  That being said, if you MUST stay on the island, look for something noisy or ugly.  A construction site (second avenue subway line anyone?), a tunnel entrance or exit, an above ground subway (excluding the high line)- yes, there are some quality of life considerations here, but if you’re willing to swap an eye sore for a commute, you can save a lot of money by renting in one of these kinds of locations.

Unfortunately, Manhattan is not the only pricey NYC area.  Apartments in Williamsburg and Hoboken give me sticker shock.  Look for the neighborhoods that aren’t incessantly written about in the paper.  Walk away from the street with the trendy restaurants and bookstores.  Even a block or two over can mean a major price difference.     

Once you settle on a neighborhood the easiest way to save money is to avoid a hefty brokers fee.  Look for homes with a “For Rent” sign in the window or for buildings with a rental office on site.   Negotiate directly with the landlord, bypass the middleman, and save the cash. 

The last time I moved I walked through the streets of my desired neighborhoods and wrote down the addresses and numbers for all the buildings with a “For Rent” sign.  Within two weeks I was in a spacious three bedroom for $1600/month!!! Needless to say, I wish I’d never have to move again. 

No luck spotting “For Rent” signs?  Check with the doormen/ front desk associates in some of the bigger buildings. They may be able to provide some insider info or direct you to the buildings’ leasing office.  Also keep an eye out for moving sales, moving trucks, or people dumping their odds and ends on the sidewalk.  Introduce yourself and ask if the landlord has found anyone to take over the lease.  Not only will they be able to give you a first hand account of living in the prospective apartment, but they might just let you take a look around.

The internet is another good place to start your search.  Notice I said “start your search” and not “complete your search”.  While there are so many resources and so much information regarding housing online, there are also so many scams and cons.  Do not wire or send money without ever having seen the apartment or spoken directly to the landlord.  If something sounds too good to be true, it probably is.  Spend some time getting a feel for the market so you can identify when something is a good deal and when something is a too good to be true scam.

The following is a list of websites and resources to help you get a feel for the market and get you started on your search.

Listings/ Classifieds

NY Times

NY Daily News

NY Press

AM New York

NY Post

Village Voice

New York Magazine

Websites/Resources

Craigslist

Pad Mapper

Street Easy

Naked Apartments

Urban Edge

Citirent

NY Habitat

Best of Luck!

GROCERY STORE SAVINGS!

The best way to save on food is to cook for yourself. Follow these tips to save cash and calories while you’re at the grocery store or market.

1.                     Know what you already have.   Before going to the grocery store take a quick inventory of your fridge and pantry.  You don’t want to wind up with 3 packages of expensive berries that spoil before you eat your way through them.

2.                     Make a list and stick to it. Making a list will help you stay focused on what you need (whole grains, fruits, and veggies) instead of what you impulsively want (a Snickers bar at the checkout counter). 

3.                     Shop on a full stomach.  Shopping when you're hungry can lead to poor decision making and overbuying.  Grab a snack before hitting the store.

4.                     Compare unit prices.  Just because one jar of peanut butter is twice the size of the one next to it doesn’t mean it’s a better value.  Always make price comparisons based on the unit price (the price per pound, per ounce, etc) of an item.  Consider bringing a pocket calculator with you and give yourself plenty of time.

5.                     Buy grains in bulk. You’ll find that the larger bags and bulk bins of brown rice generally have cheaper unit prices than the individual meal boxes.  Same goes for the majority of your grains- barley, oats, cereals, etc.  If you can find the space, buy in bulk and store your grains in air tight containers to keep them fresh.

6.                     Buy in season. When produce is in season, it’s both at its cheapest and its highest nutritional value.  Try to plan snacks and meals that revolve around what’s in season.

7.                     Shop the frozen food aisle.  Not the prepackaged, high sodium meals, but the bags of frozen produce.  For maximum health benefits and flavor choose organic fruits and veggies.  You’ll still save a ton by buying frozen.

8.                     Check out alternate sources of protein.  Beans and lentils are excellent and cheap sources of protein that can be bought in bulk and stored for long periods of time.  Try incorporating these powerhouse legumes into your meals on a regular basis to get major benefits while saving major bucks.

9.                     Choose generic.  When it comes to items that are of the same product quality, choose the generic over the more expensive name brand.

10.                 Buy whole foods.  Sometimes the less processed something is, the cheaper it is.  For example, an apple is often cheaper than apple sauce and dry beans are cheaper than their refried counterparts.  Double win for you! 

11.                 Shop the perimeter of the store first.  Fill your cart with nutrient dense produce, protein, grains, and dairy leaving less room for the processed junk food in the center of the store.

Buying locally grown, organic products is ideal, but it’s not always an option when finances are tight.  I would however, recommend investing more of your food and grocery budget in your produce.  You need to be eating the most nutrient rich fruits and vegetables that you can to maintain both your fitness and your health. 

Trader Joe’s offers great, organic produce at a reasonable rate.

-       Trader Joe’s Union Square

o   142 E 14^th Street

New York, NY 10003

-       Trader Joe’s Chelsea

o   675 6^th Avenue

New York, NY 10010

-       Trader Joe’s 72^nd & Broadway

o   2073 Broadway

New York, NY 10023

-       Trader Joe’s Brooklyn

o   130 Court Street

Brooklyn, NY 11201

-       Trader Joe’s Edgewater, NJ

o   715 River Rd

Edgewater, NJ 07020

-       Trader Joe’s Queens

o   9030 Metropolitan Avenue

Rego Park, NY 11374

Fairway Market is another place to find great prices with lots of organic options.

-       Fairway- Upper West Side

o   2127 Broadway (@74^th Street)

New York, NY 10023

-       Fairway- Upper East Side

o   240 East 86^th Street

New York, NY 10128

-       Fairway- Harlem

o   2328 12^th Avenue (@130^th Street)

New York, NY 10027

-       Fairway- Brooklyn

o   480-500 Van Brunt Street

Brooklyn, NY 11231

-       Fairway- Queens

o   242-02 61^st Avenue

Douglaston, Queens, NY 11362

New York is also home to a wealth of farmers markets.  Check out www.grownyc.org/ourmarkets for a complete listing of farmers markets around the five boroughs.  If you head to the farmers market in the last hour or two you may find vendors selling their remaining perishable items at a discount. 

Remember that how foods are grown has an impact on their quality and consequently on your health.  By buying organically grown foods you reduce the potential health hazards posed by pesticides, additives, and genetically modified food.  An investment in your food now could save you tons of money on your health bills later.

** This post is an excerpt from a book I'm in the process of writing.  Stay tuned for publishing info!

WHAT IS YOUR WHY?

As I fly home from Moscow and two weeks of thrilling whirlwind travels throughout Eastern Europe I fantasize about my next vacation.  Maybe something indulgent and relaxing.  An all-inclusive resort in Hawaii perhaps?  Just as I start to feel the sun on my face and the taste of frozen cocktails on my lips REALITY CHECK. 

I sigh and think someday.  Someday I will travel to exotic and foreign places, allowing myself the luxury of cabs to and from the airport, dining out without triple checking menu costs, staying at real hotels, frequenting the spas, maybe even first class flying.  Okay okay, I know I’m getting out of hand and I realize how lucky I am to have been where I have been and to have had the experiences I have had but hey, you’ve got to have a dream.  

Not just a career dream like being an astronaut or a movie star or a famous author, but a dream of a lifestyle which, let’s face it, only money can buy.  Something to work towards.

So what is it you’re working towards, saving towards, investing towards?  Not the reasons you HAVE to work, save, etc, but the reasons that get forgotten somewhere in the day to day struggle of just trying to get by?  What is the lifestyle you dream of living?  Apartment on Central Park west?  Fine dining every weekend?  Vacation home on the beach?  Sending three children to Ivy League Schools? Jet setting around the world?  Get crazy.   Think Big.  There’s got to be something more motivating you than, “To pay my credit card bill”, “To make rent”, or “To get my car fixed”.  Sure those things are necessary, but those reasons will make you work and save just enough.  If you want big financial success, start by having a big dream and a clear and defined “why”.

What’s your why?  It’s got to be something you want badly.  Something that will keep you going beyond your regular 9 to 5 and inspire you to seek greater financial gain.  Something that will make you save before you spend.  Something that will motivate you to get educated on investments so you can stop sitting on your cash and start watching it grow.

Really brainstorm and get specific.  Use all five senses to experience your why. Right now I see ocean and palm trees, I feel the sand between my toes, I hear the waves crashing on the shore, I taste the salty air, and I smell the warm ocean breeze.  Yes, in reality I’m sitting in economy on a ten hour flight, but this meditation on my dream lifestyle is what’s got me on my laptop blogging rather than plugging into another in flight movie.  The more tangible it is, the more I’m reminded of it, the more I seek to achieve it.

WHAT DO YOU HAVE TO OFFER?

As I sit here at my parents house for the weekend, unemployed and enjoying the benefit of their hardwork for the past forty years I contemplate what I have to offer.  What can I do, make, or provide that has monetary value?  In these times of financial uncertainty it can’t hurt to have more than one income stream.  Even if I were working full time, I’d gladly take an extra couple hundred bucks a month.

            So here it is; A list I’ve compiled for anyone looking to boost or create an income in some conventional and maybe some unconventional ways.

1.    Sublet a room.

For those already living in an apartment the size of a closet this may not be an option, but for those who have a spare bedroom and are looking to generate some extra cash, rent is awesome when you’re on the receiving end.  If you’re not crazy about having an extra person in your living equation at all times, list your space on airbnb.com or roomorama.com and set availbility  as you chose.

      If you are one of those NYC closet dwellers and you’re headed to the country for the week or weekend, you can list your space for $50/day and make some fast cash while you’re gone.  It’s cheaper than a hotel for your visitors and you get a quick income boost for that small effort. Everybody wins.

2.    Sell your crap.

How many clothes do you have that you’ve barely worn?  Did you just move in with someone and find you now have doubles of everything?  Do you have stacks and stacks of books you’ve already read lying around your house?  Before sending it all to the trash see if you can sell it.  If it’s in great condition list it on ebay, craigslist, amazon, even facebook.  Set up a garage sale.  Anything you can’t sell, donate and enjoy a small tax deduction.

3.    Babysit

If you have nothing to do for the weekend, keep your eye out for babysitting gigs.  Babysitters in metropolitan areas make an average of $15-$20/hour.  In other word four hours of reading The Hunger Games while little Johnny sleeps can get you sixty bucks.  Check out sittercity.com for jobs in your area- they also list tutoring and housekeeping gigs.

4.    Make your hobbies work for you.

If you love photography, try selling your images on stock photo sites.  If you love shopping, sign up to by a mystery shopper.  If you love crafts, sell your work or take custom orders (etsy.com). Best of all, since it’s already your hobby, you’ll love what you’re doing.

5.    Register for focus groups.

If you fit the criteria, you can make anywhere from $50-$100 in an hour or two, just for offering your opinion.  To find focus groups for which you may qualify, check out findfocusgroups.com

6.    Sell your hair.

Definitely not the most convetional way of earning extra income but it’s too easy and profitable not to list.  Your hair can get you anywhere from $300 to $900 on sites like hairwork.com.  On that note you can also sell your sperm or eggs for a pretty penny, but there’s a lot more to consider when selling your “reproductables”.

7.    Use the Internet.

There are a multitude of sites that allow you to list your services for the world to purchase.  Here are a few that you may not be familiar with.

-       Fiverr.com:  Fill in the blank.  I will _______ for $5.  Then list your service.  People list everything from video editing to dancing around in spandex while singing happy birthday.

-       Gigbucks.com: Similar concept to Fiverr, but gigs can range from $5-$100.

-       Vayable.com:  Offer your expertise or an insider’s guide to your hometown.  You can list anything from guiding a hike through the Catskills to bar hopping through your favorite spots in the east village.

-       Taskarmy.com: List your service and set your price.

These are just suggestions.  Take a moment to brainstorm.  What do you have to offer?  What service, skill, or thing do you have that you can trade for money?  You may stumble upon something that you really love doing, and you’ll be getting paid.  Just remember not to blow all that extra money on more crap that you’ll eventually have to sell ;)

“When you know better you do better” – Maya Angelou

I own a few shares of Whole Foods (WFM), which took a bit of a plunge this week after being up since I bought them back in March.  Trying to understand the price dip I decided to read some recent articles on the company’s projected performance.  About two sentences in, I felt like I was reading another language.  And to be fair, I was.  In the world of finance and investments there is an entirely separate set of vocabulary.   Unfortunately, my 13 years in the public school system did little, or rather, nothing to prepare me when it comes to banking and investments.  So it’s up to me to fill in those gaps.

             After reading some preliminary materials (Suzie Orman, Investing for Dummies, etc) I feel I have a bit of a foundation and certainly an awareness of my finances and financial goals.  But where do I go from there?  It’s like I’m building my own curriculum without any guidance or expertise.

            Fortunately, the Internet offers a wealth of information on anything and everything.  And while I’m not sure how to approach it all and put it into practice without being completely overwhelmed, I’m eager to delve into it.  Education is essential. When it comes to finance, it’s up to the individual to lay the foundation and build from there.  You can’t do algebra if you don’t know basic arithmetic.  Similarly, your money won’t work for you if you don’t understand the basic vocabulary.

            So I’ve been searching for a curriculum.  A program that will take me through financial concepts, basic and advanced, in plain English.  Fortunately, I was just introduced to one called Khan Academy.  Khan Academy is a free website that covers a range of topics in a youTube lecture format.  They have an entire section devoted to Finance and Economics that covers everything from basic banking to venture capital to the implications of the financial crisis.  The videos average around ten minutes.  With one of those videos a day, I can quickly establish an understanding of an otherwise perplexing language of finance and investments. 

The more I learn and understand how it all works, the better chances I have of making my money work for me.  It’s about working smarter rather than harder.  By constantly learning, expanding the vocabulary, mastering the concepts, reading the current literature in the form of the Wall Street Journal or other financial publications, I’m setting myself up for success. It’s like approaching any kind of work.  If you want to excel, you need to educate.

Unfortunately, I think a lot of people forego the self education and throw their paychecks into a low yielding checking account and buy houses with mortgages they can’t afford and throw money away leasing cars because they don’t know any better.  Handling money is possibly the most practical and necessary skill to be taught and it’s completely passed over in the educational system. But if we take on the responsibility to educate ourselves, we can not only avoid financial pitfalls, but prosper both intellectually and fiscally.

Start now.  www.khanacademy.org   

YOUR money YOUR responsibility.

Double check EVERYTHING!

The amount of mistakes made on everything from paychecks to credit scores is astounding.  No one has better intentions for your money than you.  The retailers and government can only gain from a mistake and if you don’t care enough to check and rectify it, you’re the one who loses.

In the past six months I’ve had at least five errors on my credit card.  Not only that, but after calling the companies that overcharged me I had to follow up again with at least two of them to get the errors fixed.  It happens all the time on purchases of all sizes.  I once made a $1,000 purchase on my credit card and was accidentally charged twice.  Can you imagine losing $1,000 just because you didn’t double check your credit card statement.  You may be thinking, well I’d notce a $1,000 difference.  But you may not notice $5 or $10 and those can add up fast costing you hundreds.  More importantly, if there’s a $10 charge on your card that you didn’t authorize, by noticing it right away you may save yourself thousands in fraudulent charges by calling your card company immediately and reporting it. 

Check your account statements everyday.  With online access it’s so simple.  It’s part of my daily routine.  Gmail and Facebook… then Chase then Charles Schwab..  Not only do you ensure everything is in order, but you get a snapshot of your spending when it’s all on the screen in front of you.  I’m a spreadsheet kind of gal so I crossreference my spreadsheet with my statements and make sure all charges are accounted for.

The mistakes are not limited to retailers and credit card companies.  Double check your pay check or pay stubs each week.  Make sure all the hours including overtime have been accounted for, and speak up if something is wrong.  Again, it’s only you who can lose.  I recently had an incident with my employer.  I had $50 each week deducted from my paycheck  to pay off my union membership initiation fee.  The day I paid off my membership I contacted both the union and my employer to make sure that $50 would stop being deducted.  Low and behold, the next week the $50 was deducted despite taking every precaution.  Don’t assume anything is or will be taken care of – even if you’ve covered all of your bases.  Your paycheck is just one of a hundred or thousand to your employer, but to you it’s your livelihood.  If you want it all , it’s up to you to keep track of it.

Finally, be sure to check up on all three of your credit reports once a year.  In a 2009 study by the National Association of State Public Interest Research Groups they found that 79 percent of all credit reports contained some type of error- and 25 percent contained errors serious enough that individuals were denied credit.  Your credit reports affect the interest rates on your loans and credit cards, what you pay for insurance, even  your potential for future employment.  In other words, a mistake unchecked can cost you thousands.  Here’s a link to the Federal Trade Commission which explains how to check each score for free once a year and report any errors.

 http://www.ftc.gov/bcp/edu/pubs/consumer/credit/cre34.shtm

You are the greatest beneficiary of your money.  Be responsible with it and for it.