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With the cost of college growing ever more expensive, more and more people are choosing to forego a degree and all of the debt that comes with it. I’ll explain why I didn’t go to college and if I have any regrets over my decision. For a lot of people, college is the natural next step after high school.  Our parents tell us to go; our teachers encourage us to go, all of our friends are going.  Once upon a time, there was no question that college was the path to riches.  But things have changed so does college still make sense? From an economic standpoint, the numbers are still in favor of obtaining a college degree.  People with a bachelor’s degree will earn 84% more over a lifetime than a high school graduate.  A degree will also open more doors.  Some companies will not even look at the resume of someone without a degree, no matter how much experience they may have.  It’s not fair, but it’s what a lot of companies use to screen the huge volume of resumes they receive.  Which college and the grades you got

What is inflation, what is deflation and what benefits to knowing? We’ll explain the basics and what you need to know to make sure your money keeps pace. Inflation and deflation are terms you hear thrown around a lot but what do they mean and what impact do they have on us? What is Inflation? The value of a dollar is determined by its purchasing power, the number of things or services which that money can buy. When inflation increases, the purchasing power or our dollar decreases. In the US, our rate of inflation is 3% a year on average. That means the newspaper that costs $1 now will cost $1.03 the following year. Inflation means your dollar doesn’t go as far as it once did. Types of Inflation Demand-Pull Inflation: This is caused when there is an increased demand for something which drives up the price. When demand grows faster than supply, the price goes up. Cost-Push Inflation:If the cost to produce a good increase, a company increases the price to maintain their profit margin. Monetary Inflation:

We all fail and we’re all afraid to fail.  Today we’ll discuss why failure is not always the end of the road and may even be the beginning of a new path. No one likes to fail but if that fear is stopping you from trying, it can hold you back in every walk-off life from investing to dating.  Every failure should be mined for lessons.  What could you do differently the next time you try?  Maybe the endeavor you failed it should be scrapped entirely.  There is a difference between quitting and failing. If you start a babysitting business and your town is mostly comprised of retired people, quitting as soon as you realize that is not so much a failure but a reassessment of your situation.  Maybe you decide to start an in-home companion business and now you’re making money. When it comes to investing a lot of people are fearful and not well informed.  Because of this you listen to an “expert” when deciding what to buy without doing any research yourself.  Well, experts get it wrong too and if you lose money, yo

How do you stop yourself from burning through all your hard earned money like a drunken sailor on shore leave?  Today we discuss a few mind hacks that can help curb your baser monetary urges. The easiest way to not spend money is to stay home.  No siren song of the bar, no annoying co-workers forcing Girl Scout cookies on you against your will or asking you to sponsor their self-congratulatory charity walk.  Staying inside like Howard Hughes is not really an option for most of us but you probably encounter at least one invitation a week you could say no to. You spend forty hours a week or more with co-workers.  Do you really want to spend more time and your money with them at happy hour?  Turn down those invites that you really aren’t that interested in. It’s hard to say no to spending money unless you have a reason.  Maybe it’s “eff you”  money.  The money that allows you to tell your idiot boss to go to hell when he or she asks you to work the weekend one too many times. Maybe it’s a vacation or the abil

Travis Pizel from Enemy of Debt tells us how he and his wife accumulated $109,000 of credit card debt through lack of communication and how they paid off the debt and strengthened their relationship in the process. HOW does a couple accumulate that much debt?  Buying Faberge Eggs, eating panda steaks marinated in unicorn tears?  The answer is pretty mundane.  Never budgeting, never tracking spending, vacations, dinners out, and perhaps the biggest problem, never discussing money. Travis and his wife both had good jobs and always figured the next pay raise would put them in a position of eventually having enough money that they couldn’t possibly spend it all.  But that never happened and eventually Travis began to insulate his wife from how bad it had become.  Opening the bills after everyone had gone to bed, shifting balances to newly opened cards, asking for limit increases on existing cards. The watershed moment came when Travis got five identical letters from a company that he had five different cards w

We’re doing personal finance potpourri today, answering listener’s questions about investing with Betterment, unpaid internships, 401K’s, passive income, and credit scores. 1.  What is Betterment and what’s so great about it?  Betterment is an investment tool that charges a low fee, no transaction charges, and abstracts investing.  LMM’s loves Betterment because it is a great first step to investing.  It’s easy to use and allows you to choose your level of risk with a simple sliding scale. 2.  Are unpaid internships worth it?  Jackie from Personal Finance with Jackie Walters sent this one in.  An internship is valuable even when unpaid.  You gain experience, have something to add to your resume, can cultivate good contacts for the future and sometimes an internship turns into a full time job. 3.  If an employer does not offer matching 401K funds, should you contribute the minimum to participate and the rest into a Roth IRA?  We’ve done a few Roth 401K episodes and Matt paid attention!  Unless you are getti

In this special Father’s Day episode Matt and Andrew interview their dads to find out what mistakes and victories they had with money and what lessons they have for their sons and us listeners. The apples don’t fall far from the trees.  Andrew’s dad has been good with money for a long time.  Andrew’s father didn’t grow up with money and learned important lessons watching his own parent’s struggle.  He wanted to be a musician but soon realized that life was not a secure one.  He got a full time job and went to school at night and his job covered 80% of his tuition expenses.  He eventually received an MBA. When Andrew’s dad was coming up, it was unusual to job hop.  A lot of people of that age would work for the same company for thirty years and retire with a pension.  But his father was never afraid to chase more money and even when not actively seeking a new job, he would still go on interviews to see what might be out there.  He was able to increase his salary much quicker this way than by waiting for a sm

This financial life episodes give us a chance to delve into a listener’s personal finance life and to give them some advice to improve it. Today we have This Financial Life with Connor. Connor is 23, lives in Manhattan, has been working in finance as a commercial underwriter for about a year and is making $70,000 annually before bonus.  He has no debt,  credit card debt or student loan. Connor has some money invested in individual stocks.  He bought GM after the recall fiasco because the price was low.  A smart move as GM might have dipped, but it’s “too big to fail” so not going anywhere anytime soon.  At least until Elon Musk decides otherwise.  He also bought stock in an e-cigarette company because it’s a fast-growing trend.  And WWE (disclaimer:  Connor is not a pro-wrestling fan) after it dropped 43% on news that it did not get enough monthly subscribers to offset lost pay-per-view orders.  So Connor does his research and makes a move when other’s fear to tread.  A favorite LMM trait. Once again provi

When did tipping become such a minefield? Who do you tip, how much, how often? We are going to sort it all out for you. We are giving you just the tips and will tell you how much to tip pizza delivery and everyone else. It seems that everywhere you go, no matter what you do, there is someone you need to tip. And tip well. A decade ago for instance, 10 percent was an acceptable tip — 15 percent if the service was impeccable. Now, anything less than 15 percent is considered inappropriate. For good service, 20 percent is the norm. In more expensive restaurants, patrons are sometimes expected to tip up to 25 percent on the total amount of their bill (taxes included). Sometimes you expect it. If you are out to dinner, you know you are expected to tip the server. But there are a lot of other situations where you might not be so sure. We will explain what you should tip in both kinds of situations. Food Tipping around food probably causes the most consternation for people simply because there are so many scena

We’re talking Roth and traditional IRA’s today with Darin Hayes, author of Beer Money: A Beer Drinker’s Guide to Personal Finance and Investing. Let’s put this in drinking terms.  Taxes are a hangover.  A Roth IRA gets the hangover out of the way before the drinking even commences because the money contributed is taxed before the contribution.  A Traditional IRA let’s you drink first and the hangover comes later because the money is taxed once it’s withdrawn. How should you decide when you want to suffer your hangover?  A very simple way to determine is whether or not you receive a tax refund.  If you get money back, do a Roth.  You likely are in a lower income bracket and don’t need the tax deduction.  A lot of young people with years ahead to work and invest will fall into this category.  If you’re older, making more and in a higher tax bracket, a Traditional IRA will give you that deduction that may drop you into a lower bracket. A Roth IRA also has the advantage of having no penalties for early withdra

For many working Americans, a 401(k) is often the single largest asset they have. Unfortunately, managing a 401(k) can be extremely complicated, resulting in the poor management or complete negligence of this very important savings account. Fortunately for most Americans thought, they have some time to plan. As one of my favorite retirement quotes says, “Hang in there, retirement is only about 30 years away” – My jerk Uncle Dave. This is why Blooom was created. The robo-advisor-based service helps Americans of all income brackets with managing their investments through their employer-sponsored retirement funds, including 401(k), 403(b), 401(a), TSP, and 457 accounts. Blooom aims to make managing a 401(k) simple, easy and accessible — no matter how much money is in your account. In this Blooom review, we’ll cover the ins and outs of the service, along with areas where Blooom stands out and falls short, so you have a better idea of if the service is right for you. What is Blooom? Blooom is an automated o

  We answer your questions about emergency funds, whether should you prioritize debt or investing, and is being frugal the latest hipster trend?  Find out! I have $30,000 in a savings account and am moving it into Betterment as LMM recommends.  How much should I move over monthly until it’s all relocated? The answer will be different for everyone.  Andrew followed up with Dillon and found he was saving $1100 a month.  Andrew advised 2.5 times that amount be put into Betterment.  Once Dillon has $20-30,000 in Betterment, he should stop contributing and consider that his emergency fund.  Then start diversifying into something like Van Guard. I have a Capital One Quicksilver card with 0% APR until January 1, 2015.  Will I be charged interest if I don’t use this card after December 30 if the bill is due on January 12th? Even with a 0% APR card, you have to pay at least the minimum every month, otherwise you get an interest charge on the entire balance. Automate the monthly payment so it won’t slip your mind.

Do you know how much your time is really worth? Today we discuss when to trade money for time and vice versa. There are things we all hate to do, mowing the lawn, painting, cleaning, food shopping.  Or maybe you’re a weirdo who loves those things.  That’s okay. Takes all kinds.  How do you decide if you should do these kinds of things yourself or pay someone to do them for you? Math, that’s how.  The simplest way to get a yes or no answer is to work out how much you make an hour, even if you’re not paid hourly.  You’re worth $20 an hour, it costs $5 a week to have Fresh Direct deliver your groceries.  It would take you two hours to drive to the store, shop for your items, pay, drive them home and bring them inside. Unless you’ve turned food shopping into a speed sport like Matt has and can bang the whole process out in fifteen minutes.  If you hate food shopping, then it makes sense for you to pay for Fresh Direct. But it’s not always just a matter of dollars and cents and time.  Maybe you work from home

Relationships are hard enough as it is without talking about finances. So we’re gonna lay it down about how to handle money in a relationship. You have a better chance of staying married than winning the lottery so that’s good news!  But how can we increase the chances that you’ll stay married when money issues arise? To prenup or not prenup?  Oooh, sticky.  If there is a chance that the man or woman of your dreams is marrying you for your vast wealth or celebrity, a prenup might be the life choice for you.  But if you’re just a regular guy or gal, a prenup is probably not that important. A good solution to avoid money arguments is a joint checking account where each partner contributes a percentage of their income for household expenses. Each partner can also have a private account that they can spend on whatever they like. Open, on-going communication is better than the occasional fight.  This is especially important before moving in together or getting married.  Imagine finding out on your honeymoon th

 Listener Daniel Murrell to analyze his financial situation.  He shares a great strategy for making college affordable. Daniel is twenty three, lives in Southern California, works and goes to school.  And he has a smooooth voice.  Daniel works in overnight freight for Home Depot.  Daniel shares an apartment with his brother.  His portion of the rent is $475 a month and the utilities are $65 a month.  Daniel makes about $1300 a month, paid bi-weekly.  He’s able to use one check for living expenses. He drives a motor cycle to work rain or shine.  Daniel’s transportation situation is one of the things working for him and working against him. He rides his motorcycle to work rain or shine.  Daniel bought the bike used, spends $13 for gas a week and pays $140 a year for insurance.  However, Daniel bought a car with a personal loan a few years ago.  The car is long gone, traded in for the awesome bike but he’s stuck with the payment.  The balance on the loan is about $3500. Daniel is investing monthly in Betterme

There is no doubt about it, being broke sucks. But that isn’t to say you can’t learn valuable lessons from being broke. These are the most important lessons I learned from being broke. * Credit cards are a good thing when used correctly.  You can earn cash back, free flights, and free hotel stays, win! * Debt is the devil.  It is the devil waiting to poke you with its pointy pitchfork.  No one likes that. * Banks are the devil too.  Fees, fines, charges, crap interest.  The banks are the devil with two pointy pitchforks. * Mint is mint.  We have a lot of love for Mint at LMM.  For a lot of us, it was our first step in taking control of our finances. * Investing is what makes people rich. Starting your own business is one path to riches, but  not everyone can or wants to start their own business.  But all of us can and should be investing.  Always be investing. * I don’t need everything.  Neither do you.  Stop buying shit! * Staying home is ok.  Invite friends over to cook a meal, watch the game, play

Andrew and Matt calculate the absolute minimum they could each live on.  We hope it will inspire you to cut some of the frills out of your spending. If you cut your expenses to the bone, how much could you live on?  And what does “live on” mean?  Would you be willing to eat ramen for every meal or would you still need a weekly Whole Foods run?  Is it realistic to get rid of your car? We pad our expenses with a lot of unnecessary fluff.  If you lost your job or if you decided to quit your job, you would get by on a lot less than you are spending now.  As a hypothetical, list out your expenses, or check your Mint account and decide what you could cut but still maintain a good quality of life and be happy. Now see what you could cut to live like a recluse, never going out, eating only two meals a day, no alcohol, no public transport. Of course you could try one of these approaches for a month and see how you do but it’s really just an exercise.  It can be reassuring to know that if you had to live on $1500 a

We get lots of questions about student loans so we decided to bring on an expert to help.  Heather Jarvis joins us to answer of your pressing questions. Heather graduated from Duke Law School with $125,000 in student loans.  She wanted to use her degree to help poor people so it wasn’t going to be a big salary helping her pay that back. Heather has worked on the government’s student debt relief programs but admits they are complicated and tricky to access. Heather’s site is designed to make things easier for those who already have student loan debt. We asked Heather to explain some of the programs to help deal with student loan debt. 1. Income-Based Repayment Plans This is an income-based repayment for federal student loans. You do need to show financial hardship in order to get it. Which shouldn’t be too hard as student loans are a financial hardship. Your monthly payment will be based on the income reported on your tax return and compared to the national poverty rate. 2. Public Service Loan Forgivenes

We share stories about how we found awesome jobs in the past and new ways you can go about getting the job of your dreams on this episode. If you want to walk the path of financial success (following our Wealth Wheel, of course), then you need to begin with income. You can’t get out of debt, budget or invest without money. But money isn’t everything. You also want a job that you enjoy or at least don’t feels miserable going to every day. What Kind of Job? Before you start scouring the want ads (no one does that anymore),you should ask yourself a few questions to determine what kind of job you want. Do You Hate Dealing With People? Whether it’s because you are an introvert or you just have little patience for the stupidity of the average person, if you hate dealing with people, find a job that limits contact with them. Become an economist, a software developer, or an accountant and you will have a blissfully people-free career. How Much Do You Want to Work? Some careers provide more work-life balance t

Interested in purchasing individual stocks? Listener Patrick Kenneally teaches us how to research stocks. Patrick had his first taste of investing while in college where he was part of Huntington 360, the student-run group that invested a portion of the school’s endowment in mutual funds. There are some tools that Patrick recommends, the first is an SEC site that will give you any publicly traded company’s quarterly filings.  The next is from Business Week which provides financial statements as well as ratio calculations. Aside from hard numbers, it’s also important to consider emotions that could be inflating or deflating a stock price.  Several months ago a Tesla car caught fire and affected the stock price.  Conventional cars catch fire too but as Teslas are new, this was suddenly considered a safety issue specific to them. Another important consideration when buying single stocks is your familiarity with the company’s products.  If you are researching something you have no knowledge of, you won’t unde