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Statistics Support That We Are a House Poor Nation

By Erik Folgate

USA Today has an article about homeowners who are paying more than 30% and more than 50% of their household income towards their mortgage. Here are the statistics from the Joint Center of Housing Studies at Harvard University.

Homeowners with mortgages spending at least 30% of income on housing:

  • 2000: 27%
  • 2005: 35%
  • 2007: 37%

Homeowners with mortgages spending at least 50% of income on housing:

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  • 2000: 10%
  • 2005: 13%
  • 2007: 14%

Financial Lessons to Learn In The Post 9/11 Era

By Erik Folgate

Before I begin the topic of this post, I just want to recognize all of the men and women that lost their lives six years ago today, whether they were in one of the airplanes, in the twin towers, or trying to rescue survivors. Your lives were taken by a bunch of cowards, and for that reason, we’ll always remember you.

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Choose the Debt Elimination Method That is Right For You

By Erik Folgate

I am a strong believer that eliminating your debt is the first step to becoming wealthy. Once you are debt free, there is nothing holding you back from saving a higher percentage of your income. Think about how much of your household income goes to credit card payments, car payments, and other miscellaneous debts. I’ll venture to say that it’s at least 20% of your take home pay. Saving an extra 20% of your income over 30 to 40 years will ALWAYS make you a millionaire, even if you make $35K for the rest of your life. There are three popular ways of methodically paying off your debt. I don’t want to tell you which one that I think you should do, because I think it has much to do with what kind of person you are. Here are the three methods for eliminating your debt.

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Dave Ramsey Talks About Socialism and Eminant Domain In America

By Erik Folgate

This is not a political blog, but the issues that Ramsey talks about on this video are definitely political issues. My challenge is for you to research the presidential candidates before you vote in a year. Make sure that you choose a candidate that not only agrees with your foreign policy and selsocial views, but also your financial views. The idea of socialism, at its core, does not work and it only benefits the less hard working individuals in society. The idea of working hard to make something for yourself is why this country’s economy has thrived over the past 200 plus years. That’s not to say that the mentally ill and physically disabled should be left to fend for themselves, but there are plenty of other socialized systems in place that drain the congressional budget every year.

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Reader Question: Should I Pay Off My Car or Trade It In and Lease Another Car?

By Erik Folgate

Here is a question submitted to me from one of our readers. He is having trouble with being upside down on a car loan. He makes $42,000 a year household income. I will post the question answer it based on what I would do if I were in his shoes.

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Do Something For Free On The Holiday Weekend

By Erik Folgate

As you all know, entertainment can be a very rough on your bank account if you aren’t budgeting out money specifically for it. We’ve become a very lazy culture, and we’ll pay quite a bit of money to be entertained. The fact is that you can have a great amount of fun with your family or friends without spending much money. Here are four things you can do that will not kill your wallet:

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Choosing The Right Mutual Funds For Your 401k and 403b

By Erik Folgate

Adjusting to your first “real” job can be a daunting task. First of all, you have to get into the routine of getting up early every day and being ON TIME every day. Then, you have the task of relating to your co-workers and boss. Then, you have the human resources meeting about your benefits package. If your brain isn’t scrambled after all of that information, then you are a much better person than me when it comes to processing information.

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Small Business: Do You Have a Blog?

By Erik Folgate

If you’re currently running a small business or a home-based business, but you are not writing or managing a blog for your business, there is a problem. Blogs are probably the easiest self-publishing tool to create on the internet. If you already have a website for your smalll business, then you’re already paying for a domain name and a web hosting package to house the domain and its content.

How to Set it Up:

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Protect Yourself From Identity Theft – Use Your Debit Card

By Erik Folgate

You’re in line to pay for some gas at the local gas station, and the cashier asks you, “Will this be debit or credit”. You’re saying to yourself, “I’m paying with a Visa debit card, does it really matter?”. The answer is YES. It does really matter what you choose when they ask you for debit or credit. There are two reasons why you need to make sure to choose debit if you are using your debit card to pay for a purchase.

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The Psychology Behind Why People Don’t Like Personal Finance

By Erik Folgate

If you are a frequent reader of this site, then you know that I am a big believer that behavior has much to do with having success with your financial future. My goal is to help you understand personal financial issues along with helping you identify the behavioral problems that hinder you from becoming wealthy. I identified my behavioral problems in college. I had no concept of what it meant to carry a balance on a credit card and I was horrible about saving money and looking for bargains. You can spit out every financial equation and explain how the stock market works, but that won’t make you wealthy. What will make you wealthy is focusing on the psychological aspect of changing the way you handle money. Saving first, demanding a better deal when you buy something, and always preparing a monthly budget are behavioral habits that will help you become wealthy.

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Choosing an ETF versus an Index Fund For Your Long Term Investments

By Erik Folgate

The ETF (Exchange Traded Fund): The ETF seems like it was created for those active traders that like the way mutual funds perform, but they hated the way they traded.

Liquidity: The ETF is very liquid. It trades like a regular, single stock. Whereas, a mutual fund can only be traded once a day. If you sell a mutual fund, you get the price that it ends in at the end of the day. Active traders that trade on a margin or short sell like the ETF and the way its liquidity.

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Understanding the Move That The Fed Made Last Week

By Erik Folgate

If you’re still confused about what the Fed did last week to supposedly “buy the economy some time” from going into a recession, then check out this article from Kiplinger’s Online. Kiplinger’s does a good job of answering the most frequently asked questions that may be on your mind about what the Fed actually did by cutting the discount rate and what it means to the economy and to us.

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Get Green Friendly by Viewing and Paying Bills Online

By Erik Folgate

Sanda Block, a personal finance columnist for USA Today, wrote this article about the environmental advantages of viewing and paying your bills online. There are many environmentally friendly things you can do such as recycling, using less utilities energy, and carpooling to work. Some changes are more sacrificial than others, but this one is effortless. Many large companies are now giving you the option to receive your monthly statements and bills online. Once the monthly statement is ready, you’ll receive an email in your inbox stating that your monthly statement is ready to view. Block’s column talks about how many people pay their bills online, but they still receive a hard copy of their statement in the mail. If you are one of those people that keeps every document that is sent to you, you can still save a copy of it on your hard drive. If you’re paranoid about saving important documentation on your computer, than you can print a copy of it, and you’ll still be helping out the environment by saving on fuel costs. It was one less thing for the post office to deliver.

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Democrats Weigh In On Solutions to Cleaning Up Mortgage Industry

By Erik Folgate

The Democrats are now diving into the discussion about cleaning up the mortgage industry and subprime lending. I’ve written quite a bit about the importance of avoiding the curse of being house poor. The rising foreclosure rate is due to two major factors. Mortgage lenders are loosely regulated and consumers made uneducated, selfish financial decisions. So now it’s the democrats to the rescue! I read the article from CNN Money, and i was a little surprised to see that I actually liked some of their ideas. I am definitely about capitalism, but financial agents need to have a fiduciary duty to their customers. It should not matter if it’s an insurance agent, mortgage lender, or stock broker. Christopher Dodd proposed these ideas to help regulate the subprime industry:

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Techniques to Avoid Foreclosure On Your House

By Erik Folgate

You’ve seen all of the articles and news segments about the skyrocketing percentage of homes going into foreclosure around the country. It’s not hard to figure out why the foreclosure rate has risen so drastically. Mortgage lenders took advantage of buyers, and buyers threw away all logic and reasoning when figuring out how much house they could afford. However, looking back at the past will not get us anywhere. The damage is done and now this country needs to clean up the housing market mess. Ask someone who has gone through a foreclosure how much fun it was. They will most likely tell you that it was an extremely emotionally draining time period in their life. Losing your home is a nightmare come true. However, there are ways to avoid the full foreclosure process. Here are two options to consider if you’ve found yourself in a position where you can’t pay your mortgage payment.

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