Consumer Spending

This is not surprising, consumer spending is down.

http://seattlepi.nwsource.com/business/1311ap_economy.html

There is a great book called 'Smart Couples Finish Rich" by David Bach (http://www.finishrich.com/books/couples_brandhome.php ) that talks about not feeling quilty about spending money but you should at least think ahead about your discretionary spending. Good advice for sure. If you want to go golfing each week and spend the money on it, go for it, as long as it is important to you. But, if you buy coffee each morning and it is just a lazy habit, you might have to drop the coffee to keep golfing.

With spending down, hopefully people remember that they should still spend some cash on themselves if they can, just maybe think it through a bit...

Devin

Concierge Bill Pay

What is Concierge Bill Pay? We get this a lot from people calling in and new wealth management partners. To us, Concierge Bill Pay is simply daily money management. It is also personal bookkeeping. It can also be family office services, or maybe personal cfo services. Lost yet? If you are looking for someone to manage your personal daily finances for you then you better learn these many different names. That is why PPS came up with Concierge Bill Pay. Concierge because we are doing them for the client on their behalf and bill pay because paying your bills is the cornerstone of daily finances.

Like any standard business, the average individual has accounts receivable (A/R - or your income, paycheck, etc.), accounts payable (A/P - these are your bills, debts, etc) and then you should have a profit and loss report (P/L - where your income was spent each month). Any of the terms we used above focus on these three things for you personally as well as the overall management that goes into getting them done.

At PPS, we believe that services such as Concierge Bill Pay will continue to become more prominent and more people will seek some level of assistance with one of the the core areas of their daily finances. If you have a good handle on paying bills but don't have a clue where your money goes, then Concierge Bill Pay is a good fit. If you have 3 homes around the country and 50 bills to pay each month, Concierge Bill Pay is a good fit. If your income is coming from different areas and is somewhat sporadic and you need assistance managing the process, Concierge Bill Pay is a good fit. Overall, Concierge Bill Pay is anything that we can do to help you better manage your daily finances.

Thanks for letting me define the difference!

Devin

Daily Money Management for seniors

As the American population ages, more and more families are struggling to find solutions to who manages the massive wealth held by the greatest generation. This can cause strife in many families and in others can leave seniors on their own. I come from a large extended family with a seemingly endless line of cousins. In our family, it does not seem to be a question of who is going to help a family member out, but how many will join in. But that does not mean we are qualified for the job when we volunteer!

http://www.fdic.gov/consumers/consumer/news/cnfall05/professionalsPG9.html

Deciding who will manage your parents money is a difficult decision for many families and one where you should definitely stop and ask yourself, am I qualified.... Here is a great link from the FDIC from a few years about with links to tips and thoughts on hiring a daily money manager like PPS as well as what is at stake in having a family member manage your finances. Be sure to stop and think about how this will affect the family dynamic, is the person managing the finances qualified, willing and able to do the task and what does the senior really need.

Devin

Inflation Rate

Lucky us, we had the highest inflation last year here in Seattle.

http://seattlepi.nwsource.com/local/352078_economy21.html

It was bound to hit sometime and it seems to have hit in all the places you would expect. Groceries, gas, etc. Another reason to watch our spending more closely!

Devin

Credit Card Interest Rates II

Here is another great article on current rate changes. It sounds like this is not affecting as many people as was originally reported. This is just a great reminder that if you can avoid using credit, it is a wise decision. You cant really control the rates you pay.

http://seattletimes.nwsource.com/html/businesstechnology/2004188899_cardrates19.html

uTANGO

My sister-in-law was recently married and moved into a new house with her husband. The costs of getting started in life can be very high, expecially if you feel the need to outfit your home with the latest and greatest. I suggested they sign up for a new web retail startup called uTANGO. uTANGO is a company here in Seattle that I am familiar with (Our CEO and their CEO know one another) that encourages newlyweds to purchase products through their site and in return, the couple earns cash back for staying married.

Interesting twist in a lot of ways! Anyway, if you qualify for it, it is a great way to earn some cash and stregthen your marriage. Arguing over finances is a prime reason for divorce in many cases, maybe a little monetary encouragement will help lower that. If nothing else, bribe people!

http://www.utango.com/

Home Concierge

Here is a great service PPS is starting to work with called Home Concierge (http://www.bcbhomeconcierge.com/index.aspx ) . In their own words:

"Home Concierge is a web service designed to help multiple-home owners list, plan, and organize their lives in multiple locations."

Home Concierge uses an online dashboard to allow you to manage your household by storing important documents, contacts, manuals, calendar information, etc. For those with a second home, it is a great tool for keeping organized and staying on top of things. I am a big fan of services that have created an easy to use technology solution to help people keep more organized. Vacation homes specifically are a funny thing, at Premier Payment Services, we find that people buy a second home with the intent of simply having their own vacation destination and then grow overwhelmed at the maintenance and upkeep required as well as the cost and daily money management required to keep the place running. $150 a year is what they charge, and in my opinion, for a second home to help keep things straight, that is a great deal.

Billeo - Simpler Payment Methods

I learned about a startup in the payments industry lately called Billeo (www.billeo.com) . Billeo has a great directory of around 8000 vendors and their online portals where you can make payments with your credit or debit card. From our experience, the database alone is a great value since many vendors don't make it easy on the client to make online payments or if they do, the website can be hard to navigate, Billeo takes you straight to the right spot.

This is the kind of tool that we very much like at PPS because it is a straight forward tool and fits well in the management of your daily finances. Billeo is a great timesaver and acts as your guide in making these payments as well as remembering what you set up. This is one tool we recommend.

Devin

Credit Card Interest Rates

Even with the recent slashing of rates by the fed, many credit card companies are increasing or at least maintaining the rates they charge clients on a monthly basis. This astounded me becuase the reason the fed cuts the rate is to encourage lower rates for the consumer by lenders. Due to the market conditions apperently and an increased attention to client credit ratings, lenders are not lowering rates as they normally do. Here is a great article on the issue from Monday:

http://www.washingtonpost.com/wp-dyn/content/article/2008/02/10/AR2008021002537.html

Credit cards are one of the monthly bills that here at PPS we pay first before most other things, in order to make sure clients are not getting hit with higher interest or late fees. We have also found ourselves more and more offering clients monthly reports on the status of their cards, focusing on APR, minimum payments, outstanding balance and general terms and conditions. Many of our clients simply do not have the time to review this data.

This is an area of your daily finances that requires close attention and management, news like this only reinforces that.

Devin

Addicted to Debt

An update on our financial makeover:

I saw an article in my local paper yesterday that talked about Americans being addicted to debt. PPS has partners in the debt elimination industry which develops plans for more rapid and strategic debt reduction without credit counseling. These are great services and ones that I think more people should consider.

Fighting debt does take a change in midset that you are going to stop competing with friends and neighbors for who has the cooler plasma TV. One of the best strategies for paying off debt is to spend less than you make and dont take on any new debt.

My wife's grandparents are in there 80s. They live in Toronto in a house that they built in 1946 for $5500. The paid off the house decades ago and the thought never crossed their minds to buy up, or to use the equity for anything. Current generations seem quite the opposite. Not that buying up or using equity is a bad decision (I have done both) however it is their restraint in life and prioritaztion of values that impresses me. As part of our current financial makeover plans, we are trying to be happier with what we have. It is important to remember that we live in the wealthiest country on the planet and the majority of us have been blessed with quite a nice life. Many people I know have nicer things than I do or seem to have more disposable income than I do, but that doesn't mean they have the ideal financial situation. I need to focus on mine, not theirs.

This is the first step of our financial makeover, find joy in the things we already have and don't add more debt to the situation.

Natalie Jean Arrives!

On Christmas eve, my wife and I welcomed our first child, Natalie Jean Miller! She was born healthy and happy and so far has a big personality and a never ending appetite.

I wrote earlier about preparing for parenthood and the impact it has on families. This fact hit home particularly hard the other weekend when during a football party, I went with a friend to the store, he bought a case of beer and I bought a case of diapers. My purchase was more expensive. Even more unfortunate was that this was a bi-weekly trip for me, I am not sure about my friend.

Diapers were only the first part, after subsequent trips to Babies 'R Us, we had spent enough money to clothe and carry an entire village of kids. This was our reality check. Kids are expensive thats for sure. This link below from the University of Minnesota tells me little Natalie is going to cost me about $750 per month. A quick approximation based on their numbers tell me she is going to cost $209,139 (current value) through the age of 18. Yikes...

And to think, my wife wants more kids....

One smile from Natalie and it is all worth it. Maybe we just need to expand our monthly baby budget!

http://www.extension.umn.edu/distribution/businessmanagement/DF5899.html

My Personal Finance Makeover

Happy New Year! I know, I am a bit slow but as you know, time flies. With each new year my wife and I write out our goals for the coming year. Our favorite part is going through the previous goals and seeing how we did. If this were a college course, we would get an F each time. The good news is, this is just life and the score is much more subjective.

Each time we go through the excercise of reviewing last years goals and then writing ones for the upcoming year, we include a section for financial goals. This year, we are going to try something new. Instead of stating the same old goals and only doing half of them, we are going to give our finances a makeover.

We aren't doing a new long term plan or changing financial advisors, lets say we plan on changing our accounting procedures. Like any good business, your personal finances need a good accounting division. If you aren't good at accounting then don't worry, there are plenty of tools available. Quicken, Microsoft Money, mint.com, billeo.com, online banking, and so on and so on. These can provide you with a great system for managing an aspect of your finances.

Already tried these? Didn't work or you are still struggling? Don't worry, you are not alone. Most people are in the same boat. What they are really missing is a good financial management system. At PPS, we provide our clients with this management system by managing their finances for them. What we are finding though is that almost everyone could use a daily financial makeover to give themselves a jumpstart. This means taking the time to get set up on one of those great tools available above or by creating one for yourself using Excel or just a new filing system. The important part is building something you can stick with, is easy to manage, fits your lifestyle and gives you the information you need. At PPS, we like to think that we give many of our clients that jumpstart or help them develop a system they can stick with.

I will try and write again about how our makeover is coming and give some tips as we learn along the way. Hopefully as a result, we will have a better understanding of our finances, see where we can improve, find problems as they come up and prevent them before they occur. In the end, hopefully we can create a better long term financial picture for ourselves by starting with today!