Tips On How To Save Money Booking Flights

So you want to travel without reducing down your net worth to zero. Worry not, I’ve got some good tips to help you see some beautiful cities around the world without having to go bust. Let’s take a look into the details:

  1. Clean Your History: Before searching for flights, delete your browser history and go into incognito mode. This doesn’t ensure cheaper flights, but is definitely a best practice. Sometimes sites can catch on to repetitive searches and boost your price.
  2. Sign up for AirFareWatchDog
    • Set price alerts from one city to another so you can get automated emails
    • Get a list of the cheapest flights from your city to global destinations
    • Look at a compilation of the cheapest 50 random destinations
  3. Sign up for The Flight Deal
    • Check out the cheapest flight to random destinations from your city
  4. Use ITA Matrix as a planning guideline to find the cheapest days to travel on (you won’t be able to purchase from here though)
  5. Use Google Flights to show you prices of destinations for certain dates around the world, all conveniently plotted on a map. Also track flights to your destination and get notifications.
  6. Book Off Season And In Advance:This is probably the most important advice. I can’t tell you how many insane deals I have booked by traveling off peak. For example, don’t visit England in July, go during Fall/Winter to get massive discounts. Europe can be more than 50% off September to May. Making your reservations late can cost you a lot of money, so don’t blow your savings because of your procrastination!
  7. Search One Leg At A Time: Don’t book multi city vacations all in one shot. Break down the legs to get the cheapest flights. It’s a tedious way to go about air fare hacking, but a great way to save.
  8. Get Your Timings Right: Don’t try to depart or arrive on a Fri, Sat, Sun or Mon as they are usually more expensive. Also, early morning flights and late night flights will be the cheapest.
  9. 24 Hour Rule: You have 24 hours to cancel your ticket after purchase. So if you find an awesome deal, grab it. You can always get a refund if you find something even cheaper.
  10. Try Other Airports: This is going to be inconvenient but you can travel to smaller airports that are further from the main city. A major city may have nearby airports outside the main city. They are usually cheaper. Run multiple searches to do comparisons. Always check how far your airport is on the map and if there is easy public transport.

The Starbucks Latte Fallacy And A Better Way To Save A Lot Of Money

Here’s the bottom line: You can cut back on all the Starbucks Latte’s you want, but the savings will be a drop in the bucket when compared to what you can save if you have a solid credit score.

You guys probably remember from a few weeks back when I posted an article on why your savings account was getting decimated. You probably also remember that I listed a bunch of things that people like you and I waste money on. One of those things was a Latte. If you drank one Latte every other day it would cost you $684 at the end of the year.

So now you’ve put $684 precious bucks back into your savings account. Optimistic, you cut back on eating out in restaurants, entertainment and drinks and at the end of the year you’ve put back a few thousand dollars into your savings account.  

Now prepare to get mindblown…

All of the savings that you made by cutting back on unnecessary expenses is at best peanuts when compared to what a good credit score can do for you. Yes, that’s right, that 3 digit number can literally put back tens of thousands of beautiful dollars back into your savings account over the duration of a loan. Take a look at this super important table which shows your mortgage payment based on your FICO score:

 

Credit Scores Have Tremendous Impacts On Mortgage Payments

 

Let’s say you want to buy a really really cheap house in California, so you borrow $400k on a 30 year fixed rate mortgage. If you had a stellar credit score your monthly mortgage would be $1,801 every month. At the end of the 30 years you would have paid $248,314 in interest.

Now assume that you never tried building up a good credit score and you decide to get the exact same mortgage as above. This time your monthly mortgage will be $2,174 every month and at the end of the 30 year loan you would be out of $382,644 in interest. Having a stellar credit score just saved you an insane $134,330. Try figuring out how many Latte’s that buys you.

Home loans, car loans, and credit card loans are all charging you interest based on your credit score. You are either bleeding out a lot of money through these loans or saving a ton of money So forget the fallacy of saving on Latte’s.  Cutting back on minor expenses will not provide you the ultimate financial freedom.

Verdict: Your credit score will single handedly save you more money than any other type of savings that you can make. You can potentially be robbing yourself of tens of thousands of dollars if your credit score is weak.

 

Best Online Savings Accounts For 2017

This is one heck of an important article, so listen up.

If your savings account is parked at Wells Fargo, Chase, Citibank, Bank of America or any big traditional bank, close your accounts and transfer your money to an online savings account NOW.

Let me qualify that…

Online savings accounts have much higher interest rates over traditional savings accounts Online banks don’t have physical branches or extra customer service payroll, or other good for nothing overhead costs. They pass on some of their savings to you in the form of high interest rates.

Chase is currently offering a near non-existent .01% APY on its savings account. The average online savings accounts offers a rate that is 100 times greater than Chase’s. When is the last time you read about a deal where something was 100 times better than another option?

If you are too lazy to go through the below details I’ll sum it up short and sweet for you. If you have money sitting in your savings and you have no plans of touching it in the near term, then transfer it to a high interest online savings account. Your best bets are the popular Synchrony and Ally banks. Purepoint Financial also seems solid as it gives a big rate which is owned by a huge bank. Your money is protected as they are all FDIC insured.

Here, I even went out of the way to make an infographic for those of you who didn’t want to get into the minutiae of the article…

 

A Few Online Savings Accounts for 2017

 

….hopefully you are still awake? This is important stuff so listen up! …

Below are the smaller, lesser known brands. Many of these guys have nice rates, but they will nickel and dime you to death, ahem ahem Salem and Alliant.

Dollar Savings Direct – 1.40% APY

Check out the fees and account disclosures.

Live Oak Bank – 1.40% APY

I couldn’t find their fee schedule which makes me a bit nervous

Salem Five Direct – 1.35% APY (Up to $1M)

They will nickel and dime you to death. That high APY will be lost to some of the fees. Also they don’t treat their customers right. For example if you already have a traditional checking/savings, then you cannot open an online savings account.

Check out fee schedule

Bank Purely – 1.30% APY

Check out fee schedule

Must wait for a PIN to come through snail mail before using account. Not fast.

Alliant Credit Union – 1.16% APY

Will nickel and dime you to death. For example: $5 Min balance. Paper Statement Fee $1/per. Inactivity fee $10. Dormant account fee $10. Close your account within 90 days of opening, $10. Copy of document $5 per. Foreign outgoing wire transfer fee $50. Domestic outgoing wire transfer fee $20.

Check out fee schedule.

Capital One 360 Savings Account – 1.2% APY (Balances over $10k)

 

Verdict: You need to open an online savings account tonight, as you most likely are losing out on high interest payments (more cash!). They are easy to setup and usually do not have many fees associated with them.

-All the information in this article should be used as a guidance and rates and fees should always be verified on the bank’s website itself-

My First Post: Who Am I And Why Am I Starting This Website.

Introduction

Hello World! I finally did it. I became serious and decided to take the big plunge to launch my own blog. After thinking about it for a couple of years I said to myself, enough thinking. Let’s write. I knew I loved writing, but it was actually my wife who pushed me from dreaming about it to actually launching something.Thanks wifey. I had to get my wonderful ideas across to my readers somehow.

A Little Background On Me

I was born in Houston but quickly moved to Silicon Valley at the age of 2. My father had just landed a new position at National Semiconductor in 1983. It was an offer he couldn’t resist so my family made the big move to the sunshine state. I spent most of my formative years in Cupertino from 1989 to 1996 and consider it to be my hometown forever. I received my Bachelors in Marketing from San Jose State, and most recently obtained my Masters in Information Systems from the University of San Francisco. I’ve worked in large tech companies here in the bay in varying business roles.

My wife and I got married in May 2014 in Canada. She definitely is a Canadian girl. She came to visit California for a vacation, we met and had lunch, and the rest is history. We’ve been married a little over three strong years now and we travel as much as we can.

What This Blog Will Focus On

Our original idea was to write about personal finances: Boosting income, minimizing expenses, and generally creating a clean and sustainable way to live. We’ve been stellar at this stuff and we want to teach you guys too. Personal finance will be one of the things that I will write a lot about. Other topics that I really think my readers will benefit from include real estate, career management, leisure travel and what it’s like living in Silicon Valley.

My mission statement is to help get your financial foundation in order so that you can enjoy this beautiful life.

So welcome to my site my friend. Let’s get this journey started.

15 Interesting Facts About The Bay Area And Silicon Valley

The Bay Area is a supreme place to live. At least it was back in the 80s and 90s. Things have changed now. If you are new to the area or just curious about what this place is all about, Read On:

  1. Three major events helped to bring the bay area to a critical mass: The Gold Rush of 1849, the founding of Stanford and Berkeley, and the installation of military bases.
  2. Before Silicon Valley was founded, the bay area was known for fruit orchards and massive fruit canneries.
  3. The “greater” Bay Area refers to 9 counties and over 3 dozen cities with a population of 8 million people collectively.
  4. Silicon Valley gets its name from Silicon, a naturally occurring element from which computer chips are made.
  5. Silicon Valley geographically refers to the city of San Jose and bordering towns like Santa Clara and Sunnyvale where many high tech firms are located.
  6. San Jose is the unofficial capital of Silicon Valley although SF has more startups.
  7. The first tech company in Silicon Valley was Shockley Semiconductor founded in 1956.
  8. According to Angel.Co, there are appx 18,000 startups listed in San Francisco. South Bay has almost twice the number of startups as San Francisco does at 32,000.
  9. The median annual income of a person working in Santa Clara County is $100K.
  10. The median price of a home in Santa Clara County is around $1.1 Million.
  11. A normal 2 bedroom apartment in Santa Clara County will cost around $2,400/month.
  12. Bay Area weather is perhaps the most perfect. Daytime weather is usually crisp and nights are cool. We don’t get snow. Actually, we barely get any seasons.
  13. Most of the Bay Area, with the exception of SF, is extremely suburban in nature. Think plazas, Safeways, and Boba Tea shops all interlinked with one another.
  14. The City attracts mostly a younger, single crowd as its denizens. Most of these people hang out here in the weekends as the South Bay is virtually devoid of night life.
  15. SF to its residents is known as “The City”.
Silicon Valley Facts

Five Reasons Why Your Savings Account Is Being Destroyed

As you know Americans are notorious for not being able to save enough every month. We bleed out our savings every single month by costs that can be trimmed down. Let’s take a look at some of the biggest offenders:

Rent

This is your biggest expense but also a place where you can single handedly get your biggest savings from. You don’t have to move to a place with a higher homicide rate, you just have to avoid an extra fancy place. You may be tempted to move into a sleek glass skyscraper, or a newly developed gated condo community. Some people pay a huge premium to live in the core of the city. Choosing a sensible property is bound to save you thousands every year.

Car Payments

Car payments can easily be people’s second largest expense. Sports cars and luxury cars are so tempting, but they also kill the amount of money you can sock away every month. An option here is to buy a reasonably priced car on cash and go for a reliable machine so you don’t have to spend $1500 on a transmission job. I am not stopping anyone from getting their Porsche, but I’d definitely have my financial foundation solid first.

Eating Out

You really need to put a stop to this one which can be as bad as a car payment. If you read my previous article, you would know that James was spending $336/month eating out.  At my last startup, my engineer colleagues ate out every single day. These were single guys living alone. They just couldn’t be bothered to pack a home lunch. A simple lunch is an easy $10 bucks these days and you can shell out a few hundred bucks a month. Buy food from cheap grocery stores and prep it before the week starts.

Entertainment

People are in love with entertaining themselves on a whim. Movies on the weekend, $12. Caramel Frappuccino from Starbucks, $4, Drinks with the friends on the weekend, $30. A random coffee date, $15. A once in awhile concert ticket, $60. Eating out with friends and colleagues, $20. Do this for a year and now you’re out of a few thousand dollars. Watch your excess spending by setting up a spending limit for your entertainment category every month. If you exceed the amount, you’ll need to politely decline dinner invitations for the month.

Try a mechanism that you have a comfort level with. For example, you can have different envelopes for different expenditures. Seeing and visualizing cash as you take from it, can help reinforce strong saving habits.

Cable/Internet/Subscriptions

You most likely have subscription to Cable, Wi-Fi, Netflix, Hulu or some other type of pay for service feature. Cut your cable all together and check out Republic Wireless or Simple Mobile for as low as $15/month. It’s a network that’s based off of only wi-fi service. You can then subscribe to a Netflix and Amazon for $20/month.

Verdict: Trim these expenses every single month and you’ll notice a healthy bump in your savings account.

How To Save More Money When You Make Less

A middle aged man I know makes a big five figure salary each month as a specialized Doctor. He has no sizeable savings and a very small retirement account. How can someone blow through such a massive salary? To be honest, you just have to make stupid decisions and keep on repeating them. He has a mortgage on a million plus dollar house, pays property tax, he has 3 car payments, and blows money on random novelties. He lives day to day.

Nearly no paycheck can support a decadent lifestyle that does not respect money.

Jack vs James

Let me illustrate a simple point using the chart below. James makes more money but has an extravagant lifestyle while Jack makes less money yet lives simply. James lives in a nice part of town in a newer high rise condo. James also eats out at work for lunch every day and also eats out on the weekends. He also likes fast German cars so he leased a BMW with his good credit and high salary. For entertainment, James goes out to concerts, movies, dates and in general likes a good time. He also likes to buy branded clothing at trendy stores.

James makes more, but he also spends more too. Jack comes out ahead in the long term.

At the end of every month, James saves $2,146 and Jack saves $2,539. Even though James makes considerably more money, it is Jack who saves nearly $400 more every month. If you stretch that over one year, James has been able to stash away $4,700 more!

There are so many people in the world living like either Jack or James. The person that makes more money seems to be more financially secure but what is not apparent is that he has a very low savings rate. This is an illusion as it is just the perception of being more well off. The fact is that overspenders are simply better at looking wealthy rather than being wealthy. I am not for living a minimalist or austere life. But in the beginning you must sacrifice so that in the end you have a financial foundation. Otherwise you are living paycheck to paycheck.

Here is a little infographic for you to understand the differences…

Higher Income Doesn’t Always Translate To More Savings

Verdict: A person with a lower paycheck can put more in their pocket every month over an extravagant spender. It is better to save now and spend later, otherwise you are only living paycheck to paycheck.

Why Its Insanely Important To Save in Your 20s and 30s

The Facts

The fact of the matter is that when you are young, time is on your side. And the more time you can set aside for yourself, the more money you can save. If you started saving at 35 instead of 25, you would have lost 10 years of massive savings. Your savings rate would need to be much higher to have the same savings as that smart 25 year old. Just take a look at this simple article from Business Insider that shows the ending savings balance of a 25 year old vs a 35 year old. The difference is staggering.

It’s All About Habits

If you are in your 20s, chances are that you aren’t earning much. But you probably don’t have many expenses either. Saving in the beginning will be painful. And many times you will go back to your old habits of wastefulness. But I assure you, that if you are resilient and you keep fighting the urge to burn your cash, you will eventually enter a lifestyle where saving will become a part of your personality. Once your savings build the urge to continue will increase. Losing weight is a concept that is almost identical to saving money. You start, you stop, you start, you stop. But once you do it for long enough, only then do you see a slimmer self. Habits are best formed earlier in life. They are stored in a deep part of the brain which we don’t forget.

What You Should Do

Every time you earn a dollar, the first thing you need to do is to deposit it in your bank. If you make these small deposits on a continuous basis, you have now created a habit. You will need to reinforce this habit until you are living a continuous life of a smaller footprint. Most expenditures are wasteful: TV, cable, internet subscriptions, eating out (huge one!), random frappucinos, clothes shopping, makeup shopping, shoe shopping, and gadgets shopping. We all splurge on something that we really love. A bunch of small cost savings amount to a big number at the end of the day.

Verdict: It is painful to begin saving. The harder you try the quicker you will develop this skill. Bite the bullet and save now so that you can live comfortably later.