2005 Financial Review

I still haven't reached the half year mark in age, but I get to do my first yearly financial review. That ranks right up there with beginning to make sounds.

Thanks to a couple of gifts from my uncle and nana and some sales on ebay, December turned into a good month for my finances and I'm closing on the $3,000 mark and was able to increase my net worth by approximately 20% this month.

Upromise did better than the last couple of months and brought in $6.44. Advertising did better, too, bringing in a little more than $14 with much of this thanks to the sponsor I have. I earned less than $1 in interest from ING, but their site is currently not online as they upgrade so I'll add that little amount in later. There is no interest counted toward the $1,000 I-Bond I have since it still hasn't been 3 months since I purchased it.

If we do a little forward thinking and if I can add $2850 to my savings each 6 months, that will leave me with over $100,000 for college which makes me smile. That isn't counting the interest that the money would also earn. 2005 has been good and I think I'll continue to keep smiling into 2006.

A Happy New Year To All!!!!

Consolidate Student Loans Now To Save Money

While this doesn't effect me since I'm still 18 years away from college, for everyone who has gone through school and picked up loans along the way (something that I'm trying to avoid doing by saving early), congress has change the law on Safford and PLUS Loans. If you are carrying student loans and are considering consolidating them, you now have a time-limit: July 1. As part of its $40 billion budget cutting effort, congress has raised the interest rate of Safford loans to 6.8% (one of the more popular student loans because borrowers don't have to show a financial need to get one) and has made this rated fixed, not adjustable as it currently is.

This change can have a significant affect on the amount you pay. If you currently have a Stafford loan, you can consolidate and lock in a rate of 5.375% for its life. If you happen to still be in your grace period, you can lock in a 4.75% rate.

Parents of students will also have to pay higher rates under the new law. The rate for PLUS loans (Parent Loans for Undergraduate Students) will become a fixed rate of 8.5%. PLUS loans currently sit at 6.1% and are variable.

The new rates will increase the cost of college by quite a bit. If you currently have a Stafford loan balance of $20,000 and paid the new 6.8% rate compared with the current low rate, it would cost more than $2,000 more in interest over a standard 10-year life of the loan. With PLUS, parents would have to pay nearly $3,000 more.

With interest rats not likely to fall between now and July and with a chance that they will rise, now is the time to get low rates locked in. If you have student loans and you haven't consolidated them, be sure to make that one of the first New Year's resolutions that you complete.

Happy Holidays

Happy holidays to one and all. I woke up this morning to lots of gifts and also $100 from my uncle and $200 from nana (grandma)to add to my college fund. I haven't heard from grandpa yet, but I'll probably be able to add a bit more when I do (I'd cross my fingers if I was that coordinated, but since I can't, I'll just stick them in my mouth). That brings my net worth up to $2,823.15 so it's a Merry Christmas for me!

Should I Be Paying For My Own College?

This is the question that came up in a recent article I found. Should it be my responsibility to pay for my own college education? There seem to be quite a few people out there that think that a student going to college should pay for their own education according to this piece from a Utah newspaper:

"When a student is responsible for the costs of education they seem to take it more serious, because it is their money. They are less likely to skip class or waste their investment. What is wrong with a child working hard through the summer to earn money for fall/winter semesters — or saving money while working during the summer of the high school years?"

This is a difficult question as I can see the point of view from both sides (even at my young age). I think that helping out students going to college is important if they also realize the value of money. As another person wrote:

"I am from California and had to pay for my education because my parents were poor," he wrote. "I knew how vital it was to get a good education. I did not want my kids to go through the same work/study plan I had to go through. So, I paid for their first year of education.

"During that first year, they each showed little interest in learning. I stopped paying after the first year for each of them. All of a sudden some of them became very interested in studying, when they were paying for it. . . . I guess I learned my lesson after six kids. I will advise my children to not pay for my grandchildren's education."

If a student doesn't realize the worth of the money given to help them through college, then they are not likely to appreciate the help which in the long run will be detrimental to their own personal finances.

I once read an article (okay, I didn't actually read it since I'm still working on rolling over with ease, but I did hear about it) about a woman that was considering going to graduate school. Her father had said he would pay for her education which was going to run about $100,000, but instead of saying he would pay for her education, he phrased it in a different way. He said, "I have $100,000 for you. Please use it as you want."

What this did was make the woman view the money as her own, not as free money from someone else. She ultimately decided to go to graduate school, but to a program that was much less expensive and used the rest of the money for a down payment on a house. I think when you give children the opportunity view the money as theirs, they must consider much more how they want to use it. Of course, this all presupposes that the child has been brought up and taught about personal finances and the way that money works.

More Investment Sales

I had four more of my antique investments sell for $79.80. Taking into account all the expenses for selling them, I am left with a profit of $68.38. That in turn brings my net worth up to $2,523.15 and means that I have managed to break through the $2,500 barrier for my net worth! I'm enjoying the antique investments very much.

That means, however, that I only have one more antique investment. My uncle has promised to put that one on auction tomorrow and then he will look for some more items for me to invest in.

Overall it's been a good week and has kept me smiling the whole time. (^_^)

Choosing A College

Even though college is still 18 years off for me, there are a lot of students that are beginning to think about college. I came across a good article in the Christian Science Monitor about choosing the right college. The article says that the most important point in choosing is that the college has "the right fit" which could be anything from college being the right price to the campus feeling comfortable. To figure this "right fit" out, they suggest four actions to take:

Build your own college ranking system: What's important to you and what's important to another student is probably not the same. Make a list of what you want from a college to help rank the colleges of interest.

Focus on the first year: Look at how the college treats it's freshman students for classes ans other activities and see if this appeals to you.

Gauge the engagement: "Research shows that if students engage in certain activities, they're likely to learn more than if they don't," says Trudy Banta, vice chancellor for planning and institutional improvement at Indiana University-Purdue University in Indianapolis. The long list includes: "things like participating in faculty research; study abroad;... service learning; contact with faculty outside the classroom - [especially] talking about intellectual matters; group work with peers; and how much they study."

Probe preferred majors: Take a look at how the majors you may be interested in are regarded at the colleges you're considering.

I think that these are a good way to begin if you have no idea where you want to go or if you're trying to narrow from a few colleges to one or two. I think the last line in the article sums it up pretty well:

Do as much research as you can, Stuart says, but when it's time to make a choice, "it comes down to a feeling."

Antique Investments

I had 5 of the ten antique items my uncle bought for me sell over the weekend, so I have been smiling and gurgling even more than usual! The five sold for $99.75 in total and after all fees were deducted, I came away with a $84.97 profit! That raises my total net worth to $2,454.77.

My uncle has promised to place the other 5 items up for auction this week and hopefully they will sell well so that I can break through the $2,500.00 mark. While this may not seem too exciting for most, it's fantastic for me. I may not even be fussy for an entire week just to celebrate.

I still need to talk to nana and grandpa about what they will be getting me for X-mas. Hopefully they will be generous and add a bit more to my net worth on top of these investments.

I've also hinted to my uncle that he needs to find a few more investment for me since I'm enjoying the returns they are bringing in quite a lot. I'm sure that I'll be able to charm him into doing so (that's an advantage we babies have when we are in a good mood)

Free American Greeting 1 Year Subscription

My gift to all the readers of this blog. Thank you for visiting!

Free American Greeting 1 Year Electronic Greeting Card Subscription

1. Go to americangreetings.com/promo
2. Enter Code: AGift4U
3. Fill out basic information

4. When it asks for your credit card info, don't fill anything in and hit "submit" until you see the confirmation page. It appears that they have changed their form :( - you now must enter a credit card number to get this free year and be sure to cancel if you don't want to be charged once the year term is over.

You'll receive a confirmation email and your free 1 year subscription. They also have a great reminder service so you don't forget those important days. Enjoy! (^_^)

Net Worth Ranking - November

Personal Finance Advice has listed the net worth for personal finance writers in November and for the third straight month - you guessed it - I came out in last place. this has made me a bit cranky, but I think I will have to get used to this position for awhile.

There is a bit of hope, however. He started a new ranking of the % change in net worth which I did poorly in this month (15th out of 17), but an area where I can do really well since my current net worth is much lower than everybody else.

I would like to be at the top of the list next month, but that could be hard. Some of the writers had double digit gains in their net worth over a one month period!

The Strange World Of College Financing

I came across a good article that I think every parent should read and especially those that have older kids that will be entering college in a couple of years (if you have a junior in high school, start reading NOW!)The article is titled The weird world of college financing and here are some of the highlights:

To qualify for financial aid based on family finances, parents need to understand a quirky formula that is as complex as the tax code.

Using the formula, colleges calculate what they believe a family can afford to pay for college. That calculation is called "the expected family contribution," and essentially tells parents and students what percentage of their income and assets should be devoted to college.

After a college has calculated what students and parents must pay, the financial aid office helps cover what families can't afford, frequently by providing low-interest loans, work-study jobs and grants.

This formula, while not easy to understand, can end up saving you thousands of dollars out of your own pocket so it's worthwhile to study up a bit on it. I have 18 years, but most of you probably have a shorter amount of time to do it, so start asap.

One common mistake is that tax accountants often encourage grandparents and parents to shift money to children by opening Uniform Gift to Minors Act accounts. Those accounts sabotage financial aid because they are in the child's name.

"If you are going to qualify for financial aid, you should never, ever put money in the child's name," Chany said. "It's like throwing money away."

For example, if a family has saved $40,000 for college, and the money is kept under the parents' name, the family will be required under the formula to use as much as $2,260 of that savings to pay for the first year of college, Chany said. If the family instead has kept identical savings in their child's name, they will have to spend $14,000 immediately.

This is often difficult for parents to understand because they assume college money will be treated the same regardless of the account it is in. But the quirky financial aid formula doesn't act with that logic. It looks at student income and assets differently from parents' income and assets.

I'm going to have to look into this closely and it may change my strategy on how I same. My hope is that I won't have to take out any loans, but I don't want to exclude myself from loans and financial aid if I can get it. Being the financially savvy nearly 5 month old that I am, if I can get low interest rate college loans that are have a lower rate than what can earn elsewhere with the money, it would make sense for me to take them out. I7m always trying to think ahead...

Parents also can make college affordable by discouraging a student from earning too much.

"It's a bizarre situation," Chany said. "The best way a student receiving financial aid can help his parents pay for college is by not working very much."

Under the formula used to compute a family's expected contribution, students must devote half of their income and 35 percent of their assets to college over a certain threshold.

A student who earned $2,761 would be required to spend $1,150 of it for college. But for every dollar over $2,761, the student would have to provide 85 cents for college.

Because parents typically are paying for most of the tuition and living costs, the child's job simply is decreasing financial aid and requiring parents to pay more.

Now that makes absolutely no sense to me, but since it is the system we are all working with, I guess it's important to take it into consideration. Since I hope to be making more than that before entering college, I will have to sit down and really work the numbers on the best way to approach this.

Parents also are surprised at what happens if they sell stocks, bonds or mutual funds during college to pay tuition bills. Selling the investments gives families income under the formula. So they may sell all their investments one year and use every cent to pay for tuition that year. But the college aid formula will indicate they have that money as income for tuition in the coming year, even though it already has been spent.

I've read this numerous times. The best course of action is to sell these investments before December 31 of the student's junior year in high school so that the money doesn't appear to be income. The article also list these strategies for those will kids in their junior year in high school:

Saving the maximum possible in 401(k) and tax-deductible individual retirement accounts before Dec. 31. When a student is in college, it won't hurt a family to save for retirement, but making contributions to 401(k)s and IRAs won't help cut your income. Under the financial aid formula, those contributions are deemed income - available to pay for college.

Don't take early distributions from IRAs or convert an IRA into a Roth IRA. If you do, your income will go up, and you will lose some financial aid.

Do not take out a second mortgage on your home to pay for college. If you do and stash the money in a savings account, your assets could be inflated substantially and reduce aid.

Instead of making charitable contributions during the college years, make a large contribution before Dec. 31 of your child's junior year. If you keep providing contributions during the college years, financial aid staff will consider that income you can use for college.

Medical expenses can help increase financial aid. So if you have a choice, you could push an expensive medical procedure into your child's senior year of high school.

Before doing any of this, make sure you will qualify for financial aid. If your income is too high to qualify, you could be interfering unnecessarily with your investments and taxes by using these strategies.

I think that last one is going to be important for me. It would be nice if they could develop a formula that made sense and was easy to understand, but maybe financial aid is the first test a student (and parents) receive when a child goes to college. Stick around and I hope we can all pass it with flying colors together!

My Antique Investment

As part of my investments , I have my uncle buying some Japanese antiques for me. This is one that he bought. This is "Benzaiten" who is one of the 7 Gods of fortune, and the only woman God (or should I say - if I could speak - Goddess). The cup dates from the Taisho period in Japan (1912-1926). It's made by Kutani which is a well respected pottery maker both in Japan and in the world.

Since I7ve been threatening to be fussy if auctions don't go up this month, my uncle spent a few hours getting my antiques ready to place on auction. I'm looking forward to seeing how they do and hopefully increasing my net worth a bit more!

No I-Bond Interest

I received a nice email asking if I forgot to include the I-bond interest in my November net worth calculations. I purchased a $1000 I-Bond, but haven't added any interest on it yet.

The reason for this is that I-bonds have a three month interest penalty if the bonds are redeemed before 5 years are up. Due to this, they will not count interest on it until 3 months have passed and thus I don't have any interest added for this past month. it will begin adding interest in January.

While this may not look good now, if I keep the bond for 5 years, when I hit that mark I get a nice 3 month addition to my interest. If I sell, I don't have to decrease my account worth because the penalty has already been built into the system.

This is even a bit confusing for my uncle (so you can imagine how I feel), but he assured me that it makes sense and I have nothing to worry about. The interest will show up and is being calculated, it's just delayed three months until the I-bond reaches 5 years.

December Goals

For the second month in a row I fell short on a couple of my monthly goals. Unlike last month, I would have liked to have done a bit better.

My goal for my net worth was to increase it to $2434.51, but I only managed $2369.80 falling $64.71 short of the goal. At this time I still feel that a 5% increase in my net worth per month is realistic since I'm still too young to even think about spending it. That would put my goal to increase my net worth by $118.49.

Since it is the holiday season and I'm a bit young to really appreciate the gifts that are given to me, I'm also going to see if I can convince nana (grandma) and grandpa to give me at lease one cash gift each that will go toward my savings. I7ll shoot for another $100 in that area for a goal of $2588.29.

I did open a BabyMint account, but only I'm still not sure how I'm going to approach this. I need to do a bit more research to see which of the programs will be best for me to concentrate on. That will be another goal this month.

I failed on getting articles in all the carnivals of Personal Finance only getting in 2 of the 4. Those are good for this journal because they bring in extra traffic and new people can see what I'm doing, but with the holiday season, I don't think I can do one each week. I'll shoot for 2 this month.

I fell one short on the getting link trades and ended the month with 9 instead of the ten I wanted. I will try and get another 5 this month for a goal of 15. In addition, now that I have one sponsored link, I would like to try and get another one this month.

I completely failed on getting auction listed with the antiques I have in my investments, but have been assured that this month they will go up (my uncle doesn't like it when I get fussy around him). Since I wanted to list 5 last month, but didn't get any up, I'm going to shoot for 10 this month.

I hope you all cheer my on in my goals and hope that you that have found my have been enjoying my journey thus far!

Net Worth Increases 2.21%

My net worth increased $51.29 in November or 2.21% from the previous month. This was a bit disappointing since I was shooting for 5%. Part of the problem was that I didn't get any auctions up with my antique investments. My uncle has assured me that this misstep will not happen again after explaining that if it did, I would be fussy around him every time he comes to visit.

The advertising revenue fell almost 50% from the month before to $7.52 (it had been $14.09 in October), but I had expected this. With the journal still in its beginning stages, that will fluctuate quite a bit from month to month. I was shooting for $5 and surpassed this.

Upromise added another $3 to my net worth from the bonus links from Kellogg's. I've been told that some of the relatives that have signed up with my account have done them too, but they haven't posted in my account yet.

The rest came from ING interest and bonuses which I can't count on anymore until I get a new account opened.

With the holiday season here, I'll see if I can get some cash gifts from family and friends instead of clothing to pad my savings...

First Sponsor!

I received my first site sponsor today! While it isn't much (only $6.95 after expenses) it's a big deal to me. If I can keep the sponsor until I enter college, it would add $1500 to my college fund (the advantages of starting early). Now I doubt that I will be able to keep the sponsor for that long, but for now it's a guaranteed monthly income coming in for me. Considering I'm still working on rolling over I say that's pretty good.

Since the sponsor just came, I won't be able to add it to this month's revenue - it will be added beginning next month. That should help me in my goal to earn at least $10 a month from this site through advertising.

ING Bonuses Used

I used up the last of my ING bonuses. Even with the $250 minimum deposit, people have found the $25 bonus is worth opening the account since they don't have to keep it there (no minimums) and there are no fees. That's good news as there hasn't been much of an increase to my net worth (up to $2358.51, +$40.00) this month.

The next step will be convincing mom and dad to open up two more accounts so that I can get some more bonuses. I think that will have to wait until next year, however, when my uncle can nudge them in that direction. They are so busy with taking great care of me (^_^) that they don't have much free time for themselves.

For those looking to begin your baby's college savings, opening an account is a good way to start - you can get the $25 bonus by following these directions and where mine will be as soon as I get those other accounts open.

Mentions and More Babies

Trying to decide what to write about can be half the problem if you decide to begin a journal like this. Jeremy Coenen is trying to decide a direction to go and mentions a number of possibilities related to finance including a nice mention about my site:

Another cool idea a long these lines is starting my son's college/retirement savings fund and tracking his net worth, this is done on a couple other blogs I've run across and is a pretty cool idea. Check out Financial Baby Steps . The only problem with this is that well Jack isn't worth a whole lot at this point in time $242.14 and all of his money is sitting in a boring savings account getting 3.5% interest so he's increasing his net worth at about 71 cents a month. Oh yeah he does also have 2 $50 savings bonds that he received at birth. So there wouldn't be much to update on and I don't plan on contributing a whole lot to his net worth anytime soon as the cash flow meter in the Coenen's household is not exactly off the charts and most of the extra money that comes in will be going to my retirement instead of Jack's college/retirement (sorry Jack - but more on that later).

One thing that I've found is when you make the saving a focus of a journal like this (in my 4 months of experience), you spend more time focusing on ways to increase savings than if you didn't do anything at all. While I haven't spend as much time as I wanted to over the last couple of weeks, I'm so much better off than if I hadn't started at all. My vote is for following Jack, bu then I may be a bit biased there ;)

Updates

It's been a busy, busy week plus since my last entry. While I've been enjoying myself lying around, sleeping and all around being a cute baby, I haven't done as well as I should have this past week managing my money (when this happens I always blame it on my uncle since at my age, all I'm supposed to do is lie around, sleep and look cute).

I did sign up for a BabyMint but haven't had a chance to wander around the site much. I'm also wary of asking everyone to sign up for another program. I'll have to weigh the pros and cons of each and commit to one for everyone to use (or get everyone to agree to use the account that best fits them.

The one thing I noticed was that they make receiving money much easier than uPromise - which is a plus since I may not be placing the money into a 529 plan for awhile (if ever - still thinking about that)

Should You Move To Kalamazoo?

Why would you want to consider moving to Kalamazoo? A free college education is a big reason. If you have a child who is pre high school, a move to Kalamazoo could make financial sense in a lot of ways. The more children that you have, the more appealing the offer is. Not all kids get 100% tuition with the exact amount being determined by the number of years the child is in the school system. According to the Kalamazoo public school website:

All students who graduate from Kalamazoo Public Schools and are Kalamazoo residents can get up to 100% of their tuition paid to any Michigan public university or community college. Students must take 12 credit hours or more each semester, unless interrupted for military service, and maintain at least a 2.0 grade-point average.

The percent of tuition paid by the plan depends on the years of attendance in the district, using the following formula:

K-12...100%
1-12...95%
2-12...95%
3-12...95%
4-12...90%
5-12...85%
6-12...80%
7-12...75%
8-12...70%
9-12...65%
10-12...None

If you have a child entering the 9th grade next year (assuming tuition of $10,000 a year for ease), a move to Kalamazoo would be worth $26,000 in saved tuition. If you have three children with one going into kindergarten, one into 3rd grade and one into 6th grade, the move would be worth $110,000 in college tuition. To further increase the worth of the tuition payments, they will be to the kids and not the parents meaning that the taxes owed on the gifts will be much less.

In fact, the grant of free tuition will probably be worth a lot more than merely the tuition. Since the announcement, colleges in Michigan have been tumbling over one another trying to lure the students that are receiving the free tuition by offering discounted to free room and board and other incentives to attend their college. They are able to do this because most students receive financial aid of some type when they go to college. Since those from Kalamazoo have their tuition already paid, there is no reason to offer those students financial aid. Therefore the colleges are taking the financial aid portion and moving it toward other benefits increasing the worth of the free tuition offer.

Then all the savings for college made thus far for your children could be earmarked for retirement savings giving you a huge boost in your personal net worth and outlook for retirement. This means that you could start maxing out your retirement funds (401K or IRA) if you haven't been doing so up to this point further increasing your retirement money.

The offer is especially appealing to middle income families that would have a difficult time paying for college, but earn enough that scholarships and grants would be limited for their child.

Of course, there are a lot of other factors involved that come into play when determining whether a move is even feasible. It is, however, certainly worth careful consideration to see if a move makes financial sense.

It also makes sense to keep your eyes on this type of offer. Since the announcement a lot of other small towns have expressed interest in creating a similar system for their school children. While Kalamazoo may not be possible today, another offer in a different town in the future may be.

November Financial Goals Update

I have been quite fussy with my uncle over the last couple of weeks. November is more than half over and I'm well off the pace of meeting all my goals. I figured that being fussy was the only way to get his attention and focus a bit so that we can meet as many of them as possible.

I've already realized at a young age that if you don't remain focused even just a bit on your goals, time can fly by without you making the advances you want. So I'm revisiting the goals with my uncle again so we can refocus a bit more.

My goal is to have $2434.51 by the beginning of December, bu without the ING saving bonuses, this is looking to be a lot harder than last month. I do have some antique cups that my uncle has promised to put on auction next week that will hopefully at least get me close to this goal. It will also mean that I meet my goal of listing at least 5 auctions.

I still need to open the BabyMint account and will shoot for having that open this weekend.

I missed the first Carnival of Personal Finance this month as I didn't have an article to submit, but did make the second one. I will be writing my entry for this week right after posting this.

I'm a couple of sites short on the trading links, but will send out some requests and see if I can fill those up as soon as possible.

Although I don't mind writing for myself and how I'm progressing, it's always much more fun when a lot of people are reading and commenting. I may have to think of some ways to try and raise the profile of my journal. While the main focus is financial, I think this would be of interest to a lot of people with babies and young kids. I may have to begin focusing attempts for those groups to become more aware of what I'm doing.

Time to work on the carnival of personal finance post...

The Kid Bank

If you're kids are a little older than I am and are beginning to understand the concept of money (something I hope to be doing soon), I think that you should encourage them to be entrepreneurs. Not only will this teach them basics about money and business at an early age, it will also make it a lot more likely that they can fund their own college education instead of relying on your bank account.

The Kid Bank offers low-interest business loans to children 18 years old and younger. In order to get the loan, you and the child need to complete an application, including the project description, references and a business plan. You also have to figure out projected income and expenses.

The interest rate is "2% below the national rate" and repayment is structured on the projected income. This is a wonderful way to teach kids hands-on about money and business. It's a wonderful opportunity to help your child take a hobby or interest and turn it into a money making venture - something that will be a valuable lesson for his or her entire life.

American Express $50 Mercury Milan Test Drive

Gift Card Challenge: If you happen to frequent one of the places that is offering the free gift card, then take the money that the gift card is worth and place it into your child's education fund. If you don't usually spend money there, then get the gift card anyway and enjoy a treat on me for visiting my journal (^_^)

Another free gift card offer so you can put the savings into your child's college fund. I haven't been able to confirm this one because I'm not old enough to drive (or even walk for that matter), but it comes from a reliable source. Better yet, it hasn't been placed in the freebies area, so you have a good chance of getting it if you act quickly. Here are the details

$50 AMEX Card Mercury Milan Test Drive

Get this by requesting a brochure snail mail from the Milan site. Click "request brochure", not "test drive". Fill in your info and select you are considering a new car in under 3 months. Be sure to request the Milan brochure if there is a choice.

Personal Finance Carnival Is Saved

A big thank you to Flexo over at Consumerism Commentary for saving this week's Carnival of Personal Finance. The person who was supposed to host it never did and he took over to get all the submitted articles up. Mine was for the Affinity Bank 10% Interest Bank Account for kids. There is a lot of good personal finance reading over there if you have some extra time this week.

Free College For Kids In Kalamazoo

If I was a bit older and living in Kalamazoo, I probably wouldn't need to be writing this journal (but I probably would with the emphasis on saving for a house and retirement rather than college). I came across an article in the Detroit Free Press that says that every student in the Kalamazoo school district will have their college paid for them from a anonymous donor

WOW! I bet the parents and kids living in Kalamazoo are happy today. The parents that had been saving for college have a double bonus - not only will their child get to go to college for free, they just had a significant increase in their retirement savings.

I especially liked the fact that the free college money goes to anyone who graduates no matter how well they did in high school.

To qualify for four years of free tuition, students just need to be enrolled in Kalamazoo Public Schools and graduate, be accepted at a Michigan public university or community college, maintain steady progress toward a degree and maintain a 2.0 grade-point average.

In my opinion, it's a wonderful gesture and I hope that all the kids in that school district take advantage of the wonderful opportunity that has been given to them.

Affinity Bank 10% Interest For Kids

This offer is one that I will start bugging mom and dad about right away. Affinity Bank has a special account called the "Kids Only Savings Account" - and this account offers 10% (that's not a typo!)APY interest rate on all balances up to and including $500. That means that if I put the maximum $500 into the account now, it will earn me $900 in interest by the time I'm ready to go to college. Finding a guaranteed interest rate of 10% is a dream come true!

The on catch is that one of my parents has to open up an account there, but they do offer a free checking account with a minimum $100 balance. The checking account doesn't earn any interest, so in reality the earnings on the $500 + $100 needed for my parent's account would be 8.33% and not 10%. Still, 8.33% is not something that I will turn my back on (well, at least when I get better at rolling over on my own).

For others that are interested:

The Kids Only account is restricted to children under 16 years (but if you sign up before 16 years of age, you can keep the account until you7re 18 years old). The minimum deposit on the account to begin the account is $1.00. Balances that exceed $500 will be paid the bank's regular savings rates which is 0.50%. Children that open an account also receive a free Piggy Bank (and I would love to have a new piggy bank!!!).

My uncle will be passing along the message to my parents to open the account asap and as soon as that is done, I will take some of the money I have and place it into that account.

Someone Younger Than Me?!?

I came across a site where the owner seems to be younger than even me! One Month Old Baby Begins Saving For College. It seems to be currently under construction with the only post being about me, but I hope to see it come to life in the near future. It would be great to have some others my age along for the ride!

Free Gift Cards

For all the parents that visit here, I'm going to make a suggestion. From time to time I hear about free gift cards from my uncle. Usually you need to fill out a short survey and in return for your help, they send you a gift card. When I hear about free gift cards in the future, I will list them. If you happen to frequent one of the places that is offering the free gift card, then take the money that the gift card is worth and place it into your child's education fund. If you don't usually spend money there, then get the gift card anyway and enjoy a treat on me for visiting my journal (^_^)

Starbucks $5 Gift Card (this survey has ended so I took out the link): Take a short survey. use code 07761 or 01899 (it worked when I tried it, but I don't know how long the codes will be good for)

$10 BestBuy Gift Card (this survey has ended so I took out the link): Complete a marketing survey

If you get coffee at Starbucks and shop at BestBuy, you can add $15 to your child's college account.

*These surveys for Gift Cards usually end quickly because of the number of people that want to get the freebie so you have to move on them quickly.

Teach Your Baby The Value of Saving Money

I came across this interesting article about helping babies learn about money

I like the hands on approach that he describes and the emphasis of making it a fun experience. I hope that my parents will do the same for me when I get a bit older and have a bit more coordination.

Free Upromise Money From Kellogg's

Thanks to a post at Saving Advice my Upromise account is $3.00 richer. It seems that Kellogg's is running a campaign and by using a special URL you can have $1.00 deposited into your Upromise account. There are three of these URLs meaning that you can get $3.00 for your account if you're already a member.

you can earn $3 if you are a member by going to these URLs when signed into your account:

upromise.com/applejacks
upromise.com/cornpops
upromise.com/ricekrispies

When you do, press the "redeem your code" link and it will automatically fill in a code for you. Hit "submit" and you will be entered into a sweepstakes and have $1 placed into your Upormise account.

Even if you're not currently a Upromise member, this might be the right time to sign up as there is a code for a $5.00 sign up bonus (I wish I had known about this as the code I used was only worth $3.00)

If you are not a current member, you can sign up and use code "BN5" when you do - this will give you a $5 bonus for just signing up. Once signed up, you can use the above codes so you can earn $8 right away.

I will be emailing all the people that I asked to sign up to help me and ask them to also use the code. If it works for all of them too, then I can earn a bit more money without anyone having to buy anything which would make me smile and gurgle for the rest of the week.

Finding Other Advertising Income Sources

I have decided to try and generate a little more earned income by offering adverting on my site. I really don't expect much to come of it now, but I hope that as my blog becomes more popular there will be other websites that will want to advertise and help me with my savings.

I'm also discussing with my uncle to possibly place an auction up to sell some space on the site. While there would be a risk of losing a minimum amount of money for listing the offer, it could generate some long term income if I can find a couple of sponsors.

At this point I know that every little bit of income that I can generate will have a long time to compound which is to my advantage. Even if I can get one or two ads that only pay $5 a month, that would double what I'm currently earning from the site and could add over $100 to my savings over a year period. Now all I have to do is find some sites that feel sponsoring me would be in their benefit.

Happy 4 Months To Me!

Time flies when you're having fun! Today I turned 4 months old (no birthday cake, but nana is coming up to visit me, so I'm excited!), and 25% older than I was just 31 days ago. I'm not sure how much I have wizened during this time, but I'm still a happy baby. In another 2 months I'll be 1/2 year old. While this might seem like a big deal to most of my colleagues writing about financial matters, 2 months will add a significant amount of time to the percentage I've been here.

I've begun on my goals for this month, but still have a long way to go. I'll get to work on them as soon as I finish celebrating (^_^)

Still At The Bottom Of The Heap

Personal Finance Advice has listed how all those writing about personal finances fared in October. I was in the positive unlike some of the others, but that still wasn't enough to lift me out of the basement when it comes to net worth. Still, time is on my side and I hope to move out of the basement one of these days. Here is a look at the net worth of those listed:

1. NCYMoney $684,000.00
2. Boston Gal’s Open Wallet $355,799.35
3. PFBlog $353,676.00
4. My Open Wallet $244,664.51
5. 2 Million $194,868.05
6. Clutter 2 Cash $185,212.00
7. MMB’s Personal Finance Journal $180.198.72
8. Capital Ideas $123,542.00
9. My Money Blog $83,262.00
10. Debt Free $65,418.00
11. New Age PF $63,162.57
12. Consumerism Commentary $36,241.76
13. Alpha Guy $29,051.00
14. Million Dollar Goal $18,777.47
15. Personal Finance Progress $11,231.00
16. Financial Baby Steps $2,318.51

As you can see, I'm the only one that still has a 4 digit net worth. I will be working hard over the coming months to try and join the 5 digit net worth club. While I know my baby steps will pay off in the long run, it is still motivation for me to move up the ladder a bit as soon as possible.

November Goals

I fell short on a couple of my October goals, but overall I came out well for the month.

I had hoped to increase my current savings by 5% to a total of $2251.90 by the beginning of November. I managed to increase my savings by more than 10% so I exceeded the goal by quite a lot. I would like to increase the savings by another 5% during November if possible. My current total is $2318.51 so I need to add another $116 to my total for $2434.51 by the beginning of December.

I wanted to open a Upromise and BabyMint account, but only got around to opening up the Upromise account. I will set a goal of opening up the BabyMint account this month. I would also like to get a few more of my relatives to sign up on the Upromise account to help me build my savings.

I wanted to submit posts to the carnival of Personal Finance each week and I managed to do so 3 of the 4 weeks. I will set a goal of submitting to each week again this month to help promote my writing. I wanted to trade links with 5 other financial sites and managed to only do so with 4. I will try to increase that to 10 by the end of November.

I would also like to get a bit more active in reselling the antiques I'm investing in since the holiday season is coming up and when prices can be much higher than at other times of the year. I want to list at least 5 auctions this month from my investments.

Again, I think that all these goals are reasonable and will work hard to achieving them.

ING Savings Account

The ING savings account treated me very well over the month. With bonuses and interest, my college savings grew from $100 to $271.73 or by $171.73. Unfortunately, I don't think that I'll be able to get anywhere near that amount this month since the bonus links I have are down to the last few. It was great while it lasted, but i will have to find a different source of income to make up for that in the coming months.

I will continue to keep money in this account for now. While the 3.4% interest isn't the best of the online banks, it will be a good place to park the money for now in case my uncle needs it for investing later on. depending on what the I-bond does next April, I may move some of it in there at that time.

Upromise 529 College Savings

I took a look at the Upromise account that I opened up and it has done virtually nothing. I have a couple of relatives signed up, but the account doesn't show any income from them over the past month. The only credit that is shown is the $3.00 sign up bonus I received. While I won't turn my back on the money (it's difficult to do, but I am learning to turn over), I'm a little disappointed that it isn't a bit more. We'll see after a few more months whether or not this system will be any good.

Financial Advertising Revenue - October 2005

I've been a bit grumpy at my uncle over the past week because he's been busy with friends visiting and hasn't been able to help me with my saving as much as I wanted. I guess that he deserves a break every once in awhile, but I'm glad to see he's back and we can refocus on my saving. He has quite a bit to update and has said to make sure he gets it all recorded and not to confuse himself or me, he'll do it in a number of posts today.

I had a much better month with the financial revenue generated than last month, but I don't expect that I will be able to keep this pace up (although I hope I eventually build up to it) Advertising on the site brought in $14.09 for October which would put me on pace to add more than $3000 to my college savings, but again, I don't think I can sustain that pace at this time. I think I'll shoot for $5 in advertising revenue again this month.

I Invested $1000 In I-Bonds

After having a talk (well, I made some sounds at least) with my uncle, we decided to invest $1000 of my current savings into I-Bonds. For those of you who are not familiar with the, you can learn more about I-Bonds here. That means that $1000 of mine will be earning 4.8% for six months and then somewhere over 5.5% (I'll know the exact amount on November 1) for six months. Since my uncle doesn't believe he'll find more than $1000 worth of investments for me in the next year, we decided that this was a better place to keep the money rather than in cash.

This is an exciting moment for me since it's mt first investment of this kind that will pay me interest. I've liked the idea of compound interest since my uncle began explaining it to me and I want to use it to my full advantage since I am beginning to invest so young. I7m hoping for a big increase come November 1 so that my savings will grow even more.

I'm One Happy Baby!

There's no doubt about it, I'm one happy baby the way things are currently going with my savings!

Money Trumps Smarts For College Graduation

This is some distressing news that I came across (so much that I was fussy the entire afternoon). When it comes to graduating from college, the amount of money you have plays a big part regardless of how smart you are. This from a recent press release from the College Board:

Education Pays 2005 also documents persistent gaps in graduation rates. Even among students with very high levels of academic achievement, those from families with low socioeconomic status are significantly less likely to enroll in college than their peers from more privileged backgrounds. Moreover, there are large gaps in college completion rates across socioeconomic groups.

"Socioeconomic status and college success cannot be separated from the serious problem of unequal academic opportunity within our schools," Caperton said. "In addition to increasing the affordability of higher education, we need to make sure that students from all backgrounds have the opportunity to prepare for college. As well, all families should be made aware of the financial aid process and the long-term benefits, both financial and personal, of investing in a college education."

What exactly does all this mean? It means that money is a bigger factor in graduation that how smart you are. From another article:

Sandy Baum, a College Board analyst, said the data show that college completion increasingly is "not about academic preparation, it's about money..."

Within the lowest socioeconomic quartile, 75 percent of high-scoring eighth-graders eventually enrolled in college, but only 29 percent earned college degrees by eight years after high school graduation.

Ninety-nine percent of high-scoring eighth graders within the highest socioeconomic quartile attended college, with 74 percent earning degrees.

This is yet another reason to plan early and save for college costs. In a society where everyone is supposed to have the same advantage no matter where they come from, it shows that having money above how smart you are goes a long way to getting a college degree.

Still shy of 4 months, I'm not sure if there is anything I can do to help with this situation, but I do want to have a good, long discussion (when I learn to talk) about if there is something that I can do to help...

My First Investment Profit!

I just found out that the antique cup set which I invested in sold on auction yesterday for $56.00. After all the fees, I ended up with $51.06 or a $26.06 profit. That was over a 100% return on my $25 investment which I liked very much and I've been gurgling all morning.

My uncle says that he will look for some more investments this coming weekend and I'm excited about that. I would cross my fingers and hope, but my coordination isn't quite that good yet, so I'll just hope.

I love mornings when my savings has increased overnight!

Another College Saving Program To Check Out

I have another program to check out when I find the time (I bet you don't realize how much time it takes being a baby and doing baby stuff!). The program is called LittleGrad and it looks like it is focused only on online purchases. Here's a bit about it I found:

The Little Grad Savings Manager automatically reminds members if a retailer is a Little Grad partner, and cites the percentage rebate offered. Importantly, grandparents, relatives and friends can also join and contribute directly to a child's account via their everyday online shopping. A member page detailing each contribution is accessible via Little Grad's password protected web site. And, with one click of the mouse a member can send a customizable email thank you note to family and friends for every rebate contribution they make. Little Grad users who invite their friends to join will receive additional rebates as long as they both are members.

I will do a better review when I have time to look over the specifics of the site.

New Finance Carnival Up & Goals

As I stated in my goals for this month, one was to write an article for the carnival of Personal Finance each week. The latest carnival is up at My Money Blog and my contribution this week was the post on the Indy 529 College Saving Plan

Revisiting my goals for this month, I still have a few things to do, but I'm getting close to reaching all of them. I'll need to write and submit a couple of more articles for the carnival, but I have that sort of in a rhythm now. I've already surpassed the savings goal I had for this month, so I'm a happy baby in that area. I still need to open a BabyMint account and find one more site trade. I still think that I can meet or exceed all the gaols for this month.

Some Facts On The Price Of College

While the news is always putting forth headlines of huge college expenses, they have to be taken into context. Yes, there are some colleges that cost a small fortune to attend, but these statistics that I found from Collegeboard.com are a bit more reassuring that college can be affordable:

...nearly 70 percent of students attending four-year schools pay less than $8,000 for tuition and fees per year? After grants are taken into consideration, the net price the average undergraduate pays for a college education is significantly lower than the published tuition and fees.

About 50 percent of students attending four-year colleges pay less than $6,000 for tuition and fees per year.

About three quarters of students attending public four-year colleges pay less than $6,000 for tuition and fees per year.

Only about 5 percent of all students attend colleges where tuition and fees total $24,000 or higher per year.

and just to let my mom and dad know that I've been listening

According to U.S. Census Bureau statistics, people with a bachelor's degree earn over 70 percent more on average than those with only a high school diploma? Over a lifetime, the gap in earning potential between a high school diploma and a B.A. (or higher) is more than $1,000,000.

These make saving for college and the prices I'll have to pay seem a little less daunting.

Indy 529 - A Twist On The 529 Savings Plan

As I was doing my research the other day, I came across an interesting twist on the 529 plan. It's called the Independent 529 Savings Plan or Indy 529 (if you want to be trendy like me)

This plan began in September 2003 and is a group of just over 250 private schools that will allow me to purchase tuition credits today and redeem them in 18 years when I go to college at any of the participating colleges. (here is the full list of colleges which happens to include the colleges mom, dad and my uncle went to)

For example if college yearly tuition currently costs $10,000, and I invest $10,000 into the program today, even if the cost of attending the college rises to $20,000 I have already paid for it in full. If I invest $2,000, I've paid for 20% of one year's tuition no matter what it becomes when I actually attend college.

So why would I pick the Indy 529 over a regular 529 plan?

Basically I would be using today's money to pay for college when I'm ready to go. Statistics say that college tuition has been increasing about 6% a year, so if that trend continues, I would be getting a 6% return on the money. Of course, college tuition could increase more or less - it's kind of a gamble on what I think college tuition will be doing and if you believe you can make more by investing the money in another area.

Another bonus is that these schools actually give you a discount. The discount varies from school to school, but a 1% discount per year is typical.

The big risk (aside from college tuition not increasing - something that I don't think is going to happen) is if I decide to go to a different college than those listed in the plan, or decide not to go to college at all. While the money could be transferred to another name, if I wanted the money back for other things, I would only get back the money I put in initially, plus an annualized 2 percent gain or loss depending on how the fund which holds the money has performed.

There are also some financial aid implications. While many are predicting that the Indy 529 plan will be treated like a regular 529 plan and counted as the parent's assets for financial aid in the future, currently it would be considered my asset which could affect the amount of financial aid I could qualify for.

I guess the Indy 529 plan makes sense if I know I want to go to a private school and don't think the stock market will perform at its historical average in the future. Since I haven't even reached the third of a year mark in age, these are questions that I haven't considered with much thought and probably won't do so for quite some time. Even though the Indy 529 is not something for me at the moment, it's a creative alternative that certainly could turn out to be a great college investment for certain individuals.

What Will My Return On Investment Be?

With the news that I will probably have to start finding other sources to increase my net worth, I decided that we would see how selling my investment would work out. Thus, my first investment is currently being sold. My uncle picked it up for me for $25 at a flea market and I have my fingers crossed (well, not really crossed because my coordination isn't quite at that level yet, but you get what I mean) that it turns out well.

He also said that he would look for more investment items this weekend for me. I'm off to work on my post that I will submit to the carnival of personal finance (one of my Oct. goals) and should have that up by tomorrow. All continues to go along smoothly (knock on wood - if I could - I can't seem to turn myself over quite yet on my own to do it, so I had to ask mom to help me)

Money Source Throws Wrench In Plans

For those of you who have been following my savings, you'll know that a good portion of it has come from ING with the initial sign up bonus and then referrals afterward. My plan was to have accounts opened for each member of the family and then with my uncle's help, max out the referrals. If I had done that with the three of us, the referral money alone would have come to $750 added to my savings.

Well, a wrench was thrown into that plan when ING announced this morning that to receive the $25 bonus when opening an account with them, it will no longer just cost $1, but you must deposit $250 to get it. Since this is a new change in their policy, I don't know how much it will effect the willingness of people to sign up, but I assume that it will be harder to earn my referral bonuses. It's much easier to open an account with $1 than it is to open one with $250. That means I will probably need to begin looking for another source to pad my savings. As you may have imagined. mom had to pass me the pacifier to calm me down from this news...

My First Antique Investment

I just got word from my uncle that we have made out first antique investment. It's a set of three pewter sake cups that date before WW2 that he purchased for $25. They come in their original box which is always rare I'm told. The question is whether to hold onto them as a long term investment or try to sell them now to generate more cash to reinvest some more. We'll probably sell them quickly to make sure we're well ahead of this month's goals. A baby only a bit over three months old already investing in antique - imagine that!

In other good news I added another 2 ING $10 referrals to my savings over the last few days. That puts me in really good shape for this month.

My Net Worth Rank

I ran across a post over at Free Money Finance that lists the Net Worth of all the finance writers like myself. The result are that I'm at the bottom of the list (this made me cry and it took a pacifier to calm me down):

1. NYC Money -- $689,728.95
2. My Personal Finance Journey -- $263,886
3. My Open Wallet -- $245,124.76
4. 2million -- $193,077.82
5. MMB's Personal Finance Journal -- $180,198.72
6. Capital Ideas -- $123,542
7. My Money -- $83,262
8. Debt Free -- $65,418
9. Personal Finance for the New Age -- $58,882.15
10. Consumerism Commentary -- $36,892.78
11. The Alpha Guy -- $27,818
12. Financial Baby Steps -- $2,164.67

Then I remembered that I have time on my side. Considering I'm only 3 months old, what if I was to project out a bit. Let's assume the average age of the writers is 35 years old. By taking my current net worth and extending it out to when I'm 35, I would have just over $3,600,000 ($2164.67 x 4 x 12 x 35 = $3,636,645.60) which would put me by far and away highest on the list. Granted, there are a lot of things that will happen between now and the time I'm 35, but looking at the numbers that way made me feel a lot better...so much so that I spit out the pacifier and am still gurgling contently.

This Week's Personal Finance Carnival Is Up

The Carnival of Personal Finance (#17) is live. If you aren't familiar with carnivals, they bring together posts from various authors on a specific subject which gives you an opportunity see what others which you might not have been familiar with are writing.

My contributions this week was Really Creative Financing For College which shows 529 Saving Plans, Coverdell Education Savings Accounts and your parent's IRAs aren't the only way you can pay for college when you're creative. There's a lot of good reading to check out.

Best 529 Plans

One of the most frustrating aspects of trying to figure out about 529 plans is trying to get a good comparison on how they preform and their fees (especially when your still trying to get those first words out). As i was looking for simple guidelines, I stumbled upon Kiplinger's Top 529 College Saving Plans.

Their top choice makes sense to me. Index funds usually perform as well or better than managed funds and have low fees. The question is will any state tax benefits outweigh the extra fees if I decide on a 529 plan. Something I still need to research a bit more.

College Savings Superpage

While looking for more information about what's available, I came across SmartMoney's College Savings Superpage which I will have the adults go through with a fine toothed comb (something that I don't need at the moment - I'm still wondering when my hair will come in) to help resolve the best investment for me.

The page lays out the basics for six types of college investment options:

Taxable Investment Account in Parent's Name
529 Qualified Tuition Plan (QTP): College-savings account
529 Qualified Tuition Plan (QTP): Prepaid tuition plan
Coverdell Education Savings Account (ESA)
Custodial Account: UGMA/UTMA
Crummey Trust

and then answers basic questions for each

Does the Account Grow Tax-Free?
Who's Eligible?
How Much Can I Contribute?
How Can I Allocate the Account?
What Can Withdrawals Be Used For?
Can I Change Beneficiaries?
What Are the Financial-Aid Implications?
Who Are the Best Candidates for This Type of Account?

It seems like a great primer for college savings education written is a straight forward manner. I think it will help me a lot in determining where to put my money.

Investing My Money

I am ready to begin investing some of the money I have. As I mentioned before, I decided to take a different approach in these early years. Instead of placing all the money into a 529 Plan or Coverdell Education Saving Account, I have decided to take this money and invest it in antiques. While this is not a typical approach, I have someone who is an expert in this area helping me out so I feel the potential risks are worth the rewards.

My uncle said that he will go on a buying run this weekend and try to pick up some items to begin my investments in this area. I'm excited to see what he will be able to find.

The plan will be to invest any profits into some type of college saving account. I still need to do some more research to find which would be best for me. I will sit down and review 529 Plans, Coverdell as well as non college specific saving options and hopefully come up with a basic plan by the end of this month. It's just a lot of information to take in for someone as young as me.

Where I Keep My Money

This will be a listing I will update on a monthly basis showing where I have my savings:

September 30, 2006

Assets

Cash: $259.31
S&P 500: $2600.00
I-Bond: $1041.60
ING Bank Account: $290.85
Antique Collectibles: $5.00
529 Plan: $0
IRA: $0
Upromise Account: $37.50
BabyMint Account: $0

Total: $4234.26 (+$210.80 or +4.98%)

August 31, 2006

Assets

Cash: $2623.44
I-Bond: $1035.60
ING Bank Account: $321.92
Antique Collectibles: $5.00
529 Plan: $0
IRA: $0
Upromise Account: $37.50
BabyMint Account: $0

Total: $4023.46 (+$165.76 or +4.12%)

July 31, 2006

Assets

Cash: $2463.44
I-Bond: $1031.00
ING Bank Account: $320.76
Antique Collectibles: $5.00
529 Plan: $0
IRA: $0
Upromise Account: $37.50
BabyMint Account: $0

Total: $3857.70 (+$256.40 or +6.65%)

June 30, 2006

Assets

Cash: $2212.80
I-Bond: $1026.40
ING Bank Account: $319.60
Antique Collectibles: $5.00
529 Plan: $0
IRA: $0
Upromise Account: $37.50
BabyMint Account: $0

Total: $3601.30 (+$156.33 or +4.34%)

May 31, 2006

Assets

Cash: $2062.16
I-Bond: $1021.80
ING Bank Account: $318.51
Antique Collectibles: $5.00
529 Plan: $0
IRA: $0
Upromise Account: $37.50
BabyMint Account: $0

Total: $3444.97 (+$150.22 or +4.36%)

April 30, 2006

Assets

Cash: $1917.64
I-Bond: $1017.20
ING Bank Account: $317.41
Antique Collectibles: $5.00
529 Plan: $0
IRA: $0
Upromise Account: $37.50
BabyMint Account: $0

Total: $3294.75 (+$137.33 or +4.17%)

March 31, 2006

Assets

Cash: $1785.93
I-Bond: $1012.60
ING Bank Account: $316.39
Antique Collectibles: $5.00
529 Plan: $0
IRA: $0
Upromise Account: $37.50
BabyMint Account: $0

Total: $3157.42 (+$170.97 or +4.48%)

February 28, 2006

Assets

Cash: $1649.93
I-Bond: $1008.00
ING Bank Account: $315.39
Antique Collectibles: $5.00
529 Plan: $0
IRA: $0
Upromise Account: $37.50
BabyMint Account: $0

Total: $3015.82 (+$141.60 or +5.66%)


January 31, 2006

Assets

Cash: $1569.56
I-Bond: $1000.00
ING Bank Account: $314.49
Antique Collectibles: $5.00
529 Plan: $0
IRA: $0
Upromise Account: $37.50
BabyMint Account: $0

Total: $2844.85 (+$81.70 or +2.79%)

December 31, 2005

Assets

Cash: $1513.91
I-Bond: $1000.00
ING Bank Account: $313.50
Antique Collectibles: $5.00
529 Plan: $0
IRA: $0
Upromise Account: $12.44
BabyMint Account: $0

Total: $2844.85 (+$482.57 or +20.43%)


November 30, 2005

Assets

Cash: $1001.30
I-Bond: $1000.00
ING Bank Account: $312.50
Antique Collectibles: $50.00
529 Plan: $0
IRA: $0
Upromise Account: $6.00
BabyMint Account: $0

Total: $2362.28 (+$51.29 or +2.21%)

October 31, 2005

Assets

Cash: $993.78
I-Bond: $1000.00
ING Bank Account: $271.73
Antique Collectibles: $50.00
529 Plan: $0
IRA: $0
Upromise Account: $3.00
BabyMint Account: $0

Total: $2318.51 (+$218.51 or +10.41%)

September 30, 2005

Assets

Cash: $2000.00
ING Bank Account: $100.00
529 Plan: $0
IRA: $0

Total: $2100.00

Blush, Blush, Blush

The kind people over at Board Game Madness think I'm Adorable!. (^_^) Mom and dad think so, too, but they have to because they're my parents.

The writer over at Blog Y ? also complimented me on getting an early start to my college savings.

With all these compliments, all I can do is blush....

Closing In On This Month's Goals

Some quick updates:

I have 3 of the five link trades that I wanted to get this month. The three trades are with My Open Wallet, Million Dollar Goal and No Credit Needed. Now I just need to find two more.

Looking at this moths overall goals, I've already opened a Upromise account and sent some emails out to get people to join. I still have to open a BabyMint account. I did submit a post to the carnival of Personal Finance this week, so I just need to keep up with that and I'm within $30 of my goal for how much I wanted in my account. Not bad for the first 7 days of the month.

With the savings goal in mind, I've received a couple more bonuses the last couple of days raising my savings by $20.00. This has been a good source of income for me and I will be sorry when it isn't available anymore.

Happy 3 Months To Me!

When you're as young as I am, celebrations are counted in months and not years. Today I turned 3 months old, a full quarter of a year old! While it's a time for celebration, it's also a good time to reflect on how I am progressing. I feel confident that I have laid down a good foundation for my savings and they way they are currently growing.

I still need to work on my goals for this month, but I have already accomplished some of them in this first week. All signs point that I can meet or exceed them for this month.

Life is good for this little girl (knock on wood)!

College Costs Still Rising

I just heard the news that college tuition is still rising, but not quite as quickly as it has in the past couple of years according to a usatoday.com college tuition survey. Here are some of the things it had to say:

Eleven of the schools surveyed increased in-state tuition (including mandatory fees) for first-year, full-time freshmen in 2005-06. That's down from 29 schools last year and 41 in the 2003-04 school year.

This year's 7.1% median increase is smaller than last year's 9.3%, or the previous year's 12.5%. Still, tuition at some schools have increased 70% or more in the past three years; the median increase is 33% since 2002-03.

The largest in-state jump this year was at the University of Colorado, Boulder: nearly 24%, from $4,341 to $5,372.

The smallest increase this year was at the University at Buffalo (SUNY): 1.7%, from $5,966 to $6,068.

What I also noticed (actually told - I still can't read) is that the price range in tuition cost is pretty dramatic. If I were to attend the least expensive school on the list (University of Florida, Gainseville), I already have over a half year's tuition paid for ($3180). Then again, other colleges have tuition over $11,000 a year. I'm sure glad I'm starting to save early.

$20 More Into Savings & Emails

The referral bonuses keep coming in and I added another $20 to my savings. My uncle talked with my mom yesterday about having dad sign up and open an account. This would keep a nice steady stream of money coming in for me.

In addition, we are starting to send out emails to all the relatives to help add any little bit to the Upromise program. Since time is on my side, even if the account only produces $5 a month, that will still mean over a $1000 added to my college fund.

Really Creative Financing For College

My uncle had a good one on one with me about creativity in finding sources for paying for college. While the money being saved now is to be used for my education, he doesn't want me to take the money for granted. He explained that by using a little creativity I might be able to pay for my education in full and have this money for my first house down payment or retirement.

As an example, he explained about a guy in England that started the site a couple of months ago called Million Dollar Homepage to pay for his college education. This is how it started according to him:

It was a muggy summer's night late in August, the time around midnight, and there I was, lying on my bed with a notepad, brainstorming ideas to make money for uni. I think I'm quite a creative person, so I wanted to come up with an idea that was unique and would hopefully capture people's imagination, but with the whole purpose of making money. No point being shy about it! I think we brits can sometimes be too shy about money. Well bugger that, I DO NOT want to be a broke student!

So anyway, after an hour of two of jotting random things on paper, the idea seemingly popped out of nowhere. Almost like my subconscious mind had been ticking over in the background, working it all out. So it just kind of happened. That's about it. I scribbled it down and within about 10 minutes a picture of what needed to be done had emerged.

Well, his creativity ended being a big hit and he has earned over $250,000 for his simple idea and looks likely he will reach his goal of $1,000,000 which will more than pay for his college.

My uncle also told me about a guy that asked everyone to send him a penny to pay for his college education and his story has since turned into an Urban Legend. He managed to raise $28,000 by asking for pennies:

Mike Hayes...came up with a novel idea to solve his tuition and college expenses problem. Figuring that just about anyone could spare a penny, he brazenly asked everyone to do it.

He wrote to Chicago Tribune columnist Bob Greene, asking him to request each of his readers send Hayes a penny. The notion tickled the veteran columnist's fancy enough that he was willing to go along with it. From Bob Greene's column:

No one likes being used, but in this case I'm willing. It sounds like fun.

Mike Hayes, 18, is a freshman science major at the University of Illinois in Champaign. He is looking for a way to finance his college education, and he decided that my column is the answer.

"How many people read your column?" he asked me.

I told him I didn't know.

"Millions, right?" he said. "All over the country, right?"

I said I supposed that was true.

"Well, here's my idea," he said, and proceeded to explain.

I'll break it down simply: Mike Hayes wants every person who is reading this column right this minute to send him a penny.

"Just one penny," Hayes said. "A penny doesn't mean anything to anyone. If everyone who is reading your column looks around the room right now, there will be a penny under the couch cushion, or on the corner of the desk, or on the floor. That's all I'm asking. A penny from each of your readers."

Donations were received from every state in the United States, plus Mexico, Canada, and the Bahamas. Yes, he ended up with the $28,000 he'd set out to get.

My uncle likes to talk a lot about how building a foundation to be prepared is important, but also to be creative and seek new ways of doing things. I'm still a little young to take it all in, but I think he may have something there. I mean, how many kids start their own blog at the ripe old age of a month?

Some New Information To Think About

I came across an article in the Miami Herald that has been bothering me about 529s as I have been researching. That is that they seem like mutual funds with a specific purpose (ie - to save for college), but picking ones that perform well and without fees that eat up the gains is a tough task. Maybe simply placing the money into a S & P 500 index fund (forgoing the tax benefit of it growing debt free) is a smarter move. Some of the points that article made:

Among the all-stock investment options offered by the (state sponsored 529) plans, Hurley said, performance varied by huge margins, with the best-performing plans earning more than 11 percent a year on average over the last three years and the worst registering gains of just 4.4 percent. Over the same time period, the Standard & Poor's 500 stock index returned 12.02 percent a year, according to Ibbotson & Associates, a market research firm based in Chicago.

That tells me that over the last three year that the 529s have been in existence, I would have been better in an index fund since it performed better than the very best of the 529s. In addition:

Some of the plans offer convenience and good investment options, but they're almost always more costly than simply investing in a mutual fund, said Hurley. His research indicates that the average plan charges higher management fees than a similar mutual fund. That difference adds up over time and is worth paying only if you're getting enough in the way of tax breaks to compensate for the additional costs.

So not only does the stock index fund perform better, stock it also has fees much lower than any of the state 529 funds. With this in mind, the 529 plans begin to lose some luster (even with the tax free compounding). Add onto that

...But those tax breaks may be small unless parents invest large sums for college -- the write-off is based only on the earnings from the 529, not the amount invested. Meanwhile there are significant tax penalties for using 529 assets for anything but higher education.

While I keep assuring everyone that I will use this savings for college, it might be nice to have a bit more flexibility. I also need to do more research about the government credits and how a 529 plan would affect them:

Then, too, middle-income taxpayers could be giving up tax credits when they pay for college with 529 assets, said Greenberg. The federal government offers the Hope Scholarship and Lifetime Learning tax credits for paying for college. But those who finance college with tax-free savings can't use the credits, because the government considers it double dipping. In some cases, the lost credits would be worth more than the tax-free income.

All this goes to show that I need to do some more research before committing to any investment plan. It's good that my uncle will be investing the money in antiques for the time being to give me more time to research this all more thoroughly.

Another $20 To My Savings

With a couple more referrals from ING, I have been able to use over half (13 so far) of the 25 that are offered. I should point out that for most people who sign up for a bank account shouldn't count on getting referral money nearly as easy as it has seemed for me. My uncle runs a website where he gets requests for them on a regular basis which makes it seem much easier than it is. The good point is that it is another free source to build my college savings.

Upromise Account Set Up

I signed up for Upromise to get one of my goals this month out of the way - it was a fairly easy process and took less than 30 minutes total. I did do a search on the Internet before signing up and found a code that gave me a $3 bonus for signing up (that was the highest bonus I could find). I think that I will add up any funds gained through the program at the end of each month and add it to my total since that will be the easiest approach.

Since I still haven't decided on a 529 college savings plan I did not hook my account up to any. It seems like Upromise has a limited number of choices and must hook it up with one of the 529 plans they offer, but I did read that it's possible to get the money send if you request it by snail mail. I'll worry about that a little while down the road.

I also sent out emails to get other family members to join in and help. I still have to ask dad for some more emails I didn't have, but will do that this week too. Hopefully between all the extended family, I can add some extra money into the account (the advantage of being the first grandchild on both sides of the family).

Although I'm not expecting much, every little bit will help and as long as nobody changes their spending habits (which I've told everyone to be careful about), it's free money. I will continue to report on how this program works for me.

ING Is Becoming My Best Friend

The ING savings account has done wonders for my college saving plans and net worth thus far. I received 2 more referrals which adds an extra $20 to my total. I need to sit down (well, lie on my back...I still don't sit very well) with mom (if you remember from the first post about this account, she was a bit nervous about opening the account due to some past issues with identity theft) and have a good heart to heart with her (if I smile enough, I know she'll have to agree with me)

I'm hoping to convince dad to also open up an ING account with the money earmarked for my savings and then have them open out an account as me as the primary owner (with them as co-account owners). If the referrals continue like this, I think that I'll be able to convince them that it's a smart move.

Carnival of Personal Finance #16

The latest carnival of personal finance is up at the Canadian Capitalist. My entry this week was The More I Save, The Less Financial Aid I'll Get Myth.

As I stated in my goals, submitting a post to each one of these carnivals this month is something I will try to do. They are fun and have a wide variety of posts on personal finance.

October Goals

As I stated (gurgled) in my last post, I wanted to make some goals for October. I have been having quite a few discussions with him and he is big on setting and writing down goals to help motivate you to reach them. After discussing it with my uncle, there are the goals we have set out:

Savings Goals:

Try to increase my current savings by 5% this month With $2144.67 currently in my savings, that means that the goal is to increase my savings by $107.23 to have a grand total of $2251.90 by the beginning of November.

Open a Upromise account

Open a BabyMint account

Blog Goals:

Submit posts to the carnival of Personal Finance each week

Trade links with 5 other financial blogs that I like

I think that all of these goals can be attained and it will keep a good momentum going for my savings. I will report back at the beginning of November and we can see how I did with all of them.

Happy 1 Month Birthday For This Blog

My blog has been up and running for a month now! While that may not seem like a long time for most people, it's been over a third of my entire life. The month has gone by quickly, but I have learned a lot this month and I'm feeling a lot more secure about my financial future.

I don't think that a lot of people have discovered my blog yet, but that is something that my uncle says will just take time. He tells me to be patient and eventually more and more people will discover it, but I'm getting to the age where I tend to squirm a lot and not have a lot of patience.

Since the blog has reached a month old, I think that I need to set some goals for October (besides grabbing my feet which I'm becoming an expert at). I think a short list for both the blog and my finances would be good, so I'll sit down with my uncle and work those out in the next day or two.

More from ING

ING has been good to me since opening the account. I received another 4 referal bonuses from them which adds $40 to my savings and have earned a total of $90 from the referrals since opening the account. I also recieved $0.04 in interest for the month of Septemebr for my account. That brings my total to $2144.67 which I'm pleased about and I'm looking forward to finding new ways to increase my college savings in the months to come!

Running List Of My Savings

Mom suggested to me (and I gurgled with a smile to approve) that a running list of where my savings has come from and accumulated would be in order for those who find my blog at a later date.

Septemer 2005 - the beginning

2nd - $1000.00 Gift from my uncle ($1000.00)
2nd - $500.00 Gift from grandpa ($1500.00)
2nd - $500.00 Gift from Nana (grandma)($2000.00)
27th - $50.00 Sign-up bonus from ING bank ($2050.00)
28th - $30.00 3 referral bonuses from ING bank ($2080.00)
30th - $20.00 2 referral bonuses from ING bank ($2100.00)

October 2005

1st - $4.63 Advertising Income (2104.63)
1st - $40.00 4 referral bonuses from ING bank ($2144.63)
1st - $0.04 Interest earned in September in ING bank account ($2144.67)
2nd - $20.00 2 referral bonuses from ING bank ($2164.67)
3rd - $20.00 2 referral bonuses from ING bank ($2184.67)
4th - $20.00 2 referral bonuses from ING bank ($2204.67)
5th - $10.00 1 referral Bonus from ING bank ($2214.67)
7th - $10.00 1 referral Bonus from ING bank ($2224.67)
9th - $10.00 1 referral Bonus from ING bank ($2234.67)
11th - $10.00 1 referral Bonus from ING bank ($2244.67)
12th - $10.00 1 referral Bonus from ING bank ($2254.67)
15th - $10.00 1 referral Bonus from ING bank ($2264.67)
20th - $26.06 Profit From Antique Investment ($2290.73)
22nd - $10.00 1 referral Bonus from ING bank ($2300.73)
31st - $3.00 Upromise Account ($2303.73)
31st - $14.09 October Advertising ($2317.82)
31st - $0.69 ING Interest - October ($2318.51)

November 2005

20th - $10.00 1 referral Bonus from ING bank ($2328.51)
21st - $10.00 1 referral Bonus from ING bank ($2338.51)
23rd - $10.00 1 referral Bonus from ING bank ($2348.51)
24th - $10.00 1 referral Bonus from ING bank ($2358.51)
30th - $3.00 Upromise Account ($2361.51)
30th - $7.52 November Advertising ($2369.03)
30th - $0.77 ING Interest - November ($2369.80)

December 2005

11th - $84.97 Profit from selling 5 antique cups from investments ($2454.77)
14th - $68.38 Profit from selling 4 antique cups from investments ($2523.15)
25th - $100.00 Xmas Gift from uncle ($2623.15)
25th - $200.00 Xmas Gift from nana ($2823.15)
31st - $6.44 Upromise Account ($2829.59)
31st - $14.26 December Advertising ($2843.85)
31st - $1.00 ING Interest - December ($2844.85)

January 2006

6th - $46.27 six month advertising link payment ($2891.12)
31st - $25.06 Upromise Account ($2916.18)
31st - $9.38 January Advertising ($2925.56)
31st - $0.99 ING Interest - January ($2926.55)

February 2006

16th - $29.85 three month advertising link payment ($2956.40)
28th - $50.52 February Advertising ($3006.92)
28th - $0.90 ING Interest - February ($3007.82)
28th - $8.00 US Treasury I-Bond Interest ($3015.82)

March 2006

26th - $9.32 Advertising link ($3025.14)
31st - $126.68 March Advertising ($3151.82)
31st - $1.00 ING Interest ($3152.82)
31st - $4.60 US Treasury I-Bond Interest ($3157.42)

April 2006

30th - $131.71 April Advertising ($3289.13)
30th - $1.02 ING Interest ($3290.15)
30th - $4.60 US Treasury I-Bond Interest ($3294.75)

May 2006

31st - $144.52 May Advertising ($3439.27)
31st - $1.10 ING Interest ($3440.37)
31st - $4.60 US Treasury I-Bond Interest ($3444.97)

June 2006

30th - $150.64 June Advertising ($3595.61)
30th - $1.09 ING Interest ($3596.70)
30th - $4.60 US Treasury I-Bond Interest ($3601.30)

July 2006

7th - $100 Birthday Present From Uncle ($3701.30)
31st - $150.64 July Advertising ($3851.94)
31st - $1.16 ING Interest ($3853.10)
31st - $4.60 US Treasury I-Bond Interest ($3857.70)

August 2006

1st - $9.36 Advertising ($3867.06)
31st - $150.64 August Advertising ($4017.70)
31st - $1.16 ING Interest ($4018.86)
31st - $4.60 US Treasury I-Bond Interest ($4023.46)

September 2006

1st - 9.36 Advertising ($4032.82)
30th - $194.41 August Advertising ($4227.23)
30th - $1.03 ING Interest ($4228.26)
30th - $6.00 US Treasury I-Bond Interest ($4234.26)

October 2006

1st - 9.36 Advertising ($4243.62)

September Advertising

September advertising brought in $4.63 to my total which just thrills me (I even babbled a bit when told!). While that may seem like a small amount to some people, you have to remember that I have time on my side. Being extremely conservative, let's look at the possibilities.

Assuming that I make $4.63 a month until I go to college, the advertising on this site will place just a tad over $1,000 into my college fund ($4.63 x 12 months x 18 year = $1000.08) not counting any compound interest earned. That's nothing to sneeze about. Of course, I hope my blog becomes wildly popular and that I can average more than that over the long run (although I suspect I will have months when I make less than that.

Now since this is earned income for me, I may decide to place it in a Roth IRA instead of my college savings. Do the math for this and I come up with over $3,500 ($4.63 x 12 months x 63 years = $3,611.40) for my retirement savings excluding any compound interest (which would be tax free in the Roth IRA) earned.

When you start to look at it like this, $4.63 is a much bigger deal than nothing at all and it goes to show that starting to save little amounts early can make a significant difference.

College Financing Calculator

Even though my college days are a ways off, it's never too early to know where the resources that will be useful for college are located.

For those looking to get a rough estimate of coolege costs and what you may be expected to pay, you can use the College Board's college financing calculator to get a rough estimate of your costs.

The estimate will be quite rough since there are a lot of contributing factors that it can't take into account, but for those who would like to see a number, it can be a good place to begin.

Free College Savings Plans

I am beginning to learn about the free college savings plans that are out there. The four that I have come across so far are Upromise, BabyMint, The Education Plan, and futuretrust. Basically, you sign up with them and then if you make purchases through them with their paticipating stores, they kick a small amount of money for your 529 college savings plan. I need to do a bit more research on each of them and will likely sign up with all of them to see which one is the best. I'll be reporting on my findings as I do that and hopefully this will also add a few extra dollars into my account.

Another $20 Into The Pot

I had another 2 referral sign ups from ING come through today which added another $20 to my growing nest egg. That means I'm up to $2100 and haven't even reached the ripe old age of 3 months yet!

The More I Save, The Less Aid I'll Get Myth

As I was sitting in my baby carriage minding my own business and dozing off to sleep, I happened to overhear a conversation between my mom and one of her friends. My mom was was explaining about how we were already beginning my college savings to which her friend replied, "it's not worth saving money for college because the more you save, the less aid you're child will qualify for."

Well, this certainly woke me up and mom had to shove a pacifier in my mouth to keep me quiet. I had a conversation (well, I gurgled and listened) with my uncle about this concern and knew that saving money for college will reduce aid is largely a myth.

First off, it's important to remember that a lot of financial aid is in the form of loans. So when you have saved money, you're less likely to need to borrow money and thus won't need this form of financial aid.

There are a few issues that you need to be aware of that can help you save money while not affecting the financial aid that you qualify for. The main issue is that I don't want a lot of the college savings in my name. If the money I save for college is in my name, up to 35% of it may be counted against the aid distribution formulas. now if the money is in my parent's name, those same aid formulas will only count 5.6% of my mom's and dad's assets.

While the Coverdell ESA and 529 Plans are set up and meant for me, they're classified as "parental assets" instead of my assets under federal aid rules. Another aspect that makes them an appealing way to save for college.

While saving money now may mean that I qualify for a bit less in financial aid when I go to college, it certainly won't be a dollar for dollar reduction. I would much rather have the savings than the loans. While saving for college will reduce financial aid may be a convenient excuse for parents not to save, it's a false excuse that should be avoided.