Ranking of America high schools shown few surprises

U.S. News and World Report released its first ever Best High Schools list in America Friday.

Nearly 1,600 high schools, out of 18,500 analyzed in 40 states, met U.S. News' criteria for great high schools, based on 2005-06 test data. The top 100 schools were awarded "gold medals," followed by 405 silver medals and 1,086 bronze medals.

The following 10 states and the District of Columbia did not have sufficient data available for analysis: Alabama, Alaska, Mississippi, Montana, Nebraska, North Dakota, Oklahoma, South Dakota, Utah, and Wyoming.

U.S. News editor Brian Kelly said his magazine evaluated college readiness, as measured by state reading and math test results, and factored in the performance of low-income students - who tend to score lower on tests.

U.S. News also looked at whether black, Latino and low-income students were scoring higher than the statewide average for similar students. Finally, the schools were rated on their AP test participation rate and how high students scored on AP tests.

The result is a more complete picture of education than the Newsweek list, Kelly maintained.

Paul Gazzerro, the lead analyst for the project, said the method requires schools to do more than Newsweek's to be recognized. The methodology was developed by School Evaluation Services, a K-12 education data research business run by Standard & Poor's.

Kelly said that it's important to measure schools based on how all students are doing, not just the high achievers.

"To be a very good school performing at a very good level is not enough," Kelly said. "We're looking at schools that are exceeding expectations."

Kelly stressed that it didn't mean a school is bad if it didn't receive an award from the magazine. But Gazzerro said it could show that a school's disadvantaged students are "falling through the cracks."

However, 20% of schools on the list are selective.

Apply for US citizenship now may save you money

11/22/07 Update -

The Dept of Homeland Security (DHS) failed to prepare for a massive influx of applications for U.S. citizenship and other immigration benefits this summer, prompting complaints that several hundred thousand people likely will not be granted citizenship in time to cast ballots in the 2008 presidential election.

This summer, immigrants rushed to beat drastic fee increases for naturalization, legal residency, work permits, international adoptions and a host of other immigration benefits.

Citizenship cases typically took about seven months to complete. Now, immigration officials can take five months or more just to acknowledge receipt of applications from parts of the country and will take 16 to 18 months on average to process applications filed after June 1.

Such a timeline would push many prospective citizens well past voter-registration deadlines for the 2008 primaries and the general elections.

Earlier this year I reported -

If you have your green card for 5 years or more (3 years or more for someone married to U.S. citizen), it is time to become an U.S. citizen!

You'll save $275 before July 30.

Remember, by becoming an U.S. citizen, you'll save more in long run. For example, you don't have to renew your green card every ten years.

Finally, if you need a proof of U.S. citizenship for any reasons; you'll save time & money by applying for a U.S. Passport ($97 and 10 - 12 weeks) instead.

Starting July 30 2007

- The fee for Naturalization (N-400) increases from $400 to $675.

- The fee to renew or replace Permanent Residence Card (I-90) increases from $260 to $370.

- The fee to apply for Certificate of Citizenship (N-600) increases from $255 to $460.

Considering a Mac

From wsj.com

Q. Who should consider a Mac?

A. Pretty much every average consumer (has money) using a computer should at least look at the Mac.

It combines gorgeous hardware with an operating system that is superior to Windows, with better built-in software.

It can even run Windows programs if you buy and install a copy of Windows.

And you won't be vulnerable to the vast array of viruses and spyware that threaten Windows users. Only a handful, so far, have been written to run on the Mac operating system, OS X.

Q. Who shouldn't consider the Mac?

A. People playing cutting-edge games should stick to Windows computers, because there are far fewer games written for OS X. Apple doesn't offer hardware tuned for serious gaming.

People looking for the lowest-price low-end PCs should also avoid the Mac, because Apple's cheapest model, the Mac Mini, costs $599. And, it is BYOKMM - Bring your own Keyboard, Mouse and Monitor.

Q. What desktops does Apple offer for consumers?

A. Apple's main consumer desktop is the one-piece iMac, which is the best (but expensive) consumer desktop on the market. It comes in four models, with built-in 20-inch or 24-inch, flat-panel screens at starting prices ranging from $1,199 to $2,299.

Q. How about Mac laptops?

A. There are two. The entry-level MacBook has a 13-inch screen and a starting price of $1,099. The high-end MacBook Pro comes with either a 15-inch or 17-inch screen and starts at $1,999.

Apple currently doesn't offer a smaller laptop for road warriors.

Q. What minimum specs should I look for on a Mac?

A. All Macs come with at least one gigabyte of memory -- twice the minimum required for the new version of OS X, called Leopard.

If you can, get two gigabytes. Apple charges a lot for extra memory, but you can buy it for less at stores and online providers.

Macs use the same dual-core Intel processors and graphics systems as many mainstream Windows computers; and, as with Windows, you shouldn't pay extra for greater processor speed.

The iMac comes with at least a 250-gigabyte hard disk, and Mac laptop hard disks start at 80 gigabytes.

Apple offers much larger disks as options, which you should consider if you store a lot of photos, music and video files.

Personal recession

By Liz Pulliam Weston

You may feel increasingly squeezed even while your income or assets are growing. Or you might think you're doing fine when your economic foundations are being eroded underneath you.

Liz Weston looks at three important indicators on your personal finances -- your real income (and how far it goes), your net worth and your economic prospects.

If you're not doing well in at least two of these three areas, you're in danger of sliding backward in your journey.

Make some moves now to make sure that doesn't happen.

Is your real income rising or falling?

If you're not making at least 2% more than you were last year, you're not keeping up with the general rate of inflation.

Even if your overall wages are growing, you might still be feeling a pinch.

The most likely culprits are health care, energy costs and food.

All are 4% to 5% higher than a year ago. The more of your budget that is spent on these expenses, the more you're likely to feel as if you're losing ground.

How's your net worth?

Ideally, your net worth is higher now than it was last year. But it might not be.

Your home's value may have slid, your investments may have faltered or you may have added new debt.

A one-year drop in net worth isn't necessarily a crisis, but you should have a plan to start building your wealth.

Possible economic fixes:

Pay down your debt

Increase your contributions.

Build your savings.

Now it's time to look at the final piece of the puzzle: your economic prospects.

How's your future look?

Is your company growing so fast it's bursting at the seams -- or did it just announce another round of layoffs?

If it's publicly traded, what do analysts say about its future, and how's the stock price doing? What are the prospects for your industry?

Now look closer to home.

How well-regarded are you within your company and within your industry?

Have you identified your next career step and determined how to get there?

Are you adding skills and people to your network of contacts, or are you hiding in your cubicle?

Investing strategy from Ric Edelman

From his new book "The Lies About Money"

1) Save regularly.

2) Hold your investments for very long periods.

3) Build a highly diversified portfolio.

4) Periodically rebalance that portfolio.

Make your cash work harder

From wsj.com

Here's how to squeeze the most out of your cash:

-Pay bills from a no-fee, low-minimum checking account.

-Keep extra savings in a high-yield online savings account.

-Pile expenses onto credit cards that give cash back or other rewards.

But it does require some efforts from you

-Move your cash among your accounts.

-Watch out the fees - such as overdraft fee, or late payment fee.

Don't cash this check!

I received a letter from Chase Bank and it has a check payable to me.

At first, I thought it is a reward check from my Chase Reward Card.

It turns out to be a bait from Trilegiant Corp. -

If I cash the check, my Chase credit card will be charged $59.99 for six months of Shoppers Advantage benefits.

It claims it will give me a dollar back for every dollar charged to my Chase credit card up to $200, year after year.

I googled Trilegiant and I found

Trilegiant Corp. and Chase Bank have settled with AG from 15 states to resolve allegations that the companies misled consumers into paying for membership programs that purported to provide consumers with discounts on auto and home repairs, shopping, and other goods and services.

Shoppers Advantage is one of the programs.

Too bad my state is not one of the 15 states.

In the end, I tore up the check.

OSC

The Office of Special Counsel for Immigration Related Unfair Employment Practices (OSC) is a federal government agency that you may not heard of. It is in the U.S. Justice Department's Civil Rights Division.

It protects U.S. citizens and individuals from

employment discrimination based upon citizenship or immigration status and national origin,

unfair documentary practices when verifying the employment eligibility of employees (Form I-9), and retaliation.

OSC's telephone intervention program is an innovative form of alternative dispute resolution which can resolve potential immigration-related employment disputes within hours or minutes.

Employer Hotline: 1-800-255-8155

Worker Hotline: 1-800-255-7688

Redesigned Naturalization Test

The following guidelines will determine whether naturalization applicants will take the current test or the redesigned version:

If an applicant:

Applies BEFORE October 1, 2008 and is scheduled for his or her naturalization interview BEFORE October 1, 2008, he or she will take the current test.

Applies BEFORE October 1, 2008 and is scheduled for his or her naturalization interview AFTER October 1, 2008, he or she can choose to take the current test or the redesigned version.

Applies AFTER October 1, 2008, he or she will take the redesigned version.

Is scheduled for his or her naturalization interview AFTER October 1, 2009, regardless of when he or she applied, he or she will take the redesigned version.

You can find the current test here and redesigned version here.

Cash is king

JONATHAN CLEMENTS of GETTING GOING says

When recession rules, cash is king.

Worried about a recession? Here's what to do:

• Keep funding your 401(k) plan to get the full employer match.

Why? Not really help you in the recession.

• Stockpile cash in a money-market fund.

• Set up a home-equity line of credit.

• Pay off credit-card balances.

The technology of XO laptop

The XO laptop is designed by the One Laptop Per Child project. They want to provide a $100 laptop to every child in the developing countries.

The XO will cost $175 $188 and have the following technology:

366 MHz 433 MHz AMD Geode LX-700 x86 Processor
128 MB 256 MB RAM
512 MB 1 GB NAND Flash Storage
3 USB Ports
2 watts power usage during nominal load
802.11b / g-based WiFi Mesh networking
Dual Mode Display (Color or high-contrast for outdoors)

Also worth nothing is the battery: the nickel-metal hydride battery selected will allow the XO to operate for between four and eight hours depending on what features are in use. And when power sockets aren't available, users can recharge the battery with a built-in pull-string charger.

Power usage will be at its highest when the device is in "e-book mode." The XO laptop's unique 7-1/2 inch dual-mode LCD supports a resolution of 800x600 in color mode, but it jumps to 1200x900 in monochrome mode for reading and ease of use outdoors. In that mode, power usage will be closer to 4-8 watts.

As far as software, the OLPC will run a suite based around Linux, X-Windows, the lightweight Matchbox window manager, and the Sugar desktop environment. A FORTH interpreter is provided to teach programming skills.

Everything created on the laptop will automatically get backed up to the child's Google account, using a mesh networking infrastructure. This networking protocol is a form of Internet connection sharing that allows a single connection to be shared by many nearby laptops. There is also shared school software that sits on a common server accessible by all students.

OLPC - best use of money?

OLPC stands for One Laptop Per Child. The project is intedned to provide low-cost computers to the children of developing countries.


BITS of nytimes.com reported the following

The One Laptop Per Child project is starting a “Give 1 Get 1″ campaign to try to jump start its drive to bring its XO laptop to children in the developing world.

Give 1 Get 1

In return for spending $399, American customers will receive their own laptop as well as paying for a second computer for children in countries that are among the poorest of the poor: Afghanistan, Cambodia, Haiti and Rwanda.

OLPC hopes that by subsidizing the purchase of computers in these four countries, other countries will be prompted to make their own investments on their children.

If we built the laptop, will they buy it?

Quanta Computer is beginning mass production of the laptops in OctoberNovember (some 40,000 units will be produced in November, then about 80,000 the following month), but with far fewer than the 3 1 million orders that OLPC was waiting for.

So far, not a single government has written a check for the laptops.

The OLPC is facing skepticism among potential customers — the governments in developing nations — mainly because the laptops' price has gone up from $100 to $188. Given that poor countries only allocate less than $20 per year per pupil to education, few governments are willing to invest this much in technology for education.


Also, the technology of XO laptops is unusual — a small green-and-white machine that communicates with a wireless, peer-to-peer network and is not running Microsoft’s Windows or Office. So even if a government is willing to invest in computers, they have to bet on an odd-looking box and unfamiliar software.

Instead, I think that building schools, hiring teachers, and buying books and equipments would be better use of education dollars in the developing world.

P.S. More reporting from msn.com on the '$100 laptop.'

Bad debt to avoid

Source: DEAL WITH YOUR DEBT

BAD loans to avoid

1) Payday loans

2) Rent-to-own deals

3) Tile or "pink slip" loans

4) Direct-deposit advances

5) Refund anticipation loans

6) Pawnshop loans

7) 125 or high-loan-to-value mortgages

8) Debt-consolidation loans

9) Margin loans

Also myths on housing

1) Real estate prices always rise

2) A house is a great investment

3) Buying is always better than renting

4) homeownership comes with great tax breaks

Investing by Bogleheads

Source: "The Bogleheads' Guide to Investing"

Before you start investing

1) Graduate from paycheck mentality to net worth mentality. It's not how much you make, it's how much you keep. However, in recent years, high-income earners have gotten much wealthier than low-income earners.

2) Pay off credit card and other high-interest debts because it's the highest, risk-free, tax-free return on your money that you can earn.

3) Establish an emergency fund and carry proper types and amount of insurance. Emergencies always showing up when you're least expected; and bad news usually come in threes.

Start to save early and invest regularly.

Estimate your retirement need. You can't reach your goal if you don't have a target.

Indexing via low-cost mutual funds is a strategy that will most likely outperform the vast majority of strategies in long term.

6 excuses for not save for retirement

By JONATHAN CLEMENTS of wsj.com

1 "I still have plenty of time."

2 "My house is worth a bundle."

3 "My investments are doing great."

4 "I'll receive a fat inheritance."

5 "I have a pension."

6 "I'll work in retirement."

Upgrading Dell OptiPlex GX1

Why?

A good exercise for CompTIA A+ students. Many slot-1 motherboards could be upgraded to run the Tualatin processor by using Slot-1 adaptor.

I done it because I have all the components and it is easy to work on a GX1.

The followings are how I did it, with the help of many web pages. One of them is Dell GX1 Upgrade.

--------------------------------------------------------------------------------

This is the original Dell GX1 system that I have

Processor: Intel Pentium III 500 MHz (Slot 1, L2 Cache 256 Kb, 100 MHz FSB)

Memory: 128 mB

BIOS: a09

Onboard video memory: 4 mb

--------------------------------------------------------------------------------

The followings are what I did to upgrade the system

-I downgraded the BIOS from version a09 to a07. Save GX1_A07.EXE onto a bootable floppy disk and reboot the system with the floopy disk.

-I took out the 128 mB DIMM memory module and put in three 256 mB DIMM memory modules. The 256 mb modules need to be double sides. This GX1 motherboard is one of the few could have memory of greater than 512 mb.

-I took out the Pentium III assembly and put in the Powerleap PL-iP3/T upgrade with a Celeron 1200 CPU.

-I replaced the fan on the Powerleap PL-iP3/T with the fan from the Pentium III assembly. The original Pentium III fan may not pwerful enough; however, the GX1's fan (see below) is specially designed for Dell.

-I put in a PCI video card to increase the video memory to 16 mb.

-The computer rebooted with no problem!

-I enabled the ACPI in the system setup so the OS will set this computer as an Advanced Configuration and Power Interface (ACPI) PC . You enter the system setup with F2.

-I did a clean install of Windows XP Home Edition.

-I disabled the onboard video.

--------------------------------------------------------------------------------

Here is the upgraded Dell GX1 system

Processor: Intel Celeron 1.2 GHz (Tualatin Socket 370 FC-PGA2, L2 Cache 256 Kb, 100 MHz FSB)

Memory: 768 mB

BIOS: a07

Video: 16 mB PCI card

--------------------------------------------------------------------------------

More notes:

1) The CPU speed increased from 500 MHz to 1200 MHz, 2.4 times faster.

2) After the CPU upgrade, the system setup says that it has a Pentium III 800 MHz processor with 512 kb L2 cache. But the CPU-Z says it has an Taulatin Celeron 1200 MHz processor.

3) CPU fan of most Dell computers has a proprietary design that includes an RPM sensor and the color white wire carries the fan sense signal.

Without the proprietary connector, the BIOS does not recognize the fan and you get an error on boot. It says 'Alert! Previous fan error. Press F1 to continue or F2 for setup.'

Third-party fans without this connector work great and the computer works just fine. But you won't be alerted if the CPU fan is dying.

Getting passports for my family

09/08/07 - My son got his birth certificate back today.

09/07/07 - I got my old passport back today. My daughters also got their birth certificate back too.

09/04/07 - I got my passport today. I sent in my renewal application on 8/2/07 (see below).

09/01/07 - My daughters received their passport today. They also applied at the post office on 8/4/07 (see below).

08/31/07 - My son received his passport today. He applied at the post office on 8/4/07 (see below).

08/09/2007 - We are able to check on the status at travel.state.gov


Mine

- My passport was expired last year; however, I was still able to use the application form DS-82 to renew the passport by mail.
- I gotten my set of picture at the town hall that cost me $10 - no line.
- The fee to Department of State is $67.
- I mailed the application on 8/2/07 by Priority Mail.

My children's

- They have to apply in person, and both parents required to sign the application DS-11 in person too.
- They applied at the post office on 8/4/07. That post office had a Passport Day that was conveniently held on the Saturday - long line.
- The fees are follow

	Under 16 year old	16 year old or older
Passport processing fee to State Dept	$52	$67
Application execution fee at post office	$30	$30
The pictures at post office	$10	$10
Total	$92	$107

FAQ

- We were told that passports will be mail to us in 15 weeks.
- In 3 weeks, we can check the status and print the proof of passport application at travel.state.gov.
- More FAQ on passport.

More on balanced money formula

Key messages

Keeping your must-haves down to 50% gives you flexibility

If your must-haves creep higher — say, to 70 or 80% — there just isn't much room to maneuver. There's no space for you to scale back, nowhere you can cut if you need to.

But if you can get by on 50% of your (after-tax) income, you have the flexibility to cut back on your spending whenever you need to. You are in control. You can manage an unexpected expense like a car accident or a leaky roof. You'll be okay if your boss cuts your hours.

Debt reduction is a kind of savings

The assertion is that when you're making extra (more than the minimum) payments on credit-card debt, personal loans, medical debts, and most other debts, you are actually decreasing future obligations, and thus increasing your potential for future cash flow.

Those additional debt payments now, in other words, make increased future saving possible. Thus any extra payments toward debt principal are grouped with Savings.

The authors recommend if you're carrying credit-card debt, personal loans, overdue bills — basically any debts other than mortgages, car loans, or student loans; the entire 20% of savings should go toward debt paydown each month.

Just do your best

If you can't save 20%, can you save 15%? If you can't get your Must-Haves down to 50%, can you get them down to 55%?

The balanced money formula

From the book "All Your Worth" by Elizabeth Warren & Amelia Warren Tyagi

How to allocate your after-tax incomes

Must-have - 50%

Wants - 30%

Savings - 20%

The lifetime savings plan

1. Save $1,000

2. Pay off debt

3. Build a 6-month security fund

4. Lifetime of wealth creation

a. Save for retirement

b. Pay off your house

c. Save for other dreams

This plan is very similar to Ramsey's baby steps

7 financial disastrous mistakes

By Liz Pulliam Weston of msn.com. (She wrote this article in last year.)

7 financial disastrous mistakes that people make:

1) Carrying large credit card debt

Carrying credit card balances is not the norm in America. More than half of U.S. households have no credit card debt, and only 7.2% carried balances of $10,000 or more.

However, the average credit card interest rate is about 13% - 14%; carrying any credit card debt is a big, red flag that you're living beyond your means. Paying off that debt should be a priority.

2) Letting fixed-living costs swell

If you've cut your spending to the bone and are still struggling, maybe you need to take a closer look at the bones -- that is, your basic living expenses.

Elizabeth Warren, a Harvard University bankruptcy expert and co-author of the personal finance book, "All Your Worth" , recommends that people's "must have" expenses total no more than 50% of their after-tax income. (Your after-tax income is basically your take-home pay, with any tax deductions like 401(k) contributions and health insurance premiums added back in.)

"Must haves" typically include:

Mortgage or rent
Utilities (including basic phone service)
Transportation (gas, car payment, car insurance)
Other insurance (life, health, property, disability)
Groceries
Child care
Minimum loan payments
Child support or other court-mandated payments

Recently, subprime mortgage becomes a main factor in the swelling of fixed-living cost.

Once you've trimmed the easier stuff, like utilities and groceries, you come to more agonizing decisions, such as finding cheaper child care, opting for less expensive housing or taking in a roommate. Alternatively you can look for ways to boost your income.

3) Using retirement savings to pay off debt

To raid IRAs or 401(k)s in order to pay off debt is

Incredibly expensive.

Penalties and taxes typically eat up 25% to 50% of such withdrawals, but even worse is the loss of future tax-deferred gains that money could have earned. You should figure each $1,000 you withdraw from a retirement account now will cost you at least $10,000 in lost retirement income. That assumes 8% average annual returns over 30 years, which is a reasonable long-term assumption for a balanced portfolio of stocks and bonds.

Often shortsighted.

Grabbing money from your retirement doesn't help you fix the problem that caused the debt in the first place, which is usually overspending.

Furthermore, money in retirement accounts can be protected if you end up filing for bankruptcy.

4) Using payday lenders

These lenders promise you a short-term loan, to be paid off when you get your next paycheck. But they charge you fees that are the equivalent of a 400% annual interest rate, or even more. Many people find when payday rolls around that they're not able to repay the loan, so they wind up rolling it over and incurring more fees.

5) Failing to have an emergency fund

Among the unemployed, the average time between jobs is around 17 weeks. Yet only about three in 10 U.S. households have liquid savings sufficient to last them even 12 weeks. Many either live paycheck to paycheck or have less than $1,000 in liquid savings.

Having a sufficient emergency fund can help you withstand all kinds of financial setbacks, from car trouble to losing your job.

Even if you're concentrating on other goals, like saving for retirement and paying down debt, you should keep at least $1,000 for emergency.

Keeping space open on your credit cards or home equity line of credit can be a temporary supplement to a real emergency fund, but as soon as you can you should give yourself a real cash cushion.

6) Using subprime mortgage to finance your house

The Center for Responsible Lending, a nonpartisan research group based in North Carolina, predicts that more than 18 percent of the people holding those subprimes loans will go into foreclosure in the next three to four years.

7) Trying to borrow your way out of debt

So many debtors are looking for a magic bullet in the form of a consolidation loan and think their problem is that they just haven't found the right one.

If you don't have home equity to tap, the debt consolidation loans available to you typically come with sky-high interest rates and hefty fees. Instead of getting you out of debt faster, they normally stretch out your loan term so that you wind up in debt much longer and pay a lot more in interest. Clearly, that's not the way to go.

Even if you do have lots of home equity, using it to pay off credit card debt is because, once again, you haven't fixed the problem that caused the overspending in the first place.

Often, the best option is to simply buckle down and pay off the cards, one by one. If you have good credit, you may be able to negotiate lower rates directly with your lenders. If not, and you're having trouble making progress on your debt, you might consider a debt management plan through a legitimate credit counselor.

If you're really drowning, and facing debts you can never repay, then bankruptcy might be the best of bad options. Filing bankruptcy is often unpleasant and expensive, but unlike real suicide, the damage isn't permanent.

Better yet, let's hope you can contain the damage to your finances before your situation gets that bad. Realizing how serious these seven missteps are can be the first step toward averting disaster, and getting yourself on the right financial path.

Personal finance websites from government

There are many websites on the personal finance from government, such as

Help for national banks customers from Office of the Comptroller of the Currency (OCC, it has a consumer help line 800-613-6743 too).

MyMoney.gov is the U.S. government's website dedicated to teaching all Americans the basics about financial education

IRS: Free Tax Return Preparation by volunteers

IRS: Free Federal Online Filing

The Federal Citizen Information Center provides the answer to questions about the Federal government and everyday consumer issues

Bankrate is not a governmental website, but

Financial literacy 2007 - financial education offer by Bankrate

Five Credit Card Surprises

5 nasty tricks from your credit card companies

1. Universal default

If you make late payments or exceed your credit limit, you could be shifted to a default penalty interest rate on your credit card, sometimes exceeding 30 percent. But you could also get socked if you are late paying your electric bill or mortgage, or take out an auto loan, or do anything that hikes your credit score.

2. Future shock

If your credit card company does decide to shift you to a higher interest rate, expect the penalty price to apply not only to future charges but to your past charges.

3. Two-cycle billing

In double-cycle billing, you are charged interest on the average daily balance of two months of charges instead of just one. So if at the end of 30 days you pay off most—but not all—of your balance, the next month you will still pay interest on the sum that you already paid.

4. Grace period

The 30-day grace period for paying your credit card without interest is true only if the bill is paid in full.

5. Pay to pay

Close to your credit card due date, you decide to use pay-by-phone or an online payment at the bank's website instead of the mail to get the payment in on time. Expect to pay a fee of $5 to $15 for the convenience.

FICO high achievers

FICO high achievers have

- Their oldest accounts is 19 years old.

- The average age of their accounts is between 6 and 12 years.

- opened their most recent account 27 months ago.

Opening new credit account or short credit history will hurt your FICO score.

- 93% of them have no missed payments at all. But of those who do, the missed payment happened nearly 4 years ago.

Missing payment will hurt your FICO score.

- Ratio of their revolving balances to their credit limits is 7%.

Too many credit cards carrying balances or heavy usage of your credit will hurt your FICO score.

myFICO packages

From msufcu.com

Whether you're applying for a mortgage, auto loan or credit card, banks use your FICO scores to base the approval and determine what interest rate you'll pay.

You have 3 FICO scores, one for each credit bureau - Equifax, Experian, and TransUnion; and you can purchase them from myFICO.com.

Choose the package that best suits your needs:

FICO Standard - $15.95 / each score.
Receive your individual FICO scores and credit reports from Equifax, Experian or TransUnion.

FICO Deluxe - $47.85 or $42.84/year.
Perfect for first-time users. Purchase all three of your current FICO scores.

Suze Orman's FICO Kit Platinum - $49.95.
Designed for those who want tips on how to improve their scores. Receive your three FICO scores and Suze Orman's FICO kit.

Score Watch - $8.95/month (minimum 3 months) or $89.95/year.
Monitors your credit file at Equifax on a daily basis and your FICO score on a weekly basis. Each year, you will have 2 Score Power reports that include your score and credit report.

Please note that you don't have unlimited retrieving of your FICO score and your credit report in all the packages from myFICO.

Financial fire drill

Harvard Law Professor Elizabeth Warren is an expert on bankruptcy and is an outspoken critic of consumer lenders.

On this All Thing Considered interview, Warren argues that two-incomes families are at the greater financial risk than others.

A paradox

A middle-class lifestyle is increasingly out of reach for middle-class families, many of whom are going broke trying to attain it. And they generally need two incomes to make ends meet.

However, it's reliance on that second income (usually mom's) that's putting them in financial peril. By counting on two incomes to fund the basics of a middle-class lifestyle - including modest homes in safe neighborhoods with good schools and high-quality child care, preschool, after-school care, or college - families are without their safety nets.

Safety nets

A generation ago, if the sole breadwinner lost his (or her) job or became disabled, the family had a backup earner who could readily step into the workforce.

Today, families who hit a financial rock in the road often turn to credit cards, mortgage refinancing, and payday lenders - often at ballooning interest costs that drag families into a spiral of debt. More and more, bankruptcy becomes the only way out.

Financial fire drill

1) Can your family survive without the second income?

2) Can you downdrift the fixed expenses?

Don't stretch yourself to buy a house you can't afford.

3) What is your emergency backup plan?

- Protect what you value the most, such as family and home.

Warren encourages families to create a plan - savings to cover the mortgage payment for a few months, valuables to sell, a relative to move in with if circumstances dictate giving up the house - before disaster strikes and debt rages out of control.

Lastly, Warren really discourages families from using credits as safety nets.

Maxed out

Maxed out is a documentary by James D. Scurlock on America's credit card debt.

On average, American has credit card balance over $9,000.

Half of credit card holders only made the minimum payment.

The 2005 bankruptcy reform bill was written by MBNA, one of the top credit card issuers.

On average, credit card debt at the bankruptcy proceeding is $1 in principle & $2 in interests and fees.

Credit card companies do issue credit cards to people who declared bankruptcy because they know that those people can't file for bankruptcy again for another 8 years.

Suze Orman has a deal with FICO's parent company and FICO is the preferred credit score in the consumer lending industry..

Although college students don't have much income, they can get credit cards easily. One student had 12 credit cards!

Collection agencies can call on your neighbors or anyone in order to hassle and embarrass you.

There are no laws to protect your financial privacy from business.

People today have less income to pay for necessities.

Also, one more debt ...

An American family's share of the federal debt is $90,000.

The federal government spends more on interest payments than on homeland security, education, & health care combined.

Stop debt collection agencies calling you

All debt collection agencies love to call you at the most inconvenient hours.

FinanceIsPersonal.com has a sample letter for you to write, and send it certified mail, return receipt requested; telling the debt collection agencies that under the Fair Debt Collection Practices act, they are not allowed to contact you further in regards to the debt in question. If they do illegally contact you after that, you could sue them and will win quite easily.

Below is FinanceIsPersonal.com’s a sample cease and desist letter:

[Date]

To Whom It May Concern:

Your company has contacted me about a debt that you allege I owe, and I am instructing you to not contact me further in regards to this debt in question. Under the federal law (Fair Debt Collection Practices Act), you and your company may not contact me any further as I have notified you not to do so.

Sincerely,

[Your Name]

[Your Address]

Free file program from IRS

Since 2003, the IRS has administered a Free File Program, under which low income taxpayers can file tax returns online, free of charge.

However, TaxProf Blog reported

The Treasury Inspector General for Tax Administration has issued a report slamming the IRS's Free-File Program, charging that the electronic-filing software is replete with errors that affect even the simplest tax returns.

Fairmark.com also has been complaining

We stopped recommending the program on this site when it became apparent that it's run for the benefit of private software companies, rather than for the benefit of taxpayers or even for the benefit of the IRS.

Its purpose is to discourage Congress from requiring the IRS to offer its own free, convenient method of preparing and filing tax returns online while at the same time discouraging taxpayers from actually using the program, so they will continue to buy software and services from private companies.

So far, it has succeeded on both counts...

I too found a major problem with IRS's Free File Program:

Many of its partners do not offer free file for state tax returns.

Taxpayers have to pay as much as half of the regular software price to file the state tax return.

It's no wonder that Free File Program accounted for only 3 percent of the individual income tax returns filed in 2006.

Blockbuster vs Netflix

New plan for Blockbuster in 9/2007



The price for 1 dvd at-a-time will increase by 70%, and no more eCoupons for in-store rental of games.

I think I will try Netflix in September

A Chinese perspective on made-in-China

An article on Sara Bongiorni with Chinese perspectives: A US family's adventure in one-year made-in-China ban.

It has an interesting example on high-end products: Apple's iPod.

Apple outsources the entire manufacturing of the iPod to a number of Asian enterprises.

Three researchers at the University of California recently made a thorough analysis of the cost and profit of all the parts that went into the iPod, and found that out of $299 the retail price of iPod, $163 was captured by American companies and workers, according to a report by New York Times late in June.

While China makes most of the Toshiba hard drives, which are the most expensive component in iPod, and it only does the final assembly.

Chinese workers contribute only $4, about one percent of the cost of the iPod. However, the Chinese export of an iPod to United States directly contributes about $150 to U.S. trade deficit with the Chinese.

More

Economist Joel L. Naroff reminds readers that the "Made in Japan" label caused similar anxieties and introspection in the 1950s, adding, "almost everyone's standard of living is improved by being able to purchase less expensive products no matter where they are made."

Now it's China's turn. And for families whose income has been stagnant for the past 20 years, reaching for the "Made in China" label is simply a reality for getting by.

Mail in rebates (MIR)

The good

Getting products at lower cost

The bad

Paperwork
Mail-in the resquest
Waiting

The ugly

Request denied
Request lost in the mail

Life's firsts

From wsj.com

1st job

-401(k) (to capture full company matching)
-Asset allocation - contact the company managing your 401(k) plan
-To make most of other benefits - seek fee-only planner for an hour or two
-Absent workplace health insurance, shop for high-deductible policy and combine with a Health Savings Account
-Debt-management - especially student loan and credit card
-Other saving / investing priorities - seek advice again from fee-only planner

1st family

-Buying 1st home, stick to what you can afford (30%)
-Budgeting
-Debt-management
-Operate finances together

1st child

-Life insurance
-consider term life
-Estate plan
-Planning for college - 529 plan and other options

Brokers banks

Fidelity Investments
- mySmart cash account
- 3.5% interest rate

Charles Schwab Corp
- Invest checking
- 4.25% interest rate

E*Trade Financial Corp
- MaxRate checking
- 3.25% interest rate ($5,000 in average monthly balances to qualify)

Do these high interests and other perks outweigh the hassles of switching from your local banks?

Direct deposit and automatic payments have made it trickier for consumers to move their primary checking account to another firm.

Clements defenses his contrarian advice

Jonathan Clements (of wsj.com) argued that those people in their 20s should forget the emergency reserve and, instead, focus on things like putting enough in their 401(k) to get the full company match.

If they had a financial emergency, they could always borrow against their 401(k).

What if those twentysomethings borrow against their 401(k) and then get laid off?

The current law says that if you get laid off, these 401(k) loans have to be repaid immediately. If you can't come up with the cash, you would owe both income taxes and a 10% tax penalty on the money borrowed.

Clements suggests that after pay tax penalty, 401(k) loans still going to be ahead than the emergency fund which sits in say, a savings account or a money-market fund.

- 401(k) contribution will get company match.

- 401(k) contribution is tax-deferred and saving for emergency is not.

- 401(k) also gets tax-deferred investment growth and emergency fund gets short-term interest rate that probably exceed inflation rate by 1 or 2 points.

Clements assumes that there is no certainty we will have a financial emergency. Most of us don't regularly get laid off, wrap the car around a telephone pole, or need an emergency appendectomy. In fact, many of us will make it through our entire lives without a major financial crisis.

I disagree with Clements.

We will have financial crisis sooner or later. We will change jobs - planned or unplanned, We will have car accidents.

If you can't amassing an emergency reserve equal to six months of living expenses, save $1000 for for a beginner emergency fund instead.

Also, you're repay the 401(k) loan with after-tax dollars. So, let's say your monthly interest payment is $300 and you're in the 25% tax bracket. You'll have to make $375 to make the $300 payment. Then, when you retire and withdraw from 401(k), you pay taxes yet again.

$99 Zonbu computer

This computer is a desktop preloaded with 20 popular & full versions Linux programs. It comes with free, automatic, online backup of your files, and a design that cuts energy use way below that of a standard computer.

It uses just 10 watts while a standard PC uses 200 watts.

But you've to get your own display, keyboard, and mouse. You also have to have a broadband connection!

The PC is $99 if you get a two-year Amazon S3 service plan. For $13-$20, you get 25-100GB of synched data. It is sold for $249 without any commitment.

WALTER S. MOSSBERG of wsj.com reviewed this pc from Zonbu and found it has many compromises that belie its goal of eliminating hassles.

1) You aren't allowed to install any added software. You seem to stuck with what the company provides.

2) Most Linux softwares ate rough, below the polished level of Windows or Mac programs.

3) The Zonbu crawled much of the time.

Folders took forever to open, email took way too long to appear, and so forth. And it was on a very fast Internet connection. This may be because of the very wimpy processor (1.2GHz intel-compatible VIA C7 ULV chipset) Zonbu uses to save money and energy.

New method college

I studied at 新法書院 from F1 to F5 ...

How the school started

1953年，創校人王澤森博士在加路連山道買地擴建校舍，加路連山道分校遂於1956年落成。而太子道分校、大坑道分校、文褔道分校分別於1964、1966、1971年落成。當時該校連同英文專修日、夜校的學生 曾接近二萬。

How the school going to end

於一九四九年創校、至今已有五十七年歷史的老牌學校新法書院，突然宣布六年後 (2012) 停止辦學，該校將於明年 (2007) 九月起停止招收中一級新生，成為本港第三間停辦的直資中學。該校校長黃廣威解釋，辦學團體在檢討過現有校舍的空間及地理環境後，認為現有的校舍無法為學生提供足夠的配套及學習環境，他說︰「校舍只有三千平方米，根本沒辦法與其他擁有千禧校舍的學校相比，暫時未有在其他地方重新辦學的計劃。」

近年收生理想

位於何文田文福道的新法書院是本港其中一間老牌學校，四九年創校後經歷過「私校」及「買位」兩個階段，該校於九七年加入育統籌局推出的「直接資助計劃」，轉為「直資學校」，新法書院近年不斷透過電視廣告宣傳學校，又推出中一至中三免學費優惠，近年收生情況理想。

But

校方前天發出通告，指校方因為「未能再進一步為同學提供更佳之學習環境」所以決定停止辦學。黃廣威強調，停辦是以學校發展為大前提，與財政問題無關，現時學校一千二百名學生不會受到停止辦學影響，他說︰「學校會等所有學生畢業後才停辦，現有學生不會受影響……宣布停辦後，校方預計今年的中一收生情況會受到影響。」統局發言人指出，局方早前已得悉新法書院以「營辦上的考慮」為理由，將於0七年九月開始停止招收中一級新生。

I still remembered ... those 新法書院的校服

夏季時, 女生穿藍衣白裙的水手服, 男生純白襯衫和白褲。

Rebalancing your portfolio annually

Source: When It Comes to Rebalancing, a Little Means a Lot By PAUL J. LIM of nytimes.com

Over the long term, stocks tend to outperform bonds.

If you have not rebalance your portfolio for several years, chances are that you probably have more exposure in stocks than you intended.

Moreover, you are probably overexposed to the most volatile types of stocks.

So some rebalancing may be better than no action at all.

Example of asset allocation

Over the last half-century, the worst one-year stretch for a portfolio of 60 percent stocks, 30 percent bonds and 10 percent cash was a loss of 24.1 percent. That occurred in the 12 months that ended in September 1974.

By comparison, the worst one-year loss for a more conservative mix — 40 percent stocks, 40 percent bonds and 20 percent cash — was just 15.5 percent during the same period.

Yet to achieve this lower risk, you would have to give up a decent amount of gains. The switch in asset allocation strategy would have reduced your average annual returns to 8.3 percent from 9.2 percent.

Rebalancing your portfolio once a year

Say you started investing at the end of 1984, in a portfolio consisting of 60 percent stocks, 30 percent bonds and 10 percent cash. And further assume that you never rebalanced this portfolio back to that 60-30-10 ratio. Instead, you let the market take your investments for a ride.

Through the end of June, this strategy would have earned an average annual gain of 11.1 percent since 1984.

Now, had you started in 1984 with the same strategy, but this time rebalanced your portfolio annually, you would have earned nearly as much on your investments: 10.7 percent a year, on average.

But at the same time, that portfolio would have been 18 percent less volatile, based on standard deviation.

The buffering effect of rebalancing might have been enough to let you sleep better at night.

More on rebalancing

Rebalancing is not just about resetting your mix of stocks and bonds. You should also consider periodically resetting the types of stocks you own.

For instance, over the last five years, many of the best-performing areas of the stock market have also been among the most volatile.

Those include the basic materials, telecommunications and technology sectors, all of which have a “beta” of more than 1.0. (Beta measures the tendency of an investment to go up or down, relative to the market — in this case the S&P 500 index. So a beta of more than 1 implies that if the S&P 500 were to rise or fall 5 percent, for example, that investment would rise or fall even further.)

On the other hand, two of the lowest beta sectors in the market — health care stocks, with a beta of 0.6, and consumer staples stocks, at 0.5 — have been the market’s worst performers over the past five years.

One way that investors might consider rebalancing the stock portion of their portfolios is to gravitate toward areas with lower volatility, like health care and consumer staples, while avoiding those highly volatile areas that have already done exceptionally well..

Another way to rebalance — without selling any holdings — is simply to take your new money and invest it in areas that many investors have ignored in recent years, like large-capitalization domestic growth stocks and stock funds. These may be worth buying now.

2004 Federal Reserve survey on credit cards

The 2004 Survey of Consumer Finances from the Federal Reserve gives a snapshot of American household on credit card.

	2004	2001
Carrying a balance	46.2%	44.4%
Average balance	$5,100	$4,400
Median balance	$2,200	$2,000

This table shown American households are carrying higher balances. The average income of American household is currently $43,200 and the typical household's credit card balance is now almost 5% of their annual income.

But the survey is not a completely discouraging picture for American households.

While 74.9% of all households have a credit card, 42% of this group of households pays off their card each month.

Saving for retirement: Who's falling short

The Center for Retirement Research (CRR) estimates that

36 percent of high-income households - those with a median income of $117,000 - won't be able to live as well in retirement as they do today.

Among middle-income households, 40 percent are at risk of having to downsize.

While 53 percent of low-income households are likely to fall short.

Examples of credit card balance transfer

Lesson learned: The minimum payments could cause problems to your cash-flow management.

Example 1

Card: Citi
Amount: $6000 transferred to checking account
Rate: 2.99% until payoff
Fee: None
E-statement & automatic minimum payment
Where: 26 weeks & 13 weeks T-bills
$ made: 11.6 per month for last 15 months

Example 2

Card: M&T
Amount: $30000 transferred to checking account
Rate: 0% for 11 months
Fee: 2%
Paper statement & automatic minimum payment
Where: 26 weeks, 13 weeks, & 4 weeks T-bills
$ made: 612.86

Credit card debt in the US

By Elizabeth Harrison

American carry an average of 2.7 bank credit cards, 3.8 retail credit cards, and 1.1 debit cards, which averages to 7.6 cards per cardholder.

According to CardWeb.com, the recommended number of credit cards for the average consumer is 3. At most 4, if you use a card for business expenditures. And one of those cards should only be kept for emergencies.

The reason for this?

Preservation of your interest rates and your credit score. Not to mention your sanity.

30% of your overall credit rating is determined by how much debt you carry. The ideal picture of your debt: Low balances spread over several different types of accounts, like a mortgage, a student loan, and a few credit cards.

Another danger in carrying 6 or 7 balances: Credit card companies routinely scan your credit report to watch for signs of financial trouble. If just one of your accounts becomes delinquent, or if you suddenly revolve a balance at or near the maximum, this could induce your other lenders to raise their interest rates. Your interest payments could skyrocket.

Credit card companies want your business, and will spend $80 - $200 to acquire it. And its no wonder- in the US, we owe $785 billion in credit card debt, according to data analyzed by Cardweb.com. That's about $9000 of credit card debt per card-carrying household in the US. All that interest we're paying contributes to the lender's profits.

Note that $785 billion is just the amount of credit card debt; the actual figure for Americans' non-mortgage debt is $2 trillion.)

There are about 6,000 general purpose credit card companies in the US, mostly credit unions. That's a lot of options. Credit can be a great tool when used the right way.

So get your boutique-cards down to a minimum. They are not versatile, they can't help you in an emergency and they don't earn miles. Remember if you ever close an account to be sure the lender marks it 'closed by account holder.'

Keep a few general-purpose cards and leave it at that. And keep the balances low.

Credit card debt statistics

Total credit card debt in the United States has reached about $665 billion on bank credit cards and about $105 billion on store or gas credit cards. The total is roughly $800 billion. (January 2006, Cardweb and the Federal Reserve)

Average household or individual debt (or both) is about $9,300 per household holding at least one credit card. (Source: Cardweb)

According to the advocacy group Demos, the average balance among lower- and middle-income households is $8,650.

More statistics from Mark Brinker (updated June 2007)

In 1968, consumers’ total credit debt was $8 billion (in present dollars). Now the total exceeds $880 billion.(SOURCE: Federal Reserve Bank)

Approximately half of all credit card holders pay only their minimum monthly payments.(SOURCE: Experian-Gallup Personal Credit Index survey)

According to the Federal Reserve Bank, 40% of American families spend more than they earn.(SOURCE: www.federalreserve.gov)

23.8% of American households have no credit cards at all -- no bank cards, no retail cards, nothing. 31.2% of the households. paid off their most recent credit card bills in full.(SOURCE: Liz Pulliam Weston, www.asklizweston.com)

Only one household in 50 (2%) carry more than $20,000 in credit card debt. However, that "one in 50 households" figure represents more than 2 million American homes.(SOURCE: Liz Pulliam Weston, www.asklizweston.com)

Turbulent market offers 6 lessons

GETTING GOING by JONATHAN CLEMENTS of wsj.com

1. GO MODERATELY WILD

No more than 5% of your portfolio should be in these fringe sectors such as emerging-market stocks, emerging-market debt, commodities, gold shares, high-yield junk bonds and real-estate investment trusts.

2. CHECK YOUR PULSE

Every investor should have exposure to the broad U.S. stock market, to high-quality U.S. bonds and to developed foreign stock markets. These three core holdings should probably account for 70% or 80% of your investment portfolio, and maybe more.

How you divvy up your money among these three core holdings will depend on your tolerance for risk and your need for returns. Think about what mix you can live with when markets turn volatile.

3. IT'S A BIG MARKET

At this juncture, blue-chip U.S. stocks may be one of the global stock market's most reasonably priced sectors. After all, the S&P 500 is trading below its March 2000 stock-market peak, while small-company stocks, emerging markets, REITs and other sectors have all posted impressive gains over the past seven years.

4. LOSE YOUR CONFIDENCE

Not only do we need to think about risk as well as reward, but also we shouldn't be nearly so confident in our predictive powers.

5. FUNDAMENTALS TRIUMPH

When investments are hot, it can seem like there's no limit to the possible gains. Yet there are always limits -- and economic fundamentals always win out in the end.

For instance, the broad market's share-price gains frequently outpace the economy's growth rate over the short run. But unless investors are willing to pay higher and higher price/earnings multiples for stocks, that can't go on forever.

6. WINNING TAKES TIME

The lesson: It's mighty tough to predict which sectors will shine and which will sink, so our best bet is to diversify broadly, never betting too heavily on any one investment.

Statistics can be misleading

Liz Pulliam Weston complained the following misled statistic:

The average American household with at least one credit card has over $9,300 in credit card debt, according to CardWeb.com.

She claims that the average is skewed by a small % of households with very high credit card debt.

However, her concern is that this statistc gives false comfort to those people who think they're only "average" for having $9,300 in credit card debt.

In fact, they could be on the road to financial ruin.

According to Federal Reserve's 2004 Survey of Consumer Finances:

Most American households don't have any credit card debt.

- About a quarter of household, or 25% have no credit cards.

- Additional 30% or so pay off their balances every month.

- Of those households that do owe money on credit cards, the median balance was $2,200.

- Only 8.3% of households owe more than $9,000 on their credit cards.


For a group of 100 American households

55 households don't have any credit card debts.

25 households don't have credit cards at all.

30 households pay off their credit cards balances every month.

45 households do carry balance on their credit cards.

22.5 households have balances less than $2,200, and 22.5 households have balances higher than $2,200.

8.3 households carry balances higher than $9,000.

Are you on track for retirement?

Two questions from Money.com will tell you if you're on track for retirement or not.

1) Are you doing the right things?

Yes, if you
- contribute 401(k)
- know where you're and where you should be
- claim as many tax breaks as possible
- build safety net

2) Do you have the right investments?

Yes, if you
- asset allocation
- avoid high fees
- avoid hot stocks
- rebalance regularly

Can you afford a healthy retirement?

Source: Chicago Tribune personal finance columnist Gail MarksJarvis with Renee Montagne of NPR

My comment

Medicare only covers part of retiree health needs.

MarksJarvis claims that you need extra $400,000 in savings to buy extra health insurance to cover what Medicare doesn't.

As they approach retirement age, many people have no idea how much money they will need to support themselves - and they frequently underestimate the cost of health insurance that they'll need to supplement Medicare.

Gail MarksJarvis notes that the average senior gets $1,011 in Social Security a month.

Most households on the verge of retirement (within 10 years away from retirement) have saved no more than $88,000. That amount translates into about $653 a month for living expenses.

Medicare will cover only part of their health bill, and health insurance alone will cost a retired couple an average $330 per month.

Below are some of MarksJarvis' tips for avoiding financial troubles in retirement:

- Avoid wishful thinking and calculate what you will need to save for retirement.

- A rule of thumb: Go into retirement with savings that equal about 12 times your last annual pay and take out no more than 4 to 5 percent of your nest egg annually.

- Prepare when you are young by saving small amounts early and investing in a mixture of stock and bond mutual funds in 401(k) plans and IRAs. If you invest $20 a week on your first job, you'll reach $1 million by retirement age. Wait until 35, and you will need to save $100 a week for the same sum. And don't give up. A person saving $5,000 a year in middle age can still accumulate about $500,000.

- Consider health care costs as you look ahead. Be realistic. If you are retired for 20 years, you will need about $200,000 in savings to buy extra health insurance to cover what Medicare doesn't. If you live to 90, the cost will be close to $400,000. Medicare only covers part of retiree health needs.

- Check your employment benefits so you don't have unrealistic expectations. Most employers DON'T help their former employees with health insurance in retirement, but many people assume they WILL get this help. Even employers promising health benefits to retirees may back out of the agreement.

- Avoid retiring early unless you have calculated the impact of spending $1,000 a month to buy health insurance until Medicare benefits kick in.

- If you retire early and need to buy health insurance, you can cut your costs by using high deductibles and buying insurance through business or trade groups. Consider starting a small business so you have access to one of these groups, or work part-time for an employer who provides insurance.

- Pay off your home and credit cards before retiring so that you have manageable costs.

Calculating your retirement nest egg

Source: CRANKY CONSUMER By ANDREA COOMBES of Wsj.com

There are many online retirement calculators will tell you how much you need to save for retirement.

However, these calculators almost always over-estimate the amount that you need to save now. If you follow the suggestions, the savings for retirement may impact your current quality of living.

The parameters require for retirement calculators:

1) Rate of inflation - 3% is popular
2) Rate of return - 6% is popular too
3) Years in retirement - 25 years to 35 years
4) Living expenses in retirement - 70% to 80% of pre-retirement expenses
5) When will you retire? - 65

Most calculators are over-estimated the rate of inflation, but under-estimated the rate of return on your retirement nest egg.

Remember, if the rate of inflation is 2.5% instead of 3.0%, the error is 20%!

If the average rate of return is 8% instead of 6%, that is 25% for the error!

Notes on Harry Potter 7th book

The symbol of the Deathly Hallows:

- The triangle represents the Invisibility Cloak,
- The circle represents the Resurrection Stone, and
- The line represents the Elder Wand.

Anyone holding all three Deathly Hallows together becomes the master of Death itself.

Did Dumbledore try to keep the Deathly Hallows from Voldemort, or did he wanted Harry Potter to have all three Hallows?

1) The ownership of Invisibility Cloak was passed from James Potter to Harry Potter.

The true magic of the Invisibility Cloak is that it can be used to shield and protect others as well as its owner. If Dumbledore didn't borrow the the Cloak from James Potter, would James and Lily Potter still be killed by Voldermont?

2) The Resurrection Stone was willed by Dumbledore to Harry Potter.

3) Dumbledore had the Elder Wand from the beginning.

In book 6, Draco Malfoy became Elder Wand's new owner by disarming Dumbledore; but it was buried with Dumbledore.

In book 7, although both Draco and Harry didn't have the Elder Wand in their possession; Harry Potter disarmed Draco Malfoy and became the latest owner of the Elder Wand.

In the Forbidden Forest, Harry Potter wasn't really dying from the deathly curse by Voldermont using Elder Wand. Was it because the Elder Wand refuses to kill its master - Harry Potter; or, was it because Harry Potter had all three Deathly Hallows and became master of Death?

Horcrux was explained in book 6: It is any normal object that a Dark wizard stored a part of his soul. A Dark wizard can create more than one Horcrux and he becomes immortal as long as one of the Horcruxes remains intact.

Altogether there are 7 Horcruxes for Voldemort. He created 6 Horcruxes. Harry Potter was the unintended Horcrux.

5 Horcruxes are found and destroyed in book 7. They are Salazar Slytherin's locket, Helga Hufflepuff's cup, Rowena Ravenclaw's diadem, Harry Potter (who survives, but the piece of Voldemort's soul within him is destroyed), and Nagini; in the order of their destruction.

Did Dumbledore really want Harry Potter to die so that a Voldemort's Horcrux would destroyed?

The other 2 Horcruxes, Slytherin's ring and Riddle's diary were already destroyed in book 6 and book 2 respectively.

8th Harry Potter book?

Yes, J.K. Rowling should write another book on Harry Potter.

After spending last two days to read the 7th book, I think there are still a lot of stories to tell between the gap between the last two chapters of the 7th book.

Such as:

If Harry, Ron, Hermione ever finish their education?

How do they marry?

SPOILER: Harry Potter and the Deathly Hallows

Happy ending for the 7th Harry Potter book

Harry lives!

Hemione and Ron too!

Rules to grow rich by

Many articles on personal finance all seem to suggest these few rules to grow rich by :

- boost your earning power by work hard and educate yourself

You couldn't be rich if you can't make any money.

- live frugally, live below your means, and also live healthy too

- control your debts (mortgages, credit cards, and student loans)

- save 10% to 15% of your incomes for retirement, emergency reserve, and college education; in that order of priority

- asset allocate your investments, and defer taxes on your investment as long as possible

By the time you're in late 50s or early 60s, your household should have a net worth well over a million dollars

DETAILS

Retirement investments
- Financial planner
- 401(k)
- IRA
- Lifecycle funds
- Index funds
- Allocation of stocks & bonds

Real estates as an investment?
- TBD

College education savings
- 529 as soon as possible
- keep student loan debt to 1x of the annual income of your first job

Emergency reserve
- Start a "beginner" emergency fund as soon as possible
- Full emergency fund should be 3 - 6 months of living expenses

Mortgages
- Ensure you can afford the monthly payment
- The payment should not exceed 28% of your income

Money magazine's 25 rules to grow rich by

By Money.com

HOUSING

1. For return on investment, the best home renovation is to upgrade an old bathroom. Kitchens come in second.

2. It’s worth refinancing your mortgage when you can cut your interest rate by at least one point.

3. Spend no more than two times of your income on a home. For a down payment, it’s best to come up with at least 20%.
Make absolute certain that you can afford the monthly payments, especially if the loan is adjustable-rate.

4. Your total housing payments should not exceed 28% of your gross income. Total debt payments should come in under 36%.
If your monthly payments near the limit, consider re-financing the mortgage to longer term.

5. Never hire a roofer, driveway paver or chimney sweeper who is going door to door.

SAVING AND INVESTING

1. All else being equal, the best place to invest is a 401(k). Once you've earned the full company match, try to max out a Roth IRA.

2. To figure out what percentage of your money should be in stocks, subtract your age from 120. Consider lifecycle funds instead.

3. Invest no more than 10% of your portfolio in your company stock – or any single company’s stock, for that matter.

4. The most you should pay in annual fees for a mutual fund is 1% for a large-company stock fund, 1.3% for any other type of stock fund and 0.6% for a U.S. bond fund.

5. Aim to build a retirement nest egg that is 25 times the annual investment income you need. So if you want $40,000 a year to supplement Social Security and a pension, you must save $1 million.
You could safety use 5% as the withdrawal rate.

6. If you don’t understand how an investment works, don’t buy it.

7. If you’re not saving 10% of your salary, you aren't saving enough.
Saving of 15% is needed for comfortable retirement.

8. Keep three months’ worth of living expenses in a money-market fund for emergencies. If you have kids or rely on one income, make it six months.
Emergencies are short term disabilities or loss of jobs.
The money-market fund may not has the highest interest rate.

9. Aim to accumulate enough money to pay for a third of your kids’ college costs. You can borrow the rest or cover it from your income.
Use today's college costs as guidelines. Aim to have a third or half coming from your savings and the rest should come from financial aids and your future incomes.
Consider 529 college savings plan for the savings.

PLANNING

1. You need to have enough life insurance to replace at least 5 years of your salary – as much as 10 years if you have several young children or significant debts.

2. When you buy insurance, choose the highest deductible you can afford. It’s the easiest way to lower your premium.

3. The best credit card is a no-fee rewards card that you pay in full every month. But if you carry a balance, high interest rates will wipe out the benefits.

4. The best way to improve your credit score is to pay bills on time and to borrow no more than 30% of your available credit.

5. Anyone who calls or e-mails you asking for your Social Security number or information about your bank or credit-card account is a scam artist.

SPENDING

1. The best way to save money on a car is to buy a late-model used car and drive it until it’s junk. A car loses 30% of its value in the first year.

2. Lease a new car or truck only if you plan to replace it within two or three years.
It is expensive to drive a leased car.

3. Resist the urge to buy the latest computer or other gadget as soon as it comes out. Wait three months and the price will be lower.

4. Buy airline tickets early because the cheapest fares are snapped up first. Most seats go on sale 11 months in advance.

5. Don’t redeem frequent-flier miles unless you can get more than a dollar’s worth of air fare or other stuff for every 100 miles you spend.

6. When you shop for electronics, don’t pay for an extended warranty. One exception: It’s a laptop and the warranty is from the manufacturer.

Mortgages are a double-edged sword

Source: JONATHAN CLEMENTS of wsj.com

Mortgages are the cheapest money you will ever borrow. But if you took out a big loan that you can't afford, and are falling behind on you payments; you may lose your homes to foreclosure.

Playing the spread

If you need to borrow, you couldn't do better than a home loan, especially the adjustable-rate loan which monthly payment is often lower than the payment of fixed-rate loan.

Not only are interest rates typically lower than other types of loan, but the mortgage interest is usually tax deductible. To get a mortgage, you need to own a home or agree to buy one. But once you have that debt, the effect is to leverage all your assets. That can be highly profitable.

Suppose you have $300,000 in stocks and you want to buy a $300,000 home. You could sell your stocks and pay cash for the house. But you will likely fare better by putting, say, $100,000 of your stock money toward the house and funding the rest with a $200,000 mortgage.

Result: You control $500,000 of stocks and real estate, 40% of which ($200,000) was bought with borrowed money. As long as your assets generate higher returns than your mortgage rate, the leverage is working in your favor.

On one end, some are missing the boat

Many homeowners, however, are striving to pay down their fixed-rate mortgage quickly. Sometime they also are reducing their contributions to their employer's 401(k) or 403(b) plan.

That means these people are missing out on their 401(k)'s initial tax deduction and tax-deferred investment growth. That combination should easily outpace the interest expense they save by paying down their mortgage.

Throw in a matching employer contribution, and the 401(k) would be even more compelling.

Similarly, you could probably improve returns by taking money earmarked for extra mortgage payments and using it to fund an individual retirement account or to buy stocks in a taxable account.

Still, prepaying a mortgage can be attractive, especially if the alternative is to purchase bonds or money-market funds in a taxable account. The mortgage's after-tax interest cost is likely higher than the after-tax yield on these conservative investments.

On the other end, some are unraveling fast

Like the idea of supercharging your returns with low-cost leverage? Carry a mortgage of $300,000 for the house and you will be in control $600,000 of stocks and real estate.

But, before you take out such hefty home loan, make absolutely sure you can handle the monthly payments. Especially if you're getting an adjustable-rate loan to keep the initial mothly payments low.

Indeed, that's why I (Clements) get nervous when experts advocate getting the largest mortgage possible or recommend re-mortgaging a house to buy stocks or cash-value life insurance.

However, if the interest rate rise, you may not able to afford the larger monthly payments; things can unravel fast.

Now, if you have other savings, you could pay off a chunk of your mortgage. That should lower your monthly payment next time your mortgage rate resets.

Investment strategy with lifecycle funds

Source: JONATHAN CLEMENTS of wsj.com

Lifecycle funds were designed to be the ultimate buy-and-forget investment.

You purchase a lifecycle fund that targets your expected retirement date, and then sit back and let your money ride all the way to retirement and beyond.

But it turns out that lifecycle-fund investors have other ideas -- some good, some not so good.

Adding on

One sensible strategy: Stick maybe 80% of your retirement money in a lifecycle fund and then tack on smaller stakes in intriguing sectors such as emerging-market stocks, foreign small-company shares and high-yield junk bonds.

You might even buy more than one lifecycle fund. Suppose you plan to retire in 2017. You might purchase a mix of, say, Schwab Target 2010 and Schwab Target 2020.

Aiming elsewhere

Lifecycle funds were designed for retirement investors, who might draw down their nest egg over 20 or 30 years. But some shareholders are using the funds to amass money for a home purchase, where they will need their savings on a single day, or college, where costs should be over in just four years.

The problem: When lifecycle funds reach their target date, they typically have 50% to 60% of their money in stocks. You run that horrific risk of having too much equity exposure when you get that tuition bill.

A solution: there are lifecycle funds designed for college expenses.

Laddering funds

Some investors are laddering lifecycle funds in the same way folks ladder individual bonds. It could help you manage your retirement spending.

Suppose you plan to retire in 2015, when you turn age 65. You might buy a 2015 fund to cover the first 10 years of retirement, a 2025 fund to pay for the years from ages 75 to 85, and a 2035 fund for your final years.

Some bad financial advice

Source: Jonathan Clements of wsj.com

If your adviser who is disparaging lifecycle funds and telling you to throttle back on your 401(k) contributions.

It's time to find a new adviser.

My advisor suggested otherwise - investment in lifecycle funds would provide some balance to my portfolio that was setup by him.

1. "Lifecycle funds are a lousy investment."

Lifecycle funds were developed primarily to help 401(k) plan investors, who often struggle to build sensible portfolios. These funds offer one-stop shopping by combining a slew of investments - mainly stocks and bonds - in a single portfolio.

A talented adviser may be able to build you a better portfolio. But it may not be a whole lot better - and maybe not enough to justify the adviser's fee.

2. "Don't fully fund your 401(k)."

Some advisers have argued that people should contribute 401(k) only enough to get the full company match.

They claim that when you fund a 401(k), you are setting yourself up for huge tax bills later and thus it isn't worth maxing out on these plans. Any withdrawal (contributions and gains) will be tax at ordinary income rates, and may also incurs the extra 10% penalty.

Instead, these advisers argue that this money should be invested through a regular taxable accounts - only the gains are tax at the preferential long-term capital-gain rates.

The reality is, 401(k) plans are a great deal, even if you aren't getting a company match. The contributions and the gains are tax deferred; and thus, your 401(k) portfolio is compounding to the fullest.

Bankrate's guide to financial literacy

Financial Literacy 2007 - Guide to Building Personal Wealth

The 12 topics:

January: The simple art of budgeting

February: Mastering credit cards

March: Understanding mortgages

April: Mapping a retirement plan

May: Dealing wisely with home equity

June: Credit scoring demystified

July: Creating an emergency fund

August: Understanding insurance needs

September: Maximizing a college fund

October: Financial tuneup

November: Planning for your heirs

December: Taxes made easy

4 reasons to sell a stock

Source: Money by MSN video

Sell a stock if

1) It is overpriced.

2) Declining fundamentals.

3) You were wrong about this stock!

4) Your position is too large.

Chinese reporting of Sara Bongiorni experiment

生活麻煩代價更高 拒絕中國貨一年 美作家認輸

朱建陵/綜合報導

三年前的耶誕節後兩天，美國專欄作家邦喬妮（Sara Bongiorni）望著家中節日後的滿地狼籍時，忽然發現中國占領了她的家，包含電視、網球鞋、耶誕樹彩燈、地板上的洋娃娃等，屋裡隨處可見「中國製造」（made in China），於是決定展開全家「沒有『中國製造』的一年」計畫。這項計畫的執行過程日前成書，並預計在本月正式發行。

在《沒有『中國製造』的一年》書中，邦喬妮描述她及家人在拒絕中國商品一年中的體驗，發現以前一些再簡單不過的事，例如買雙新鞋、買件生日玩具或修理傢俱，在沒有了中國之後，都變成一種痛苦折磨。

中國產品已深入生活各層面

邦喬妮說，她並非貿易保護主義者，而除了偶或擔心美國國內工作機會流失之外，她並不反對中國。她的目標其實很簡單，只是想讓美國人了解，一個一般美國人的生活是如何地與國際貿易體系產生聯繫。

在美國路易斯安那州巴頓魯吉擔任財經記者的邦喬妮，過去十年一直撰寫有關國際貿易的稿件。她說：「我曾看過美國商務部的統計資料」，「我曾認為這些都和我無關」，但事實卻不是這樣。

在一開始抵制中國商品時，邦喬妮書中寫說：「抵制讓我重新思考中國和我之間的距離，在把中國推出我的生活之外後，我得到一個中國已經深深介入我們生活的有趣觀點。」

美國經濟學家納羅夫在邦喬妮書中作序指出，美國去年進口的一兆七千萬美元商品中，約一五％來自中國，其中多數是沃爾瑪或其他零售商的架上商品，都是一些中低階層美國人生活的必需和非必需商品。

廉價又方便 消費者難抗拒

目前擔任《基督教科學箴言報》自由撰稿人的邦喬妮說，較低的價格一直讓北京受益，並促成中國經濟上的崛起，也讓美國消費者很難放棄中國商品。

在抵制階段中，為了替兒子買一雙非中國製造的鞋子，她傷透了腦筋，既要看各種型錄，又要仔細閱讀標籤，研究各種款式。最終發現，當地專門出售歐洲品牌的專賣店都已經歇業。為此，她不得不用六十八美元替兒子買一雙義大利製造的運動鞋。

據指出，中國大陸商品的價格，大概只是美國同類商品價格的三分之一，而這些廉價商品的品質也在可以接受的範圍之內。

家裡的電器壞了，最終只能讓它壞在那裡，因為零件都是中國製造。邦喬妮得到了一個教訓，很多標榜「美國製造」的商品，零件其實都來自中國。此外，在抵制中國商品之後，她四歲的兒子不得不每次都選擇丹麥產的樂高（Legos）當成送給同學的生日禮物，因為他已經找不到其他適合的非中國製造玩具。

此前，邦喬妮原本擔心美國就業機會流失，以及一些關於中國大陸人權狀況的報導，這讓她下定決心抵制中國商品，但一年的實驗之後，她得出結論：美國人民根本拒絕不了中國商品。邦喬妮在書籍的結論中指出，沒有中國你也可以活下去，但生活會越來越麻煩，而且代價會越來越高。
她說：「以後十年我可能都沒有勇氣再嘗試這種日子。」

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拒绝中国货一年 美作家认输

三年前的圣诞节后两天，美国专栏作家邦乔妮（Sara Bongiorni）望着家中节日后的满地狼籍时，忽然发现中国占领了她的家，包含电视、网球鞋、耶诞树彩灯、地板上的洋娃娃等，屋里随处可见「中国制造」（made in China），于是决定展开全家「没有『中国制造』的一年」计划。

这项计划的执行过程日前成书，并预计在本月正式发行。在《没有『中国制造』的一年》书中，邦乔妮描述她及家人在拒绝中国商品一年中的体验，发现以前一些再简单不过的事，例如买双新鞋、买件生日玩具或修理家具，在没有了中国之后，都变成一种痛苦折磨。

邦乔妮说，她并非贸易保护主义者，而除了偶或担心美国国内工作机会流失之外，她并不反对中国。她的目标其实很简单，只是想让美国人了解，一个一般美国人的生活是如何地与国际贸易体系产生联系。

在美国路易斯安那州巴顿鲁吉担任财经记者的邦乔妮，过去十年一直撰写有关国际贸易的稿件。她说：「我曾看过美国商务部的统计资料」，「我曾认为这些都和我无关」，但事实却不是这样。

在一开始抵制中国商品时，邦乔妮书中写说：「抵制让我重新思考中国和我之间的距离，在把中国推出我的生活之外后，我得到一个中国已经深深介入我们生活的有趣观点。」

美国经济学家纳罗夫在邦乔妮书中作序指出，美国去年进口的一兆七千万美元商品中，约一五％来自中国，其中多数是沃尔玛或其它零售商的架上商品，都是一些中低阶层美国人生活的必需和非必需商品。

目前担任《基督教科学箴言报》自由撰稿人的邦乔妮说，较低的价格一直让北京受益，并促成中国经济上的崛起，也让美国消费者很难放弃中国商品。

在抵制阶段中，为了替儿子买一双非中国制造的鞋子，她伤透了脑筋，既要看各种型录，又要仔细阅读标签，研究各种款式。最终发现，当地专门出售欧洲品牌的专卖店都已经歇业。为此，她不得不用六十八美元替儿子买一双意大利制造的运动鞋。

据指出，中国大陆商品的价格，大概只是美国同类商品价格的三分之一，而这些廉价商品的品质也在可以接受的范围之内。

家里的电器坏了，最终只能让它坏在那里，因为零件都是中国制造。邦乔妮得到了一个教训，很多标榜「美国制造」的商品，零件其实都来自中国。此外，在抵制中国商品之后，她四岁的儿子不得不每次都选择丹麦产的乐高当成送给同学的生日礼物，因为他已经找不到其它适合的非中国制造玩具。

此前，邦乔妮原本担心美国就业机会流失，以及一些关于中国大陆人权状况的报导，这让她下定决心抵制中国商品，但一年的实验之后，她得出结论：美国人民根本拒绝不了中国商品。邦乔妮在书籍的结论中指出，没有中国你也可以活下去，但生活会越来越麻烦，而且代价会越来越高。

她说：「以后十年我可能都没有勇气再尝试这种日子。」

No escaping from Chinese porducts

By Low Ching Ling July 15, 2007

For five days last week, I barred China and China-made products from my life. It was an experiment to see how pervasive the products of the world's factory have become in our lives.

TAKING OVER

American journalist Sara Bongiorni embarked on a boycott for a whole year in 2005 because she was sick of China 'taking over' her home.

Though she succeeded, life without anything 'Made in China' became an ordeal for her and her family as they struggled to find cheaper, and sometimes, better alternatives to China-made products.

My experiment was sparked by the current product-safety crisis in China, and Singapore's hopes of a Free Trade Agreement with Beijing.

For years, the factory of the world has helped consumers like you and me stretch our dollars by churning out cheap goods.

But is it possible to live without the world's fourth-biggest economy?

Most of the time, my China embargo succeeded. But it made my life difficult.

Almost as soon as I woke up, China was in my face - literally. I spent five minutes rummaging through my drawers for a face towel of non-Chinese origin. Another five minutes for the bath towel.

When I suggested to my mother that she should shop for new towels, she groused: 'All the neighbourhood shops sell towels from China.'

I peeped under the standing fan and the words 'Made in PRC' stared right back at me.

I left my beloved iPod (assembled in China) at home and broke the monotony of my daily train journey by eavesdropping on my fellow commuters' conversations.

I gave the China-made Panasonic phone at home the cold shoulder, even when it was ringing off the hook.

I was ecstatic my TV and DVD player were made in Korea, but moaned when I saw the three tiny words at the back of the remote controls.

I boycotted my mother's cooking because she insisted on using the made-in-China Maggi soya sauce.

One hawker gave me a dirty look when I asked where his ingredients were from.

I vetoed a colleague's suggestion to go to a restaurant serving food from Putian (a city in Fujian province). I thought it might be rude to ask the waitresses from China if they use ingredients from their homeland.

I gave up shopping. I knew the pair of shoes I had been eyeing and the camera memory card I wanted to buy were born in China factories.

Almost every corner I turned, China lurked - under my shoes, on my lip balm, at the back of my notebook.

I tried my best to avoid anything off the assembly belt from the Asian giant - but still got unwittingly snared.

I found out that the longans and chicken rice sauce were imported from China - after I had eaten them.

Some things I couldn't help.

Like charging my Taiwan-made handphone with the China-made charger.

Or working on my Made-in-China Hewlett-Packard office laptop on which I wrote this article. (I thought it was a good excuse to boycott work for five days but my boss, known for his sardonic wit, complimented me on my sense of humour).

After five days, I threw in the towel. I simply missed China too much.

I missed my iPod. I missed being a channel-surfing couch potato. I missed my mother's cooking.
Sure, it's possible to shut the door on China if you try really, really hard - and if you don't mind burning a hole in your pocket to buy costlier things made elsewhere, or if you enjoy making life difficult for yourself.

Maybe I won't eat seafood from China or buy China-made toothpaste, but that's as far as I'd go to keep China out of my life.

I have never been to mainland China (Hong Kong was as close as I got).

But during my very brief experiment, I discovered that China has been in my life for a long time now, and will be, inextricably and possibly, forever.

The reality is China, as a growing economic and political power, cannot be avoided in a globalised economy.

But that does not give it the right to give the world shoddy products.

THE ANSWER?

The answer, however, is not protectionism.

Mr Suan Teck Kin, a regional economist at United Overseas Bank, said: 'Most of the big American companies have a presence in China. They make their products there and sell them to other parts of the world, including the US.

'Protectionist moves will only hurt its own consumers, who are also the voters, and they will then have to pay higher prices for goods.

'Sure, you can ban China products. But where do you find replacements? In such a globalised economy, how do you find alternatives to satisfy your consumers?

What the Chinese need to do is show the rest of the world it is serious in tackling its product-safety crisis.

Authorities say efforts are already under way with an overhaul of food-safety regulations and revamp of its top drug regulator.

And in its strongest signal yet, it executed the former head of its food and drug watchdog on Tuesday for accepting bribes to approve untested medicine.

Yes, buyers beware.

But until we're willing to give up our iPods, cheap shoes and remote controls, China will always be indispensable to our lives.