1.)  Save as much of your income as you UNCOMFORTABLY can!

• I can honestly say that my family and I actually DID save WAY more in 2010 than we ever have in the past.  We were able to bank over 50% of our take home pay, as well as pay down some debts.  This was accomplished through some very deliberate attempts to not blow money on all the little junk that can add up so quick.  I’m very proud of our saving habits this year!

2.)  Place a bet on US Stocks.

• Tip #2 also seemed to be right on the money for 2010.  US stocks performed WONDERFULLY in 2010, and early in the year I was able to allocate significant funds from my IRA into about 10 great, US based companies.  I had a couple of investments up almost 100% (CBI being one of them).  I’m hopeful that you took my advice on this one and consulted with a solid financial professional, regarding investment options, early in the year!

3.)  Study IRS tax laws!

• I’ve got to admit that I didn’t do a great job on this one in 2010.  I worked very hard to understand where I stood with my tax situation this year, but did not spend too much time researching new tax laws or seeking out new tax saving strategies.  I will need to do a better job in 2011 as it appears tax issues are getting more complicated every time Congress gets in a room together.

4.) Work Harder!

• I’m a big believer there NO-ONE works to their optimal potential…it is just human nature.  That being said, I truly had a great year at work!  I know I can work harder in 2011 though, as the house fire that I had to deal with for 6 months took a significant mental toll on the family.  I’m hopeful that now that we are back and life is getting back to normal, 2011 will be a year of hard work, lots of fun and great rewards!

5.)  Strive to become debt free!  6.)  Be Generous and Be Thankful!

7.)   “Have fun, love people, and drink great coffee!”

• I truly did work hard on 5,6 and 7 in 2010…especially on the coffee side…we seem to enjoy a lot of coffee here in Michigan!

Today I take on my newest Scam-Busters question…Is Online Poker a Scam?

I’ve recently tried online poker at Full Tilt Poker.  Full Tilt was suggested to me by a “poker guy” that I know, and who I believe plays quite a bit.  He told me that if I “bought” $250 of online chips at Full Tilt Poker, that I would receive “matching chips” worth $250.00  SEEMED TO ME LIKE A PRETTY GOOD DEAL! 

IT WASN’T, UNFORTUNATLY FOR ME.

I dropped the $250 that I had paid for pretty quickly…probably stupid to try to learn Texas Hold Um with real money on the internet…but I felt OK about it because of my $250 “Bonus Bucks” from Full Tilt.

APPEARANTLY, I didn’t read the Full Tilt “fine print” well enough.  When I tried to access the Bonus Matching Dollars on my account…there wasn’t $250 there…there was about $6. 

To this day I don’t know why my matching funds were not available, but I think it had something to do with the fact that I didn’t play long enough, AKA I LOST TOO FAST! 

HERE IS WHAT I LEARNED:  Read the fine print, don’t lose your money very quickly and don’t waste your time trying to fine a customer service phone number for Full Tilt Poker.

Personally, I thought that was one of my finest posts (if I do say so myself).  But alas, I only received 18 comments…not nearly as many as the 65 comments that have been exchanged on the Quicken Loans post.

Anyways, here are my thoughts for 2010, in no particular order:

1.)  Save as much of your income as you UNCOMFORTABLY can!  I know this seem like an impossible and crazy goal, but I took some time last week to plug some family budget numbers for my team of 5, and surpisingly, it appears that if we made some marginal sacrifices, we could save ALOT more money every month than we currently do.  Now I haven’t discussed it with my wife yet, but I believe she will be on board, and that it makes sense to hunker down and become “uncomfortable savers”.  No doubt, we will thank our “younger” selves in the future!

2.)  Place a bet on US stocks.  I believe that over the next 20 years, investing in strong US based companies is going to provide significantly better financial returns than CD’s or Money Market accounts.  Make it a point this year to talk to your financial advisor or stock broker about some potential investment opportunities.

3.)  Study IRS tax laws!  I feel like a significant path to wealth is to be wise and strategic with your money.  One step in the right direction in 2010 will be to actually do TAX PLANNING.  Hire a good CPA and really invest your time into understanding your options within the US tax systems, then take the steps necessary to take advantage of every tax deduction or credit that you are legally entitled to…the IRS is not going to do it for you!  If you don’t educate yourself, and take advantage of good things like Electric Vehicle Tax Credits, or Energy Efficiency tax savings, no one is to blame but yourself!

4.) Work Harder!  This one is a carryover from 2009, but is still a timeless truth!  Times are STILL tough and many great people are losing their jobs.  My suggestion to you is to work that much harder at whatever it is you do to bring home the bacon.  Become the “we cannot lose, period” employee at your job.  This is often thankless extra effort, but it is worth it in the long run.  I believe great effort is always richly rewarded over the long haul!

5.)  Strive to become debt free!  Easy advice, enough said!  Too many people WAY smarter than me have preached on the debt topic!

6.)  Be Generous and Be Thankful!  Life is a gift, and is way too short to not take full advantage of it!

7.)   “Have fun, love people, and drink great coffee!”

HERE IS TO A HAPPY AND HEALTHY 2010! -TAM

A link in an email can be part of a phishing scam or linked to a virus. So even if it seems to link to a well known organisation, you should still double check. This is especially true when it comes to organisations that are expected to take your payment details, like eBay, Amazon, banks and even supermarkets.

To check if it’s the real McCoy, right click on the link and choose “properties” to reveal the link’s actual destination. Then see if the address makes sense. If it’s different to the organisation’s normal web address, then it’s almost certainly bogus – even if it’s just one character out. So get into the habit of looking at web addresses very carefully indeed. If you’re providing personal details of any kind you need to make sure the site is real and secure. Identity theft is common online, but is totally avoidable and all internet users should know certain facts to avoid their bank accounts being accessed.

How do you know if a site is secure? Well, if you’re a regular online shopper or use a range of personal finance tools, or if you receive your bank statements and access your bank account online, you should know to check for two key things:

1.      A padlock in the browser window to signify that the site has a security certificate

2.      An address that starts ‘https://’ – rather than the usual ‘http://’

If you’re asked to enter bank details or private information and these two key features are missing, you are doing so in a site that is not secure. And remember, if you’re ever asked for full details of personal information like your user name or password, when you are normally only asked for some of it, something isn’t right.

A further word of caution – just because these features appear in an email before you click on the link, don’t assume they are real. Furthermore, when you double click the padlock, the security certificate for the site should be displayed. So if you ever get a warning that the address of the site does not match the certificate, do not continue.

That’s why it’s good to get into the habit of entering the address of any banking, shopping, auction, money management or financial transaction website into your browser yourself – don’t just depend on the email links, no matter how convenient that might seem.

Finally, make sure you’ve installed the latest version of your web browser – Internet Explorer version 7 and Firefox version 2 have built in filters to detect fake sites – and check your credit card statements and online bank accounts regularly, to make sure nothing is amiss.

I really do need a nice new car though, because I am, once again, getting tired of paying $2.75 a gallon for vehicles that only get 10-14 miles per gallon.  (Why do I buy big trucks all the time?)

Anyways, I’m looking at the 2010 Buick LaCross, the 2010 Ford Taurus, and the 2010 Lexus ES 350.  Each are beautiful vehicles with great Consumers Report ratings…but this comes at a price. 

I wish I liked the Chevy Impala…I believe you can get rebates and 72 month, interest free financing…BUT IT IS SO UGLY! 

Any of my blogging buddies bought a vehicle out there, I would love some advice and input on which vehicle you picked, why you picked it, and if it appears to be a good deal.  All input is greatly appreciated as always!  Believe it or not, I want my next car to be nice, but to actually be a decent long term investment…I realize that is a tough task to accomplish.

Peace and blessings to YOU, my online friends!

-TAM

Many Thanks to Jennifer Lohan for the above guest post.

• Allow yourself time to change gears- If you have been on spending fast track for years, it will be difficult at first to adjust to a slower pace. Going back to the days before credit cards became popular, people were forced to save money before they made a purchase. Over the years, as credit became more readily available, this practice became almost obsolete. As you adjust to this change in your spending “mentality”, remember in some cases slow and steady does win the race.
• Start slow- If you are dealing with a financial hardship or trying to pay off debt, it may be difficult to find a lot of money to put toward your savings goals. It is important to remember that every little bit helps and even if you are only able to put a few dollars away each week, that amount will eventually add up.
• Build momentum as you go- As you eliminate your debt, you will be able to increase the amount of money you put in your savings. Do not feel tempted to absorb that money in your day-to-day spending. If you lived without it while paying your debt, you can live without it to build your savings.
• Different financial goals require different saving strategies- Once you feel comfortable saving money in general you will be able to fine tune your savings goals. This will include having both short and long term goals which will require different saving strategies to achieve.

In many cases the hardest thing about saving money is getting started. For many people living paycheck-to-paycheck trying to squeeze even a few extra dollars into the budget may seem impossible. In most situations it is possible to find the money to save, and once you get started you will see how quickly small contributions add up. Whenever possible automate your savings so you are not tempted to spend that money in other places. Reaching your financial goals is not something that happens overnight, in fact for most people it is a lifetime endeavor, one that is well worth the effort in the end.

Trisha Wagner is a freelance writer for DepositAccounts.com, where you can compare rates of checking accountsfrom dozens of banks in one place. Trisha writes regularly on the topics of personal finance and savings accounts.

I purchased 15 companies over at Fristrade.  As of today, nine of them have lost money, five of them have made money…but my account is sitting at almost EXACTLY the $15,000 that I started with…so I’m flat overall.  That is ok, as I am generally investing for the next 4-6 years.  I did this in late 2002, andby 2007 my original $10,000 investment in stocks had quadrupled.  I liquidated around the time when the Dow Hit 13,000.  (I originally had thought I’d made a horrible decision as the Dow continued to climb past 14,000…but I stuck to my guns and did not get hammered in this market.)

So like I said, I tested the waters with $15,000 about 6 months ago.  My best RETURN was a 1 week trade on National City stock.  I bought in at $1.80 per share, and about a week later sold for over $3.00 a share. 

BUT MY BEST INVESTMENT HAS TO BE AMERICAN EAGLE OUTFITTERS INC. (AEO)

American Eagle is up 41.14% since I purchased it.  Same store sales are down at AEO, but not terrible.  I was a teenager once, I remember saving all my money to buy clothes.  (We really seem to care about clothing here in America, don’t we)  The company has next to zero debt, and almost $500 Million cash on its balance sheet.  It is also highly profitable.  I think as the economy softens, they do better than companies like Abercrombie & Finch…because the products is similar in style, very similar, but at a considerable value.  That has been a winning combination for my portfolio!

2nd best investment…APPLE COMPUTER STOCK…UP 17.54%

Again, I’m not offering specific investment advice, just letting you know what I’m up to.  Please seek professional advice when making any type of investment.  For informational purposes only!  Amen.

As I’ve shared in the past, my wife and I built our dream home about 3 and a half years ago…right at the height of the housing bubble here in Michigan (and across the US for that matter).  Hind sight is always 20/20, but it sickens my some days to think of how many beautiful homes I could be buying TODAY, ON THE CHEAP, had I not went “house crazy” at the ripe old age of 26?  We have a beautiful house that we will enjoy for years to come, Blah, Blah, Blah, is what we keep telling ourselves.  This is fine, you live and learn!  But the bottom line is that I dumped WAY too much of my dry powder into my home.  If I had that cash now I can think of 5 places I would buy in a HEARTBEAT today for 75% off their rebuild price. 

I tell you this story becuase I know there are some of you out there who are wondering if now is the time to buy your first home or to invest in foreclosures or whatever.  I’m just saying that if I had a couple hundred grand liquid to invest for the long term, I’d be snatching up some of these deals in a minute.  The demographics of the United States support my theory.  Our populations is still growing at 1% or more per year.   These fine folks are going to need a place to live.  Supply and demand seems to suggest that values will be sightly higher in the future. 

YOU ALWAYS MAKE YOUR MONEY ON THE BUY SIDE OF A TRANSACTION. 

So knowing when to buy is very important.  Now may be the time, I don’t know.  But depending on where you live, it might make sense to talk to an expert and see if there are opportunities in your area! 

Good luck, and do as I say, not as I do…because I probably moved into my house on the VERY DAY that the housing bubble burst!  Crazy stuff.  I thank the good Lord that we weren’t trying to FLIP anything.  We would be up the creek baby!!!

 Over the past 5 years I’ve had the opportunity to buy, operate, and sell five franchised restaurants.  The restaurant businesses, and specifically franchised restaurants, have provided significant additional cash flow for my family (on top of my earnings as a financial advisor 2002-2006, and VP @ Private Equity firm 2007-present).

I think the key is to realize that 9 out of 10 new business ventures fail in the first 12-18 months.  Conversely, a franchised business (franchised from an established, proven company) generally has a 90% chance of surviving that first year, and a 75% chance of surviving and/or thriving for up to 5 years.

The second key point is to understand the difference between franchises that require the owner to operate them day in and day out, and franchises that are designed to be operated by a manager and not requiring 8 hours of “on site” time from the owner.  I’ve confused these two in the past and it has cost me dearly. 

If you desire additional cash flow, you need to find a franchise concept that is designed to allow the owner to maintain their current career, but to “support and assist” a manager at their franchised business.  This is important, because if you purchase a franchise that is designed to have the owner live there, you have simply bought yourself an expensive job.  It will own you, you will not own it!

The key point of understanding a franchise as an investment is to employ the concept of return on equity.  Let’s say you purchase a hair care franchise for $100,000.  With good credit you generally will need to come up with $20,000 of your own cash (you, family, friends, etc.)…and a bank will usually give you the other $80,000 spread out over a 5 year repayment term.  If you hire a great manager your store may be profitable that first year.  To illustrate, let’s assume your store did $200,000 in haircut sales that first year.  You paid your manager, your employees, your rent, your supplies, utilities, franchise fees (royalties), taxes, interest on your loan, etc.  Then your accountant tells you that you have $20,000 left over at the end of the year…your profit!  You may look at this and say, “Wow, I made a 20% return, because this hair care place cost a total of $100,000…Great!”  But from the standpoint of Return on Equity, you have actually made a 100% return on your invested dollars!  The actual equity that you have into your business is only the $20,000 that you had to come up with to secure your $80,000 bank loan.  $20,000 invested, $20,000 profit, 100% annual return.  (If things go well…and there is a lot that can go wrong!  This is not for the faint of heart, no matter how much you like a franchise.)