assistance requested for the uneducated

[cracked_belle]

okies, so I'm an financial moron. not to suggest I'm financially irresponsible. I'm excellent at saving my money and spending it wisely. however, I know NOTHING about credit limits, credit card interests, savings account fees, etc. I'm all about working for my money; but it's time I get my money to start working for me too.

what resources do y'all suggest for someone who's uninformed about the world of finances? I want to educate myself, but I really need a "Money for Dummies" level of simplicity to start.

(if it matters, I'm a USA resident.)

thanks in advance, fellow rebels!!

[cracked_belle]

a little more clarification (after re-reading the other threads in here):

I'm not in debt, so I'm not really looking for debt reduction. (I only have one hospital bill I'm paying off, with no interest.) but I'm getting fees from my savings account, and I don't know if it's better to use a debit card or a credit card.

I'm just looking for general information. like I said, a "Money for Dummies" that's reliable, if that makes any sense.

[msuroo]

a little more clarification (after re-reading the other threads in here):

I'm not in debt, so I'm not really looking for debt reduction. (I only have one hospital bill I'm paying off, with no interest.) but I'm getting fees from my savings account, and I don't know if it's better to use a debit card or a credit card.

I'm just looking for general information. like I said, a "Money for Dummies" that's reliable, if that makes any sense.

If your gym doesn't have a squat rack, it's time to find a new gym. Oh wait, wrong section. If you are getting hit with fees from your savings account, it's time to find a new bank.

In all seriousness, there are free checking/savings accounts everywhere - I wouldn't dream of staying with a bank that was charging fees for that. As to the debit/credit card thing - as long as you are responsible, a credit card is undoubtedly the better choice. My usual recommendation is for an Amex Blue Cash or Blue Cash Preferred (depending on if you would spend enough to make up the annual fee on the latter). Assuming you don't change your spending habits any from when you were using a debit card, the only difference would be that you are earning between 1% and 6% back on every dollar you spend. It's like free money. Seriously, I'll put a stick of gum on a credit card if the merchant will let me - I never use a debit card, and I avoid using cash/checks wherever possible.

That said, if you let yourself run up a balance because hey, it's on credit - then stay away. No amount of rewards is worth digging yourself into a hole of debt, but it sounds like you're pretty responsible, so that shouldn't be an issue.

[msuroo]

Also, don't let yourself get overwhelmed.

I'm excellent at saving my money and spending it wisely.

This is literally 99.9% of the battle. The rest is just details.

[Anivair]

TBF (and I know this gets pimped a lot around her) but I Will Teach You to Be Rich (by Ramit Sethi) is really a money for dummies. Good stuff. Get the kindle edition to save a few bucks.

[morethanjustamom]

TBF (and I know this gets pimped a lot around her) but I Will Teach You to Be Rich (by Ramit Sethi) is really a money for dummies. Good stuff. Get the kindle edition to save a few bucks.

Second this. Just starting to automate my money stuffs, good info here.

[Strawberry Squatcake]

Why the heck are you getting charged a fee in a savings account? Is there a minimum required balance? The no minimum balance accounts will earn less interest, but if you aren't at the minimum balance you usually pay more fees than you'd earn in interest anyway. My suggestion is to look around for an account with no minimum balance that earns the most interest. Interest sucks these days - so be warned. Strangely, the minimum balance fees didn't decline when interest did. So you really get socked now.

I don't really have any good advice for money for dummies books. Once you have enough saved that you want to look at long term investments, a next step might be a mutual fund, so you could read up on those. And if you don't already, I'd definitely suggest a Roth IRA. You pay the taxes on your money now, put it in the account, and when you take it out after retiring you don't pay taxes on what you've earned. This is pretty awesome because you'll probably double or triple what you've saved, so you're only paying taxes (in your current tax bracket) on the initial investment. You can also always withdrawal your intial investment from a Roth with no fee. (You pay a fee if you withdrawal earnings.)

Alternatively, you can defer paying taxes on a set amount of money now and put it in a Traditional IRA, but then you pay taxes on what you take out each year beyond retirement. These are less popular but for some people a better option. I don't like them because I'd rather be done paying taxes, and you have a forced distribution amount you're required to withdrawal each year. But for you, this could be a good choice for a variety of reasons.

Soooo... If you're looking for books, I'd also suggest investments beyond banks/CUs when you've saved up enough that you want to truly turn it into a long-term investment. Of course, if you're not that far, yet, general savings is a fantastic place to start, too!

[Seabright]

Hey there, jtggoqdos -

One of the best books I've read out there on getting started with managing your finances is "Get a Financial Life" by Beth Kobliner. This book is geared toward people in just your situation - starting to earn money, already knowing how to stay on point with spending, and wondering where to go from here. I found this book incredibly helpful, in a number of ways. It's still on my bookshelf, and I like to re-read certain parts to help me stay on track.

[cracked_belle]

y'all freakin' rock! thank y'all so much! I'll look into snagging at least one of those two books (I do have trouble with collecting underpants, to be honest, so I'll probably pick them both up, haha), as well as switching savings accounts and looking into mutual funds and IRAs (neither of which I have any idea what they are, lol).

as always, the NF community saves the day! thanks again, everyone.

<3

[drayz]

Hey there, jtggoqdos -

One of the best books I've read out there on getting started with managing your finances is "Get a Financial Life" by Beth Kobliner. This book is geared toward people in just your situation - starting to earn money, already knowing how to stay on point with spending, and wondering where to go from here. I found this book incredibly helpful, in a number of ways. It's still on my bookshelf, and I like to re-read certain parts to help me stay on track.

Thanks for the suggestion. I reserved a copy of Get a Financial Life from the library. I am looking forward to reading it.

[bchurchill]

The financial industry doesn't make it as easy to find out everything as it could be (I second Ramit Sehti's "I Will Teach You To Be Rich" book. If you are most concerned about getting out of debt specifically, then I would suggest Dave Ramsey's "Total Money Makeover).

I saw that nobody addressed your question on credit so I'll field that one.

-You can get FREE access to your credit report: Your Access to Free Credit Reports.

-Errors and mistakes do happen on credit reports so keep an eye out for those.

-General note about credit scores: credit scores are not income or net worth (i.e. it's not the most important or significant measure of financial success)

Regarding saving and investing:

-if your employer offers it, see if their is a PENSION or retirement program [e.g. 401(k)] investment program at your bank

[Absidey]

Just some quick tips; random things I've picked up. I might be reading some of the books above, too, for more in depth stuff.

Savings Accounts:

Not all fees are bogus. The Federal Reserve has put some limits on withdrawals from savings, and over-the-limit withdrawals incur a fee. The policy was implemented without notice at Bank of America, so they had to refund the illegally charged fees to me. When I asked my credit union about it, they confirmed that the fees themselves are legitimate and industry wide, it was the process BofA messed up. If you’re getting account or maintenance fees on your account, however, dump your bank.

Regarding credit:

Different “get your score†sites will calculate your score based on your report differently. On the same day, one site said my Experian score was 728 while a different site reported the Experian score as 739. (Also on the same day, Transunion reported 839, and Equifax was 734.) It's very misleading for companies to imply someone's score is specific. It can vary significantly, even without blemishes or errors on your report.

Companies pulling your credit report also weigh things differently, which can result in different scores pulled even from the same credit reporting agency. You are entitled to a free annual credit report from each agency WITHOUT signing up for any recurring services. This does not include the score, and if it gives an option to add it in, this will usually trigger a service trial period, after which a monthly fee is charged if you don't cancel the service.

Credit Cards:

I own a business and use credit cards almost exclusively for all purchases, but never carry a balance. On both ends, it helps me manage cash flow, and the cash back is nice, even if it's not huge. Year-to-date, I've gotten about $378 back. I'm planning to switch over to mileage rewards, because I think with bonuses and such, I will get more for the amount I charge to cards each month. Also, I am much more comfortable handing my employee a company credit card than an expense account debit card, though that part probably won't matter to you.

Even if you don't want to utilize credit as a financial tool, it's a very good idea to get and periodically use a credit card. It doesn't have to be much, just enough to keep a credit account active. I used to buy groceries once a month on my first card, then schedule a payment when I got home the same day. There's a couple of reasons this is beneficial to you: 1) lack of credit history can be as much of a pain in the butt to you as a credit history with a couple of issues, and 2) one of the factors in score calculation is your debt-to-credit ratio. The more credit you have available to you, but not actually in use, the better it is for your score. You can actually bump your score up a smidge by asking to increase your credit limit when you don't need to, because it improves the ratio. However, you have to make sure you don't take advantage of your increased purchasing power. Always assume your credit card company has given you enough rope to hang yourself, and set your own limits well behind what they think you can handle.

Most household accounts (utilities, cell phone, etc) don't count favorably towards your credit score. They can hurt you if you get behind, but just paying your electricity every month won't do you any good. You have to borrow money to build credit. You don't have to borrow it long enough to incur interest, but it does have to be borrowed. The only exception I'm aware of is rent, which I think is a fairly recent shift and I don't know if all reporting agencies have adopted the policy. I think it may also depend on your landlord's reporting policy for accounts in good standing.

[Guest ApptivGames]

Read "The Richest Man In Babylon" it teaches you all the basic principles of saving money, making money, and making it work for you. Plus it's in story form, so it's a really easy read!

Once you understand the basic principles it teaches, the rest just comes.

[chasely]

When you're ready to start investing (after you pay off debt, have a good emergency fund) start out with the Boglehead's Guide to Investing and go from there.

http://www.amazon.com/Bogleheads-Guide-Investing-Taylor-Larimore/dp/0470067365