Taking advantage of high interest savings

Earlier this week I was reading my regular financial blogs and websites and thinking about the different ways that those articles can be applied to my life.  One topic that was touched on was the interest rate on savings.  This is probably an often overlooked area for many people because, lets face it, most banks basically give you nothing.  Add to the fact there is such a low national rate of savings and the interest rate is probably not a big factor for most people.  However, I am trying to find whatever means necessary to grow my net-worth, even on my emergency fund and general savings that just sits there.

I admit that we do have more cash on hand than most investment advisers would say we need, but I would like to move in the next year or so, so I am saving a lot.  So this money that we have is our emergency fund and a general savings which would total probably close to 10 months of must have expenses.  I should really know exactly what our expenses are, but I have not calculated the total lately since some significant life and financial changes.

So, once I got the idea that there was a better option out there, I had to begin my research.  We all know where that leads.  After a good old Google search for high interest savings, there was a multitude of good information.  Low and behold, one of the top suggestions was an article on one of my regularly read sites, The Simple Dollar had an article about their best savings accounts of 2015.  I thought it was a well written article that gave pretty solid info about the various providers.  It included info regarding the interest rate offered, minimum balances, fees, and any other aspects that set the provider apart from the pack.  Often times I see the interest rate fluctuates slightly based on the added options that they offer.  Less options usually means higher rate.  Translation, the more options means it costs the provider more.

After reviewing the article I decided to visit a few of the individual sites and see for myself what I liked about it.  

Capital One 360: This was the first site I visited.  They offered a rate of .75% which was the lowest of the options I looked into.  They also offered a tiered reward based on the amount of your initial deposit.  The bonus started with deposits of $5000 and reached the highest tier at $50,000.  The actual bonus was from $50 to $500.  All in all, nice to offer the bonus, but over the long haul it would not take me long to get more than that bonus with a higher rate.  The best feature about Capital One 360 is the ability to have separate "mini accounts" I will call them within your main account.  This is a great option to divide your money among the various savings goals you have.

Ally:  The Simple Dollar actually rated Ally as the best overall savings.  This was in part due to the high savings rate they offer of .99%.  Well above the Capital One option.  Another big aspect of Ally getting the highest rating was the online offering.  The site is very user friendly and also offers mobile options.  There was no minimum deposit or monthly fee.  Interest is compounded daily to help you grow faster.  

Others: I also looked at the Synchrony option as well as Discover and American Express.  These all offered rates close to the 1% with various combinations of minimum balances and monthly fees.  Overall they were very similar in offerings.

In the end I decided to go with the Ally financial savings account.  I am a big fan of ease of use and do not like a very busy website to navigate.  They also have the option to deposit checks using a mobile device, which I like to do.

As I mentioned in the beginning this decision to get this account was in an effort to grow my money more quickly.  That being said, a savings account growing at .99% is not going to do a lot to create log term wealth for me.  That means I now need to look into other options to create long term growth.  I have heard various things about brokerage accounts and ETFs, but I am not knowledgeable enough on those to make that move yet.  Look for that post in the future.

Holiday Travel with Points

Happy Thanksgiving to any readers out there.

For this past weeks holiday I traveled with my family to see my wife's relatives and introduce our new baby.  There was a little stress leading up to it for me due to the holiday's typically being a high volume of travelers.  Also, traveling for the first time with a baby seemed like it would have been rough.  However, I am happy to say, it was actually one of my easier traveling adventures.  I must have been lucky to chose flights that left at low volume times because we did not have to deal with much traffic at the security check points or any hassles whatsoever.  It was definitely a smooth trip.  But this I attribute more to luck.  The most low stress aspect of this trip was the cost.

The total cost for the flight for 3 people, hotel, and rental car was about $10 for the flight taxes.  The joys of traveling with points.

This was achieved through the use of multiple credit card offers over the past few years that have allowed me to accumulate points that I allot specifically for travel.  Rarely do I use points for anything else.

Flight
For the flights, we traveled for a total of about 20,000 points through Southwest Rapid Rewards.  This total covers myself, my wife, and our baby.  The low point spend was because we only had to pay for myself.  Because I was able to accumulate 110,000 Rapid Reward points this calendar year, I was awarded a companion pass.  This means my wife fly's for free, anytime I do through Dec. 31 2016.  What a great deal.  In addition, because our daughter is under 2, she can fly as a lap child, which does not require a ticket.  Some may wonder how I accumulated so many points in a year, but in fact it is very easy with the offers that are available.  Early this year, southwest offered 50,000 bonus points for a spend of around $2000 in 3 months.  I took advantage and opened a personal and a business card.  I used the personal card for all my expenses to easily cover the minimum spend, and the business card was used for all the renovations on our latest rental property.  This also easily got us over the minimum spend to get the points.

Hotel
We decided that we wanted to stay for 1 night in Baltimore to try to see a bit of the city on the last night of our trip so I looked into our options.  I found that there was a Hyatt Place located near the airport and decided that was a good option.  It was a good option because I had previously opened a Hyatt Visa card that came with 2 free night stays anywhere in the world.  1 of those nights was used last year in Paris on our Honeymoon so I had 1 remaining.  All I had to do was call and request to use my night at the Baltimore Hyatt Place and it was booked.  Simple.

Rental Car
I was surprised that the rental car was the most expensive part of our trip in terms of points.  I am used to booking cars through work and the corporate rates are much better than the general rates.  Either way, I decided to use my Chase Ultimate rewards points to book a small SUV for our trip.  I could have booked a smaller car to save, but with a baby and stroller, plus luggage, the SUV made sense.  In the end I used 26,000 points for a 5 day rental.  Not too bad at all.  We actually got upgraded to a large SUV for free anyways, so that was a bonus.

All in all, I am happy with how that all worked out for us in terms of cost for the trip.  We really only paid for food at the airports, which is expensive.  I think the point of this post is to just make people aware of the opportunities out there to travel on a budget.  I know many people say they would love to travel but cannot afford it.  I would tell them there is always a way if you do your research.

That being said, I would not advocate this method of generating credit card points to everyone.  We all know that not everyone can control themselves with the plastic in their hand.  If you are someone who carries a balance on anything besides a 0% interest card, I would not recommend this to you.  Mainly because it will end up costing you more than the benefit, but also because you not only have to spend the minimum spending, you generally have to pay it off in that time.

I hope this post can help someone out there to realize their travel goals while staying on a budget.

The Basics of Change

I believe that just about everyone out there wants to change at least one thing in life, most people more than that.  Whether it is financial situation, health and fitness, education, job, living situation, or any of the multitude of other facets of our life we could possibly want to change.  However, despite our desire to make these changes, most of us don't.  Too often I hear about people who say how they wish they could BLANK.   And yet, they do little to put themselves in the position to do what they desire.  At some point we become settled into our situation and eventually lose hope for change.  In many cases this becomes a topic that we subconsciously complain about.  And this is part of what drove me to write this, because I am of the believe that if you do not like your situation, you have every opportunity to change it.

Why don't we change?
The reasons that we do not take the steps to make these changes in life are endless.  
-Fear:  Fear of failure. Fear of ridicule. Fear of the unknown. Oddly enough, fear of success.  Most people do not want to step out of their comfort zone into the unknown.  This fear is a controlling force in their life that holds them back from reaching their potential.
- Conditioning:  People are often programmed to believe that they are only as good as their parents and relatives before them.  They are so ingrained in how their family has lived that they do not realize that they are in control of their future.  The past has no bearing on each individuals potential.  Everyone has obstacles in life of varying sizes and qty, but we all have our struggles.  How you deal with that adversity is what forms you and prepares you for the success you will be down the road.
- Education:  Oddly enough, there are people out there that believe they are not intelligent enough to have better than their current situation.  I find this to be a very sad situation.  We all have opportunities for learning and bettering ourselves, that do not cost much if any money at all.  While I am college educated, I believe some of the most valuable knowledge I have gained has come from books I have read on my own.  Libraries are great resources to gain knowledge.  The Internet has also put knowledge in the hands of anyone who seeks it out.  Learning should not be a hurdle to making a change in your life.
- Money:  I can understand that money is a hurdle to making an immediate change, but with proper planning and execution, money problems can be overcome.  It may take making changes in other aspects of your life such as spending or working more, but money problems can be overcome.

This list could go on and on, but I think these are some of the biggest factors that restrict us from doing little things that can improve our lives.

How do we change?
I think change can be accomplished with just a few steps.  In a lot of my studies and experience I have seen various models for organizational change and optimization.  All of these same principles can be applied to any aspect of our lives that we wish to make better.  I will lay out the steps that I believe can help us all improve.
Step 1: Awareness-Where are we?
I call this step awareness because we need to understand where we currently are.  Financially, if we are to really be aware of our situation we need to understand our in flows and outflows of money, as well as any debts and bills.  While this can be as simple as writing down all of our spending on a piece of paper and tracking that way, the world of technology has made it so much easier with various software and apps. I use the finance example because it is something I am interested in and track pretty regularly, but the principle applies to anything. Losing weight, job salary, educational goals, etc.
Step 2: Where do I want to be?
This can basically be considered goal setting.  We need to understand where we want to be.  Whether it means to become debt free, lost 30 lbs, or increase our salary by 25%.  Knowing where you want to go is the only way to make a proper plan of action.
Step 3: Gap analysis/How to
Now is the time to see exactly how far we are from the goal.  Is this a short term or long term goal?  Will this change effect other aspects of my life in order to achieve it?  What resources do I have to get there?  All of these questions can be addressed in this step.  That is because, all of those questions should be answered in order to make a plan.  The plan is basically the "How to" guide to achieving your goal.  It is a road map of the steps you will take to get there.  Part of the plan should include any risks you see that could interfere and how you will address them if they do happen.  Also, any budgeting or resources that you need along the way should be identified at this point.  There are plenty of what ifs that could be considered at this step and I am sure this is where a lot of people get afraid and stop.  However, some risks cannot be identified anyways so there is always something that could go wrong.  Do not let the what ifs stop you from moving forward.
Step 4: Make it happen
Now is the time to move forward with implementing your plan.  Some may call it taking the leap of faith, but I think its just taking the first small step in a well mapped out path to success.  This is the time to begin making the sacrifices that you identified in your plan in order to meet your goal.  A lot of reaching financial or fitness goals revolve around using the word no.  A lot of the time you will be saying no to friends and socializing, but most of it has to do with telling yourself no.  This is called discipline and is the root of successful change.  The most important parts of this phase of change is to stay focused on your goal, and disciplined with your plan.  Your plan should have fun or splurge days built into it so as to not cause a huge setback to your normal plan.  If you can stay disciplined, you can have the change you want.
Step 5: Analyze/Revise
This part of the process is where you will begin to see your results.  It is wise to periodically take a step back to step 1 and analyze where you are.  Measure your current situation to both your beginning as well as to your goal.  Make it a regular progress review maybe monthly or quarterly.  This will then give you the chance to make small tweaks or revisions to your plan.  I think that once you begin to take the small steps of progress you will see there are opportunities to become more aggressive with the goal.

In Summary, I just want people to realize that there is no reason to fear change.  Change is a certainty in life, but whether or not you have control over it is up to you.  A few small steps can help you down the path to all you desire if you have the discipline to stick to the plan.

Good Luck.

About Me

Just a quick bit about myself.  Some of this may be carryover from the original post, but will still be helpful.

I am 31 year old married man with a 3 month old daughter.  My family lives in the suburbs just outside the city of Detroit.  While I personally wish we lived in a different suburb about 20 minutes away from here, this is where my wife grew up and we are very happy overall.  We are very fortunate for such a great life.  We both work full time and live very comfortably.  That can be attributed to the strong work ethic we both learned from our parents.

As for education, I have both a BBA and MS degrees from U of M.  In addition I have recently earned a certification as a Project Management Professional.  For the past 10 years I have worked for several automotive suppliers in the area.  

A big reason that I became interested in writing about my life and various topics would be goals that my wife and I have.  The reasons I say that are 1. I try to read and gain knowledge in the areas related to our goals, and 2. writing about goals and sharing those thoughts are a way to hold myself accountable.  The simple fact is that I can write about all kinds of topics and goals, but most of them are difficult to implement and maintain.  Despite that, all we can do is our best.

That's all for today.

The Beginning

Welcome to The Path to Better.  A place to bring together ideas for personal progress toward a better you.  

You will find a plethora of topics and areas for self improvement.  Topics may range from finance, fitness, education or any other topic that I feel I have some knowledge on or feel I want to improve upon.  

The reason I wanted to begin this blog was to write down some of my thoughts and ideas on things that I can improve, or have gained knowledge about in the past to get me to where I am.  Somewhat for the purpose of self reflection, but also hoping to provide others with some inspiration or direction to take a step down the path to their own self improvement.

For my posts I will draw from my own experiences and other topics I encounter on the Web or news.  I have tried to gain a lot of knowledge by reading about personal finance, work place optimization, leadership, real estate investing, and economics.  In addition I have both Bachelors and Masters degrees, as well as a PMP certification.  

I like to think of myself of a Jack of all trades, but a master of none.

I hope you enjoy some of my posts and I appreciate any constructive criticism.