Quick Cambodia Update

First off: Cambodia is great! I love it here. The food, people, scenery, and culture are amazing!

I have found internet access here to be limited and unreliable so I am unable to post as much as I would like,

That said I have been to a deserted island, a beach town, the capital, and now I am writing from a smaller typical town in the northwest. I have taken a cooking course, ridden on a bamboo train, and done all sorts of other great things I could not do back in the USA.

This is what I live for. This is the type of things I want to see and do as opposed to sitting at a desk answering emails and fixing computers. Traveling every year like this keeps me focused on this goal of seeing the planet one country at a time.

Hope all is well back in the states!

November 2010 Prosper Lending Update

It is the middle of the month again and it is time for my update on prosper.com lending. It has been a quiet month with business as usual. I have 0 late loans and 2 more have paid off completely. I have no open bids at this time.

I am have decided to begin reinvesting in Prosper once again. I have drawn down my account and my financial situation has improved. I will add no new money at this point.

I "write off" all loans in collections as a loss.

Here are my stats as of today:

Outstanding Loans:

Late: 0 (< 30 days)
In Collections: 0 (written off)
Current: 33

Closed Loans:

Charged Off: 10
Paid Off: 22

Open Bids: 0

Total currently invested: $715.26 (Principal Value)
Cash in Account: $88.94 (includes open bids)

Total Principal: $804.20

How to Save for a Month-Long Vacation

I decided this post would be most appropriate while I am on my month-long vacation!

When planning a long trip such as this one you always have to start with costs. You have to factor in airfare, hotel/guesthouse, local transport, food, entertainment, splurges, and so on. Once you have the big number calculated you have to plan your savings strategy to make it happen.

I always start by looking at my monthly budget. In the 1-month vacation example I can immediately see that the "Food" and "Gasoline" budget items are at my disposal. I won't be home using gas in my car nor will I be going to the grocery store or eating out at home. Those I allot to the vacation budget immediately.

Next I start shopping around to reduce costs. Is there a cheaper airfare (maybe with a layover)? Can I use any miles or points I may have to reduce or eliminate the airfare cost? Do I need a 5 star hotel or will a 2 star bed and breakfest or guesthouse do just as well? What sort of things to do are available for free? This list can go on forever. Look at every cost on your vacation list and explore options.

Once I have some more exact costs and itinerary determined I work up a monthly savings amount to fill the gap. Remember to include the actual month you will be gone as you will still get your paid time off money even though you are not here! Start an automatic savings plan to reach this goal. This is a great use for a savings account from Smarty Pig!

Now all you have to do is plan all the fun stuff that you will do while you are gone. You have the savings on autopilot and are on your way. I highly recommend getting a guidebook, such as the Lonely Planet, for your destination so you can get good idea of costs, activities, local information about your destination. Planning the vacation is half the fun so get to it!

Looking Forward: The Savings Snowball

I have heard and read a lot about the debt snowball method. You pay your lowest balance debt first and work your way up until you pay it all off. This is a great method that I used myself to pay off my own credit card debts. I believe we should take it one step further: the savings snowball.

The basic idea is the same but there are some slight tweaks to it. We all have a list of goals to accomplish. A lot of them require money and a lot of savings to cover them. Here is what I propose as the "Savings Snowball" method:

1. Make a list of financial goals and prioritize (ie retirement, kid's college, emergency fund, etc)
2. From your budget see how much cash flow you have left each month to dedicate to savings
3. Come up with a monthly amount for each item. 
4. Start saving money towards each goal in order.

I recommend putting the emergency fund first. I also recommend putting all savings toward that emergency fund until you reach the target. Plans fall apart fast when you have a financially burdensome emergency and no money to cover it! Next I would put retirement. We have to live and eat after we stop working so that is the next most important. All goals after that can be in the order you wish.

The idea is simple. You put all your savings toward an emergency fund. When you finish you do not stop! You take your monthly savings amount and put it towards retirement. If you have enough to cover your retirement needs you move on to other goals. As they become funded you keep moving down the list. Chances are you will never run out of goals!

This idea is not as simple as the debt snowball but works off of the same principal. The major factor that has to be determined first is how much you will need to retire and how to invest your savings to meet that goal. This varies widely for everyone and sometimes professional help is best here. Once you establish "I need to save $X per month for the rest of my working days to retire" you can work out all the other numbers on your savings snowball. It all falls into place after that!

Pre-Plan Salary Increases to Prevent Lifestlye Inflation

Most of us, if we are lucky, get some sort of raise every year. It may be fixed or it may be decided by someone above us in the company. It is very tempting to simply add your raise to your "fun money" and move on with the status quo. Don't do it! Plan ahead and make sure you get ahead!

I got a salary increase last month. In fact it was a reinstatement of my old salary when my company had to cut pay to make it thru an economically challenging time. Once I got work that I was getting full pay back I went to work on my budget to be sure I utilized the extra money effectively. Once I figured out what the take home increase was I update my excel budget. Here is what I did with the "new" money:

• Increased my 401(k) contribution
• Restarted my emergency fund deposits (monthly)

By planning ahead and foregoing the opportunity to spend the money unwisely I am now well on my way to meeting my big goals. Most of us get some sort of warning before a raise kicks in. You must act immediately to be sure you stay on track. This is a good problem to have!

Arrived in Cambodia!

After a long time in transit I am finally in Cambodia! Today I will be making my way down to the beach for some relaxation and unwinding from all my flights and my day in Seoul. It is summer-like weather here and I don't miss the cold one bit!

I will post updates from my travels here as time and internet access permits. I hear there is some wifi around but I am sure my access will be limited. That is ok because I am on vacation!

iPhone 4 as a travel tool

I am a proud owner of the iPhone 4. I use it extensively every day and absolutely love it. It has tons of very useful features and applications and I get a really good value from it. Since I love to travel it also has lots of great tools that I can use on the road. Since I am in Asia I am going to list all it's uses:

• Camera - It has a 5.0 megapixel camera (also with HDR function) and a flash. It is great for when I don't have my normal camera on me and also for quick snaps on the move. I can also record video as an added bonus in HD.
• Internet - With WiFi everywhere I can surf my usual sites and check emails. I can also get maps and look up local information with ease.
• Media - I can watch movies, listen to music, play games, and otherwise entertain myself on planes, trains, buses, etc.
• Texting - When I am abroad I get texts for free under my plan and can send back for 50 cents each. Not bad for getting an instant message back home when needed!
• Notes - I can note down places, times, etc as needed.
• Contacts - I have all my contacts with me. I can add numbers, emails, facebook, etc of people I meet and want to keep in touch with.
• VOIP Phone. On WiFi I can make calls using Line2 or Skype for little cost to me. It is a great way to keep in touch cheaply. 

Above are the basic uses of my iPhone for travel. I find that these benefits far outweigh my monthly bill and well worth the convenience of only having to carry one device in my pocket. I look back at when I used to travel without it and I can see just how great it is to have now. My iPhone served me well in Thailand last year and I expect more of the same in Cambodia!

On my way to Asia!!! (ATL - YYZ - ICN - PNH)

Tonight I fly into Toronto and onward to Seoul, South Korea. I will spend the day in Seoul seeking out wonderful street food and checking out a couple sites before flying into Phnom Penh that night.

I am excited about this much needed, month long vacation in an area of the world that I love. I am looking forward to $5 guest houses, the beach, cold beer, and good times.

Cheers!

Mobile Office Checklist: What you need to work from anywhere

With many innovations it is getting easier and easier to live and work form anywhere. I do a great deal of work travel and have learned many tricks to make working on the road easier. I find there are a few key items you need in order to operate in a travel office setting:

• Internet Access
• Telephone Access
• Printing
• Computer
• Backing Up
• Navigation

Internet access is probably the most important element of working while on the road. It allows you to access email, maps, travel information, and just about everything you need. You can operate off of a wifi signal such as one at a hotel or coffee shop or you can get a 3G USB modem. I like the 3G option as you have a lot more freedom to move around. If you get a SIM card based modem it can be unlocked and used worldwide on cellular networks. A third option is to have a phone that allows internet tethering to your laptop via a USB cable.

Telephone access comes in a lot of forms. The best is cellular phone which works when and where you need it. If you have a good enough internet connection you can use VOIP services such as skype, line 2, google voice, etc. A lot of these can forward to your local number as well. If you need to fax things I find that eFax or Fax.com are good choices.

Printing can be difficult outside major towns or cities. When abroad I seek out an internet cafe where I can pay per page. I print very little so it is a lot more cost effective for me. I also do not wish to carry a printer and have to worry about buying ink. In the USA Fedex Office or UPS Store have great printing abilities. Many countries around the world will have some sort of print shop you can utilize to fill your needs.

Computer access sounds simple but it can be complicated. Laptop is always the best choice but you can also use internet cafes, a smart phone or pad, and netbook if need be. Security is a concern in an internet cafe but using your best judgment prevents security problems. Keep your passwords and data safe! If in doubt go without!

No matter which method you use be sure to have a way to back up to an external hard drive or flash drive. You can pair this with a free service such as dropbox that syncs files with secure online storage. Laptops (and especially hard drives) do break eventually so backing up your data is crucial. You should be able to connect your external backup to any computer and be back in business in 20 minutes or less. I recommend daily backups while on the road!

Navigation is the last concern. Maps are good but limiting. A proper GPS device is good if you already own one and have the local maps. If not a smart phone with map abilities will do. If you already have a local data plan you should be good to go. Getting around can be made much easier with navigation tools at your disposal!

Working on the road is not hard if you plan ahead and have all the devices and know-how to use them properly. I am nearly to the point where I can work from halfway around the world with little or no issues. This is part of my big picture goal of being completely independent of not only a salary but also a stationary office. I want to be able to live and work wherever I want!

Cost / Benefit Analysis of my Delta Skymiles American Express Card

I already know for a fact that I get a LOT more value than the annual fee that I pay for my Delta American Express card. I have had some difficulty convincing others that it is worth it. This post will describe in detail how much I get from the card versus what I pay for having it in my wallet!

First the numbers:

Annual Fee: $150 per year

1 Delta Skymile earned for each $1 spent. 2 miles per dollar on Delta purchase. (plus various bonuses)

The Analysis:

Benefits:

• 1 Free domestic (exclude HI) companion ticket per year. Value: $200-$500.
• Free checked bag for having card. Value: $25 per flight ($50 per round trip!)
• Discounted SkyClub Acess. Value $25 (normal visit for public is $50)
• Miles earned. Value: varies but well more than $150 (up to $2000 in my case!)
• Bonus Offers. Value: varies. Lots of double miles and Elite Status offers

The free domestic companion ticket (1 person flying the exact same round trip route as you) alone is worth more than the annual fee. The waived baggage fee adds up too. You only need 3 round trips in a year on Delta to break even. The SkyClub Lounge discounted access can be well worth the $25 if you are delayed severely. Having a comfortable seat, open bar, free snacks, less crowds, nice bathrooms, free internet, and a business area can be well worth it.

In my case the miles I earn alone far exceed $150 in fees. For the past 2 years I have scored award flights to Asia and back. This would not have been possible without using this card for all of my purchases. If I had bought the tickets with cash it would have cost me a total of $3,800 for both. Using miles I only pay taxes. Even if you add in the annual fees I only paid $555 out of pocket. I got great experiences, a cheaper vacation, and saved a lot of money too!

As you can see if you take full advantage of all the travel benefits associated with an airline miles card you can get a lot for $150 per year. Having this card has also helped me to maintain my elite status with Delta which comes with it's own benefits in addition to the ones list here. I get free upgrades to first class, can book an exit row seat, and so on. Be sure to fully analyzed your reward options and get the most for your money!

Weekly Blog Roundup

This is a series where I link to my favorite blog posts from the financial blogs that I follow and read directly. These are the articles I found particularly useful or good in some way. I hope you enjoy my choices and learn something too!

Week of 10/25/2010:

• How Often Should I Rebalance My Investment Portfolio @ Bargaineering. Jim has a good post on when and why to rebalance. I always thought once a year was enough but this is making me reconsider.
• The Quest for the Best Budget @ Get Rich Slowly. Guest poster Robert Brokamp has an interesting approach to budgeting. To me it looks like a "reverse budget".
• My Ten Biggest Money Savers Since Starting The Simple Dollar @ The Simple Dollar. Trent wrote a great "top ten" post full of useful information and ideas. Check it out!

These are my favorites for the last week. Feel free to comment and share some others that I may have missed or not even know about. Have a great week!

Note: This will be the last weekly roundup until I return from Asia.

November 2010 Net Worth Update

It is the 1st of the month again and it is time for my net worth report card. I had a great month this month! I am officially credit card debt free and pay my balances in full every month. I also got a nice bonus from work as well as getting my old pay reinstated. Things are looking great!


As of today my current net worth is $903.61. That is an increase of $3,291.21 over last month. THIS IS MY FIRST MONTH IN THE BLACK!!! The major contributing factors were a work bonus, side income from a client, pay reinstatement, and paying off of all of my credit card debts!

I expect next month to be a good month. I will spend November in Cambodia which is a very inexpensive place.  I will remain focused on debt elimination and increasing my income in any way I can!

Alternative Income this month:

IT Consulting: $150
Extra Rent: $100