My fiancée bought me Heroes: Season One on DVD a few weeks ago and it’s amazing. We’ve been watching an episode or four every few nights and basically need to pull ourselves away from watching all of them at once. We weren’t able to watch it when they were first on television because of my Monday night classes and we started falling so far behind that the prospect of watching multiple episodes via the internet wasn’t particularly appealing. Now that we are caught up and missed only episode 1 of the second season, it’s about time to keep current again!

Now, some of the characters on the show have some typical comic book character abilities: telepathy, clairvoyance, persuasion, regeneration, invisibility, flight, time travel, walking through walls, cutting people’s heads off and stealing their powers. Now, some of the secondary characters have some crazier powers like being able to locate other “heroes” and ultra-sensitive hearing, so that got me thinking… what power would I really want? (answer below) What power would you want?

• FMF quotes a statistic from Kiplingers that more than 60% of parents expect to pay for their kids education. I think 100% of parents should but that’s just me.
• Flexo summarizes how the recent education bill has helped new students.
• MBH shares his thoughts on Maxed Out.
• With HSBC dropping their rates, Nickel has moved his funds over to a new Bank of America account.
• JD talks about how you can use Quicken to analyze and fix your bad spending habits.
• NCN illustrates the debt snowball tactic.
• JLP talks about the changing face of healthcare, which is about the GM-UAW.
• Jeremy also takes a look at the GM-UAW contract.
• Would you rather pay more taxes (that go for health care) or pay more for health care?
• Lazy Man would like politicians to adjust the Roth IRA contribution limits based on cost of living in different areas.
• Golbguru writes about the tools of financial phishers, it’s worth reviewing.
• Sun has invented a new country, Chindia, and he’d like to invest there.
• Of course, a roundup wouldn’t be complete if it didn’t include something about subprime. SVB writes about the causes and consequences of the subprime implosion nuclear death whirlwind.
• Consumerist has a Devil’s Advocate post listing 5 ways credit cards can make you happy.
• Three’s a crowd but My Retirement Blog takes a look at the Voluntary Employees Beneficiary Association, a huge component of the GM-UAW contract agreement.
• ANd here are three things you need to be careful about with short sales.

I’d probably want the ability to fly. Or walk through walls. You?

When President Bush took office the national debt was $5.6 trillion. That’s right, five trillion, six hundred billion dollars. That’s $5,600,000,000,000.00 in debt. Yesterday, the Senate voted 53-42 to raise the credit limit for the fifth time in the Bush Presidency to $9.815 trillion dollars. 9,815,000,000,000.00 is how much debt the United States is allowed. Isn’t that absolutely staggering?

What makes this absolutely hilarious is the fact that all these lawmakers went absolutely nuts about the “subprime meltdown.” Oh, so when the banks were offering credit to people who had absolutely no right getting that credit, it was a travesty. When we discovered that these borrowers couldn’t pay the debt back, we needed consider bailing them out because they were the victims of predatory lenders. But, when the government can’t control its spending and is about to hit its limit, they can just raise it by, oh, eight hundred and fifty billion dollars. I wonder if any other country is going to bail out the United States when we discover we can’t possibly pay it back. It’s predatory lending!

Thoughts?

As checkered a history as the board game Monopoly has had (Monopoly: The World’s Most Famous Game–and How It Got That Way is a great book about its history), it’s amazing how much can be gleaned from it and how applicable those lessons are in so many facets of our lives. I think there are at least a half dozen million “business lessons learned from Monopoly” books but I haven’t seen any personal finance lessons, until now.

Lesson #1: Passive Income Is The Key to Wealth

This the world of Monopoly, passive income comes in the form of rent when opposing plays land on your properties. In reality, passive income can come from any source but the path to wealth comes from building up your assets so they can generate passive income. Why do you save for retirement? So you can live off your investments passively and you can stop relying on that $200 every time around the board as a means of survival. In Monopoly, you win by acquiring more land, building up hotels, and bankrupting your opponents. You can’t win by just running around the board.

Lesson #2: Luck Is Part of Life, Take Advantage of It

So you hit a few doubles and fly around the board, take advantage of it by snatching up as many properties as you can. In life, you’ll often catch lucky breaks, be sure you’re in a position to capitalize on those lucky breaks. Sometimes you’ll have an opportunity that requires a particular skill, try expanding your horizons beforehand and polishing up on those skills that are related to your current job but not necessarily applicable at the moment. You don’t need to become an expert but when the opportunity presents itself you can at least claim brief experience so that it can get you in the discussion.

Lesson #3: An Emergency Fund Is Essential

When you have only $54, a monopoly with three hotels, and a few random deeds like B&O Railroad. You hit community chest… and you get the housing renovation card. Now you have to find a way to scratch up a hundred dollars or so per hotel and you’re plum out of luck. You flip over B&O and shutter a hotel just to make the payment. Emergency funds are as important in Monopoly as they are in real life. The only difference is that in real life there are a lot more emergencies than in Monopoly.

Lesson #4: Improve What You Have

Don’t overlook the things in your life that you already have and think of ways to make them better. In Monopoly, it’s putting houses and hotels on the properties you already own, not trying to find more property. In real life, it’s about working hard at the job you already have, getting promoted, getting good raises, and setting yourself up for a financially prosperous retirement. It’s very tempting to look at what others have, especially material possessions, and think that your life would be better if you add those things… don’t.

Lesson #5: Use Jail to Reflect, Refresh, and Come Back Stronger

I’m not saying you should go to jail to get a breather, as one sometimes tries to do in the end of Monopoly, but sometimes you have to give yourself a time-out to rest and relax. Whether it’s pressures from your work or pressures from your friends or pressures from your family, it always pays huge dividends to take a step back so that you can collect your thoughts. It could be for a minute, an hour, or a week, but taking a little “me” time will always give you more energy to tackle life’s challenges with a renewed spirit.

Lesson #6: Life Isn’t Fair, It’s What You Make Of It

Everyone starts off with $1,500 and their butts on GO, so everyone starts off as equals right? Wrong. The player with the first move has an advantage over everyone else. The player with the second move has an advantage over everyone after him or her. The player that hits doubles has an advantage of the player that doesn’t. Life isn’t fair but that’s okay, the decisions you make after the dice have been thrown are more important than how many spaces you move. Look at all the professional athletes with million dollar contracts flushed down the toilet because of bad decisions? You could say they got lucky but they messed things up for themselves.

Lesson #7: Life Is About Relationships

In Monopoly, part of the game is negotiating with the other players to strike up a deal. It’s really a proxy for building relationships with people so that you can leverage those relationships for your own benefit. Small business owners build up networks of other professionals, such as attorneys, tax accountants, and bankers; because they know they will need to draw on them in the future. Regular folks like us build up our networks because it may be the contact that gets us our next job. Life is about relationships and building up a network of trusted individuals you can turn to in a jam.

Lesson #8: There Is Only One Winner

In Monopoly, there is only one winner. Okay, this last one is more a little peek at the next post about Monopoly I’ll write - Lessons I Had To Unlearn From Monopoly.

Imagine that you just bought a $16M home… it’s gorgeous, idyllic, and 99.99999% of all human beings on the planet would do anything to be able to live in a home like that. Now imagine that you just submitted a request to the Preservation Division in your town for permission to demolish that home. That’s right… demolish it. Stop imagining it because John Henry, owner of the Boston Red Sox, has done just that.

But wait, there’s more. Now imagine that you’re a little puppy that’s been living the high life. It’s a life that most human beings would trade their left arm for… now imagine that your benefactor has passed away and has left you twelve million dollars. That’s right. Oh yeah, your name is Trouble and that’s exactly what happened. Leona Helmsley left her dog Trouble exactly twelve million dollars. Two of her grandkids got nothing.

Okay okay, just when you thought rich people weren’t all that crazy… check this out. Mel Gibson bought an island in Fiji and he had an eight lane bowling alley shipped there. Yeah… four lanes just wouldn’t be enough.

But wait there’s more… check out this story about the homes of billionaires. “Perhaps most mind-numbing of all is Baron Capital Management founder Ron Baron’s record-breaking buy this year. In May, Baron paid Adelaide de Menil Carpenter, an heiress to the Schlumberger oil fortune, $103 million for a 40-acre property in East Hampton, N.Y., shattering the previous residential record held by Ron Perelman, who sold a Palm Beach estate for $70 million in 2004.” Amazing.

But wait… there’s more! The last one is more of a sad story about Michael Larson. Michael Larson was the guy who figured out the pattern in Press Your Luck and won himself a cool $110,237. You have to read his story, it’s amazing, until you get to the part where he loses it all in a real estate Ponzi scheme and some get rich quick fraud contest involving matching serial numbers on dollar bills. Poor guy. I guess that’s not really a crazy rich story but I wanted to write about it anyway.

A hearty welcome to those of you awake and listening 7:06 Minnesota local time to The Morning Show with John Hines on KTLK-FM radio and glad you were able to find the site. As John mentioned, I’m just a regular guy writing about regular personal finance stuff from an amateur’s point of view. Sometimes I’m right, sometimes I’m wrong, but most of the time I’m close enough so that readers like you can correct, reinforce, or add to the discussion so that all of us learn about these topics together. Ahhh the power of citizen media!

While the discussion with John Hines focused more on the article I wrote about the 7 Unwritten & Often Forgotten Credit Card Secrets, this blog covers much more than that. John mentioned a few other topics I hit such as searching for a home but the site covers everything I’ve dealt with from a money perspective. For example, I’m getting married soon and one of the most popular posts on this site is whether Married Couples Should Combine Finances… so you can see the chronology of this site very much mirrors my life.

So, you’re not 27, about to be married, and just settled into your new home, can you get anything out of this? Of course! I write about topics that aren’t necessary pertinent to me now but may come in handy some day, such as this post briefly talking about 529 plans (I have no kids). I also answer reader questions such as the one I mentioned on-air with John, about the reader who asked whether he needed a credit card (he already has a condo, is doing great, no he doesn’t need one).

Also, if you want to receive what I write in a daily email, you can sign up to this mailing list (I don’t use it for anything else other than to send you a daily digest) below (Privacy Policy):

Ultimately, I’m just a regular person just like you facing the regular problems that you do, so feel free to send me an email (I love email!) if you have a question, comment, or to just say hello.

I totally forgot to mention this but I’ll be on The Morning Show with John Hines on KTLK-FM radio (100.3), a Minnesota radio station, tomorrow (September 26th) at 8:06 am Eastern time to talk about how I started up blogging and more in detail about the 7 Unwritten & Often Forgotten Credit Card Secrets article I wrote last week. If you’re in the area, I hope you’ll tune in. I don’t know if it’ll be available electronically but they do have a listen live option. Since I am posting this at 11:25pm the night before, chances are by the time you read this the piece will have already happened since I’m a terrible forward looking planner.

There’s been a lot of talk about debit cards versus credit cards from a fraud perspective and I think there are a few misconceptions out there that bear further investigation. I don’t use a debit card much so until today I never researched the real differences between debit cards and credit cards from a fraud perspective. Federal Reserve Board Regulation E is the federal regulation that governs Electronic Fund Transfers and includes provisions that makes debit-card transactions instantaneous. Instantaneous means that the money is technically spent from the account the moment the card is used, which is important because your debit card draws from a bank account as opposed to a line of credit.

Why does this distinction matter? It matters because when a transaction is under investigation with a credit card, the charge is generally reversed until it is investigated further. With debit cards, the charge stays on while the transaction is investigated. So, if you have a fraudulent charge, you’re out the money until it’s fully investigated. This often causes a cascading effect where the missing money causes your account to go negative and start incurring fees. It’s not the bank’s fault at this point because it doesn’t know the offending charge was fraudulent and you really have little in the way of a defense to get the fees reversed since your account was negative.

Another difference is that you need to report the fraud within two days of “discovering” the loss (timely fashion), but “discovery” isn’t well defined, and you’ll be liable for up to $50. Any longer and you could be liable for up to $500. Now, some banks offer zero liability but those rules still apply because they’re outlined in Regulation E (§205.6 Liability of consumer for unauthorized transfers).

Regulation E has a lot of good stuff in it if you have a few minutes to kill. For example, § 205.8 Change in terms notice; error resolution notice, outlines how the bank must send you written notification of a change at least 21 days before its effective date. The only exception is a change is required to maintain or restore the security of the account or system, in which case they have 30 days to notify you.

It’s not particularly long and it’s written in easy to understand language so give it a look if you have some time. You can find all the other Federal Reserve Board Regulations here.