Dave Ramsey is a polarizing figure. Some people love him and swear by his advice and others think he’s a hack. Which one is he? Unfortunately that’s a question only you can answer but hopefully I will provide you with enough information about his flagship book to make your own decision.

The problem with personal finance is that there are multiple solutions to any one problem. If you think it’s simply about math, you’re wrong. Someone in credit card debt understands that when you use your credit card and don’t pay your entire bill, you’ll go into debt. They aren’t stupid, they know how interest works, but there is a non-math reason why they’re in debt.

If you had to boil down the book into a single sentence, then I’d say that Dave Ramsey’s Total Money Makeover is a book that gives you a good framework to get yourself out of debt and back on solid financial footing.

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Did you know that that the United States Postal Service is slated to lose $6 billion or more this year? It lost $2.8 billion last year.

With all the outrage over lending billions to financial institutions, you’d think more people would be fired up about running an operation that lost $2.8 billion last year and could lose $6 billion this year. No one is sending packages on credit for people without jobs. There aren’t multi-million dollar bonuses for anyone at the post office. It’s just a business that is spending more than it earns because mail volume is dropping.

In reading more about it, some people argue that delivery days is a red herring and that the USPS can save money in other areas. While I can appreciate that to a degree, sometimes it comes down to an argument of “less filling” or “great taste.” The reality is that the post office is losing money and we’re paying for it, with taxes and with higher postage stamp prices, and they need to stop arguing and start fixing.

I am perfectly fine with getting mail five days a week.

What do you think?

(Photo by icanchangethisright)

Eric Ripert is part-owner and executive chef at Le Bernardin, one of four New York City restaurants to have been awarded 3 Michelin stars in the Michelin Guide NYC 2006. I first learned of Ripert after he appeared on one of my favorite shows, Bravo’s Top Chef, and started reading his blog, Avec Eric.

As always, I’m a big fan of reading and learning about “behind the scenes” type stuff and in early July, Ripert wrote a post in which he gave you a behind the scenes look at the operations of Le Bernardin. The point that I found most intriguing, and most applicable to personal finance, was that they started service each day with a “family meal” where they check-in and discuss the work ahead of them:

Before we start service each day, one or two of the cooks will put together what we call “family meal”. It is usually something like home cooking but simple and not too heavy so that we don’t feel too full during dinner service. It is important to eat a little something before the really hard work starts because our dinner service lasts for several hours and we don’t take a break at all. Also, this family meal is a good time for all of us to discuss the work day but also to connect on a personal level. Just like a family meal at home, it is an important part of the day.

Why should you care about this? This underscores the importance of regularly “checking-in” with your finances.

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With the passing of the CARD Act, credit card companies have been responding by instituting purchase-based annual fees. Before the CARD Act, many issuers were trimming their books of inactive, low-activity, and risky credit card accounts. You may remember American Express offering cardholders a financial incentive to close accounts.

In this environment, there may come a time when you will want to cancel a credit card. A few years ago, canceling a credit card was easy. You called them and told them you wanted to cancel, they try to keep you around, you did that dance, and then diced up your card. Nowadays, you go through the same charade, but now you have to be worried about how the cancellation would impact your credit score! Boo!

So here are some tips on minimizing the impact of canceling any one credit card.

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BATNA is a well known negotiation acronym that stands for “best alternative to the negotiated agreement.”

If you’re familiar with the concept of opportunity cost, then BATNA will sound very familiar. The idea behind opportunity cost is that the price of something isn’t just the number listed on the tag. There’s an opportunity cost involved and that cost is the price of the next best alternative. Let’s say you have two potential events you can attend this weekend. You can either go to a movie or go to a concert. The opportunity cost of going to the movie is the enjoyment you would’ve experienced if you went to the concert instead. The opportunity cost of going to the concert is the enjoyment you would’ve experienced if you went to the movie instead. So the cost of the movie is not only the ticket but concert enjoyment. Got it?

BATNA is a similar idea. When you’re negotiating anything, it’s important to know the other side’s BATNA. You’re trying to create a win win situation, so you have to create wins for the other side. If you know their next best offer is worth $10, you can offer a $9 solution. They would simply say no and go to their BATNA. You want to know how much their next offer is worth and offer something better.

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Rules of thumb are great. They teach you a little nugget of wisdom and have been vetted by generations of experience. Don’t swim thirty minutes after eating, don’t mix hard liquor and beer, and don’t date your relatives. Follow those rules of thumb and you’ll live a happy and healthy life.

The same can be said about financial rules of thumb. Don’t spend more than you earn, save 10% of your salary, and always buy a used car. You don’t have to always follow those rules of thumb, but if you want to achieve financial prosperity, it’s best to heed them.

However, over the years, some rules of thumb are in need of a refresher. Times change. A rule that made sense ten or twenty, or even a hundred, years ago may not make sense. Let’s have a look.

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As the world of green cleaning grows, the shelves are being lined with products that claim to be natural and eco-friendly. Some companies are actually taking the time to research and utilize natural plant-derived ingredients and use recycled and bio-degradable bottles. For the rest, the term green-washing comes to mind as the best way to describe their new cleaning products. Just creating a beautiful label with wild flowers and leaves does not mean the product is natural. Just as with food and skin-care the best way to know if a product is green is to read the label. Watch for my next post on a list of cleaning products I am currently reviewing to see which are truly eco-friendly, safe-to-use and work!

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In general, cashing out an IRA is a bad idea. That being said, and I think I’m contractually obligated to mention that as a personal finance blogger, there are times when you simply have no choice. When faced with certain decisions, you might have to make a few that you know are bad for the long term but necessary for the short term. To cash out an IRA may be one of them.

So, if you are faced with such a decision, I think it’s important that we review how you can cash out an IRA and avoid the 10% penalty. It will not be possible for you to avoid paying taxes on the withdrawal, since you never paid taxes when you contributed, but we can at least try to avoid the ugliness of the 10% penalty.

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