Tom Valenti | Online Savings Blog

What Happens If My Investment Company Fails?
05.08.08 | Online Investing | 0 Comments | by Tom Valenti

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I'm in the process of bringing over an IRA to the company where I do most of my investments. I thought having as many things in one place would be convenient for me and my eventual heirs.

Then I got to thinking — what if my investment company had some type of Enron-like collapse? Would my balances go down the drain with their stock? Or am I exempt, because my balances are not invested in the company, but instead in mutual funds they offer?

So now I'm thinking, maybe not only is diversification amongst holdings a good idea, but diversification of the companies you do business with may be a good idea as well.

In reality, my investment company is a very large industry leader, so I couldn't imagine that they would not be bailed out by another company or the government.

But what if I was consolidating my assets with a smaller company that carried no clout? Could I lose everything if they went under?

Does anyone have any insights or thoughts on this topic?

Tom Valenti is a marketer and project manager who currently works for a financial institution in New Jersey. Read Tom's blog at http://thriftyhomeowner.blogspot.com or learn more about him at http://tomvalenti.com.
Using SmartyPig As a Honeymoon Fund
04.24.08 | Online Finances | 0 Comments | by Tom Valenti

As you may have read, I'm planning on getting married next year. We'll be paying for this all by ourselves, so we have to be cost-conscious.

My fiancée has already started thinking about what to put on her bridal registry, and she told me some of her married friends had signed on with travel agents so they can collect contributions to a honeymoon.

This sounded like a great idea to me, as a honeymoon will not be in our budget most likely. But, I've never dealt with a travel agent, as I like to plan things myself. So signing up with one of them is out of the question for us.

I searched for a similar type of site that collects money for a honeymoon, and I found many (Google "honeymoon fund"). But all of them had exorbitant fees just to donate to the fund, which I found unacceptable.

Then I came across SmartyPig, which is in a beta phase. With this, you can set up a savings account (that currently gives you 4.30% APY) and establish a goal for it (the amount you want to save and the deadline).

Friends can contribute to your goal for just a 2.9% processing fee, which is reasonable. It also requires the owner of the account to make systematic deposits. When the goal is reached, you can take the money saved in the form of a gift card or check.

I set up my account last week. I had a couple of questions, and the customer service has been great so far (the co-founder actually resolved one for me).

Some functionality has been not been available when I needed it, but this is understandable since it's a new company in a beta phase.

Tom Valenti is a marketer and project manager who currently works for a financial institution in New Jersey. Read Tom's blog at http://thriftyhomeowner.blogspot.com or learn more about him at http://tomvalenti.com.
My Retirement Update: 401(k) Bumped and Roth IRA Opened
04.10.08 | Retirement | 0 Comments | by Tom Valenti

In a post a little while ago, I questioned the traditional wisdom that says you should max out on your 401(k) and fully fund a Roth IRA every year.

Here's an update of where I am with that: I did some research, and I realized that I was only contributing 4% to my 401(k), which meant I wasn't even taking full advantage of my employer's match. I brought that up to 6% to get the full match.

Until the last year or so, I probably really needed that extra money in my paycheck, so I don't think I've let too much money slip away by not taking full advantage of the match.

I also opened a Roth IRA, even though I feel my retirement may be well-set without it.

So why did I open it, then? Because maybe I will use it in my retirement, and after more research, I realized I could pull out my contributions at any time if I need it before I turn 59.5. Also, if I ever have children, the contributions and interest earned can be used for their college expense.

It seems like this could work out better than a 529 plan.

I'm looking at the Roth like a miscellaneous fund right now, and I think it's a good idea I start funding it now to put the power of compounding to work earlier.

Tom Valenti is a marketer and project manager who currently works for a financial institution in New Jersey. For more info, visit him at http://tomvalenti.com.
Diamond Shopping On a Frugal Budget
04.08.08 | Consumerism | 0 Comments | by Tom Valenti

I've finally done it. I am now engaged.

All of the trepidation I had about taking this step did not stem from a fear of commitment, but rather from a severe inability to find and purchase a ring. I had a good idea of what she wanted, but the nuances involved in the selection are incredible.

Anyone who has shopped for an engagement ring knows the "four Cs," the major characteristics of a diamond which determine its price. Because these diamonds are not mass-produced, no two are completely alike, and thus comparison is extremely difficult.

So for someone who hates shopping and has no previous knowledge of jewelry, buying an engagement ring is beyond daunting, especially when you don't want to be ripped off. Being frugal, I have a difficult time spending money on something that I consider to be conspicuous consumption.

I guess I don't have the power to change societal customs, though.

In the end, I ended up using a diamond my mother had given to me, and got it set into a new band. Not only did it save me money, but it also has sentimental value.

And I think it saved me from losing my mind completely.

Tom Valenti is a marketer and project manager who currently works for a financial institution in New Jersey. For more info, visit him at http://tomvalenti.com.
Savings in Action: What I've Achieved So Far
04.03.08 | Money | 0 Comments | by Tom Valenti

In the past, I've posted about how I've decided to be environmentally-conscious whenever I can, and how a nice side-effect of it are cost-savings. In the past couple of weeks I've begun a couple of new initiatives that again prove this to be true.

Instead of buying soil for my yard, I've begun a compost pile that will eventually provide me with all that I need. Composting works by decomposing organic matter like yard waste and many foods and turning it into an enriched soil.

The process will take at least 6 months to bear fruit, but I have to start sometime.

My savings are as follows:
1. less trash: environmentally friendly, and if more people joined me in doing this, we'd have less need for garbage pickup and processing, which would lead to savings on energy and taxes
2. cost of soil: this time next year, I should never have to buy soil again
3. cost of compost bin: I purchased my bin from my county at a highly discounted rate (saving about 75%). My taxes are subsidizing it, so why not take advantage of it?

As I've also posted in the past, I'm looking into changing out my heater and air conditioner.

This will lead to the following savings:
1. energy efficiency: conservation is easier on our resources, and it saves me money
2. less maintenance: if all goes well, the units should cost almost nothing to properly maintain

Tom Valenti is a marketer and project manager who currently works for a financial institution in New Jersey. For more info, visit him at http://tomvalenti.com.
Replacing My Heat and AC: Is Now the Right Time?
03.31.08 | Money | 0 Comments | by Tom Valenti

My house's furnace and air conditioning unit are a little over 20 years old. Since many other things in the house have gone bad since I bought it last year, I'm amazed neither of these two has died yet.

I have heard that now is a good time to the best prices from contractors on replacements, so I am in the process of getting quotes. I figure I could spend my tax refund on them to avoid problems in the future, since with this economy it looks like I will own this house for at least the next three years.

The first quote I received came in at $3600 for everything, which I thought was pretty good (research online had told me to expect a cost of between $4500 and $5500). The second quote came in at $7600, for equipment of the same specs but different manufacturer.

I did some research, and everything I've read states that the manufacturer of the $3600 quote is very reliable, if not the best in the industry. Assuming this first company checks out, was this second company looking to make around $4000 more in profit off of me?

It's unbelievable that a company can try that, but I guess they are used to working in situations where heat is in immediate need, and people go with the first company who answers their call.

This certainly is a lesson that one should be prepared for potential emergency situations like a broken furnace or AC unit. It's also important to have funds set aside for such emergencies or capital expenditures.

Even though I may be cutting short the lives of my existing units, I'd rather be safe (getting a good deal now) than sorry (being taken advantage of when it's January and the heat won't work).

Tom Valenti is a marketer and project manager who currently works for a financial institution in New Jersey. For more info, visit him at http://tomvalenti.com.
Yelp Reviews Financial Services In Your City
03.14.08 | Money | 0 Comments | by Tom Valenti

Today I rediscovered a site I used to check out a little while ago, yelp.com.

It's a site where people can write reviews about a variety of different things. It seems to have taken off, and I plan on using it more (if I can remember).

The reason I bring it up in this forum is that members have critiqued and rated financial institutions, which can be of great use to prospective customers.

The ones I've read seem to focus more on the service and décor in physical locations, and not so much on the actual products.

But, if you're new to an area it's certainly a nice place to start your banking search, especially if you intend to be a frequent user of actual branches.

Tom Valenti is a marketer and project manager who currently works for a financial institution in New Jersey. For more info, visit him at http://tomvalenti.com.
Is a Financial Planner Worth It?
03.06.08 | Money | 2 Comments | by Tom Valenti

I was thinking today about how much the Internet helps us make financial decisions.

We research products, connect with experts, read news, etc. Pretty much all my life I've leaned on the Internet to either learn more about something or to even open a new account.

I can't imagine what it was like before, when you actually had to deal with live humans to learn or transact.

I would think that the wealth of knowledge and options available online would make professional financial planners a dying breed, but the opposite seems to be true (if you believe job forecasts, that is).

I've always steered clear of planners, because the commissioned planners (in my opinion) are biased, and because the few non-commissioned planners I've found charge for a consultation, or I don't have enough money for them to want to bother with me.

I'm hesitant to pay for something I may already know. But I do wonder if I'm leaving something on the table by not using a good planner.

Anyone have any opinions?

Tom Valenti is a marketer and project manager who currently works for a financial institution in New Jersey. For more info, visit him at http://tomvalenti.com.

« Previous Entries

What Happens If My Investment Company Fails?

Using SmartyPig As a Honeymoon Fund

My Retirement Update: 401(k) Bumped and Roth IRA Opened

Diamond Shopping On a Frugal Budget

Savings in Action: What I've Achieved So Far

Replacing My Heat and AC: Is Now the Right Time?

Yelp Reviews Financial Services In Your City

Is a Financial Planner Worth It?

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