Black Coffee: The Best Personal Finance Book I’ve Ever Read

It’s time to sit back, relax and enjoy a little joe…

Welcome to another rousing edition of Black Coffee, your off-beat weekly round-up of what’s been going on in the world of money and personal finance. Here’s what caught my attention over the past week…

Somebody asked me to recommend to them a personal finance book they could give to their 20-something son.  Without hesitation I told them to pick up a copy of Control Your Cash: Making Money Make Sense by Greg McFarlane and Betty Kincaid.

Now before I go any further, for those of you who think I am shilling this book simply to make a quick buck, you’re wrong.  I receive no affiliate commissions or other advertisement revenue for linking to this book (both in this column and in the side bar banner).  That is because I think Control Your Cash is the best basic, no-nonsense, personal finance book I have ever read.

Control Your Cash covers everything you need to know about the basics of personal finance, from banking accounts, credit scores and budgeting to taxes, securities and investing.  In between it lays out, in clear and concise terms, how to go about buying a house and an automobile.

Most importantly, the book is smartly written and very entertaining.  Truth be told, I use the book as my personal finance bible; it is a terrific reference book that you can refer to again and again.

If I was forced to pick my favorite chapter in Control Your Cash it would be the one on how to buy a new car.   One of the quickest ways to blow a big chunk of money – short of dropping a big stack of hundies at the craps table on a “hard way” bet – is to be unprepared when you walk into a car dealership with the intent of buying an automobile.   I guarantee you the folks who have read Control Your Cash will have no such worries.

Blogs I’ve Been Following This Week

Out of Your Rut – Have Your Down Payment Ready Before You Buy a New Car.  Speaking of buying new cars…  From a financial perspective, it is better to buy a slightly used car that was driven off the dealer’s lot within the first year or two.  But if you are simply uncomfortable with buying a used set of wheels, and haven’t yet read Chapter 6 of Control Your Cash, make sure you check out this excellent article from Kevin on how to prepare yourself before walking into that dealer showroom.

Squirrelers – What Kind of Car Should a Teenager Be Driving?   If you ask me, the answer is simple: whatever those teens can afford to pay.

Green Panda Treehouse – Why Buy a Car with Cash?   My top three smart-aleck answers:  1) because those darn dealers still refuse to accept glass beads; 2) because they also don’t accept American Express; 3)  because grand theft auto carries a maximum penalty of three years in the state penitentiary.

GoBankingRates - Personal Finance Project: Vote for Your Favorite Len Penzo.  I think the title says it all.  GoBankingRates says payola is within the spirit of the rules – unfortunately, I am pretty much broke, so I am forced to resort to begging for votes.   (Okay, so I have no pride.)

Money Crashers – How to Respond to Unauthorized Transactions In Your Bank Account.  As I told the Crashers, a long time ago I had my checking account hijacked by a pizza delivery guy (no, no, not Jeff from Deliver Away Debt) who took a personal check I had given him to pay for my pie.  What can I say?  I had no idea there were shady pizza delivery guys out there!  (And to think that I tipped the guy too.)  Needless to say, I always pay cash for my pizzas now.

Kiplinger – Private Islands for Sale.  Here are 12 islands for sale, ranging in price from just $595,000 to $3.5 million.   Sorry, Maui is not for sale.  Yet.

…And Here’s Some Other Posts You Might Enjoy:

Narrow Bridge – It’s Here: The Narrow Bridge EBook!  Eric has put together a step by step guide for building a “fire and forget” automated personal finance system.  Check it out!

Mint - Back to School Budgeting Lessons.

Not Made of Money – 4 Tactics to Help You Spend Less.

Bucksome Boomer -  Top 10 Business Travel Eats.

Financial Samurai - How to Get Girls If You Live at Home with Mom and Dad.

Frugal Zeitgeist – Debt Collection Horror Stories.

Little House in the Valley – Ten Signs You’re Not Prepared for Retirement.

Darwin’s Finance - Is the McMansion Dead?

Money Reasons – The Cost of Being Rich and Famous.

Money Crush – 31 Days to a Better Bank Balance.

Simple Financial Lifestyle – 8 Financial Seeds to Plant Now to Simplify Your Finances.

The Way-Back Machine: Past Posts Of Mine You May Have Missed

From August 2009:

What’s An Emphyteutic Lease? (And Why You May Want to Avoid One.) – I first heard about this type of lease-from-hell last summer when the Honeybee and I were sitting in front of the boob tube watching the two-millionth episode of House Hunters.

Credits and Debits

Credit: We’ll start off this edition of Black Coffee with some upbeat news. Last month the U.S. private sector added 67,000 new jobs.

Debit: Unfortunately, the government let 114,000 temporary census workers go. As a result, non-farm related payrolls fell by 54,000 last month.

Debit: So the “official” unemployment rate in the United States now stands at 9.6 percent, up 0.1 percent from last month. Meanwhile, the more credible “underemployment” rate rose a tenth of a point to 18.4 percent.

Credit: Still, the increase in the private sector jobs in August – on top of a gain of 107,000 more in July – is a glimmer of hope in what has been a sour economy. The problem is the economy has to add more jobs than that each month just to tread water.

Debit: While you’re chewing on that, keep in mind that we are less than 120 days away from what Americans for Tax Reform are calling “the largest tax hikes in history.”

Credit: Despite the rotten news here in the US, it’s not bad everywhere. A story in the Wall Street Journal this week reported that over 1500 single men have flocked to the Japanese resort town of Atami to spend a little quality time with their dates at fancy hotels charging as much as $500 per night. The thing is, the lucky girlfriends aren’t real – they’re virtual, part of a simulation game called Love Plus+.  I know.

Credit: According to the WSJ: “In Atami, the Love Plus+ fans — mostly men in their twenties and thirties — stand out. Unlike the deeply tanned beach crowd wearing very little, they are often pasty and overdressed for the heat in heavy jeans and button-down shirts.” Heh. Is it any wonder why these guys can’t get real girlfriends?

Debit: Back here in the real world, Eric Cantor in USA Today notes that businesses are currently sitting on $2 trillion, but they’re afraid to invest it and expand because of the current administration’s economic agenda and policies in five key areas. One of them was, of course, taxes.

Debit: As for the other four, Cantor warned:

“• Health-care costs are growing as a result of Obamacare’s mandates and inflationary impact on premiums.
• Energy costs remain in limbo as leading Democrats, led by Sen. John Kerry, float the idea of passing cap-and-trade during the lame-duck session of Congress.
• Credit is becoming more expensive and is increasingly out of reach for most small businesses, partly because the 2,300-plus page financial regulatory bill encourages banks to horde their capital rather than lend it.
• Labor costs also threaten to climb higher as labor unions dig in their heels and gear up for another push to pass card check.”

Credit: The good news is, as soon as we get those awful policies reversed, businesses will be less uncertain about the future and finally begin to hire at rates high enough to start bringing down the unemployment rate.

Credit: When texting somebody to arrange the purchase of illegal drugs, the first rule of thumb is always make sure you’ve got the right number. The last thing you want to do is text the county sheriff with this gnarly message: “Hey Dawg, do you have a $20 I can buy right now?” Oh yeah, Dawg! I’ll be right there with my posse.  That’s almost as stupid as raising taxes in the middle of a recession. Almost.

By the Numbers

Meanwhile, the private sector continues to be plundered for the benefit of bigger government. (From this article by the conservative Heritage Foundation.)

$26 billion The amount of a recent bailout package passed into law that averts layoffs for 140,000 teachers and tens of thousands police and firefighters.  (I’m all for firefighters, police and teachers, but when times get lean the government should have to make painful cuts just like the private sector does.)

$1.8 billion After losing $6 billion in the second quarter of this year, the amount Freddie Mac is now requesting to bail them out.

$600 million The amount 50,000 homeowners will be receiving in five states as a foreclosure prevention bailout.

1.4 The percentage increase President Obama recently requested for an across-the-board pay hike for 2 million federal workers.

$172 million The amount of money the bailed-out Chrysler corporation lost in the second quarter of this year.

Other Useless News

As promised, here are the Top 25 referring sites, excluding search engines, for the entire month of August:

1. MSN Smart Spending
2. Time Magazine: It’s Your Money
3. Wisebread
4. Cheap Healthy Good
5. Mint
6. Frugal Dad
7. Consumerist
8. Frugal Hacks
9. Green Panda Tree House
10. Political Calculations
11. The Daily Crux
12. Code Name Insight
13. Canadian Finance Blog
14. The Survival Podcast
15. Monevator
16. JoeTaxpayer
17. Live Real Now
18. Provident Plan
19. Blog Lines
20. Budgeting In the Fun Stuff
21. Lifehacker
22. Money Help for Christians
23. Swagbucks
24. Ultimate Money Blog
25. Tip Hero

I want to give a big thank you to everyone who linked back to my little ol’ blog in August – even if you didn’t make this list! I really appreciate it!

Oh yes, and here’s another friendly reminder for ya: if you happen to enjoy what you’re reading – or not – please make sure you follow me on Twitter. And, if you’ll be so kind, don’t forget to subscribe to my RSS feed too!

Letters, I Get Letters

Most likely only because I asked begged Canadians out there to drop me a line last week, Paul was kind enough to send me this note:

“Hello from Windsor! I really enjoy reading your Black Coffee articles each week!”

See why I like my friends in Canada so much? Not only are they are a very educated group, but they have really good taste too.

If you have a question you’d like to ask, or a comment you’d like to make regarding some of my irritating opinions, please feel free to drop me an e-mail at: Len@LenPenzo.com

I’ll feature the most interesting question or comment I get each week here on Black Coffee – assuming I get one, that is.

If you’re lucky enough to be the only question in the mail bag I’ll highlight your letter, whether it’s interesting or not.

Carnival News

This week I had articles featured at the following carnivals:

The Yakezie Challenge Carnival @ The Aspiring Millionaire