$250 from Bank of America Keep the Change(R) Program

Bank of America has a program called Keep the Change(R) and you can earn $250 from it. I have been a customer for a while but just recently found this out.

The program is FREE but you have to be a Bank of America customer to take advantage of the program and you will need the following from Bank of America:

1. Checking Account
2. Check Card
3. Savings Account

Let's see an example of how this works:

1. Use your check card to purchase daily item, for example: coffee $1.20.
   
2. Bank of America will round up your purchase amount to the nearest dolloar: $2.00 and move the difference: $0.8 from your checking account to your savings account.
3. Meanwhile, Bank of America will match that difference: $0.8 and credit it to your Keep the Change(R) Program.

Here is the important thing to get that $250 fast: Bank of America will only match 100% of that difference for the first 3 months after you enroll in the program. After that 3 months, they will only match 5% of the difference.

Here's the fine print on their web site:

The matching funds will be credited to your savings account annually, within 8 weeks after the month in which the anniversary of your enrollment in Keep the Change savings service occurs. To receive the matching funds, your checking and savings accounts must be open and in good standing, and you must still be enrolled in the service. Annual promotional match will not exceed $250.

So, it will take at least a year to claim your $250, but hey, it's free money, right?

Now, following are my ways to max. out that $250 in first 3 months:

1. Use the check card to pay cell phone bill in $1.01, $2.01, $3.01... I have T-Mobile and their online payment system won't allow same payment amount within 24 hours.
2. Use the check card to pay utilities bills.

If you do 5 transactions of $1.01 a day, you'll earn $4.95 ($0.99 times 5) in your Keep the Change Program. Repeat for about 50 days (less than 2 months) and you will max out the $250!

Be careful not to overdraw your checking account, otherwise you will be slap with those nasty overdraft fees.

Hey, what do you know, I have earned $25.74 this month already!

Click here to enroll or find out complete details on Bank of America Keep the Change(R) Program.

Be Vigilant During Unemployment Time

I personally know several people who have been laid-off recently due to company bankruptcy, merger and downsizing. I personally also went through unemployment for more than 1 year after the dot-com bubble bursted. It was devastating, not only on emotional level but also on my saving. Luckily, I was single, had a roommate, and have always been a big saver, those per-conditions helped. However, what I have learned from my unemployment experience is that you have to be vigilant during your down time.

Without a job, I lost sense of direction. I eventually stopped doing other things that I would normally do outside my job. Looking back, these things are important:

1. Be vigilant - Keep you friends and family close. Make sure you talk and keep in touch with them. They provide emotional support. In my case, I met my wife through a friend during my unemployment days. She gave me new direction in life and motivated me to find a new job and got me out of the slump. So the moral is, do not close yourself in, stay in constant contact with your family and friends.
   
2. Be vigilant - Check up on your 401(k). When money stopped coming in, I also stopped checking up on my 401(k) - big mistake. Since I do not plan to touch that money until I retire anyway, I should have re-balance my 401(k) portfolio and buy funds that were undervalued. That lesson really taught me the meaning of 'buy-low-sell-high'.
3. Be vigilant - Check up on you credit report. During bad economic times, you can bet that crime rates are going to go up. To protect yourself from identity theft, check your credit report. The web site www.annualcreditreport.com provides you access to three credit rating agencies: Experian, Equifax and TransUnion. You can pull your credit report from each agency for FREE once a year. I set a repeat reminder on my Yahoo! Calendar every 4 months (example: April-Experian, August-Equifax & December-TransUnion) to check up on my credit report. They do charge a fee if you want your exact credit score.
4. Be vigilant - Keep yourself busy. There are only limited number of jobs out there on Monster.com or CareerBuilder.com and you will pretty soon find yourself looking at the same jobs over and over again. Limit the number of hours for job hunting, because it is really no good wasting time staring at the computer screen and feel depress. Read books that you have always wanted to read (borrow books from public library), volunteering, exercising and hanging out with friends are all good ways to spend your non-job hunting time. The goal is to keep yourself busy.

Did you just got laid-off? Did you go through one? What are you doing\did to stay positive?

Will the market and your investment ever recover? Do the math.

I read this article Major stock market indexes fall to 1997 levels today and it was deja vu all over again like the dot-com bubble crisis.

For the dot-com bubble, NASDAQ dropped from its highest ~4,700 points on Feb. 2000 to ~1,300 points on Oct. 2002. A drop of 3,400 in 32 months that send the NASDAQ back to May 1997 level. What took 33 months to build (May 1997 to Feb. 2000) took 32 months to destroy. Meanwhile, during that period of 65 months, if you apply 'buy and hold' or 'buy it and forget it' strategy like those so called 'experts' or 'advisors' suggested you to, you would have lost money. What's worst, NASDAQ never recovered to the highest level to this day. It took NASDAQ 5 years (Sep. 2002 to Sep. 2007) just to reach 2,700 and then it went downward again.

Today, DOW ended at around 7,100, about the same level in Apr. 1997. Same scenario here, if you bought anything between Apr. 1997 and now and never sold it, you would have lost money. Just imagine that, 10 years of investing all lost in just 5 months (Dow reached its high at Sep. 2008). In other words, if you put 100% of you saving into money market saving accounts or money market funds in your 401(k)/IRA accounts that paid 3% APR, you would have done better.

OK, so you are young and think you have time to recover, think again. A sharp decline like this will take ages to recover. Here is the math: A x% decline will take a lot more than x% gain to recover.

Let's see an example: Bought a stock at $10, then it lost 40% of its value to $6. What percentage gain will it take to recover? 40% you say. Nope. It will take 250% increase to reach $10 again ($4 * 250% = $10)! So, for the stock market to recover, it will take a LONG time. In best case scenario, the DOW grew at a pretty quick rate of 3 years to double from 1995 to 1998 (4500 points to 9000 points), so it could potentially take 7.5 year (3 years * 250%) for the DOW to recover. How likely is that going to happen, not likely. The same calculation would explain why NASDAQ never reached its high again (to this day).

Personally, I think the 'buy and hold' strategy needs to be re-evaluated. Just how long do you hold? I suggest you ask your broker (or not). Also, I think that the investment landscapes have changed a lot since Peter Lynch and Warrant Buffet era, technologies (e.g. easy access to information) have induced new risks and volatilities to today's market.

How did your portfolio perform between 1997 and now? If you re-balance your portfolio, how did it work out? I would like to know.

$50 Lending Club Sign-up Bonus

Lending Club is a peer-to-peer (P2P) lending platform. The concept is pretty simple, instead of borrowing money from a bank, you borrow money from lenders on Lending Club. Pretty simple.

I've joined Lending Club and think you might want to hear about it.

Lending Club brings together individual investors and well-qualified borrowers who want fair credit (for everything from paying off high-interest credit cards to growing a small business).

With Lending Club you can diversify across many borrowers with good to excellent credit ratings. Lending Club lenders have earned annual returns that average over 9% in the past 18 months. Borrowers with excellent credit have been able to borrow at rates as low as 7.88%.

I have a word of advice, P2P lending is not a risk-free way to earn extra income. Always know your risk before bidding on any loan. If you stick with loan with higher rating (A level), you are more likely to come out ahead. I guess I don't need to remind you what got us into today's credit crisis mess, yes, all the sub-prime loans that the banks made. To me, P2P lending make sense, profit people directly instead of banks' CEOs.

Click this link to sign-up to become a lender (NOT borrower) through my referral and get $50 cash bonus. FYI, I don't get anything from this. You can take the $50 and run, or you can make 2 loans (for free) and try Lending Club out (Lending Club has a $25 minimum to bid on a loan). But if you decide to become a borrower and take advantage of the low rates, I get $25. Win-win. Sweet deal!

Manage passwords with FREE KeePass password safe

Passwords driving you crazy? Do you forget your passwords often? More importantly, if you die, does you spouse has a way to retrieve all your passwords so he or she will be able to access your online accounts (bank accounts, retirement accounts, investments accounts, etc.)? Don't worry, now you can end your passwords nightmare and put your mind at ease with KeePass (http://keepass.info).

KeePass is a free, secure and easy-to-use password management program. I have been using KeePass for 3 years now and it has quickly became one of my absolutely must have tools. Google "password management" and KeePass shows up as the #1 link, you can rest assured its popularity.

I don't want to repeat what's already on KeePass web site so I will just dive straight in. Once you have KeePass install on your computer, create a password entry for a web site, go to the web site and then press 'CTRL-ALT-a' and KeePass will automatically fill in the user name and password for you. Sweet!

To safeguard your KeePass database, you can follow what I do, or however make sense to you:

1. Backup KeePass database file (with extension .kdb) monthly to a flash drive
   
2. Print out your KeePass database and put it in safety deposit box every 6 months (this I plan to do)
   
3. Share the master password with your spouse

Now if you die, your spouse has access to all your passwords. One less thing to worry about.

I also want to share some KeePass option settings I found helpful:

• Security - set automatically lock workspace after 180 seconds
• Security - lock workspace when locking windows, switching user or sleeping
• Interface (GUI) - minimize to tray instead of taskbar
• Advance - start and exit - Start minimized and locked

To deal with web sites with unusual login screen, KeePass has a scripting language which you can use in the 'Notes' area of each entry to customize your input sequence. Here is an example:

Auto-Type-Window-1: *google*
Auto-Type-Window-1: *yahoo*
Auto-Type-1: {USERNAME}{AT}mycompany.com{TAB}{PASSWORD}{TAB}{ENTER}
Auto-Type-Window-2: CNN*
Auto-Type-2: {USERNAME}{TAB}{ENTER}{DELAY 5000}{PASSWORD}{TAB}{ENTER}

Tips: First, it took me a while to find that KeePass doesn't regonize '@' character, you have to replace '@' with '{AT}'. Second, use '{DELAY 5000}' (meaning delay 5 seconds) to put a delay in input sequence.

With KeePass, you can now sign up as many web sites as you like and don't have to ever worry about forgetting your passwords.

I encourage you to give KeePass a try and let me know what you think. You can find out much more information on KeePass web site at http://keepass.info. If you are already a KeePass user, please share your experience, do you find KeePass useful?

High Yield Money Market Saving Account (MMA) - 3.05% APY

One of the best thing you can do with you cash is put it in a high yield saving account. I like it because it has a good rate and I can get the cash whenever I want, unlike a certificate of deposite (CD).

I have been putting my extra cash to EmigrantDirect (www.emigrantdirect.com) since July 2005, but since they dropped their rate back around Oct. 2008 (currently at 2.40% APY), I have moved my cash to DollarSavingsDirect (www.dollarsavingsdirect.com). The current APY for DollarSavingsDirect is 3.05%. It is the highest I can find among high-yield MMAs. It has a minimum opening balance of $1000, no montly service fee. It is also FDIC insured. You can fund the account with an exiting checking account or send them a check. I prefer the first method because it is faster. It took me several days to complete my fund transfer. Pretty easy. Interest is credit at the end of each month. One thing to be aware of, a transfer from DollarSavingsDirect back to your checking account can takes 4-5 days. For example: initiate transfer from DollarSavingsDirect on Monday, get your cash in checking account on Friday.

I know people who do nothing with their saving/cash (often 10K or 20K), they leave it in a bank regular saving/checking account with VERY low interest rate, often less than 0.5%. To me, this is the easiest way to preserve your cash. Don't let the bank profit from your hard earned money.

Welcome to Personal Money Finance Blog!

I created this blog to collaborate with reader like you on the subject of personal finance. I hope to share, from my personal experience, strategies that worked, and those that didn't. Feel free to leave comments, or subscribe to this blog if you find the information on this blog useful.

I am going to label my posts into following 4 major categories so you can find articles quickly:

• offense - making money
  
• defense - preserving, protecting and saving money
  
• tools - things that make your life easier
• others - occasional updates
  

I will see how this method goes and make changes as this blog evolve.

Happy Reading.