You have committed to paying down your debt. No more random online subscriptions, no more nights out at the bar all covered by your credit card, no more video games, no more Ed Hardy shirts, and no more BS. You are in full debt elimination mode- well at least you want to be.

Now you have to decide what your debt elimination plan will be. If you do not have a debt eliminator strategy then do not worry because that will all change after reading this post.

The Debt Snowball debt elimination plan

The first debt elimination plan I will cover is the Dave Ramsey Debt Snowball. We all are at least somewhat aware of the Dave Ramsey tool for debt elimination from his Total Money Makeover book. If you are not informed on how to apply this debt elimination plan, the basic tenet of it is:

Pay off the debt with lowest balance, regardless of interest rates, for a much needed psychological victory.

I will not conclude this post with such a general answer, so here is the Dave Ramsey Debt Snowball described in detail.

1. Rank your debt from lowest to highest balance.

2. Pay the minimum payment on all of your debt.

3. Put every additional dollar you earn or save towards the debt with lowest balance (regardless of the interest rate).

4. Repeat this process until you finally begin to tackle your highest balance.

The motivation that comes along with paying down one of your debts can be very remarkable. Some respectable personal finance bloggers have argued that Dave Ramsey is brilliant because of this. Then on the other hand, many personal finance analysts are skeptical of this paying down debt option. They argue it makes no sense in terms of dollars and that Dave Ramsey is simply bad at math.

I personally feel that this is a great option if you are an ultimate beginner to debt reduction and need some sort of psychological boost to get you through the most difficult time (first few months of debt elimination). Twenty somethings are not machines. We don’t always do the most logical thing nor are we always driven by math alone. Yes we know credit card debt sucks, but that doesn’t stop us from using them.

Reader beware, you will pay more in the long run using the Dave Ramsey Debt Snowball, but some of the mental benefits can not be quantified.

The simple math debt elimination plan

However, if you feel you are one of the more advanced readers of Studenomics or that you can put up with the rough start of your debt elimination journey, then you can always try this method:

1. Rank your debt from highest to lowest interest rate.

2. Pay the minimum payment on all of your debt.

3. Put every extra penny towards your high interest debt.

4. Repeat this process and move on to the next high interest debt.

This is technically the logical approach but in practice it is not necessarily the best method. Credit card debt elimination is never easy and your progress will feel stagnant when you don’t see any results after a few months.

If you have the discipline and are all about numbers then the paying down your highest interest rate first debt elimination plan will work for you.

If you are like 95% of us and need some sort of motivational boost when on the long journey to total debt elimination, the Dave Ramsey debt snowball strategy is for you.

Which debt elimination plan will you follow?

Should you consolidate student loans or no? Six months after your college graduation you are required to begin paying down your student loans. At this point college graduates usually decide whether they will pursue debt consolidation loans.

Today I wanted to share a few things to consider as your mind tries to decide whether student loans consolidation is the best option at the moment:

What is the interest rate on your student loans?

Student loan consolidation rates vary greatly. The unfortunate part is that you may lose a specific low interest rate that you currently have because the debt consolidation loan may not give you the lowest rate possible. At the end of the day, juggling a bunch of different interest rates make no sense. If you can lock in one low rate that you are comfortable with then go for it.

Do you currently have federal student loans or private student loans?

It is a lot easier when your student loans consolidation involves all federal loans. Private student loans are not as easy to consolidate and will usually require more research to find loan consolidation services.

Are you struggling with making the current monthly payment on your student loans?

Depending on your field it could be extremely difficult to find a job during the current recession. If you are struggling to find the ideal job then you are most likely working a part time gig where you barely earn enough income to put money towards your student loan repayment. This is where student loans consolidation becomes the perfect solution. You do not want to put yourself in a situation where you begin working a job you hate just to pay the bills. It can turn into a viscous cycle that will have a negative affect on your overall health and happiness. A student consolidation loan isn’t a quick fix but it will give you some breathing space as you continue on in your job hunt.

Just please remember that you will lower the monthly payments on your student loan but you will end up paying more in the long run.

Are you thinking of following your passions to earn money?

College student loans consolidation becomes very handy when your income is either really low or extremely unstable. Unfortunately, these are two characteristics that describe your income when you first decide to start a business through following your passions.

If you find yourself with a labor of love, where you love what you do but the money is not quite there yet, then you can do one of two things:

1. Find a job that will help you pay off your student debt/improve your monthly payments towards your student debt.

or

2. Look into student loans consolidation in order to reduce your monthly payment so that you won’t have to stress about your fluctuating income.

Once you answer the above questions you will have a better understanding if student loans consolidation is the right option for you. Where do you stand at the moment?

I’m not naive. I realize that most 20 somethings don’t care about personal finance and saving for retirement. Most people my age are concerned with how to get rich quick and to how to make money fast with the least amount of effort.

There have been a few times when I tell someone about my personal finance blog and they will respond in a smarmy manner with a slight variation of the following comment- “so tell me how to get rich quick if you’re so smart”.

So lets have some fun with this. Let’s look at ways on how to get rich quick:

(Note: Please do NOT under any, and I mean any, circumstances take this post as a legit way for making money quick.)

Inherit money to get rich quick

Inheriting money is the best way to get rich quick. Think about it. You take it easy until you’re in your adult years, at which point the individual passes away and leaves you a nice lump sum of money. You will have to pay inheritance taxes and then the money is yours. What if you know that you won’t be inheriting any money? Maybe you can start hanging out at the seniors center more often. If you inherit money you don’t have to worry about an Roth IRA or frugality tips or even big wins for that matter.

Gamble on sports & horses to make money fast

If you are a sports fan and enjoy watching sports, then why not put some money on the games you watch? It will make the games more interesting. You can also spice things up by betting on horses. If you bet on a long shot and the horse comes in first place you can cash out and get rich quick. This way you don’t have to deal with all of that boring stuff involved with running your own business or managing your retirement accounts.

Winning the lottery is a classic way of making money fast

I’m sure this guy was thrilled at first when he won the lottery. In Stats class a few years ago we ran the odds of winning a local lottery. The odds were an astonishing 1 in 14 million. Not the greatest odds but if you spend enough money on lottery tickets every week, you will eventually get rich quick (or maybe not so quick?).

An insurance settlement can make you rich quick

You just need to be at the right place at the right time and hope that everything goes through alright. The only problem is that you can’t predict when you can get an insurance settlement so you might be waiting for a long time. Oh well in the mean time you can continue gambling on sports.

If none of these methods on how to get rich quick appeal to you then I urge you to continue reading Studenomics for advice on personal finance, wise investing, optimal career choices, money saving tips, and a little bit of entrepreneurship talk.

If you recall I had quite the elaborate celebration of my 6 months of blogging, yet I chose not to even mention a thing on my one year of blogging. The reason I chose not to commemorate this event is simply because I do not feel I have yielded the greatest possible results with Studenomics (good is the enemy of great). I will stop that conversation right here and will promise you to expect big things from Studenomics in the coming months!

PT Money tells us to make the most of gift cards this holiday season. I personally am a strong advocate of gift cards. Why? Because it’s an easy way out. You let the person decide what they should buy.

Jim Wang of Bargaineering brings us a video post on the big impact of small everyday spending. I love this concept and Jim does a great job of getting his point across.

Trent of The Simple Dollar talks about a reflection of your closest friends. My own conclusion to this is that it helps to associate with friends that have similar priorities when it comes to money and life. I personally love to travel and am willing to make the necessary sacrifices so that I can travel more. Many of my friends would love to travel but instead of focusing on conscious spending they choose to get jealous and complain.

Suburban Dollar gives us reasons why base salary isn’t everything. Working from home, 401k match, health benefits, are all important things to take into account when on the job hunt.

College Candy has a doctor chime in on hangovers. An interesting read that once again dispels the myth of drinking caffeine.

My Life ROI gives us 10 reasons why you should call your health care advocate. From finding the best doctors to scheduling appointments, this is an extensive list.

Fiscal Fizzle tells us about writing an awesome personal executive summary. Definitely a unique way to look at your financial situation.

Kyle Of 21 and broke shares 21 tips to save money in college. A classic list that is always a great reference point for college students looking to save money.

Carnivals:

Carnival of Personal Finance #230 @ Canadian Finance Blog

Carnival of Money Hacks @ Financial Blogger

Carnival of Personal Finance #229 @ The Centsible Life

Carnival of Money Stories @ Christian PF

Best of Money Carnival @ Provident Planning – So close to the top of the list!

First time credit card owners will definitely have no shortage of credit card companies throwing “amazing” offers at them.

I have nothing against responsible credit card use. The fact of the matter is that you need to build a decent credit rating if you ever want to get a loan (business, mortgage, car, etc.). If you know what you are doing and simply want a credit card to build your credit then that’s awesome!

Unfortunately, most twenty somethings don’t know what they’re doing when it comes to credit cards (or proper behavior when drinking alcohol, or maybe that’s just me). This is why credit card companies (and bartenders) take advantage of us.

The other day at the subway station and downtown I noticed that, credit cards are using marketing to prey on our emotions. Obviously I knew this a long time ago but the marketing was just blatantly placed right infront of this 20 something personal finance blogger. It’s like they were asking me to write a blog post about it.

American Express posters were literally all over the place. Two classic pieces of marketing from this credit card company were:

“Impossible is two letters too long.”

“We see you us as a person, not a number.”

Okay wtf does any of this have to do with a credit card?

Are you trying to make me feel good by knowing that you are willing to lend me money at an 18% APR?

Why would there be an inspirational quote in a credit card ad?

All great questions without great answers.

I just want to say that as a first time credit card user, you need the right credit card. I’m not going to sit here behind a computer screen and tell you what credit card is perfect for you. That is just plain stupid when I see a blogger do that. We all have different needs and more importantly- different lives. It’s like when someone tells you what to drink. Not all of us like to drink wine. Just like how not all of us will use the same credit card.

What is ideal for a first time credit card user?

No annual fee. What if the credit card company tells you they can’t waive your annual fee? Then go somewhere else. Yes it really is that easy. Unless you have made some horrible decisions in the past and nobody is willing to loan you a penny, it’s a buyers market. First time credit card purchasers need to understand that there are so many credit card companies out their vying for your business.

Once you waive your annual fee you need to be aware of the many other credit card fees that could bite you in the butt today or down the road.

Decent APR. I’m not going to suggest that you chase rates or try to find the lowest possible credit card rate. Why? Because those are usually temporary. The unfortunate part is that the credit card company is not quick to alert you that the temporary rate is going away. You also don’t want to get into the habit of switching credit card providers due to small changes here and there.

Cash back rewards credit cards can be great. This is what I use. I have read about the pros and cons of a cash back rewards credit card and I have opted to stick with it. No I do not spend more money for the potential of receiving more “cash back” at the end of the year. I just use it for major purchases (vacations, getting my girlfriend a gift- which can be very major) and for repetitive purchases (monthly subscriptions).

Points are amazing as well. If you fly a lot or plan on working in a job that requires you to fly a lot then I would recommended this option for a time credit card user. You will usually have to bite the bullet here and pay the annual fee but it will be worth it in the long run.

I know that Citibank offers you one point for every one dollar that you spend on your credit card. Not sure what everyone else out there is offering because I live in an igloo in Canada and more importantly because I’m happy with my current credit card.

(Side note: Yes it’s a psychological problem that happens to many 20 somethings. If you have a credit card with casback rewards or points, watch out so that you don’t spend more money on shit you don’t need in hope of earning more points.)

Where can I find the ideal credit card?

Your local bank. Honestly if you know the manager of your local bank by first name and drunk dial them on the weekends, then this is an amazing place to start. My local branch of my bank gave me my first credit card without any paper work. How come? Hopefully not because they thought I was an idiot that would be a cash cow. I would like to think it’s because I know my bank rep. fairly well and he was willing to take care of the paper work himself.

Online banks. A click-and-mortar bank saves money from less marketing, less employees, and the obvious- no branches or locations. As a result, online banks are usually able to offer you better (higher) rates on your savings accounts and better credit card deals.

I don’t want to give a cop out answer so I will tell you that I have an online ING banking account and a cashback rewards credit card from a chain of a popular bank that happens to be a 5 minute walk from my house.

What credit card tips would you share with first time credit card owners?

(P.S. Yes I used the picture because the lady was pretty cute.)

Alright so we all know that common sense isn’t all that common. For my Friday College Life 101 post I wanted to put together a post of things that all college students should know regarding school life. I will address different topics and kind of rant/state what’s been bothering me lately.

Coming late to class

It happens. We all come late to class (or work) at some point.I can’t even try to remember how many times I have been late for a class (especially those 8 AM classes). Why is it that there’s always some clown that feels the need to enter a huge lecture hall 30 minutes late in the middle of a sentence? Imagine you were discussing something and someone abruptly opens the door and creates a major distraction. You wouldn’t like it.

I highly recommend waiting outside the room for a break. Most 3 hour lectures have a 15 minutes break at the midway point. I know it sucks missing half of the class but suck it up. You are the late one.

If you must enter then take a peek into the room to make sure there is space. Whatever you do, never be the clown that comes late and makes a huge scene while trying to find space. Seriously do you realize how annoying you are? Just because you come late you shouldn’t piss off the other people in the class that came on time.

Missing deadlines

Nobody cares about your excuses. Unless a family member passed away or has fallen ill then shut up. People have it a lot worse than you do. Save your sorry excuse for someone that will listen.

If you absolutely have to hand an assignment in late then don’t email the professor on the due date. This basically shows that you decided to work on the assignment at the very last minute and you ran out of time.

Email the professor a few days before the due date. Tell them you require more time because you want to add more value to your work. Tell the professor you want to make sure you hand in an A paper. They may not buy it but it’s better than blatantly lying about not feeling well.

What does today’s post have to do with personal finance? Everything. The horrible habits you develop in college will follow you into the real world. These are the habits that will hold you back from that promotion or big wage increase. Who in the right mind would promote the guy that walks into a meeting late? Who would give the girl a raise that hands the report in past the deadline?

I do not know how to introduce this so I will just say it- college is the best time for starting up a business.

I was working on a guest post on balancing your college life with starting a new business and it hit me. I will say it again. College is the best time for starting up a business.

But why?

You need money in college

Starting a business may came as a hobby but it will most likely come out of necessity. Sometimes desperation drives innovation. We all know that many great businesses were started by college students working out of their parents garage. I will avoid the anecdotal advice and feel good stories today but I’m sure you guys know what I mean. College students need money. Starting up a business can be a significant source of income.

You have free time in college to start a business

We all would like to think that we are so busy that we have absolutely no time for anything. In that case how do most of us have time to catch every football game? How do we keep up with our favorite tv shows? Realistically the only time we are completely busy is right before an exam. I wrote all of my midterms and reports during the past 2 weeks. This week I have been focusing on my blog. The time is there. It’s just a matter of using this time better.

How can you improve your time management? Look no further than my time management tips to help you kick butt (sounds like I’m violent when I write these things but I’m not, I promise).

Your living conditions are ideal

Let me rephrase that- you live at home with your parents. If you moved away for college then this obviously doesn’t apply to you. Also I don’t mean to draw attention to college students because I’m sure many of you college graduates and young professionals are still living at home.

With a roof under your head how can you complain? You have no mortgage to stress about. All you have to stress about is having enough beer money for Friday night. Starting up a business is a lot easier when you don’t have the added stress of being responsible for a family and a mortgage.

Starting up a business has become increasingly easier

First of all I will steal a quote from Ramit- “Stop debating minutiae !” Seriously, I worried about the details of starting a blog for a few months. How would I host my site? How would I claim the income? Who would do the paperwork for me to setup an LLC? Do I even need an LLC?

Then one day I finally started writing blog posts. As I wrote posts I was still concerned about the server and all of those minor details.

On November 7th, 2008, I decided to it was time to pay the server costs and get my own domain name. Within hours the blog was running. The coffee change the blog earns didn’t come until many months later. Making that first move was the hardest part. The networking and connecting with other bloggers/readers can be very fun. Once I had the domain running, it was time to pump out content and try promoting it somehow.

Seriously, if you want to distribute your own t-shirts then just make the damn shirts! Draw up a unique design and get it on a shirt. Do not worry about the finance stuff because I doubt you are going to need to hire an accountant for the first few months while only your 4 closest buddies buy your shirts.

It’s really easy to worry about all of the minor details that come with starting a side business. In fact this is usually the greatest barrier to entry. Not the money or capital funding.  It’s the psychological barrier of breaking through mainstream knowledge that suggests we should simply look for a job with someone else.

I will have more about earning money online and internet entrepreneurship for 20 somethings in an upcoming ebook project that I’m still working on. For now, I listed possible side businesses you can start in college when I wrote my ultimate financial survival guide.

Help from awesome Twitter followers

I threw out the question on why college is the best time for starting up a business on Twitter and received some great feedback.

@FourPillars: It’s all about the $$$.

@NoDebtPlan: Start with minimal capital and maximum time+energy. Failure is meaningless because you can always go get a job.

@amabiae: You have nothing to lose…and your entrepreneurial creativity isn’t burdened by as many mundane anchors.

@MoneyEnergy: You may be more motivated during college than at any later time & have the energy and fresh perspective to put into it.

Do you think college is the best time for starting up a business? Or do you believe that all of your time in college should be spent on studying?

photo: dow5

I’m sure every college student reading this blog has heard the horror stories of some last year college courses. Every college program has the one or few courses that are so difficult that they basically act as a filtering system. We have all heard the depressing rumors:

“4th year Organic Chemistry has a 50% failure rate.”

Or better yet, “the professor never gives anyone an A in that course.”

I’m also positive that every financial stud reading Studenomics cares about money. Retaking a college course because you failed or because you want to improve your grade, will cost you hundreds of dollars. Why not pass the course the first time around? Why not get the desired grade the first time?

I wanted to share some tips to help you kick butt in your most difficult courses in college!

Read the material the first time as if it were a novel

The first time I go over the material the goal is not to try to figure everything out right away. The goal is to skim through the content so that you know what to expect. It will become information overload if you actually expert to absorb all of the content on your first reading of the material.

Come to class prepared

Drink your coffee.

Eat a meal.

Get enough sleep.

Do whatever it takes to come to the class prepared.

Sit in the front of the class

When you sit at the back of the class you are more susceptible to start talking with someone. At the front of the class you can’t get away with that. I know nobody wants to sit at the front of the class but it can be very beneficial in your difficult courses.

Leave the distractions behind

I know that I’m that fool that brings his laptop to class to write blog entries. If you have a difficult course you must be distraction free! No iphone, no laptop, no blackberry, no head phones, no sitting next to the cute girl in class.

Set a daily goal

My daily goal is to look at the course material for at least one hour a day. In that one hour I try to go over difficult past midterm problems and see how promptly I can solve them. This may seem excessive but there’s a reason that the 4th year course has the highest failure rate. What will your daily goal be?

Don’t be afraid to ask for help

Yes I’m that pain that annoys the professor by sending him emails. So what? I pay for my education and if I come across a question that I can’t possibly answer then I email to professor for help. Some professors will get upset. Others will appreciate your effort and take note. You benefit by obtaining the help you need.

Go over the most difficult possible problems before the exam

You know the exam isn’t going to be easy. Prepare yourself by going over the most difficult problems from the textbook or from past exams. I figure I would rather scramble my mind trying to figure out how to answer that impossible finance question before the actual exam when it counts.

photo: claudiogennari

“To teach is to learn again.”

- H.J. Brown

Do you think you are really good at managing your money? Reinforce this knowledge through sharing your money management tips with your friends.

There are two major problems that most people looking for personal money management help experience:

1. Most people are too embarrassed to admit that they have money problems. Just like any other problem you may have in life. Nobody wants to take accountability for their problems. None of us want to admit that we have an eating problem, drinking problem, lying about your age to girls problem, and especially not a money management problem.

2. The majority of the sources for personal money management help are conferences that seem like a huge scam. We’ve all seen the ads on tv and radio. You attend the conference, get a few valuable tips, and then they try to sell you some high priced product that will apparently solve all of your problems. I thought the conference was supposed to solve of all of the problems? How many editions of this product exist?

Sure there are money saving experts like Dave Ramsey out there to help you out. Some of us would rather receive advice from a familiar face than a stranger that is a supposed expert.

How can you help a friend with their personal money management situation?

1. Never ever criticize. I know it’s easy to yell at someone- “why would you buy a new car when you don’t have a job?!” This will just lead to the person getting all defensive and not wanting to continue the conversation. Money in itself is a very touchy subject. It becomes even more sensitive when people begin to own up to their mistakes. If you even give a hint of being judgmental then you will kill the conversation before it even takes off.

2. Give people real advice and skip out on the boring stuff. Money management worksheets often annoy and confuse most people that are looking to learn about personal finance. Seriously, what kind of personal money management beginner would like to see a spreadsheet?

3. Lead by example. If you show someone how to automate their finances then you better have your own finances automated. Do not be a hypocrite because you will kill your credibility and those around you will not listen to your advice.

4. Hold them accountable. It’s like having a workout partner. You don’t want to miss a workout because you know they will scream at you and  make you feel like a lazy bum. If your friend decides to set certain fiscal goals then you need to hold them accountable to you. Hopefully this will set them on the right track for getting their financial situation on track.

Have you helped a friend learn about money management? Or perhaps has a friend helped you out recently?

(Please note: This post was meant for you to provide free personal money management tips to your friends. If you wish to get paid you must remember that the financial industry is highly regulated.)

photo: jisc_infonet

Money Under 30 shares with 23 things beginners absolutely must know about saving for retirement. An essential read for those just starting out in their new career.

College Candy gives us sacred college knowledge passed on. A fun list of things to consider when starting out in college.

Canadian Finance Blog tells us 10 ways to reduce your cable or satellite tv bill. I agree that UFC & WWE events are ridiculously over priced.

MyLifeROI presents the top 15 college degrees by starting salary in 2009. How does your degree compare?

Carnivals:

Money Hacks Carnival @ Amateur Asset Allocator- Yep Editor’s Pick!

Festival of Frugality @ Gather Little By Little

Carnival of Debt Reduction @ My Journey to Millions

Carnival of Personal Finance @ Money Crashers

Carnival of Money Stories @ PT Money