Advanced Personal Finance

David Bach over at Yahoo Finance has a piece about some lesser-known debit card facts. He points out something I just recently learned - Mastercard/VISA logo cards have the same fraud protection as credit cards. Meaning if your card is stolen, you liability is limited to $50 if you report the card stolen. Some banks do even better and won’t charge you anything in the even your card and/or number is stolen.

I personally use my debit card for everything except Internet purchases and vacation charges. I use it during vacation because I can’t check our bank account every day during vacation like I typically do at home. Since until recently, as I pointed out, I didn’t know you got credit-card like fraud protection on the debit card, I considered it slightly safer. Plus I can group everything together under the ‘vacation’ heading when doing budgeting. I know many PF bloggers advocate using their rewards credit cards for everything, but I found it too a little too cumbersome. Besides that, my debit card has a cash-back element to it anyway, it’s just not as sweet as some of the credit card rewards programs.

Something else of interest regarding debit cards is that PIN transactions are much less protected by the bank. In other words, if your PIN becomes known along with a stolen card, you liability increases significantly. So it’s probably not such a great idea to write that PIN on the back of the card.

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I saw many interesting posts on PF blogs this week.  Here are my favorites:

Jeremy at Generation X Finance talks writes about the proper use of lifecycle funds.

Trent at The Simple Dollar has a big decision to make about a house.

Flexo at Consumerism Commentary got hit with a $4 bank fee because of a change his bank made and didn’t tell him about.

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There probably isn’t a day that goes by that I don’t encounter mention of this or that online high yield savings account. Then I read this post by Jonathan at My Money Blog and it got me thinking about how my own finances are set up. It appears Jonathan used to use a couple of different banks for different reasons, but has moved to consolidate at WaMu.

I started to wonder what the advantages and disadvantages are of consolidating your financial dealings with one or just a few providers. Our finances are exclusively through USAA. If you’ve never heard of USAA, they’re a ‘military-affiliated’ financial services company. I’m not a representative of the company, so I’m not positive what all the membership requirements are, but generally you can use them if you or your parents are/were in the military. What I do know is that USAA kicks ass. They provide banking, insurance, and mutual funds and brokerage. I could do a whole post on them, but that’s not the point.
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I read an interview Jason Zweig of Money Magazine did with Vanguard founder John Bogle. Here’s an excerpt that I couldn’t have said better myself.

Question Vanguard is a not-for-profit company. If you’d organized it differently, you’d be a billionaire today. Any regrets?

Answer I read this story recently: There’s a big cocktail party on Martha’s Vineyard. Someone comes up to this writer, I think it’s Joseph Heller [author of “Catch-22″], and says, “Joe, see that guy over there? He’s a hedge fund manager, and he made more money yesterday than you made on all the books you have ever published.”

Heller looks over, pauses and says, “Yeah, but I have something he’ll never have: enough.”

And I have enough too.

Question Isn’t it time to take a victory lap and retire?

Answer Every once in a while I think a day of doing zero might be a good idea. But there’s too much left to do.

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If you’re a parent or parent-to-be and you’re reading a personal finance blog, probably one of the things that’s crossed your mind is the question of how to pay for college. Besides buying a home and saving for retirement, paying for college (if you pay for your kids) is very likely going to be the most expensive thing you’ll do in your life. For our purposes here, I’ll assume you are interested in paying for at least part of your child’s college (see this post for my own debate about why you might or might not). A quick word of warning: I strongly advise you fully fund your own retirement savings before considering saving for your kids’ college. They can borrow for school, if necessary. You can’t borrow for your retirement.

There are four main ways for you to save for your kids’ college education. First, there is the Coverdell Education Savings Account (formerly known as Education IRA, who knows why). There are two different types of so-called ‘529′ plans - savings plans and prepaid plans. Finally, some people use custodial accounts under the Uniform Gifts To Minors (UGMA) and Uniform Transfers To Minors (UTMA) Acts. Each of these methods has its advantages and disadvantages.

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