photo credit: elisfanclub

I switched to ATT from Verizon with monthly cost being the motivator because of advanced technology and lower rates with the AT&T Family Plan. For the last 3 years I’ve had the Verizon Palm Treo, but with my recent decision to downgrade our budget, the Treo had to go. I could no longer justify the heft bills. Welcome iPhone and AT&T.

Service:

Verizon, while I will admit they have the best reception and customer service and would rate them at a 9, ATT follows close behind at an 8. The customer service has been great between Apple and AT&T as they were very helpful in getting me familiarized with the iPhone and coordinating my initial setup. AT&T also let us keep our 4000 rollover minutes when hubby added me to his account. AT&T also includes the data within the overall rate plan whereas Verizon does not, forcing me to pay an additional $40 for unlimited data in order to access the Internet. Not hot. Especially when Sprint (although known for their horrible customer service), charges $15 for the same data plan.

Price:
Verizon/Treo
As I mentioned above, with Verizon and the Treo, I was paying $40 for the data plan, $79.99 for the voice plan which didn’t include charges for text messaging, picture messaging, insurance, taxes and other miscellaneous fees. Our bills were CONSTANTLY $300+ and hubby’s bills were around $150 for his Treo. Over the summer we paid $600+- for our CELL phones due to overages and going overseas. I could no longer justify staying with Verizon paying that much just for service. Are you kidding me? Once I found out about the family plan offered by AT&T for the iPhone I made plans to jump ship.

AT&T/Apple iPhone
We are currently on the Family plan with ATT. We get 2100 minutes for $109.00, which includes text messaging, voice and data. So in total OUR bill will be $150. That’s a $300-$400 savings in our pocket and an individual rate plan cost of $75 per user. Verizon who?

Technology
Palm/Verizon kept insulting my techie sensibilities with the paltry upgrades they were giving the Palm Treo. I LOVED the Treo but even now with the 755p, its still not an upgrade worth spending Treo money on.

The iPhone is a superior device, not perfect but I believe for my needs, the best on the market. I am not particularly picky so you won’t see me crying for the lack of a camera recorder on the Howard Forums.

The Voyager released by Verizon last month was made in response to the iPhone. It is in no way innovative which means that this will be the ONLY version of it you will have. That’s it. Verizon hoped to sell a few thousand units by the end of 2007 while the iPhone is shooting for somewhere in the millions? How is that the iPhone killer or the answer? Sure, it builds on the iPhone weaknesses but really, if Verizon planned to come with it, then they would have given us the iPhone features and built upon its weaknesses in the Voyager. Instead, they chose to copy and create a device, which pales in comparison to the iPhone.

People tend to stay with their cell phone providers for a variety of reasons. However, I could no longer justify the crazy bills due to having a high maintenance smart phone. So there you have it. Those were my reasons and I swear I haven’t looked back.

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Lifestyle Upgrade: Making more money brings added expenses you didn’t previously consider.

When I moved to the DC metro area in 2003, I barely made enough to pay all of my bills, let alone shop a little or even go to a happy hour every now and again. I lived in a not so great area of town, couldn’t afford a car and my mom bought all of my clothes. 4 years later I own a home in a safer, nicer part of town, drive a car (with insurance!), shop more (ok I’m damn near shopaholic status) and will even admit to going to happy hours and dinner a bit more than I used to.

Touchdown
Upon moving here I was hit hard with the realities of paying rent and earning a meager salary. I couldn’t believe it, here I was with a college degree and barely making ends meet. I was dodging calls from my credit union seeking payment for a CC bill I hadn’t paid for the last 3-4 months and couldn’t even afford cable from the evil twits at Comcast.

Four years later, life has changed for me. And, while I am now a homeowner, drive a car and have cable. I also realize that certain lifestyle upgrades were made (most necessary) along the way.

Lift off
In the Being Poor is Expensive post I pointed out that your circumstances force you to make hard decisions about money. I wasn’t thinking about how the 90+ days delinquent credit card might affect me until the credit union representative caught me on the phone one afternoon and gave me a strong talk. I’ll never forget it. I remember rolling my eyes as she told me how the delinquency might affect my buying a house down the line. I was barely paying the $700 a month rent for my 750 sq ft apartment in Le Hood!

Let’s look at my recent upgrades:

Mortgage
The mortgage is 3-4 times the amount I used to pay for my first apartment. Tack on paying home insurance, property taxes, home maintenance, utilities (included in rent) and the cost of furnishing the house since we started from scratch when we moved in.

Car
I couldn’t afford a car until I got a well deserved and needed raise. Prior to that I took the metro faithfully and risked walking home late at night from that dreadful station by myself. Now I still drive the same car but that’s because I can’t truly justify a new car until I drive this one into the ground. Takes a lick and keeps on ticking. Insurance, car note, maintenance, emissions testing, license registration and renewals are all associated costs with the upgrade of buying a car.

Cable
I had a short stint with cable when I first moved here and canceled it because at the time it wasn’t worth watching. Now our cable hovers around $80 depending on whatever “special” we can snag from Comcast.

Cell Phone
In college my cell phone bill was no more than $60 a month. I had 400 minutes and made it work! Now while I recently made the switch to AT&T which resulted in a drastically lower bill (more on that later), my bills were around $300-$400 on average for both of our cell phones with Verizon. Mad.Ness! What’s changed? I’m not exactly sure, other than I’m all grown up and just seem to talk more.

Lifestyle upgrades people! Are the needed? In most cases, yes. I wouldn’t NOT buy a house because rent is cheaper. Did I NEED a car? Yes, in order to consider job offers outside of the metro rail system. But there are some that are questionable and up to the individual. Some people (like my husband) can’t live without the NBA League Pass and HBO boxing. Can I do without cable? Yes. Can he? No. So it’s different for everyone.

Make the appropriate upgrades for your lifestyle keeping in mind its function and necessity. Unfortunately, as we make more we tend to spend more.

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I called my bank the other day about a transaction that I needed done and was told the price was going to be $42.00. The price seemed pretty fair for what I needed till he said one moment Mrs. Latte I see here that you are a premium customer so therefore the price will be $9.50. While I’m ecstatic to save myself $32.50, it brings up the question - What exactly makes me a premium customer? I wasn’t applying for a loan or anything that had to do with me having my credit pulled, so the status must have been brought on by past experiences with me and the size of my accounts with them.

Do poor people really pay extra for different things?Well I could start with the biggest examples of poor people paying out the rear but I think I’ll start with the smaller, less-thought-about things and the move on up:

Check cashing places, cash call loans, money orders, collection agencies and bounced check fees.

So the bank works in a particular way- You write a check for $20, they cash the check based on your balance- Now if you write a check with an insufficient balance they charge you $32.00. Some banks give you a week to pay it if not you get charged another $32 now a 20 buck check has run you up a $84.00 debt then if your account is shut down now you have to go pay court costs,collection charges which brings your $20 shortage of funds to a whopping 200.00. Now if while you are waiting for your next paycheck you have an unexpected emergency and need a payday loan- of course it isn’t free so now they charge you for that. PayDay loans are known to carry exorbitant fees in excess of 99%. And that’s being kind.
Along with being poor usually comes bad credit or okay credit with not enough money to fix it and that often means higher rates on credit cards, mortgages, insurance rates to requiring deposits on a rental car. Being poor cost money!!

Job
Think about it, if you’re poor that means you either have no job or a menial job in which you have little control around your schedule, pay rate/grade and duties/responsibilities. You are often at the beck and call of a disconnected scheduler who may give you a schedule that may interfere with other oligations such as picking up your child from the daycare on time which then costs you upwards of $5 per minute, per child if you’re late. If you have no job then you are stressed about how you will pay the rent, mortgage, utilities and put food on the tale. Stress leads to other things like a decline in your overall health and well being.

Health and Health care
When you are already stressed out about barely making ends meet, this brings along with it health related stressors such as ulcers, heart disease (you don’t exactly have the money to shop for healthier, and more costly food options), high blood pressure and other chronic disorders brought on by the daily stresses of worrying about money.

Furthermore, one of the more obvious ways that people pay more for being poor is through their health, often not being able to afford proper health care or dental care and even dying of simple treatable diseases mentioned above. When you’re up all night stressing about a possible eviction, you arent exactly thinking about going for your yearly checkup which could tell you more about your recent bouts with shortness of breath and high cholesterol.

Silver Lining
However, being poor will force someone to make needed changes in in their attitudes towards money. For some this can be a motivator which inspires them to go back to school, seek a part time job, ask for a raise and overhaul their spending habits altogether. So if you happen to be in a bad predicament where you’re finances are concerned, there’s help available. But it starts with you and your attitude towards money. Do you control it or does it control you? Being poor is expensive, think about it!

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I was talking to a friend earlier this morning about her plans to buy a new car. We talked about the pros and cons of buying new vs. used and leasing vs. buying.

So as the conversation winds down we realize that the reason she is considering leasing this time around as opposed to buying is because she feels that she has to kick out an extra $3k anyway, so why not lease? $3k if she sells because she is upside down and $3k if she leases and goes over the mileage or incurs other related fees and expenses. She also mentioned that she changes cars every two years.

Here are some tips on how to avoid becoming upside down on your trade :

• Buy a car that you can afford. Its that simple. If you have to put down more than 20% and take on a higher than usual monthly payment then perhaps you should consider a less expensive car.
• When thinking about the purchase, consider not only the price but also the interest rate and the corresponding payment. Get a schedule that tells you how much of that payment goes towards the principal. Will that align itself with projected depreciation for that make and model?

• Research the car. Will it hold its value? What kind of maintenance will it require? How much? Are parts expensive? Will you put more into the car than it is worth? Is it a salvage? Carfax is your friend.

• Check www.autotrader.com, www.cars.com, and your local listings in www.craigslist.org for both private and dealer pricing. Compare prices and make the best choice given the seller specs.

• Keep your car longer than 2 years. Think about it, if you don’t make at least a 20% down payment then you won’t cover the first year’s appreciation. You will move into the 2nd year upside down. Keep the car and continue making payments, even sending extra payments when you can. When you can break even, then you should consider selling or trading in.

• Make at least 20% down payment of the car’s value. It may sound like a lot to some but if you don’t then you won’t cover the first year’s depreciation and end up with negative equity. According to Edmunds.com: Smart money managers, who make a 20% down payment, have more freedom to make a change in the car they drive. During the second year, when the car depreciates at a much slower rate, they would begin to build equity in their car. During a trade-in, they would actually get a positive credit toward the new car.

Now if you are already upside, that’s unfortunate, but here are some tips courtesy of Black Enterprise:

HOW TO GET RIGHT SIDE UP
Here are some tips for avoiding negative equity in your trade-in:

• Don’t tell the salesman about your trade-in. Wait until after there is an agreement on the purchase of the new car. If you still owe on your current car, trading it in may not be the best option.

• Do the math. Calculate how much your car is worth and how much you owe on it. If you owe $3,000 on a car you want to trade in, for example, you could end up with a higher car note.

• Make car payments on time. Hill says it’s best to make car payments on time and not to defer them. You will have to pay interest on the deferred payments, which will leave you with a balance once you reach the end of your loan.

• Look beyond the monthly payments. “You could gain thousands of dollars in negative equity by focusing only on how much you can pay monthly,” says Tamara Hill, Internet salesperson for David Maus Toyota in Longwood, Florida. The dealer can always work the numbers to suit your desired payment schedule–don’t fall into that trap! “Your focus should be the entire cost of the car,” says Hill

Remember, its just a car, that gets you from point A to point B, and the more you keep that in mind the more you will be able to see this as a financial transaction and not a status marker.

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We’ve all see the same Judge Joe Brown or Judge Judy case where the ex takes the other to court about financial disputes including but not limited to bank fees, credit card bills, rent, personal loans and the like. So what’s a newly shacked couple to do? Do they discuss the possible breakup now or do they jump in head first?

According to MSN Money:

The No. 1 hazard of living together is that it offers almost none of the financial or legal protection that marriage does… As unromantic as it sounds, most experts on the unmarried state advise those of us contemplating it to make some kind of contract, even an informal cohabitation agreement, that will protect each person’s assets and document key expectations.

Sounds harsh but with so many couples finding themselves in small claims court, it is often best to get whatever financial agreements you have in writing. The reality is that the love you feel now, will not be there should the relationship fall apart. 

Protect yourself.

Sit down and have a frank discussion about your finances with your significant other Decide who will pay the bills and split them in half to be equitable in the distribution. Or decide that each will pay based on their income. This opens the dialogue for expectations about who will pay what at the end of the month. Here are a few tips on how to get started:

• The Talk
  • Start by talking to your significant other about their attitudes towards money. This can include their saving and spending habits? Are they paying their monthly obligations on time? Are they behind on anything? You really don’t want to cosign on a loan with your significant other if they are in collections for $54.

• Fair Share
  • Decide how you want to split the bills. Will you split it down the middle (half) or will you one person pay a portion based on how much they make? Make sure that whatever you decide is fair for both sides as this can cause a rift if one is carrying most of the burden. Divide your expenses in proportion to your income.

• Emergencies
  • How will you handle emergencies? Will you have a separate emergency fund? Credit cards? Tap the 401k? These are all things that should be discussed prior to an emergency.

• Separate Accounts
  • Keep separate accounts. This keeps the paper trail clean around who pays what over the course of the month. Write this down so that there is no confusion about who’s responsibility it is to pay the gas bill.

Personal finance is just that personal, and brings along with it deep rooted values about money. It is best to get that out in the open and discuss attitudes towards money early on. Spend time discussing the above mentioned with your significant other to avoid issues that may come up later. And ladies, if this is something you are unable to talk with your SO about then perhaps you should rethink the move.

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Beyonce and Jay-Z were spotted in Paris this week celebrating J’s 38th birthday. They did so by taking Maybach limo rides around the city which included a day at the spa and dining at an uber fancy French restaurant called L’ Avenue. Ladies, I am sure you couldn’t help but notice the stylish fashionista that is Beyonce. The dress. Shoes. Gloves. Belt and Coat. FAB-U-LOUS! The outfit screams regal fashionista!

Dress Coat Shoes Belt Gloves

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