I am honored to host the 79th Carnival of Debt Reduction. This carnival will be in the format of a Debt Reduction University Course and Requirements. I have excluded some posts which are not debt related and also because it was too brief and I felt it will not add value to readers. In fact, some of the post below are not precisely about debt reduction (eg about savings), but I’ve included them because they are still somewhat relevant. If your post has been excluded, no hard feelings, write a better, more relevant post for future carnivals. So let’s get going :

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Welcome Message from Dean of University of Debt Reduction

Welcome, new students of the Debt Reduction University. My name is Mr Credit Card and I am the Dean of the University of Debt Reduction. Congratulations for taking this first massive step to educate yourself on how to reduce your credit card debt. I would like to take this opportunity to outline your course requirements and introduce your to our Debt Professors.

After this, I would like to invite all of you to the auditorium to watch a report on Summary of MTV True Life – I’m in Debt by Frugal Law Student. The Frugal Law Student will talk about a show on MTV about how young people get into debt. Let me be clear about this : This is not how you want your life to be. Anyone caught with such attitudes will be expelled immediately!

Now, on to a more important topic : To get your Bachelor’s Degree in Debt Reduction, you will have to pass with Distinction in the following compulsory courses :

Course Outline

1. Free Money Finance – How to get out of debt?. The first basic course is conducted by Professor Free Money Finance. This is an in depth course that introduces you to the basics of Debt Reduction.

2. The second mandatory course is conducted by Opportunities a Plenty on Preventing Identity Theft. This course a very important topic because identity theft is becoming a major problem. It is vital that you learn from Professor Steve Faber about this topic. Prevention is sure better than cure.

3. While this course is not about Debt Reduction, we have included this because nobody teaches this in school. In this course, Professors at Queercents will teach you how to find a financial planner?. The earlier you put in place a financial plan, the higher your probability of achieving your financial goals. The folks at Queercents have added tons of resources on how to interview a financial planner.

The last course that you will have have to complete is Debt Free versus Financially Free by Walt Nation. After taking this course, you will learn the importance of focusing on financial freedom as well as debt freedom. You will learn why it is important to focus not on “debt reduction”, but on “financial freedom” because if all your subconscious is “fed with” the word “debt”, then you be unconsciously making it harder for yourself to get out of debt! The importance of your midset is what you will get from this course.

Seminars

Throughout the year, we have have seminars from former graduates of the Debt Reduction University to give you some real life tips on saving money and debt reduction tips.

Next week, we have SearchLight to tell you if you should you pay your mortgage faster?. SearchLight goes through in detail how to look at this issue and how to make the right decision.

During the month of April, we have Debt is slavery presented by the Mighty Bargain Hunter. The Mighty Bargain Hunter, in my opinion, has Zen Philosophy and cautions you on cluttering your life and home with too many unnecessary items. He highlights the “true cost” of actually owning something.

In May, Debt Blitzkrieg follows Mighty Bargain Hunters advice and actually shows us that it is time to unstuff.

In June, Silicon Valley Blogger will tell you how to throw a kids birthday party without spending a fortune. Silicon Valley Blogger graduated last year and will give you some really practical advice on this money saving tip.

In July, Brian C Flemming will teach you in ins and outs of opening a 6 percent online savings account. Online savings account are the rage these days because they seemingly offer better rates than a regular savings account. However, you have to be careful about any fineprints with these deals. Brian explains these in great detail.

In August, Investing in your debt by pfadvice.com will be the topic. For those of you who have credit card debt, pf advice suggest that you get rid of this debt before even thinking about investing in the stock market.

Graduation Requirements

To graduate from this University, you have to complete all mandatory courses and attend all seminars. For each compulsory course, you will need to submit reports, projects and a final exam. Our standards are very high and we expect quality work from all of you.

Annoucements

I would also like to make an announcement that Professor Phil For Humanity will be leaving his post. Phil for Humanity has published a work on Think before Donating where he actually questions the rationale for donating to charities even when you are in debt. We as a faculty disagree with his views because to have abundance in life, you have to give before you receive. Giving to the less fortunate is a sign that you know that there is enough of goodness to go around. We believe that the more you give, the more you will receive.

Final Words

The Thinking Men have published a post on Financial Insecurity in America. In this post, he mentions about the idea of having financial education in school, like teaching how to avoid credit card debt. Well, whether or not it happens, there is lots of free education from highly esteemed professors here at the Carnival of Debt Reduction.

Once again, I congratulate you for taking the step to enroll in our University program. I wish you all the best and see you at graduation.

Two years ago, I bought a JVC DILA Rear Projection TV from Best Buy. The TV was 50 inches diagonally and I was very pleased with it. At the time of the purchase, I was offered a four year warranty by Best Buy which cost me about $400. To be honest, I was hesitant to cough up so much just for the warranty. The manufacturer (as I was told) only gave a one year warranty.

But I still decided to take it up anyway (just in case). Every thing was OK with the TV until last week when it just went blank with a buzz sound! I gave a call to Best Buy and within a few days, the repairman came and fixed the JVC. I was told that one of the bulbs was broken and it had to be replaced. Without any warranties, this would have cost me $500! Hence, I guess that paying upfront for that four year warranty did save me some money.

Not too long ago, I had another appliance break down. This time, it was the new dryer I had bought from Sears. Apparantly, the sensors was broken and the dryer kept on going without stopping! Once again, I had paid for the warranty and everything was fixed with no extra cost.

I kind of sense that today’s appliances and gadgets (unlike the old TV tube) was made to last only about three years and manufacturers expect consumers to replace them the moment a new model is introduced. I do not know about you but I tend to keep my gadgets and appliances for a very long time. But because today’s products aren’t really made to last, I think paying up for extra warranty makes sense. I was very tempted not to do that because I charge all my expenses to my Blue Cash from American Express. Amex cards extend your manufacturers warranty for one extra year from the time the manufacturers warranty ends. However, I wanted a longer warranty and so I paid up for it.

My advice to those who new appliances is to pay for the warranty. Given that stuff produced today aren’t made to last a lifetime, you will almost end up with some hefty repair cost sooner or later. Paying up for a warranty now has saved me lots of money and I suspect it will save you money as well

When I first met my accountant a couple of years ago, she told me to make sure I budgeted a “contigency expense” in my budget for things like home maintenance. I did not follow her advice. For a year or so, everything was fine as we did not have any unexpected expenses.

But just very recently, we noticed a leak in our basement whenever it rained. We have a finished basement, and hence, we had to rip off the carpet. For a few weeks, we pretended that it was not serious and hoped that it would go away. But the leaks kept getting worse and worse. We had to keep putting towels near the wall where it leaked to prevent the water from moving to the carpets.

To try to solve this problem with the least cost, we consulted lots of friends. We first had a landscaper come and take a look. He looked at it with the eyes of a landscaper. He suggested that perhaps we may want to create a “gradient” in our garden so that the water “flows away from the house”. We had a contracter friend suggest we check our drainage system to make sure there were no leaves clogging up the system.

Finally, we decided to consult basement leak experts. It turns out that we had a leak in our wall and that our basement had no sump pump! To prevent leaks in the future, we had to have a drainage system installed in our basement. Total Cost worked out to be about $5250! Well, that was certainly not budgeted in our budgets. But that was not all as we had to get a carpenter to remove the wooden panels on the walls before work could be done. That worked out to another $1000!.

We decided to get this done with because we did not want any more leaks to the basement. This certainly was not anticipated and it just goes to show that you need to budget for such contigency expenses. But I realized that I was lucky. Another church friend of mine had to fix his roof because the tiles were falling on the pavement and also because the roof specialist said that his roof was not constructed properly according to specs! Let’s just say that cost was multiples of the cost to fix my basement.

Here is what I think we have to budget for in our monthly budget.

1. House maintenance cost – like my basement leak!
2. Unexpected wedding invitations
3. Traffic Tickets!
4. Car breakdown and maintenance cost

It would be interesting to know what other unexpected expenses you have faced.

Since last year, my family goes to the public library every friday. The reason we go is that there is a chess club (unofficial) whose members gathers at the library from 6:30pm until it closes at 9:00pm. My eldest son plays chess and enjoys going there to meet friends and having a sparring session. My other kids read and use the computer.

Meanwhile Daddy goes to the magazine section and read through as many magazines that I can get my hands on. When I first went to the library, I was amazed at the amount of magazines they had. I had never read so many magazines before. Before we started going regularly to the library, I had subscribed to Fortune, Business Week, Money, Barrons and a few other magazines. I have since stopped subscribing to these magazines because I can read them for free at the library!

Meanwhile, I noticed that Mrs Credit Card started borrowing DVDs from the libary (and we’re talking about the latest releases!). It made us realize that we should never subscribe to netflix or even set foot in a blockbuster video rental store! We could borrow the DVDs for three days (there are also CDs).

There are also about 10 computers that had access to the internet. I used them occasionally, but the connection was too slow for my liking (but hey, what did you expect?).

I have seen a few post in the past about cancelling one’s cable TV and subscribing to Netflix instead. I’d say forget about Netflix and go to your nearest public library. Another idea for those looking to cut their expenditure is to cancel your magazine subsribtion and check out your library as well. I found out that the library is one great resource that is probably under utlizied by most people. Your nearest public library may not be as good as the one near my place. But check it out before you subsribe to any new magazine or Netflix. You may end up saving yourself quite a bundle.

I am going to start a review section where I review other personal finance blogs. This review is absolutely unsolicited and not part of those Pay Per Post type reviews that you see flying around the blogesphere.

One of the reasons I am starting this series with a review of this blog is because Tricia posted a guest article written by me during the last week of January when she went shopping for her insurance. The article was 2 Ideas for your Credit Card Reduction Plan. I had forgotten to thank her and so this is way to say “Thanks Tricia for letting me be a guest blogger”.

Blogging Away Debt has gone through a site redesign and has a very neat layout and structure (though I did prefer the old site layout colors!). Tricia started her blog in Febuary 2006. She has since documented the steps she has taken to reduce her debt. In fact, her debt is displayed prominently on the top right hand navigation column.

If there is one word to describe Blogging Away Debt, it is “REAL”. Blogs started originally as an online diary (a web log – soon become blog!). Along the way, blogs discovered that with traffic, it could be monetized. Bloggers started writing fancy articles like “Top 10 Ways to Reduce Debt” etc as these were “catchy headlines”. You will none of that on Tricia’s blog. Most of her post relate to her real experiences. In fact, the way she organizes her blog categories offers an interesting insight about her blog. You can read about her confessions, her monthly spending, or ways she saves money. In fact, Tricia has even outdone me on a couple of occasions like her recent post on Citibank doing away with their universal default clause (shame on me!).

As you read Tricia’s blog, you get to know her and want to follow your path to total debt reduction. It is almost like reading a reality series. This is in contrast to many blogs where there is a lack of personality. If you are in Tricia’s position, I think you should be checking out her blog for motivation, encouragement and lots of great money saving and debt reduction tips. Even if you are debt-free, this is a great blog to follow. I have her rss feed on my yahoo reader and it is a blog that I check out everyday. So head over to Blogging Away Debt and tell me if you are agree with what I have said.