Could you buy nothing for an entire year? Each year AdBusters promotes Buy Nothing Day on the day after Thanksgiving to raise awareness about wasteful consumer habits. But what about a Buy Nothing Year? That’s exactly what this group has pledged to do in 2007.

Before dismissing a buy nothing year as insane and unacheviable, consider the fact that the premise does not proclude buying the things you need for survival such as food, and actually allows to buy used or barter for anything you may desire. A secondary goal of buy nothing year is to encourage you to support local farmers and merchants in buying the foodstuffs you do need.

If you have ever participated in a buy nothing day or have ever pinched pennies for a few days, you probably already know how much we can do without when we put our minds to it. Candy and gum, fast-food lunches, useless trinkets, and excessive clothing all satisfy our desires, not our needs. And today, even larger items including computers, appliances, and cars are disposable. Wasteful packaging aside, most of what Americans buy will become trash within 10 years.

According to 2002 U.S. Environmental Protection Agency (EPA) data, the average American generates about 4.4 pounds of trash each day. That’s 1,606 pounds a year and, assuming a lifespan of 80 years, more than 64 tons in a lifetime, or the equivalent weight of some railway locomotives!

The staggering environmental impact of 300 million Americans treating their county as a landfill aside, all this buying detracts from our relationships and our health. It draws lines between privilege and poverty, inspires lust, and leads to debt. It’s why we work longer hours and get fatter than any other nation on the planet.

Not to mention, this being a personal finance website, the high cost of buying unnecessary and disposable products day in and day out.

What can you do? Can you go a year only buying local groceries and other items you need used? How much money might it save you?

What about a month? One week? Starting today, I am going to see how far I can go. I’ll let you know.

Because a buy nothing year is such an ambitious goal, anybody attempting it should be commended. Also, I would think it’s fair to be able to set your own rules. For me, I’m going to try to buy nothing from commercial sources except groceries (buy local when possible), medications and toiletries, and raw materials for art, household, or building projects. Everything else, I will buy used. I’ll let you know how it goes.

Late in 2006, ING announced to its ING Direct Savings customers the Electronic Orange checking account. It takes free checking a step further and actually pays at least 3% interest on your balance, however small.

True, Electronic Orange is a paperless checking account, meaning you can’t get physical checks in the mail. But I don’t know about you, but for me that is becoming less and less of a problem. With online bill paying, the only check I write each month is for my rent, and I’m willing to bet if I really wanted to I could convince my landlord to let me pay him electronically.

And those archaic checks aside, ING offers everything else you would expect from a checking account, most importantly free ATM access and a MasterCard debit card. They also provide bill paying and electronic check writing services for free.

If you’re a big spender, the interest rates are just as good or better than most high yield savings accounts (5.30% APY on every dollar for balances of $100,000 or more and 5.05% APY on balances between $50,000 and $100,000). For everybody else, it’s 3.0%. Still, that’s a heck of a lot better than what I currently earn on my checking account…Zilch!

As of right now, you first need to be an ING Direct savings customer to sign up. But if you haven’t done so already, there’s no reason not to grab an ING Direct Account an earn an instant 10% return on your money. (You get a $25 bonus when you open an account of $250 or more). So open an ING Direct account now and then sign up for their high yield checking account to start earning returns on your checking balance!

Maybe you just got your first credit card, or are retraining yourself to use credit responsibly after beating down some myself included, love to focus on credit card abuse and the difficulties it can cause.

But credit cards are also a powerful tool that can make managing your money easier.

Before you can use a credit card responsibly, you should understand how credit cards work. In short, the credit card is a tool you can use to receive a loan from the card’s issuing bank every time you make a purchase. The bank is happy to make this loan to you because it expects to collect interest. In fact, banks like credit cards because they can charge a much higher interest rate than they could on a secured loan.

However, the responsible credit card user typically has an advantage over the credit card bank called a grace period. Typically between 20 and 30 days, the grace period is the time period between when you make a purchase and when you pay your credit card company for that period in which no interest is charged.

Grace periods are powerful because they give you the opportunity to use your credit card as an ultra-short but interest-free loan. Instead of taking advantage of this benefit, however, many consumers do not pay their credit card balance in full each month, turning their credit card into a revolving credit line. Finance charges (interest) then accumulate on the unpaid credit card balance each month. If you’re in this situation, set a debt-free plan or look into 0% balance tranfser offers.

To use your credit card responsibly, you must resolve to pay your balance in full each month. That means keeping track of how much you’re spending on your credit card each month, and ensuring you will have enough cash the following month to cover your purchases.

I find that using one credit card for nearly all of my monthly purchases not only makes this fairly easy, but has made it easier to manage my money, keep my checking account balanced, and track my spending.

If you have learned how to create a spending plan and have written a budget, you know how much money you typically spend each month after your fixed costs like housing and car or other debt payments.

Let’s say your monthly spending allocation is $1,000. Now assume you’ll need $100 in cash for various transactions where using a credit card isn’t feasible. You know that you have $900 to spend for the month and can easily track how much you left to spend by checking your credit card balance, which most cards allow you to do easily and for free online.

At the end of your credit card billing cycle, simply pay the balance and start again.

Why bother? With the ease of using debit cards these days, why add a credit card to the mix if you’re not planning on paying over time? There are several reasons.

Rewards – Most credit cards offer some kind of rewards program, giving you back about 1% of every dollar spend in the form of cash, gift certificates, or travel. Many cards provide these rewards without an annual fee. So if you can avoid paying interest on your credit card purchases completely, your credit card is actually paying you!

Security – With growing concern over the ease of credit and debt card theft and fraudulent charges, having your credit card lost or stolen is a simpler fix than if the same happens to your debit card. In both cases you won’t have to pay for fraudulent charges, the difference is if a thief snags your credit card no money actually leaves your bank account.

Building Credit – Every month you pay your credit card bill on time, you’re building your credit history and improving your credit score, which will save you money in interest rates on every big purchase you make down the road, from your next ride to your first house. If you never use a credit card you could find yourself in your thirties and unable to buy a home!

Simplicity – Using a credit card for your monthly purchases eliminates the need to balance your checkbook more than once a month. As long as you track your credit card spending (and don’t touch your checking account), your checking balance will always be where it should be.

Now that you have the basics of using credit cards responsibly, choose a credit card that’s right for you. Chase offers a number of cards with good terms and a variety of no-annual fee rewards programs to choose from:

For Bookworms

Borders 3.2.1^SM Visa®
Chase Amazon.com Platinum Visa® Card

For Coffee Drinkers

Starbucks Card Duetto™ Visa®

For Globetrotters

Continental Airlines® World MasterCard® from Chase
British Airways Visa® Signature Card
United Mileage Plus® Signature Visa® Card

For Students

Chase Student Flexible
Rewards Card

For the “Just give me the cash” Types

Chase Free Cash Rewards^SM Visa® Card

Do you have a fat tax refund coming to you next year or will you owe Uncle Sam? If you don’t know, find out soon. If you will owe the IRS in April, there ways to reduce your tax burden now. While many year-end tax tips benefit homeowners and taxpayers with dependents, there are a few ways young, single taxpayers can reduce their tax burdens too.

Check Your Investments – If you already have non-retirement investments, December is a good time to give your portfolio a check-up and the best time to unload underperforming stocks. This will help offset any 2006 capital gains and up to $3,000 of your wages.

Boost Your IRA – If you have a traditional Individual Retirement Account, annual contributions of up to $4,000 are tax free. Better still, you have until April 2007 to make contributions that can count on your 2006 return. Just remember that you’ll pay those taxes later if you make an early withdrawal from a traditional IRA. Roth IRAs provide – in most cases – tax free withdrawals, though contributions are not tax-free.

Long Distance Refund – It’s not everyday Uncle Sam admits to pocketing more than his fair share. This year, however, the government will issue refunds between $30 and $60 for unfairly collected taxes on long-distance telephone services. Refunds will be calculated based on your filing status, but be sure to review this year’s return instructions to take advantage.

Still Owe? – Start planning now to pay your tax tab come April. With four and a half months to save, you should be able to stash away your tax bill without too much sweat. And, you can throw the cash into a high interest savings account to enjoy the interest you wouldn’t earn had the taxes been withheld from your paycheck.

Tweak for Next Year – If you’re a wage-earner and expect to owe more than $1,000 to the IRS this year, chances are your withholdings are off. Adjust your withholdings with your payroll manager on or before the new year, including allocating an additional amount to be withheld, if necessary. Hint: If you work more than one job, claim the appropriate number of allowances on your largest paycheck and zero on all others.

Dreaming of a Merry Christmas and a debt-free New Year? Jotting down a holiday shopping budget before you hit the stores is a must. If you haven’t been saving diligently all year for holiday shopping, you can still keep your credit cards on a short reign as you work through your shopping list. Here are the steps to sticking to your holiday shopping budget:

1. How Much Can You Afford?

Before you even think about shelling out for a sparkling new watch for your significant other, find out exactly what you have to spend. If you haven’t been saving for holiday shopping, what can you cut back on for the next month and a half? If you find you have absoltely no cash for holiday shopping and are looking at your credit cards, warning bells should be ringing. Some frugal shopping is still possible, but you may also want to check out our debt help page to avoid the situation next year.

2. Who Really Gets Presents?

It sounds Grinch-like, but being selective in your giving can safe you bundles. Outside of your immediate family, only buy gifts for children, and keep them small. And use your age to your advantage — unless you have kids of your own, older relatives shouldn’t expect you to be spoiling theirs just yet.

3. Give Lightly at Work

“Secret Santas”, “Yankee Swaps” or other gift exchanges should be the only giving you do at work. It’s easy to go over the top and coworkers may feel guilty if they didn’t reciprocate. Keep swap gifts under spending guidelines; and don’t expect to get anything of value for yourself. Consider yourself lucky if you score something you can actually use. (Exception: If you’re a boss, small gifts for employees is warming).

4. Agree to Spend Less

While you obviously want to give your most loved one something special, a romantic gesture doesn’t have to break the bank. Have a discussion ahead of the Holidays about gift expectations. Set a gift spending limit, but agree to put extra thought into each other gifts. Then, focus on something he or she really enjoys. The time you take to learn about your partner’s interests is worth more than any gem.

5. Make Your List, Check It Twice

Once you know how much you can spend, who gets presents and who doesn’t, and how to buy more meaningful presents for your loved ones, make your list! Write down what each item will cost you, and don’t exceed your budget when you hit the stores! Your goal should be to get through everything on your list with cash to spare. Then you can get somebody, or maybe even yourself, a little something extra!

Online personal finance tools can show all your bank, investment, and loan accounts on one webpage and – soon – may provide Quicken-like budgeting power you can access anywhere. So where are they?

While existing online personal finance tools are mostly limited to bill paying, August 2006 research from Online Banking Report states “Banks and credit unions looking to bolster customer retention…are expected to adopt…key features in Microsoft Money and Intuit’s Quicken.”

Expect these suckers to start popping up like dandelions.

Until then, current online personal finance tools can’t compete with personal finance software (or even a good budget spreadsheet). But again, in five years we’ll wonder how we balanced our virtual checkbooks without them.

What Is Already Here?

Yodlee is my vote for top current provider of online personal finance tools. Yodlee serves several major-league clients including Fidelity, Wachovia, and Bank of America.

This weekend I was fiddling with my 401k and took a look at Fidelity Full View, powered by Yodlee. After about ten minutes of setup, Full View put all of my bank, investment, and loan accounts on one page and automatically tallied my net worth. Full View also let me view recent transactions in each account and summarized periodic account inflows and outflows. Full View can also provide previews of multiple e-mail accounts and electronic bill paying.

Setting up Full View was easy; I choose most of my accounts from Yodlee’s database of over 8,000 financial institutions (including my local credit union) and simply entered each username and password. Gaining access to my ING Direct account was the only tricky part. ING asked a barrage of security questions and locked me out until I omitted the comma from my birth city and state.

Full View is a convenient tool, and I will definitely return to get an instant net worth snapshot, but Full View lacks the Yodlee Personal Finance function that would enable expense tracking, budgeting, and account balance forecasting. I welcome comments from anybody that has tried these features.

If you’d like to use Yodlee applications yourself, you’ll need an account with one of Yodlee’s Clients.

What’s Coming

BillQ is a free online bill reminder service from Seen Creative. Right now BillQ simply allows you to create a queue of your monthly bills so you don’t forget to pay them, but BillQ’s user interface is extraordinary. I will be keeping an eye on BillQ over the next couple of years. Should it evolve into a more advanced online personal finance tool with the same awesome usability, I’ll be sold.

What’s not to love?

It’s hard to pooh-pooh the idea of being able to manage myriad accounts, bills, and budgets from one webpage, but there’s a primary reason such sites don’t yet exist.

Security.

Of course, the idea of collecting every single one of your financial accounts in one location is scary. Identity thieves have proven they need far less than a few account numbers to clean somebody out.

I believe, however, online personal finance tools are simply the newest frontier for Internet security.

Ten years ago most people cringed at the thought of using a credit card online. Yet in 2005 we spent over $175 billion shopping online, paying almost exclusively with plastic.

Online-only banks like ING faced similar resistance. Critics of ING said nobody would trust sending funds to a bank they couldn’t see, yet ING Direct now has over 15 million customers.

As my experience accessing my ING Direct account through Fidelity Full View shows, however, ING has responded to security concerns with elaborate security measures; something that creators of online personal finance tools may have to mirror without becoming tedious. After all, with Quicken, Money, and Excel always available, convenience is the name of the game.

Sites providing online personal finance tools must prove that they can securely display and analyze more financial data more easily than our current systems. When they do, it will be an exciting day for personal finance nerds.

Creating a monthly budget when you are in your twenties presents unique challenges and requires different priorities than budgeting at any other time in your life. But whether you are living at home for a few years, out on your own for the first time, or eking through graduate school, budgeting is more important in your twenties than at any other time. Continued

Just like anything worth doing, getting out of debt takes self-discipline. Whether you want to wake up earlier, get in shape, or quit smoking, will power is the key to achieving difficult goals. Unlike those other tough tasks, however, you can actually use technology to overcome poor self-discipline when it comes to getting out of debt. Continued

I am pleased to present a free budget spreadsheet that can be used to quickly and easily plan how much you can spend each month. Getting started is easy:

Download Now - Free Monthly Budget Spreadsheet

Using the spreadsheet is easy. First, gather your paystubs and enter your monthly income. Next, collect a month’s worth of bills and receipts. Enter the monthly amounts in the approporate categories, estimating any value that fluctuates from month-to-month.

Once you have entered all the values, the spreadsheet will tell you how much you will have left at the end of the month to save or put towards debt. The spreadsheet will also tell you how close you are to an ideal income allocation. Such allocation models are frequently used by banks and other lenders for determining your financial balance.

Looking for more powerful budgeting tools? Read our review of the best budgeting tools and programs.

In the movie Boiler Room, Ben Affleck’s character spouts out that “Whoever said money doesn’t buy happiness doesn’t [expletive] have any.” Maybe, maybe not. But more than we often admit, money and psychology are inseparably fused.

For most, the act of spending money brings temporary gratification. The key to responsible spending is to avoid becoming “addicted” to this feeling. I’m not suggested everybody with a bit of credit card debt is a compulsive shopper, but I think we have all caved in a little to this universal human weakness.

In theory, the act of buying something should be a balance between the pleasure we get from owning something new and the “pain” we feel from parting with our money. But in the electronic age, the feeling of parting with money is no longer immediate. When you pay with a credit, or even a debit, card, the realization of spent money doesn’t come until the end of the month.

That’s why it’s a good idea to record every transaction, even when paying with plastic. Keeping a running total of your purchases will remind you of how much you’re spending, and create mental obstacles for your impulses that may want to spend more than you should. Why?

Throughout college my motto was “financial ignorance is bliss.” I charged and charged and just ignored my credit card balances each month – as long as I had enough to make the minimum, I didn’t care. But as soon as I began to look at the mounting debts on those statements, it became harder to spend. When I was thinking about my debt, I could be cheap. The only problem was I could easily put it all out of my mind days later.

As I now work to permanently change my habits, I still find it hard to read every statement carefully – after all, it’s not a pretty picture. But the more keenly aware I am of my monthly budget and my long-term goals – every day – the easier it gets to spend less.

On the flip side, I have known people so frugal that every penny they spent hurt. I am pretty sure I will never get to that point, nor do I want to get there. After all, if you can not enjoy something, why buy it at all?