The Sunday Review #21: Minimum Wage Questions Edition

A couple of days ago, on this food-for-thought post, a reader left this comment (italics are quoted from the post):

“Education is a Great Economic Leveler”

-I have a college degree and earn minimum wage. Where’s all the extra money I’m supposed to be making?

“Yes, There Are Educated People Who Think Like This”

-I think I have a pretty good handle on the basics of personal finance. But what good is that when you earn minimum wage and have student loan debt?

I tried to answer these questions here, but I am not very pleased with the attempt. Probably some of you might have more to add.

On a related note, sometime back (I don’t remember on which blog), I read a question by another reader to this effect:

How can I be a millionaire if I earn minimum wage?

How would you answer such questions?

Of course, one would simply say “increase your income”, and although that is quite obvious, it’s a bit shallow (in my opinion). I am trying (and have tried in the past), but I still don’t have satisfactory answers to such questions. Would be glad to get some reader input on this.

While you think on that, here are some noteworthy articles published this week:

• The Simple Secret of Investing by Ben @ Money Smart Life. I think this post is directed towards me. I have been a bit lethargic about putting my money in the stock market (for now)…for the fear of losing it. Ben talks about that fear in this post. However, I still look at stock markets like swimming pools - of course, you will never be able to learn swimming unless you jump in the pool - but, if you are overconfident and jump in without the proper precautions, it won’t be too difficult to drown.

• What Is Gap Insurance, and Do I Need It? by Matt @ Binary Dollar. If you have a new (or almost new) car you probably know (or should know) about this. What about used cars? Nah..you don’t need it for that (most probably some insurance companies won’t offer gap insurance on used cars).

• Entrepreneurship Lessons from Calvin & Hobbes by ISPF. Interesting lessons through funny cartoon strips. Let Calvin and the imaginary tiger teach you everything from “how to run a business” to “how to create repeat-buyers”.
  

• Questions From Readers: Can I Deduct Brokerage Commissions Paid to Trade Stocks For Tax Purposes? by Jeremy @ Generation X Finance. One would expect the answer to be a simple “YES” or “NO” - but hey it’s the IRS! so there must be some “IF ..THEN..ELSE” statements.

• End of Your Rope? Tie a Knot and Hang on Tight by Lazy @ Lazy Man and Money. Based on his personal experience, Lazy talks about ways to cope up with a job loss.

• The Perfect Hobby: One That’s Cheap, Makes Money Or Becomes A Business by SVB @ The Digerati Life. I have conflicting (but inconsistent) thoughts about this. Sometimes I think that once a hobby becomes a business, the fun just dries away from it - it’s no longer a hobby, it’s a business.

• Is the New Discover Motiva Card Encouraging Credit Card Debt? by Sun @ The Sun’s Financial Diary. Sun discusses an interesting “interest-back” offer from this Discover card. It’s probably the first of it’s kind that I have heard of - and yes, the offer does sound a bit stupid.

• Where does the Rule of 72 come from? by MBH @ Mighty Bargain Hunter. Check out this detailed derivation of the “rule of 72″. MBH’s work sort of fills in the analytical gaps in my earlier post on the subject: How Long Till You Double Your Money? Is the Rule Of 72 Good Enough?

• The Importance of Buying Flood Insurance by Nickel @ Five Cent Nickel. Some fundamental explanation about who needs flood insurance and how to get it.

• Save Money by Going Back in Time by FMF @ Free Money Finance. Blame the increased spending on lifestyle inflation over the years and apparent *needs* that we have created for ourselves. FMF suggests going back to the 70’s way of living (only figuratively, not literally) to cut the flab.

• I Don’t Want To Be Rich by Jim @ Blueprint for Financial Prosperity. A devil’s advocate post that lists a few reasons why one would choose to remain poor. One of the reasons is - “Poor people are less likely to be robbed“. Btw, Jim’s blog saw it’s 1 millionth visitor this week! That’s awesome….congratulations Jim.

Now, here are a couple of carnivals that featured my posts:

• Carnival of Personal Finance #100 hosted by Madame X @ My Open Wallet. It’s one incredible piece of work - a compilation of 100 articles with a commentary on each. My post “Husband, Does Your Wife Know How To Invest? Wife, Does Your Husband Know How To Pay The Bills?” was featured at #1 position.

• Festival of Frugality #74 hosted by Juan @ Millionster. My post “Bulk Is Not Always Frugal - Watch Out For Prices Like These” was included.