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If you have poked around on my blog before, you would have noticed that I bought myself some stock from ShareBuilder using their promotional codes. I used a $50 promotional code and bought $46 of Frontline (FRO) stock. I had to pay $4 for the trade. I received the $50 back a few weeks later, so basically, I got this stock for free.

The stock has been on it’s way up. It had a little dip a month or so back, but it is up almost 3 points since I bought it. I did not buy this stock because I thought the stock price would rise, but that is always an added plus. I bought this stock because of the high dividend it was paying. When I bought it, the dividend was $2.50 a share. I thought this was too good to be true. But I researched the company and saw that they shipped oil, so I knew that had a good quarter because of the high oil prices. I also saw they were doing good things with their money like reinvesting in the company and buying other companies.

My First Dividend

My first dividend came around, and it was not what I was hoping. I was hoping for $2.50 a share or more. The dividend this quarter was only $2.05 a share, which is still very good. I also noticed that they were giving away stock from another company. With every 28 shares of Frontline, you would get 3 shares of Ship Finance International (SFL). I did not think I would get any stock as I did not have 28 shares of Frontline.

To my surprise, I got some shares of SFL. I received over $4 worth of stock (around .15 shares). They also have a decent dividend of around 8%. ShareBuilder also has it where your dividends are automatically reinvested, so I gained another .1 shares of Frontline. This may not seem like much, but you have to remember I am doing this all with FREE stock. My portfolio is almost up to $60, a 20% return in a span of 3 months.

I am thinking about investing some of my house savings in Frontline and other high dividend stocks. I have another post coming down the road about the high dividend stocks I am researching.

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I just started my search for an investment fund or stock to put my house savings into.  I am looking for a decent price history and a high dividend yield.  The history needs to be from steady to on its way up.  The dividend yield needs to be at least better than 6%.  I can get 5% from a savings account.

Here are the two I have found so far:

• CLM - Cornerstone Strategic Value Fund - It ended trading day today at 8.33. It has dividend yield of 13.40%. The price has stayed about the same over the past two years, so I would mostly be investing in the dividend.
• GHI - Global High Income Fund - It ended trading day today at 16.62. This means it has gone up about 1.5 points in the last 6 months. This coupled with the 8.20% dividend makes it a very good bet. If the price goes up every 1.5 points every six months, the overall yield would be about 26%. As you can tell, this fund is at the top of my list.

I will be doing more research this weekend looking into high dividend-yielding stocks and funds. I found a decent Java-based stock screener at Yahoo!.  I will keep everyone informed of what I find.

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While reading Smart Couples Finish Rich by David Bach, I have come across a lot of good information that I will be sharing. First off is some good websites for researching your investment choices:

• Morningstar - This company was one of the first websites to rank mutual funds, and it is one of the best around. It provides general descriptions of the funds, along with in depth analysis. The site will also review your portfolio. This would be the first place to start when you want to invest in mutual funds.
• Yahoo Finance - This site is probably the most popular financial site on the web with good reason. It is a true full-service portal with everything from stock analysis and quotes (see left toolbar) to portfolio tracking. It provides news and research for stocks and funds, and it is growing everyday. They’ve added a personal finance section with a great deal of information like Career & Work and Taxes.
• Mutual Fund Investor’s Center - This site has lots of educational information on mutual funds. It includes a list of funds that accept initial investments of $50. This is good for those of us just getting started in investing.

Here is a list of websites that offer information on individual stocks:

• Nasdaq
• Edgar Online
• Market Guide
• Quote
• Stock Selector
• Value Line
• Value Stocks
• Raging Bull - Not the movie.
• Smart Money
• The Street - Jim Cramer’s site. It is a good site, but I like Yahoo better.
• Motley Fool

These items are in no particular order, but if you had to start somewhere, start at Yahoo and Morningstar. I was just on Yahoo the other day looking at some ETFs and trying to figure out which one would be best for me. While I have not been to all the sites, I will visit them and update this post with any relevent information. These lists should get anyone started on a good investment strategy for the future.

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Trent over at The Simple Dollar had a post called Thinking of Making a Banking Change? Here’s How to Compare Competing Bank Accounts. We kind of got in a back and forth about how his criteria for choosing a High-Yield Savings Account. I really did not understand his approach about choosing, so I decided to tell everyone my approach.

I am going to switch my emergency fund from Citibank to a bank with a higher APY. Here is some of the criteria I looked at, and the process I went through. Criteria:

• FDIC Insured. This guarantees you $100,000 of your money back in case the bank closes down. While this may not seem very important for bigger, well known banks, it is more important than you may think. In a article I recently read, the writer stated if Vanguard closes down, she would eat her hat (Vanguard is not FDIC insured), and eat up to $100,000. The bank that I chose is not widely known as it just opened. I would have never chose it if it was not FDIC insured. Even with CitiBank, you need to be weary of the bank just closing out of the blue.
• Interest Rate. Ummm … I believe I am getting a High-Yield Savings account for the high interest rate. I am going to be moving from a 4.75% APY to a 5.30%. While it may not seem like much, after I did the math, I will be making an extra $5.50 for every $1000 invested. Since I will have around $3000 in my emergency fund in the next few weeks, that comes out to $16.50 per year. It may not seem like much, but as my money grows, it grows.
• Fees. Here is where the bank can excel or fall flat on its face. High fees will completely destroy the difference in interest you are getting. The bank does not have to be completely fee free, but it cannot have fees on actions that I will be using. Maintenance fees are the big killer, and any bank that charges them is out of their mind.
• Track Record. I like to look at a bank’s track record of interest rates. If they rise and fall a lot, I will shy away from the bank because I doubt the interest rate will stay high. It would be nice for a bank to guarantee its rate, but that rarely happens, even for a few months.

Now here is the process I went through:

• I went to BankRate.com to find a list of the top banks by interest rate. Their were some other sites, but they were all outdated as they still had Citibank at 5%.
• I sorted the banks by interest rate putting the highest interest rate on top.
• I threw out all the non-FDIC insured banks.
• I threw out all banks with start-up amounts higher than what I had. I also threw out banks that had too high of amounts to gain interest.
• I went through each bank from here and looked at fees. Any bank with a fee that would throw off my return, I crossed them off the list.

I got lucky and found a bank near the top of my list - iGoBanking. They have no fees, no minimums, and a 5.30% APY. This bank is fairly new, but many bloggers have been switching over to it. While this was at the top of the list, I still went through to make sure I did not miss anything good.

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I just received a profit-sharing bonus from my company because we had a very good quarter. The bonus is about one month’s salary. This is just the start of what seems like a huge money stream coming in. I received $150 from one of my cell phone rebates, and another $150 from the other cell phone will be on its way soon. I just got a new job (and a new raise), and I will be receiving about 2 weeks extra pay for my extra Paid Time Off. I should be receiving another $2000 from my tax return. Needless to say, my wife and I will be coming into a lot of money that we have no idea what to do with.

With this new money, I have come up with a lot of topics to write about, but I will start with the obvious first question. What should I do with my extra month bonus? I had planned on putting 2/3 of it into the Emergency Fund. Some of this money going into the Emergency Fund will be used to buy baby stuff (as my wife is due in July). We do not need any baby things right now, but just knowing we have the money waiting for it gives my wife and I piece of mind. The other 1/3 will be divided between an extra principal payment towards the mortgage (7.25%) and my wife’s private student loan debt (9.85%).

One of my goal’s for this year was to pay about $7000 of my wife’s private student loan debt. Let me just say that this is just the tip of the iceberg as she has around $14,000 in private student loan debt, $16,000 in federal student loan debt, and I have about $14,000 in federal student loan debt. The federal loan debt does not concern me as the interest rate is around 4.5%. The private student loan interest rate, like I said before, is 9.85%. This is the highest interest rate on any loan I have, so my goal is to get this paid of as fast as I can.

I was thinking about investing some of this new money, but I am a very passive investor. I do not like to lose money, ever. When I do the ShareBuilder promos, I know that the stock I buy is basically free as I get the money back. I think I will wait for some of the other money I have coming in before I start investing. I will just take a good chunk of the money I have and put it into my 4.75% savings account.

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Citibank lowered its APY from 5.00% to 4.75%. This hurts as I was using Citibank for my emergency fund. Here are some alternatives if you are thinking about switching, like I am:

• OneUnited - 5.30% APY ( min of $1000 )
• E-Loan - 5.25% APY ( no minimum )
• HSBC - 5.05% APY (6.00% until 04/30)
• Emigrant Direct - 5.05% APY ( no minimum )
• Citibank e-Savings - 4.75% APY ( no minimum )
• ING Direct - 4.50% APY ( no minimum )

List complements of Spoofee. If there are any better ones out there, let me know.

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There are a lot of things you should already know about an Emergency Fund:

1. YOU SHOULD HAVE ONE!
2. It should contain about 3 to 6 months of your salary
3. It should be in a different account than your month-to-month spending. Put it in a High Interest Savings Account.

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I just had a post about the 101 Dumbest Moments in Business that had one of the 101 about how much it cost to make a penny. I saw an article today on Yahoo called Coin Shortgage Could Turn Pennies to Nickels. The 101 Dumbest Moments in Business had every penny costing around 1.75 cents to make. This article on Yahoo says a penny costs over 2 cents to make.

The article goes on to say that there is a copper shortage going on, and it will continue. The penny could cost close to 5 cents to make in the coming months. They suggested that the US Treasury just change the penny into a nickel (make it worth 5 cents) so that people don’t feel the need to melt down the pennies and sell them that way. I think I will just start keeping pennies in a piggy bank for the next few years or so. If they do change the pennies into nickels, I just got a 500% return on my money. I will have to have a ton of pennies for this to pay off, but how often can you get a 500% return on your money from just saving a penny or two every so often.

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I have seen a lot of blogs presenting the 0% Balance Transfer game lately. Basically you find a credit card with 0% Balance Transfer APR and use this money to make interest in a 5% Savings Account. (I will refer to this as the APR game throughout this post). This sounds like an easy way to make some money, and in hindsight, it is. If you can get around $10,000 credit limit on your cards and put it into a 5% Savings account, you would make $500 in interest. Easy Money because all you have to do is make the required payment every month and pay off the balance at the end of the promotion period, and you have your “free” money.

I do not see a problem with this if you do not need to make any big purchases soon. I do not see a problem with this is you are not be getting any loans soon that will be based off your credit score. Do not do this if you are planning on buying a house in the next 2 years as you will be greatly sorry. My wife and I are planning on moving in another 5 or so years, so I will need to get another mortgage. Here is why I am saying this (here comes the math, so hold on):

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My daughter’s stock purchase finally went through today through ShareBuilder. She is the proud owner of 1.4184 shares of Disney stock (DIS). As you can see by the left hand side, I now own 2 stocks. Since my daughter is too young to own a stock, I “officially” own it. Also, as you can see on the left side, both of my stocks are on their way up. After closing today (Tuesday), my Frontline stock is up almost 1.5 points. The Disney stock is up a little also. I just can’t wait to see where the Disney stock is going to be in 16 or so years (when my daughter turns 18). Hopefully it will be enough to pay for her college, so I don’t have to.

I plan on doing the ShareBuilder promo as much as I can. After I get my Frontline promo and the Disney promo, I will get my wife a stock and myself another stock. I will probably get my wife something fun that she wants. I am looking into some good index funds for myself. I may just go with the S&P 500 Index. If anyone has any good index funds or stocks, let me know.

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