Personal Economics 101

The strong January jobs report in spite of the U.S. partial government shutdown helped sentiment and eased worries about a potential economic slowdown. Alongside January's 304K job gain, November's print was revised higher by 20K to 196K, but December's was trimmed by a whopping 90K to 222K.  The last three months have now seen an average job gain of 241K. The unemployment rate unexpectedly ticked higher to 4.0% thanks to a jump in the labor force participation rate to 63.2% from 63.1%, while the broader U6 unemployment rate rose to 8.1% from 7.6%.  On Friday, the S&P 500 and Nasdaq were weighed by a 5%-plus drop in Amazon after the company issued cautious Q1 revenue guidance amid an anticipated increase in spending. For the week, the Dow gained 1.3%, the Nasdaq climbed 1.4% and the S&P advanced 1.6%. More details at Seeking Alpha . Is the market over-valued? One indicator, called the Shiller PE Ratio , indicates that the S&P 500 is high on the valuation...

Getting out of debt was the single most important thing I've ever done in my financial life. About eight years ago, I had more than $45,000 in consumer debt. The interest alone was costing me more than $500 a month. My monthly payments were almost $2,000. I used Dave Ramsey's snowball method in his Total Money Makeover . It took me about 18 months, but I became debt free. After that I was able to easily save 20 to 25 percent of my income for retirement. Here are some commons errors a lot of people make: Not following a debt snowball method This simple method means paying your lowest balance first, while making minimum payments on all other debt. Once the first is paid off, add that payment to your next lowest balance. And so on. I used this method and it worked beautifully. Some say to pay off the debt with the highest interest first, which is OK if you have the patience. Using your credit card(s) Do not ever use your credit card while in the process of paying o...

Invested: How Warren Buffett and Charlie Munger Taught Me to Master My Mind, My Emotions, and My Money (with a Little Help from My Dad) . This book, written by Phil Town's daughter, tells of her story of learning to invest. If you have a phobia toward money or investing, it would be interesting to you to learn how she overcame these same types of fears. However, if you just want to learn Phil's Rule #1 Investing, read his original book.  Seeking Alpha:  Dalio's Fear Of The Next Downturn Is Likely Understated Barron's:  Ken Langone (Home Depot) Loves Capitalism! He Explains Why You Should Too Town Hall:  Amidst Global Warming Hysteria, NASA Expects Global Cooling Steve Harvey: Take the Lid Off the Jar