Are video games a good investment?

An article on Slashdot asked this weekend whether video games were a good investment. So are video games a good investment? Will they appreciate over time?

The answer is generally no. Collectibles in general are not–they follow a boom and bust cycle. I’ve seen it happen in my own lifetime.

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Workable two-factor authentication

I’m several months late to this party, but I just saw Marcel’s post on Google’s two-factor authentication with a smartphone.

He’s right. It works until someone steals your phone. Once someone steals your phone, you’re in a world of hurt. It’s just a compromise, until we find a way to do two-factor authentication the right way.

The right way is with a smartcard, issued by some sort of central authority. Read more

Is landlording profitable?

Is landlording profitable? The answer is yes. Where people disagree, I think, is on the timing, and perhaps to a lesser degree, on the strategy.

My wife read an article yesterday on real estate investing that made her mad. I’d link to it, but I can’t find it today–maybe it was pulled. But the premise was that you shouldn’t invest in real estate, because being a landlord isn’t a quick way to get rich.

I agree with the second part. But the first part doesn’t logically follow. In fact, I don’t care who you are, probably the best thing you can do for yourself is forget about trying to get rich quickly. I speak from experience. Read more

The circulating privacy threat warnings miss the boat

This week I’ve had multiple people send me warnings they saw on Facebook about a new privacy threat, which, after I read about it, really appears just to be something that aggregates information already available about you.

Perhaps not coincidentally, PC Magazine has a piece telling you what you need to do if you’re really concerned about privacy and really want to disappear. http://www.pcmag.com/article2/0,2817,2376023,00.asp
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Turn off that stupid IE "throbber" in Explorer windows

You know how Microsoft decided in 1997 to make Windows look like a web browser? And continued that decision for the next 20 years? Don’t like seeing that stupid Windows logo moving while you’re waiting for Windows to display your files?

Me neither. Go download Throboff, which works on all versions of Windows up to XP. I don’t know about Vista or 7, sorry.

Even if the throbber doesn’t bother you all that much, turning it off regains some screen real estate, which is useful on netbooks.

How to go bankrupt and/or lose your house

I have a Saturday ritual. On Saturday mornings, about 49 times a year, I go to estate sales. On numerous occasions, I’ve been to estate sales of millionaires who, for one reason or another, were downsizing.

And on Saturday afternoons, I’ve been known to go look at foreclosure houses. Or, now that my wife and I have bought one, working on the foreclosure house.

I see a pattern.It’s unusual for the last owner of a foreclosure house to be in the house for very long. And almost invariably, I see a lot of home improvement projects. Often there’s at least one unfinished project still sitting there.

Often the projects are pointless–tearing out plaster walls to put in drywall, only because that’s what the stupid shows on HGTV say you should do.

But it’s always pretty clear from looking at the house and the information available in public records what happened. They bought the house, they made some payments, the house increased in value during the real estate boom, they took out a home equity loan and started changing things, then eventually they got in over their head.

Often the changes weren’t worth it. They’d start out with a $60,000 house in a questionable neighborhood, sink tens of thousands into modernizing the kitchen and bathroom and finishing the basement, and if everything had gone well, they would have a modernized house, still in a questionable neighborhood, and contrary to the promises they saw on TV, the house didn’t increase in value at all. Someone ends up buying what’s left of it for $35,000 or $40,000, fixing whatever is wrong or unfinished, and renting it out to someone for $700 a month. A rather inglorious end to those TV-inspired dreams.

I see another pattern on Saturday mornings at estate sales.

More often than not, the family stayed in the same house for decades. The kitchen appliances are usually dated. Sometimes they’re from the 1990s, sometimes the 1970s, and on rare occasions, you even see a range from the 1940s or 1950s. And generally most everything about the house gives the impression of age. Sometimes you see kitschy trends that have come and gone, like shag carpets and dark wood paneling. Sometimes you see timeless craftsmanship. The latter is particularly common in the homes of the wealthy–when they did buy things, they bought things that wouldn’t go out of style, so they’d only have to buy once in a lifetime.

None of these houses will show up on HGTV or any other TV, and for good reason: Houses like that don’t make you run out to Lowe’s or Home Depot and buy their crap.

But at the end of the career or life, there’s something to show for it. A paid-off house with things in it that have to be liquidated, which then goes into the estate. The money from all of it then helps pay for retirement, end-of-life expenses, or goes to the heirs.

The foreclosed houses look a lot more like what you see on TV, even if you have to wipe some grime away to see it. The appliances are certainly newer, the kitchen cabinets are usually newer, and somewhere there’s at least one TV-inspired project, maybe still brewing.

But what’s left to show for it? Years of payments, lost. A wrecked credit score. Possibly some other maladies. Nothing anyone would want.

Clearly it’s much better to just live within one’s means, even if it means sacrificing coolness points in the short term.

In the long term, I’m pretty sure the people who chased the newest trends, overextended themselves and ultimately lost their houses ended up with about the same number of coolness points. Maybe a little less.

Wouldn’t you agree, more income is the answer?

So a friend of a friend came over the other night, pitching a pyramid scheme. He just told me he’d started a business. I figured (and kind of hoped) he wanted to sell me handyman services. Actually he wanted to get me out of debt.

"But I have no debt," I said. He told me I needed to keep an open mind.

I remember the last time someone told me that. It was two Mormon missionaries. To be nice, my wife and I let him keep talking.He kept asking me how much other people would admire me if I helped them financially. "But people have to be ready," I said. "They can go to the library any day of the week and check out a Dave Ramsey book for free and get on their way to climbing out of debt. But how many people do it?"

He said he agrees with some of the things Dave Ramsey says. But he kept trying to sell me on the pyramid scheme. Even when I told him I already had a side business. (I didn’t tell him I’m thinking about two others, neither of which involve any pyramids.)

"Dave, what would you do with an extra $1,000 a month?"

"Max out the 401K, think about real estate," I said.

That wasn’t the answer he usually gets.

Finally he pitched a mortgage scheme. "How many years before you pay off your mortgage?"

"Zero," I said.

He looked at me like I was from another planet. And that was pretty much the end, because he finally realized he had nothing to sell me.

But the one line from his folksy, almost-slick presentation that rang with me was this: Wouldn’t you agree, more income is the answer?

Usually it’s not. Better management is the answer. If you just throw more money into your bank account and manage it poorly, that extra money isn’t going to help you get out of your hole much faster.

And what’s worse, pyramid schemes rarely live up to their financial promises. And they benefit the people above you more than you. From the slide he showed, for every thousand he made, his "trainer" would make nearly two thousand.

I don’t care how you spin it, that’s just not right.

Taking on side work helps when paying down debt. I sure did a lot of it. But I was making money for me, not for other people in a pyramid. Sometimes I paid fees, but we’re talking 10, maybe 15 percent. When I made $100, they made $15. Not $200. I got 85% of the fruits of my labor, not 33%.

But how much I made mattered less than what I did with what I had. I slashed my electric bill. I brown-bagged lunch. I wore secondhand clothes. I bought Chase & Sanborn coffee. (A big can costs $4.95, lasts a few months, and it isn’t very good.)

People sometimes told me life was too short to cut corners like that. But I’d do it again. I think life is to short to spend it paying interest.

I figured out that every extra $10 I could pay every month on the mortgage shaved a full month off the end. Ten lousy bucks. So I nickeled and dimed my way through, finding $1 here, $5 there, and $10 there.

Getting out of debt took several years. But more income alone wouldn’t have done it. My rule was this: I paid 10 percent, minimum, of my monthly income toward debt retirement. Plus at least 90% of any windfalls. By windfalls, I mean extra income from working weekends, tax refunds, bonuses, or overtime.

And if there was money left over in the bank account at the end of the month, I paid that in too. I’d hold back a bit of a buffer for emergencies, and send the rest in to whoever owned my mortgage at the time.

Note that we didn’t have to pay anyone or buy any financial products to get a plan to get out.

Read my other blog posts in this category. You can track the whole journey. I won’t charge you anything. Go to the library and read Dave Ramsey’s books. You can get a plan for free. And that’s good, because you’re much better off putting the money you’d pay for a plan toward actually paying down a debt.

But whatever you do, don’t sign anything!

Getting more screen real estate in Firefox

Web browsers take entirely too much room on the screen. I’ve seen tips for putting Firefox on a diet, but nothing that frees up as much space as my bag-o-tricks.

So let’s go.

First, go to View, Toolbars, and Customize. Drag the address bar and search bar up to the top, next to the File/Edit/View/History/Bookmarks menus. Drag the arrows up there too, if you want them. Click OK. Now to back to View, Toolbars, and uncheck the navigation and bookmarks toolbars.

Now do a Google search for "classic compact Firefox theme." Install it.

You’ll have significantly more screen real estate.

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