The Metafinance Show – Interview with Gini Dietrich

We’re back with another edition of The Metafinance Show. This time, we talk with one of the most prolific PR Agency folks out there, Gini Dietrich.

interview with gini dietrich

She’s everywhere, but not in a Chris Pratt sorta way. Gini Dietrich, CEO of Arment Dietrich (a PR firm based in Chicago with associates all over the world) and blogger behind the wildly popular Spin Sucks blog, joins us to talk about the money side of entrepreneurship. It’s a first for The Metafinance Show, as we sit down with someone running an agency and get their thoughts on what happens when…

…you run out of money.
…Or when the new client will pay you after 90 days.
…Or when the bank decides to call in its note.

Clocking in at a little more than 20 minutes in length, it’s a wide-ranging discussion on the Financial Aspects of Entrepreneurship. Check it out!

Do You Bet on Greece or Puerto Rico?

As I was thinking about this post, I was reminded of an old joke. And one that requires you to say it out loud.

The old joke was a multiple-choice question: “How do you pronounce the capital of Kentucky?…Is it (A) ‘Lou-uh-ville’ or (B)’Lewis-ville?'” The answer, of course, is (C) Frankfort.


So betting on Greece or Puerto Rico isn’t really a thing. The answer to the above question: “Do you bet on (A) Greece or (B) Puerto Rico?” is best answered with (C) Neither.

First, some background on Greece (courtesy BBC) and Puerto Rico (courtesy CNN Money). After you’ve digested those – you might need a beverage afterwards (Ouzo and/or Rum if you’re so inclined) – let’s take a look at what this means for you.

Greece: Not Looking Good

It’s late June 2015 and the news overseas isn’t good. Greece is likely going to exit the Euro Zone, something that has been so widely expected it has its own portmanteau: “Grexit.” Sunday, June 29, it was announced that a “Bank Holiday” would take place for a few days. If it has to be capitalized and put in quotes, “Bank Holiday” is really code for “HOLY CRAP THE FINANCIAL SYSTEM HERE IS REALLY MESSED UP.” Greeks can only withdraw 60 Euros from ATMs.

Greece has a young, photogenic financier in charge of its government – but looks don’t pay the bills and they’ll have to wiggle their way around IMF deadlines and the like. These deadlines (one is June 30, another is July 20) are dates when large payments are due. Hundreds of billions of Euros.

Read as many tea leaves as you like, but this does not look good. Greece will leave the Euro, drachmas will return, they’ll be valued at next to nothing, and the Greek financial system will screech to a near-halt.

If Greece were a stock, you’d short it. Say, short it all the way to zero.

Puerto Rico: Not Looking Better

If there were a parallel to Greece in the USA, it’s Puerto Rico. Greece isn’t really European, and Puerto Rico isn’t really American. (I’m ducking as I write this: but certain rights that are afforded Americans from the 50 states just aren’t afforded to Puerto Rico.) A US Commonwealth (with a population of 3.6 Million and more debt per capita than any US State), Puerto Ricans use the US dollar, but they don’t have a vote in General Elections, and their Senators and Representatives just sorta hang out in Washington.

Puerto Rico’s economy is an absolute mess – it’s so bad that their (equally photogenic) Governor says they will default on $70B in debt. Using the words “death spiral,” Gov. Alejandro Garcia Padilla says the island is in serious trouble. They, too, need help…and their problem is that they cannot use Chapter 9 of the US Bankruptcy code – that’s the Chapter that cities like Detroit have used to restructure their debt.

Their lifeline will have to come from mutual funds and hedge funds that have bought up their debt; and these funds will likely pull a Warren Buffett and ask for lots in return.

You may recall that, during the financial crisis of 2008, Buffett had billions to play with, and was willing to bet on the recovery. He pocketed billions. Here’s more on how that worked.

Bonds that had been at junk status are going to be…well, what’s lower than “junk status?”

If Puerto Rico were a stock, you’d short it. This one, too: all the way to zero.

What’s next – for them and for you?

What’s…interesting here is that I recently received information on a unique program touting the benefits of…Investing in Puerto Rico!

Before you laugh, think about it – and think about what will likely happen in Greece, too.

With the economy in the tank, both places will more than likely do two things:

  1. Drop the business tax rate to encourage development and
  2. Do everything in their power to bring tourism to their locales.

While this reporter is skeptical about investing in either country, there will be opportunities for individuals who want a really cheap vacation, or who want to startup or expand their businesses.

In the short term, since a Grexit will take some time, travel for EU members to the islands will be deeply discounted. Anything to stimulate the economy, right?

Americans will benefit from the fact that they can get to Puerto Rico without a passport, the island uses the US dollar, and there are tax benefits for moving your business there.

Bottom line for you: watch both places carefully.

Does Your Credit Score Matter?

Welcome to a crazy, crazy world of personal finance. Three companies are keepers of three digits – and those numbers hold the key to your financial success…or do they?

Your Credit Score
Way back when – and we’re talking 20 years ago, so thanks for making me feel old – I had intimate knowledge of the credit reporting process. I worked in PR for one of the Big Three credit reporting agencies, and part of my job included explaining the process to reporters. Back then, I would have answered the question “Does your credit score matter?” with an emphatic “YES.”

Now I’m not so sure.

The Background

A lot has changed over the years in personal finance, and the availability of credit is high on that list. We used to suggest that the credit reporting system was definitely a benefit to the populace: “We make it possible for you to walk into an auto dealer this morning, and walk out with a new car this afternoon, thanks to our reporting system and your credit history.”

You can insert your own story here: apps for this credit card or that, quick mortgage approvals for loans and refinancing, a system that now makes it possible to walk into an auto dealer knowing the exact car (down to the VIN number) and loan terms and walk out in minutes – without having to deal with an actual person – driving a shiny new vehicle.

Somewhere along the line, credit scores became more widely used by creditors, more understood by consumers, and more part of the consumer finance dialogue. Now, credit scores are everywhere – ad campaigns tout that they are used in “90 percent of financial decisions.”

So of course they matter, right?

The Black Box

Before we answer the question, though, we should talk about the score itself and how the three credit bureaus (Equifax, Experian, and TransUnion) arrive at their scores. They each license the algorithm from FICO (from a company called Fair Isaac), and FICO considers a number of factors when helping the bureaus arrive at the score. (If you’ve followed our sister site – a site that we’re phasing out because we’ve gone “all things Meta” over hereand here – you’ll know a little of this from the tales of our buddy Darnell.) (DISCLOSURE: has an affiliate relationship with myFICO.) Factors include:

Credit Score Factors

  • Do you pay your credit accounts on time?
  • How long have you been in the credit system?
  • How much of your available credit are you using?
  • Have you recently shopped for something requiring a credit report to be pulled by a bank or lending institution?
  • Have you opened accounts recently?
  • And, of the credit available to you, how much of it are you using?

(As you’ll notice from the graphic, Darnell, the friend who has shared his story with us, isn’t doing that well on the credit score scale. But he gets a passing grade.)

Darnell’s story…and how it helps answer the question

We should actually answer the question with another question:

Cash? Or credit?

If you pay cash, your credit score doesn’t matter. If you pay credit, of course it matters.

Our friend Darnell had been through a couple financial difficulties, so he was able to get his score back up from in the 500s (which is below-average and, actually, what the lenders would consider “Sub-prime”) to 605 (which is by no means sterling credit, but it’s still average).

At the time Darnell and I first started chatting, his biggest issue was getting an auto loan. He walked away from a couple opportunities because the interest rate being offered to him was pretty bad. Like “20% APR” bad. Way down in the 500s – in his case, the LOW 500s – kept Darnell from saying yes to a loan that would have been onerous. So he found other options…

  1. He looked at other ways to get around while, at the same time,
  2. He put himself on his own sort of Spending Diet and,
  3. He socked away money for a vehicle.

Interestingly enough, a few months later, his credit score stabilized – and he didn’t use all of his available credit (which actually wasn’t that much anyway). So he found himself into the 600s, making him eligible for better credit offers for that car that he ended up not needing a loan for.

Does Your Credit Score Matter?

Darnell would say “not as much as it used to,” and the credit industry would say “absolutely it does!” And, while we think Darnell has done a pretty cool thing by putting money away for a car – and by downgrading his list from “Cars I’d Want,” to “Cars That Do The Job,” – he’s going to be out of luck when it comes time for a bigger purchase. (A house, for instance – he’s still in subprime mortgage territory; though you will hear ads from mortgage brokers telling you they can go into the 500s, he’s probably going to have to wait out his current situation for quite a bit longer. Or be prepared to pay a lot more in interest than someone whose number is in the 700s.)

The problem?

The reliance on credit as a means to attain things you do not need.

The system is set up (or some may say the cards are stacked against you) in order to facilitate the usage of credit. Not debit cards, not checks – credit.

Experts like Suze Orman will suggest the responsible use of credit, and they’ll tell you that you need to start small with cards that help you build up your score. Experts like Dave Ramsey will tell you to cut up the cards – and they’ll go so far as to not even accept credit cards on their website.

But the reality is that credit scores are used in 90% of credit decisions because…it’s in the best interest of the credit system to move you from prospect into customer as quickly as possible.

Answer: Get to a point where it DOESN’T matter

Have a budget. Save, don’t spend. Write everything down.

Pay cash as often as possible. If not cash, use a debit card. Steer clear from credit cards. Throw away the offers – even if they come with 50,000 bonus miles that you’re not likely to use.

Get radical with your money – and you’ll be at a point where it doesn’t matter that you’re just a number.

New Job Money Considerations

Here’s a question that pops up more often lately than it did during the Great Recession: “I’m interviewing for a new job, and the salary bump would be at least 15%. Are there any other money considerations I should think about?”

MoneyI’d love to say “ABSOLUTELY,” but I feel like that’s rather condescending. Still, when the economy is good, job hopping is more common, and companies can often toss around nice, shiny salary increases as the thing to lure people away. There’s more, of course, to any new gig, so we’ve put together a list of new job money considerations. Keep these in mind as you negotiate.

New Job Money Considerations

Since I’m being pretty transparent on this site, I’ll share a story of my own. Back in the 90s, I was so desperate to get out of an employer that I took the only thing offered to me. The pay bump was better than twenty percent – but the rest of the package was virtually non-existent. I didn’t care: had to make the break from a toxic workplace, so I took it.

You could be in that boat: something new and different is automatically better because it’s not where you are. You’ll need to weigh the psychological benefits against the monetary benefits. Maybe it’s not that big a deal to you. It wasn’t to me.

Times have changed quite a bit, and some of the things that weren’t even considerations for me in my 20s are huge now that I’m in my…late 30s (ahem).

We’ve put our discussion into three categories, and we’ve tried to gear it around the middle class folks that are likely to visit this site. Here goes:

1. Hourly vs. Salaried

From a dollars-to-donuts standpoint, this is potentially huge. And, given the direction society is heading – more on that at another time – you could be walking into a minefield in either case.

Example: Let’s say Mary is currently an hourly employee at XYZ Widgets and she makes an even $25 an hour. Her workweek is 40 hours, and she gets two weeks of paid vacation, holiday pay, all those things. Here’s the simple math.

  • 40 hours/week x
  • 52 weeks/year =
  • 2080 hours/year.
  • $25/hour x
  • 2080 hours =
  • $52,000 a year.

Mary’s currently negotiating to leave her XYZ post for a better opportunity at QRS Inc. QRS wants her on salary – she would be “Exempt” from being paid overtime. (N.B. There’s quite a bit of discussion these days around the rules for overtime pay, and what are considered “archaic” wage and salary numbers to limit who is eligible to receive overtime pay. CNN Money breaks it down at this link.) Since Mary’s negotiating for a 15% bump in salary, let’s round up and say the offer is for $60,000 a year.

Mary would be crazy to turn this down, right? Not so fast…here are a few things she should make sure jots down.

Does Mary currently get the chance to get paid overtime at the current job? Ooh, wait a minute. That could potentially be rather large. Overtime, at time-and-a-half pay, would currently get her $37.50 an hour, meaning that she needs to work an extra 213 hours (or so) to make up the difference. If XYZ does work that can be seasonal in nature, what if a big order comes in and it’s “all hands on deck” for a few weeks? What if the boss says “hey, anyone who wants overtime, we could use you 60 hours a week for the next month”? Yes, this could happen, and could make up the difference.

Will Mary be asked to – or plan on – working more than 40 hours a week at her new job? Honestly, some people are go-getters who are looking for new and better opportunities, and are willing to come early, stay late, and show their stuff to their bosses and their peers. Others? Just there for the paycheck, and the chair is spinning at closing time.

Mary – and you – could be somewhere in between, though. Everyone likes to make a good impression, but not everyone is at the job to work their way up to VP and the corner office.

The knock on those archaic overtime rules is that employers can take advantage – change the job description, or just use that “other duties as assigned” clause to ensure that they squeeze as much blood from the turnip that they can.

Finally, and this should be totes obvious with the Great Recession in the rear view mirror (but still leaving chemtrails of yuck for many of us), What are the chances her hours could be cut where she is now?

We saw stuff like this during the Great Recession: mandatory, unpaid shutdown. Say goodbye to a week’s pay ($1,000, using the above example). The move from hourly to salary. Even something as nefarious as a change from a 40-hour week to 37.5 hours a week. (That would be huge: 1950 hours in the year, vs. 2080. Drop for Mary from $52,000 to $48,750.)

2. Health Care Costs

Of course you’re prepared to analyze all of the various options being presented to you at the new job. HMO vs. PPO, in-network vs. out-of-network, and how much you’re paying a month to cover yourself (and maybe your dependents). Don’t forget things like co-insurance and co-pays, too.

Charts, graphs, spreadsheets, tables – whip those things up to figure out whether you’re getting a good deal. But don’t forget these things – they may seem little, but they can make a huge (and sometimes crippling) difference between a good offer and one that’s pretty meh.

Flexible Spending Accounts, paying money back, and whether you’ve hit the deductible. Things happen. People get hurt. Kids get sick. Guys break their pinky toe on the door jamb getting contact lens solution out of the closet in early February.

If your FSA has been blown through and it’s in the first half of the year, you will probably have to pay that back. Ugh. If you’ve blown through the deductible, you’ll need to ask the new employer how THAT gets handled when you switch plans and coverage. Another Ugh.

Eligibility at the new employer, and whether you’re stuck paying for COBRA. What if the new place wants you really badly, but they don’t want you badly enough to make you immediately eligible for the health plan instead of having a 30-day waiting period. (Because that would take an act of God, or at least a bunch of papers that would need to go to the company’s board.) Well, you’ve got to be covered, so you’ll have to pay for COBRA.

In my 20+ years in Corporate America – including a half-dozen working in the insurance industry – I’ve never once heard someone say “wow, COBRA is a really good deal!”

3. Retirement

I should probably have made this first on the list, and not third. But, let’s face it, most people think about the here and now as opposed to the later (or, if you’re young, much later).

Whether or not you think Social Security will be there for you (I’m sorta in the middle on that one – but were I in my early 20s vs. my late 30s (ahem), I would have a much different opinion), you will need to be prepared to manage most of your own retirement. Here are some considerations that might be huge down the road.

Is there a 401(k) match, and how big is it? Someone sent me to the web page of a company that they were looking to join. Immediate eligibility for the retirement program (this was a 403(b) instead of a 401(k), since it was a not-for-profit employer) and a 200% match. You had to put in 5% of your pay, and the company threw in another 10%. (There was a vesting cliff, so you had to wait three years to be vested in the plan, but, even if you darted for another employer after a year, you’d get one-third of the employer match, meaning you’re getting another 3.33% of your pay tacked on.) This is an insanely generous match.

Most employers aren’t THAT generous, and you may have to wait a little while to be eligible. But the old adage is that “IT’S FREE MONEY.” Thus, don’t ignore it.

The math behind a retirement match can be staggering – even at the pay grade of someone like Mary, above – and you can play around with numbers by using this handy calculator over at Bankrate’s website.

Pensions are dinosaurs, but they do still exist. Don’t believe it? Here’s a story that ran in the Washington Post last fall.

I worked long enough at one employer to be eligible for one; my wife also clocked in enough time at an employer to be eligible, too. It’s not a crazy amount of money we’ll get when we’re of retirement age, but it’s nothing to sneeze at, either.

The quick rule of thumb – and I’m not an actuary, but I did work with a few in my day – is that pensions will pay you annually around 1% of your pay for each year that you work. Let’s use Mary’s job offer from the above example, and plan on her putting in the five years that are normal for vesting.

  • Average Salary: $63,680 (assuming 3% salary increase each year) x
  • Number of years worked (5) multiplied by 1% =
  • $3,184 annually upon retirement

Again, this is a VERY ROUGH calculation – you’ll need to look at the plan specifics to make sure that this is accurate for your situation. And of course you need to be mindful of whether or not you plan on spending five years at an employer to take advantage. (I’ve watched acquaintances go through sheer Hell for the last year of a five-year stint, just to get to the point where they have extra retirement income.)

What’s beautiful about a pension: the employer does all the work (so if the market crashes, it’s their problem, not yours), and there is a government insurance program, the PBGC, that US employers are required to buy into. So if the plan becomes insolvent, you’ll get some/most/maybe all of what’s coming your way.

Do the math…

Okay, there’s a lot here, folks. We’ve focused on three aspects that some people might ignore – but they’re important, maybe even vital.

There’s more to that job offer than just a few extra dollars.

The Book We Wrote – Free for a Limited Time

A couple years back, in 2013, Dave wrote a book – and we believe it’s still relevant.

How to Find an Extra $10,000: A Stealth Guide to More Money, Better Health, and Living the Lifestyle You’ve Imagined was penned based (loosely) on our sister site, There, our goal was to help readers put away an extra $10,000. Seriously: it’s not supposed to be easy, but you can put actual money in your pocket by navigating through the existing financial minefields with a little savvy and a lot of pluck.

Here’s a link to the book: How to Find… – and, from Friday, June 12 through Tuesday, June 16, the book is FREE. (NOT “Free, just pay shipping and handling.” NOT “Free, but you have to buy something later.” And so on, and so forth.)

We hope you’ll check it out.

How to find $10,000

The Metafinance Show – Interview with Cynthia Drake

CynthiaAnother treat – we’re three-for-three with these interviews – this time we sat down with Cynthia Drake, author (and Mom) and someone who knows all about traveling on a budget. In fact, she knows so much about it, she wrote the book on Budget Travel.

Here’s a link to Cynthia’s book: Budget Travel for the Genius.

Some of what you’ll hear in this interview:

And you’ll see just how passionate she is about this subject!

The Metafinance Show – Interview with Cynthia Drake

Here’s the interview!

The Metafinance Show – Interview with Jamelle Sanders

Metafinance Jamelle This edition of The Metafinance Show was a real treat for me – the first time I had a chance to talk live with Jamelle Sanders. He’s someone I’ve known for a few years – of course we met through social media – and he’s always struck me as one of the most positive people you’ll ever meet.

(He has to be positive – he’s a coach!)

SIDEBAR: Jamelle has written a few books, and here’s an AFFILIATE LINK to the his latest, available on Amazon. It’s called Chosen and it looks at leadership in the 21st Century.

I wanted to find out what makes Jamelle tick, and also understand what drives him as an entrepreneur. We also get into the difference between passion and drive – and we learn the number one word in his mind (hint: starts with a “P”) that entrepreneurs need to have to give them a chance at success.

The Metafinance Show – Interview with Jamelle Sanders

Clocking in at just over 16 minutes, Jamelle touches on what makes him tick, and what qualities he looks for in entrepreneurs. We also learn about those degrees on his wall – and what has prepared him for his entrepreneurial journey.

I hope you enjoy this interview.

The Metafinance Show – Interview with Paul Hemphill

MF interviewWe recently sat down via Google Hangout with Paul Hemphill, college admissions and financial aid consultant. We’ve known Paul for several years – going back to Dave’s days running a startup in college admissions called U Sphere – and we think you’ll like his engaging style.

The subject of this interview: what the heck is going on with the college search and college debt process? Why the heck are families allowing students to go into crazy amounts of debt – SIX FIGURES! – in order to get what is perceived to be a Top Tier education?

The interview is in two parts – thanks to Dave’s inability to push buttons correctly – but it’s still worth a listen, especially if you:

  • Have a youngster who will be headed to college in a few years
  • Are late to the college planning process
  • Haven’t saved nearly enough money, but are still anxious to make sure you and your child make the right decisions OR
  • Are planning on sending your kid to an Ivy League school come Hell or high water.

There are more Metafinance Show episodes to come, but we’re pretty delighted with this interview.

BTW: Here’s a link to one of Paul’s books, called “Planning for College.”

Paul Hemphill Interview:



Is This Card Worth It?

We’re sharing content here that recently appeared on one of our sister sites,

Credit Card Worth It

In the mail awhile back, I received an “Invitation to Apply” for the American Express Platinum Card. If memory serves, I once had one of these cards – back during my startup days – and used it, but not enough to justify keeping it. So I eventually canceled the card (and, BTW, closed out quite a few other cards, since I’m focusing on credit card use only as a necessity). What caught my eye was the price tag on the annual membership fee, leaving me to ask: Should You Spend $450 on a Credit Card?

ADVERTISEMENT: This post is presented by Prosper. Consolidate your debt with a Prosper Personal Loan.

Now, to the nitty-gritty. And, actually, a few reasons why something like this could be worth it!

It’s not a “credit card.”

That’s point one, and the very first selling point I remember from my very first American Express experience – getting a card in 1989. You have to be disciplined enough to pay the balance in full every single month.

If you don’t have that discipline, the penalties can be steep, up to $38 each month for a late payment. For some of us, that is a deal-breaker. But, if you are committed to paying it off every month…

100,000 Membership Rewards points!

I don’t cover the points space that often – and, if you’re a reader of this blog, you’re likely more focused on getting an edge when it comes to disciplined savings and investing, and the smart spending that comes with that focus on your finances. But, Amex tells us in the letter that points are valued at up to $1,000 in gift cards at select merchants.

Other perks

They list the other perks in the marketing materials:

  • $200 Airline Fee Credit
  • The Centurion Network – their airport lounges, in just a few cities
  • Access to Delta Sky Clubs
  • No foreign transaction fees
  • A fee credit for Global Entry and TSA Pre-check

So, if you travel quite a bit, this may very well be worthwhile.

But, Should you spend $450 on a credit card?

That is a hefty price tag – think of it as five Amazon Prime accounts. Four annual Netflix subscriptions. The equivalent of an average car payment.

I don’t know, gentle reader…if you travel A LOT and are disciplined, and $450 at one fell swoop is not insane…then MAYBE it’s worth it.

But, for me…I’ll pass.

(Finally, another word from our sponsor – here’s more about Prosper, if you click the banner below.)

Prosper Personal Loan

Don’t Fall For It…

The intersection of Facebook, Mortgages, and Celebrity Endorsements might fool SOME people. But not you…

Here’s the “It” I’m talking about. Screen shot from Facebook.

Barbara Corcoran

No. Let’s talk about what’s wrong with this.

First of all, it’s HARP they’re talking about

I clicked through the link – so you don’t have to – and Barbara Corcoran (from Shark Tank and NY Real Estate fame) doesn’t care whether or not you sign up for the government’s Home Affordability program, known as “HARP.” (Home Affordable Refinance Program.) (THIS LINK, not one with “dot-org,” is the one to check out for official government info.)

Second, she’s not endorsing it

We were nice enough to link to Barbara’s web page, but the people at the above-referenced site (who don’t deserve a link) only say at the bottom that “no endorsement is implied.” How lovely.

Third, it’s not a “Brilliant” tip

Refinancing is not brilliant. In fact, it may not even make SENSE. (Like, if you’re paying 4% on a 30-year mortgage, but you’ve had the mortgage for 7 years and you’re up-to-date on it anyway. Really – are you interested in starting the clock OVER? With a new 30-year mortgage, having paid seven years of it off, you’re, in effect, looking at a 37-year mortgage.)

They’re marketing to you like you’re a child – don’t fall for it.