Beating Broke

Personal Finance from the Broke Perspective

The Pros and Cons of Working in the Auto Industry

By Leave a Comment

If you’re considering a career in the auto industry, you might wonder what working as a mechanic would be like. If you like cars and enjoy working with them, it may be the right career for you. Before you decide on an auto mechanic career, consider these pros and cons:

Fix Your Own Car

You may be offered a discount on auto parts for your own car. For example, a small auto part like a tire pressure gauge typically costs between $5 to $15. This amount may seem small, but several car parts can add a significant advantage as time passes. This can be a significant boost for your finances.

 No College Needed

Working as an auto mechanic doesn’t require a college education. You only need a love for cars and a willingness to learn. You may be fortunate enough to attend a vocational school where you’ll receive training and experience. If not, you can find a shop willing to train you once you graduate high school.

Fast-Paced Days

The volume of work at a typical mechanic’s business will ensure you won’t be bored. Each car will require your effort and concentration. Some auto jobs may take up to two hours to complete. You’ll be busy doing what you love for the whole day.

Job Stability

As long as there are cars, auto mechanics will always be needed. For example, NerdWallet estimates a car should have its oil changed at least every 5,000 to 7,500 miles. A job as an auto mechanic will give you job security and a wide range of garages where you could work. If you ever relocate, you should easily find a new job.

Of course, with any job, there are some cons. Check them out below.

Noisy Environment

A typical mechanics’ shop can seem very noisy to the uninitiated. There are drills, fans, hydraulic lifts, and many metal parts. You may be one of the lucky ones who find a noisy environment doesn’t bother you. If not, you’ll need to invest in good earplugs.

Safety Risks

Safety risks exist when working with autos and the machines that repair them. Be sure you ask for training if asked to do a task you need to become more familiar with. There’s always a risk when working under a lift or jack. Some auto parts still contain asbestos, and accidental asbestos exposure is possible.

Dirty

When you work in a mechanics’ shop, you must cover your clothes. No matter how carefully you work, you’ll likely get covered by oil, grease, or gasoline. While some auto shops may supply and launder your uniforms, some do not. If your uniforms aren’t provided, that’s an expense you’ll need to assume.

Strenuous Work

Working on a car is a challenge. Some tasks take less effort than others, but most are strenuous. You’ll use power tools, move tires, and handle large auto parts. The difficulty will depend on the tasks you’ll do during the day.

Stressful Job

In addition to the hard work and the dirt, a job as an auto mechanic can be stressful. A mechanic’s shop is open for extended hours and weekends, and you may be asked to work long hours. A recent survey of auto shop workers reported 20% of them spend five working hours each week thinking about how stressful their jobs are.

Before becoming an auto mechanic, consider these pros and cons. Also, ask a garage manager if you can visit their shop before working there. If you love cars, the pros will likely outweigh the job’s cons. Remember to do your research and

Why I Prefer to Pay with a Credit Card

By Leave a Comment

Two credit cards sitting on a table

I’ve been interested in personal finance, budgeting, and money management for at least 25 years. During that time, I have repeatedly seen the advice to pay cash to best manage your money. Proponents argue that paying cash limits spending and makes you feel pain, so you won’t want to spend as freely. However, I prefer to pay with a credit card. I’ve tried paying with cash, and I find it a hassle.

Why I Prefer to Pay with a Credit Card

There are several reasons why I prefer to pay with a credit card.

Keep Track of Spending

When I pay with a credit card, I can keep track of my spending. Whenever I pay with cash, I forget what I bought and have no record unless I got a receipt and saved that. With my credit card, I can go to the credit card statement and see what I spent where.

Convenience

Paying with a credit card is more convenient. When I experimented with using cash, two things often happened. First, I would forget my cash, get to the store, and realize I had no money. I’d have to drive back home to get my cash. Second, if I went to a gas station, I didn’t feel comfortable leaving my young children in the car alone while I paid. I would have to get them out of the car to pay the cashier in the store. What a pain! Swiping a credit card at the pump was easier and safer.

Accumulate Rewards

I always use credit cards that have rewards programs. We pay them off at least every month, sometimes weekly. Because we use the cards responsibly, we aren’t stuck paying interest fees.

When we lived in Arizona, I used the credit card rewards to pay for our trips back home to Michigan. I would save rewards for a year or two until we had enough money to finance our trip. Now, my husband and I have moved closer to family, so we are using the rewards to plan international travel.

Extended Warranties

Many credit cards offer extended warranties. For instance, we recently bought a laptop and a new dryer. We charged both purchases on our American Express card because American Express offers extended warranties, saving us money from purchasing additional protection.

Rental Car Insurance

Another perk of paying with a credit card is that some cards offer car insurance for rental cars. Rental car insurance can run several hundred dollars, so this is a considerable saving. However, ensure you know what card offers this service and use that car to pay for your rental.

Protected from Theft

Thief dressed in black with a black mask holding a stack of money

If you carry cash and lose your money or it’s stolen, you’re out of luck. That money is gone. However, if you use a credit card and someone fraudulently charges something, the credit card company will erase that charge. You are not responsible. That alone is an excellent reason to pay with credit cards rather than cash.

Maintains Credit Score

A sound credit card is essential for low car loans and mortgage interest rates. In addition, a good credit score can save you money on your car insurance and help you rent an apartment.

When you use a credit card regularly and pay it off, you help build or maintain your credit score. Cash cannot do that.

Two Drawbacks to Paying with a Credit Card

Of course, there are two drawbacks to using a credit card for most of your spending.

Credit Cards Get Stolen

I have never had it physically stolen in the more than 25 years I’ve used credit cards. However, I have had people make, or try to make, fraudulent charges at least four times. Each time, the credit card company caught the fraud, often before the purchase went through. However, the company then had to cancel my card and issue a new one, which was inconvenient. I could not use my credit card for a few days while waiting for the new one, and I had to change all my autopayments that used that particular credit card. Even worse, if I forgot to change all of them, some companies billed me a $20 missed payment charge since the credit card was no longer valid.

More recently, I had a scammer steal my credit card rewards points, but the credit card company refunded them for me when I noticed.

You May Overspend

If you are not disciplined and lack a budget system, you may overspend when using credit cards. When I was in my 20s, a friend said she thought of credit cards as “free money.” Unfortunately, many think this way and mindlessly spend more when using credit cards instead of cash.

How I Handle Credit Cards in the Budget

To avoid overspending, I use my credit card only for purchases I had already budgeted for. For instance, we use You Need a Budget (YNAB), and I have a separate category for dining out. So if I only have $20 in the dining out fund, and the family wants to go out to eat, we don’t at that time because there’s not enough money in the dining out category. So, by utilizing my budget in this way, I can avoid overspending on my credit card.

Likewise, this year we needed to buy a new dryer. When ours stopped working last week, I charged it with no qualms because I had enough money in my home maintenance fund to cover the purchase.

Final Thoughts

Choosing to pay cash or use a credit card is a personal decision. I prefer to pay with a credit card because it helps me monitor my spending easier than using cash. Because I combine my credit card usage with my budgeting, I rarely overspend on my credit card. In addition, we pay off our credit card each month (or earlier), so we do not have to pay interest fees. If you currently have a credit card balance, paying with cash until your credit card is paid off may make more sense.

Read More

Why You Need a Budget If You’re Broke

How YNAB Changed Our Finances

Make Improving Your Finances Your Part-Time Job

Why You Should Save Money for Retirement Early Regardless of How Much You Make

By Leave a Comment

Your personal finance can have a big impact on your quality of life, as well as that of your family. This is why it’s a good idea to make sure that it’s in the best possible state and to take measures to improve it when you find that it isn’t. One of these measures is saving money for retirement. Outlined below are some reasons why you ought to save money for retirement early, no matter how much you make.

You May Need Urgent Health Care

Every one knows too well that health care can be extremely expensive. This is one of the reasons why it’s a good idea to start saving for retirement as early as possible. Note that slips and falls, according to the National Floor Safety Institute, are the main cause of compensation claims by workers. They’re also the main cause of occupational injury for people who are 55 years and older.

As you grow older, you may be at a higher risk of developing complications from a slip and fall accident. This and other types of health care may cost you a tidy sum, so it’s best to be prepared for such possibilities. Doing this can make your retirement years a bit more relaxed and enjoyable as you’ll be able to maintain good health.

You Might Lose Your Job When You Least Expect

It’s important for you to understand that, as times change, your job security may not hold as much. This makes it a good idea for you to save as much as you can while you still can, otherwise, it will be hard for you if you suddenly lose your job. It will be considerably harder for you to find ways to find a job and make money when you get older. You may be working as a mechanic and feel as though you’ll always have a steady stream of clients.

In this case, you may be aware of the fact that a driveshaft, according to Your Mechanic, doesn’t have a specific lifespan. All the same, it’s a good idea to change it every 75,000 miles. This and other bits of relevant information may change over time, and unless you make sure to keep your knowledge relevant to the current times, you may soon become obsolete. This is why you have to make sure that you have a backup in terms of savings.

Insurance May Not Provide Adequate Coverage

Another reason why you may be better off saving while you can is that insurance may not offer you adequate medical coverage when you need it. This is especially the case for things like oral health and optical care. You could become one of the approximately 50% to 75% of people who stand to benefit from orthodontic treatment.

You never know if you may require a procedure that falls just outside of your insurance coverage and have to pay for it out of pocket. The same goes for your car, your home, and other assets that you have insurance coverage for. Make sure that you can take care of all of these things even when insurance isn’t an option. A sudden disaster or other issues could leave you in need of immediate money. It’s always good if you can deal with financial issues as they come up without having to rely on third parties and distant sources.

These reasons should clearly show you the importance of personal finance and encourage you to save as much as you can. This can make life easier for you and your family in your twilight years.