The following is a post from the guys over at PocketSmith, who developed a web-based calendar that forecasts your future cash position and who also invest 5% of subscriptions in micro-lending to entrepreneurs from poverty-stricken countries.

Create a simple and delicious financial plan for the coming 6 months, filled with good decisions and a satisfying payoff at the end.

Cook time: 10 minutes

Level: Easy

Yield: Clairvoyance

Ingredients
- 1 free PocketSmith account

- Today’s bank balance

- 1 estimated recurring income

- 3 estimated recurring expenses

Recipe
Few would admit to enjoy budgeting. It tends to takes ages, is dry and dreary, and upkeep is a bother. But what if we told you that you budgeting could actually be compelling – if not fun – and that you could get your own budget up and running within minutes?

This personal finance recipe is the first in a series that shows you how to use PocketSmith to budget with the features available on the Free plan. PocketSmith is a free tool that lets you generate a financial forecast – meaning, it helps you see how much you’re predicted to have in your bank account in the future. Furthermore, it uses a calendar, which helps makes those numbers meaningful and easy to work with.

In 10 minutes, you will find out:

• How much you’ll have in your bank account by Christmas and beyond
• How small changes in your budget affects future outcomes

Let’s get started. First, you’ll need to create a free account at PocketSmith.com. When you’re done, we can begin. Feel free to either substitute the numbers and events below with your own, or just go follow the steps to get an idea as to how the recipe works. You can always start over with your own forecast later.

1. Take a look at today’s balance from your bank account and put it into the textbox that says ‘Enter amount here’, e.g. 5000. This starts you off with a running balance of $5000 from today onwards.

The running balance is indicated at the bottom of each day. In the graph above, you’ll also see a jump from $0 to $5000. This means that if you didn’t do anything with your money, you would continue to have $5000 remaining in your account for the next six months. But we know that’s not likely to happen, as you have recurring financial events that will change this.

2. PocketSmith has a few events prepared earlier to help you get started populating your Forecast Calendar. This recipe assumes you get paid $1200 as a salary every fortnight on a Tuesday.

Move your mouse over the Salary event until it turns orange, then click on the arrow icon and drag it onto a Tuesday. You’ll see that the event repeats automatically, changing the running balance as it occurs. You can move the event around the calendar by the same dragging motion. You can also edit events simply by clicking on the event title, which will bring up a window with a range of editable options such as title, value and repeat types.

Now you would have noticed that the graph has changed as well. If you hover your mouse over the graph, you’ll see the numbers increase as you move towards the future. It’s August at time of writing, and PocketSmith estimates that you’ll have $18,200 in your bank by February next year! Of course, we have yet to include your expenses.

3. Do the same with the recommended expense events. Drag ‘Groceries’ and ‘Entertainment’ onto a Monday, and ‘Utilities’ onto the 21st. These examples have also been pre-loaded with different repeat types (weekly and monthly), but these can be changed. Note again how each new event changes the running balance.

Now you’ve effectively cooked up a forecast with PocketSmith. You’re budgeting in broad strokes to get a good idea as to where you’re headed financially. From the end of August, your forecast tells you that you’ll have $8400 at the start of November and $9700 by Christmas! Now, you just need to stick to the plan.
You can still reset your running balance at any point if you experience a change in fortunes – just click on a balance on any day and put in a new value. You can also clear all my events and start again from the Preferences area.

Look around other areas such as the Forecast Graphs and Cashflow Statement to see what your financials look like in graph and statement form. Next time, we’ll show you how to use PocketSmith as the key ingredient to finding easily out where your money is going. It’ll take 5 minutes!

Did you like this personal finance recipe, and what would you like to see in others? Let us know in the comments!

Photos from Shutterstock

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iTunes U – I am a huge Apple nerd, so finding out I could download courses onto my iPhone was pretty cool. iTunes U is a part of the iTunes Store featuring free lectures, language lessons, audiobooks, and more, that you can enjoy on your iPod, iPhone, Mac or PC. Explore over 200,000 educational audio and video files from top universities, museums and public media organizations from around the world. With iTunes U, there’s no end to what or where you can learn.

MIT OpenCourseWare – MIT publishes pretty much all their class materials on the internet for you to dig into. MIT OpenCourseWare is a free publication of MIT course materials that reflects almost all the undergraduate and graduate subjects taught at MIT. How sweet is that?

Creative Commons Learn – Those of us who use a lot of images online know all about Creative Commons, but I had no idea they also had courses available as well! ccLearn is a division of Creative Commons dedicated to realizing the full potential of the internet to support open learning and open educational resources. Their mission is to minimize legal, technical, and social barriers to sharing and reuse of educational materials.

Open University – Talk about tons of random classes! The OpenLearn website gives free access to Open University course materials. This is the LearningSpace, where you’ll find hundreds of free study units, each with a discussion forum. Study independently at your own pace or join a group and use the free learning tools to work with others.

UC Berkeley Webcasts/Courses – Hey look, you can take courses at Berkeley without being around all those liberals! (Kidding, I am one, so no offense). Every semester, UC Berkeley webcasts select courses and events for on-demand viewing via the Internet. webcast.berkeley course lectures are provided as a study resource for students and are not sanctioned as a substitute for going to the course lectures. Of course, you don’t have to go to watch them!

Online Education Database – From the site: “A high quality education doesn’t have to come at a high cost. In fact, it’s possible to take classes from big names like Yale, MIT, and Tufts without ever submitting an application or paying a cent in tuition. We’ve compiled 200 online classes from these and other respected institutions, and you can take all of them with no strings attached.”

Do you ever take classes online? If so, where? After the holidays are past, I plan on taking as many online classes as I can in several different subjects, so please share if you have any personal favorites!

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A record number of shoppers, shut off from credit and short on cash, are relying on Kmart’s layaway program to pay for all of their kids’ school needs, said Tom Aiello, a spokesman for Kmart’s parent Sears Holdings Corp. Layaway allows shoppers to pay over time, interest- free, and pick up their merchandise when it’s paid in full.

Although I would rather see layaway used for purchases than see people pile up crazy debt on credit cards, I do find it sad that school supplies are not available to those who cannot afford them. After all, this is education we are talking about – and seeing families struggle to buy paper and pencils just isn’t right.

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EverFi offers a five-hour series of Web tutorials that let students explore real-world settings, from the floor of the New York Stock Exchange to a used-car dealership, while absorbing lessons about saving money, earning interest and managing debt. As students acquire new skills, the software encourages them to play a SimCity-style game in which they control characters’ spending habits, reaping the rewards of good choices and suffering the consequences of bad ones.

I think it’s about time that someone start teaching young people about personal finance, and maybe doing it this way will work. My parents did not teach me much, and as soon as I got to college I started racking up credit card debt that took me years and years to pay off. Some of the topics the curriculum discusses includes:

• * Savings & Compounding Interest: 401Ks and IRAs
• * Understanding a Credit Score and its Implications
• * Understanding Credit Cards and Managing Debt
• * How a Bank Works
• * Taxes
• * Insurance
• * Renting vs. Owning
• * Managing Loans
• * Investing Overview: An In Depth Review of Trading and How the Stock Exchange Works
• * How the Federal Reserve Works
• * Consumer Fraud and Protection

So kudos to EverFi and I hope they get the funding they need to take this program to more and more Generation Y students. I bet most of them could use any help they could get!

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• More than 50 percent say they talk about the economy with their friends.
• 53 percent of teens surveyed say they’re choosing activities that cost less money.
• Nearly three-in-ten teens (29 percent) said that the economy is causing them anxiety.
• One-third of all teens report less job availability.
• More than three-quarters (77 percent) of the teens polled say that their parents are talking about the economy more than they used to.
• Nearly half (49 percent) said their parents had discussed family finances with them as a result of the economy.

Since the state of the economy is on their minds, now is the perfect time for parents to seize the opportunity to talk to their children about money management. Sometimes broaching the topic of financial literacy is easier said than done, especially if you yourself are a little unsure of the basics of personal finance. With that in mind, Junior Achievement created a new series of free, downloadable teaching tools to help parents talk to their children about smart money management. The lessons, called Junior Achievement $ave, USA, are posted at www.ja.org, and cover such topics as budgeting, the importance of saving, understanding the cost of credit and how to use it, and planning how to pay for college. The lessons are sponsored by The Allstate Foundation and can serve as a great learning tool for children, teens and parents.

There’s no better time than the present to talk to your kids about personal finance. See what they’re learning in school, what they already know. They may surprise you. Once you open that dialogue with them and take away the taboo of talking about money, your whole family can benefit from a financial education.

Guest post from John M. Box, Ph.D., Senior Vice President of Education, JA Worldwide. Junior Achievement is the world’s largest organization dedicated to inspiring and preparing young people to succeed in a global economy. Through a dedicated volunteer network, Junior Achievement provides in-school and after-school programs for students which focus on three key content areas: work readiness, entrepreneurship, and financial literacy. Today, 137 individual area operations reach more than four million students in the United States, with an additional five million students served by operations in 123 other countries worldwide. For more information, visit www.ja.org.

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Unfortunately our children may end up sinking in our same boat. Even if they go to college, the personal finance education they will receive will be slim to none. While in college, our children are finding themselves more in debt than any past generations. Think about some of the financial statistics for our youth:

• 76% of undergraduate students have credit cards, while carrying a balance of over $2000, according to Nellie Mae. 28% percent of students roll over their debt each month.
• College graduates are finding that they are over $20,000 in debt, according to Creditcards.com.
• Charles Schwab reported in a 2007 survey that 45% of teens have credit cards but only 26% know how to understand how their fees and interest payments.

Whether we are looking at Generation Y, Echo Boomers, Millenials or any of the other names given to those born after 1982, it is important to understand that they have been raised to expect immediate gratification. Sixty Minutes did a recent feature discussing how companies are even bending over backwards to meet the demands of this high-expectation generation.

If everybody is bending over backward to meet their needs, what is going to happen when they have to be financially responsible for themselves? Why aren’t we bending over backwards to help them learn to be financially independent? We have seen that past generations (their parents) have been poorly educated and are apparently in no position to teach them. If it is not to be taught by parents who are uneducated themselves, where will they get this knowledge?

Currently many colleges and universities are rethinking their position in including personal finance education. Unfortunately these classes are mostly electives or only required by business majors. It costs upward of $6000/year average to pay for a child’s college tuition. What are they getting out of that to prepare them for their adult life?

What can be done?

• Colleges can create more course offerings to include personal finance education. Within the courses, texts need to be appropriate for all majors. Many colleges offer texts for these courses that are math-intensive, which can turn off the student who is not a math genius.
• As parents we can help our children by sharing our mistakes and explaining what we ourselves have learned in the process.
• K-12 Guidelines can be updated to include more specifics as to amount of “time” devoted to the financial literacy information our schools are supposed to be teaching.
• Personal finance books for younger students could be created in a story-telling format that would allow for them to relate the importance of what they are learning to their own lives.

If future generations are not taught to become financially responsible, who is going to bail them out? Are we going to have to just keep relying on the government to come to the rescue? It certainly isn’t going to be their parents, as they have lost their retirement nest eggs. In fact, their parents may be looking at this generation to take care of them.

Guest post by Diane Hamilton, who has a BS, MA and Ph.D. in Business Management. Her experience includes working in several industries including pharmaceuticals, banking and real estate. She has trained corporations in areas such as time management, emotional intelligence and Myers Briggs. She currently works as an online professor, working for 5 different universities. She teaches mostly business-related courses to bachelor, master and doctoral level students as well as mentors doctoral learners. She is in the process of writing a personal finance book for the young adult. Diane can be reached through www.drdianehamilton.com

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Faced with mounting unpaid lunch charges in the economic downturn, Albuquerque Public Schools last month instituted a “cheese sandwich policy,” serving the alternative meals to children whose parents fail to pick up their lunch tab.

Such policies have become a necessity for schools seeking to keep budgets in the black while ensuring children don’t go hungry. School districts including those in Chula Vista, Calif., Hillsborough County, Fla., and Lynnwood, Wash., have also taken to serving cheese sandwiches to lunch debtors.

Critics argue the cold meals are a form of punishment for children whose parents can’t afford to pay.

“We’ve heard stories from moms coming in saying their child was pulled out of the lunch line and given a cheese sandwich,” said Nancy Pope, director of the New Mexico Collaborative to End Hunger. “One woman said her daughter never wants to go back to school.”

Some Albuquerque parents have tearfully pleaded with school board members to stop singling out their children because they’re poor, while others have flooded talk radio shows thanking the district for imposing a policy that commands parental responsibility.

In Albuquerque, unpaid lunch charges hovered around $55,000 in 2006, $130,000 at the end of the 2007-08 school year, and $140,000 through the first five months of this school year. So…Is the school system right? Wrong? What do you think should be done?

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Here are the last two questions that were answered here on My Two Dollars, with another coming up on Tuesday:

Should We Buy A New Or Used Car In This Economy?

Move Retirement Account Or Stay Where I Am?

And here are a few important points about the “Ask The M-Network” program:

• Our answers are opinions not professional financial advice – Please remember that we are personal finance bloggers and not finance professionals. Our answers should not be considered professional advice and we assume no responsibility of any kind. Please consult a certified financial expert as needed.
• Not all questions will be answered – We will only answer selected questions. If your question is answered, you’ll also be notified via email with a link to our responses.
• Questions will be answered publicly – The questions and answers are considered property of the M-Network. Once published, you cannot ask us to remove the question. Please note, we retain the right to reuse the questions and answers any way we choose.
• Your identity is safe – Please note that we will not publish your full name or email; we will refer to you by your first name or any name that you give us.

There is a banner over to the right that will be on every page of My Two Dollars that you can click on at any time to be brought back to this post with the details. I hope you guys take advantage and ask away, and I will do my best to take care of all of your questions. Here is my contact form for when you have a question. I look forward to hearing from you!

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Don’t fail to list all household members on the application. This includes step children and even unborn babies – anyone who can be claimed as a dependent.

Be sure to report the tax you had withheld, not the amount you owe. These numbers should be different.

Don’t overstate your wealth. You’re required to list assets as of the date you sign the FAFSA, not the end of the tax year.

So for you parents out there looking to get your fair share of the free federal student aid money, you really should check out this entire article for the other 9 tips. You never know what you may be missing out on when filling out your forms!

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If you have seen her on television and have always wanted to see what Suze Orman was all about, this is your chance to do it for free! Right now until 11:59 p.m. CT on Thursday, January 15, her newest book “Suze Orman’s 2009 Action Plan” is available as a free PDF download over at Oprah.com. I have read several of her books in the past (have not read this one yet), and while I don’t agree with everything that she says, most of her advice is spot-on. I imagine this book will be more of the same, and if you are looking for a new plan in 2009, you might want to give this download a shot. Enjoy!

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