T-Mobile Money offer 4% interest

T-Mobile Money

T-mobile, one of the cell phone carriers officially launched a new banking service known as T-Mobile Money.  The best part is T-mobile money offers 4% interest to customers with qualifying service. T-Mobile Money is an attractive saving option when major banks pay between 0.01% to 0.03% interest (as of 4/19/2019).

What is the qualifying service?

Another thing that I love about T-Mobile Money is their transparency on this service.  As you can see on the front page of their website (https://www.t-mobilemoney.com), they clearly write to qualify for the 4% interest, you need to meet the following criteria:

  1. You can only earn 4% up to $3,000 if you are a T-mobile customer.
  2. Deposit at least $200 per calendar month.
  3. Earn 1% if you’re not a T-mobile customer, and for any money that is over $3,000 limit.
Find ATMs using T-Mobile Money App from your phone
T-Mobile Mobile App

Where can I find the ATMs?

You can easily withdraw your money from any Allpoints® ATMs worldwide.  They have over 55,000 no-fee ATMs worldwide.

In the US, you can usually find those ATMs at Walgreens and CVS stores.  For more ATMs locations, you can use their mobile app which is available on Android and iPhone, or from their website.

Who is this good for?

This service is certainly best if you are already using T-mobile as your phone carrier or thinking about switching to T-mobile service.

Even though, your bank account is insured by FDIC, just like any other major banks.  You need to be comfortable using a T-mobile Money phone app and ATMs to interacts with your money.  You can surely speak to their representative over the phone, but don’t expect a face-to-face interaction with the support team or bank tellers.

If you’re not a T-mobile customer already, there are other banks that offer high yields interest.  I will post my review on that bank very soon.

Join my mailing list to get more updates and start your path to financial independence today.


ACC Tax? Yes or No

Analysis on ACC Tax

ACC Tax!  WHAT ?!! More tax ?!

That’s my first reaction when I heard about ACC annexation.  For those of you who don’t live around Austin, TX area, ACC is a local community college in Austin, TX.

ACC serves 19 different school districts around Austin, TX.  Unfortunately, only 8 school districts get the privilege to pay “in-district” tuition.  According to ACC’s website, part of Pflugerville (read: flu-ger-ville) is already part of ACC district and qualify for “in-district” tuition.  However, the majority part of Pflugerville is not part of ACC district.

WHAT !!!  (yup… I like to say “what”)

That’s crazy!  Pflugerville and Austin are next to each other.  Pflugerville residents must pay out-of-district tuition to attend ACC; even though I can reach 2 different campuses within 20 minutes from Pflugerville, TX.

How does ACC get funding?

After further investigation, I found out ACC (Austin Community College) receive their funding from property taxes and student tuitions.  Unlike other four year colleges or universities, a community college does not receive state funding assistance.

Alright, I start to feel sorry for ACC for not receiving any state funding.  It’s like the only child in the family who don’t get a present at Christmas. Right?!

The cost of ACC tax

But, I still don’t like the idea that it cost me money.  How much is it exactly?

Based on my current residential tax breakdown (it varies depending on where you live), I’m currently paying taxes on 6 different categories with a total tax rate of 2.656285 per $100 value.

ACC annexation adds $0.1008 per $100.

According to Zillow, the median home value in Pflugerville is $244,000.  So, I will use this number to show how much ACC tax is going to impact your overall residential tax.

DescriptionTax Rate per $100 Tax for a $244,000 value house
Travis County0.369000$900.36
Pflugerville ISD1.540000$3,757.60
Travis Central Health0.107385$262.02
City of Pflugerville0.539900$1,317.36
Travis County ESD #20.100000$244.00
Travis County MUD #150.407500$994.30
Total before ACC3.063785 $7,475.64
ACC0.100800$245.95
Total w/ ACC3.164585 $7,721.59

In the end, a $244,000 house will pay an additional $245.95 per year or $20.5 per month.

I believe most of us have spent at least $20 for something to treat ourselves in a month, or buying some that we don’t even need or use.

ACC student saves $16,680 in 2 years

The obvious benefit for being part of ACC district is to pay the in-district tuition of $85/credit instead of $363/hour.  That is a $278 saving per credit hour.

ACC In-District tuition Vs ACC Out-of-District tuition

If I’m not mistaken, I took approximately 60 credit hours (2 years) in a community college in San Diego, CA before I transferred to UT-Austin.  That is a $16,680 savings for taking 60 credit hours in ACC per student.

The Unfavorable Scenarios

Let’s create a hypothetical scenario with some unfavorable situations.

I want to see if $16,680 is really a worthy scenario for someone who might attend ACC 20 years later.

A newlywed couple with one child

A newlywed couple, the Joneses, purchased a house for $244,000 in Pflugerville, TX.  Let’s assume the house appreciates at 4% per year. Please note with 4% appreciation per year; it will double the value of your property in 19 years, and increase your property tax tremendously.

Since we are creating unfavorable situations, let’s assume ACC tax has been approved.  Therefore, the Joneses have to pay ACC fees of 0.1008 per $100 of house value.

The Joneses don’t have any child at this moment.  They will send their only child to ACC in 20 years, but unfortunately, they are paying the ACC tax starting from the day they purchased their house.

After twenty years of paying ACC Tax

Based on the table below (ACC tax breakdown), after 19 years, this couple has paid a total of $6,805.79 to ACC.

On the 20th year, their child finishes high school and attends ACC for the first time in the Fall semester.  By this time, in our unfavorable situations, their house worth $514,071.20.  Their regular tax at 3.06 per $100 of property value is $15,730 per year, and an addition $518.18 toward ACC tax.

If the child takes 15 credits at ACC, then the family is saving $4,170 ($278 savings x 15 credit = $4,170) from paying in-district tuition instead of the out-of-district tuition.  However, the Joneses still lost $3,153.98 from paying taxes for the last 20 years.

The following year,  their son completed 30 additional credit hours at ACC (see year 21 in the table below).  Now, the Joneses saves $4,647.11 from the overall tuition saving vs tax.

The chart and table below details the money that the Joneses spent for paying taxes and saving from the in-district tuition.

Chart of benefit after paying ACC tax for 20 years VS. 2 years of education for 1 student
You can see the savings even after paying ACC tax for 20 years

ACC tax breakdown over 25 years

YearHome value with 4% increase / yearACC TaxCummulative ACC TaxSaving from In-District tuitionTotal
1 $244,000.00 $245.95 $(245.95) $- $(245.95)
2 $253,760.00 $255.79 $(501.74) $- $(501.74)
3 $263,910.40 $266.02 $(767.76) $- $(767.76)
4 $274,466.82 $276.66 $(1,044.43) $- $(1,044.43)
5 $285,445.49 $287.73 $(1,332.16) $- $(1,332.16)
6 $296,863.31 $299.24 $(1,631.39) $- $(1,631.39)
7 $308,737.84 $311.21 $(1,942.60) $- $(1,942.60)
8 $321,087.35 $323.66 $(2,266.26) $- $(2,266.26)
9 $333,930.85 $336.60 $(2,602.86) $- $(2,602.86)
10 $347,288.08 $350.07 $(2,952.93) $- $(2,952.93)
11 $361,179.61 $364.07 $(3,317.00) $- $(3,317.00)
12 $375,626.79 $378.63 $(3,695.63) $- $(3,695.63)
13 $390,651.86 $393.78 $(4,089.40) $- $(4,089.40)
14 $406,277.94 $409.53 $(4,498.93) $- $(4,498.93)
15 $422,529.05 $425.91 $(4,924.84) $- $(4,924.84)
16 $439,430.22 $442.95 $(5,367.79) $- $(5,367.79)
17 $457,007.42 $460.66 $(5,828.45) $- $(5,828.45)
18 $475,287.72 $479.09 $(6,307.54) $- $(6,307.54)
19 $494,299.23 $498.25 $(6,805.79) $- $(6,805.79)
20 $514,071.20 $518.18 $(7,323.98) $4,170.00 $(3,153.98)
21 $534,634.05 $538.91 $(7,862.89) $8,340.00 $4,647.11
22 $556,019.41 $560.47 $(8,423.36) $4,170.00 $8,256.64
23 $578,260.19 $582.89 $(9,006.24) $- $7,673.76
24 $601,390.59 $606.20 $(9,612.44) $- $7,067.56
25 $625,446.22 $630.45 $(10,242.89) $- $6,437.11

I start to believe paying an additional $20 dollars per month for a $16,680 savings in 20 years is not a bad deal.

Assuming that you don’t have a child, you might be able to take advantage of higher education at a later age.  Some companies, such as DELL, have a tuition reimbursement program to help you pursue higher education.

Let’s think about the future

Education cost is getting higher

ased on history, we’ve seen the cost of education is getting higher every year.  Bestvalueschools.com reported the price of higher education has been rising between 4% to 11% every year.

Percent changes in College tuition & fees from 1985 to 2009 (by BestValueSchools.com)

However, no one can predict the future.  It is certainly not easy to predict the future of education or job market 10 or 20 years from now.

The current education system might be obsolete in the next 10 years. Colleges and universities might replace all teachers with an interactive recording of the best teacher in the last decade.

This will certainly cut down the cost of education, right?

Well…. Who knows?  It will certainly cut the cost for a university to host a class, but the university might not pass those savings to the students.

Do you remember a price hike from airlines companies because of the higher gas price?  What happened when the gas price went down?

The price of the airline tickets did NOT go down.

Automation age is coming

If not education, what can the future generation rely on?  minimum wage, maybe?!

I’m afraid by 2030s; we won’t have the opportunity to protest for a high minimum wage anymore.

Why?  Because most of the routine, repetitive, and predictable jobs could easily be replaced by automation. (source: What jobs will still be around in 20 years? Read this to prepare your future)

My final verdict on ACC tax is Yes

Just to be clear, I’m not trying to convince anybody to vote yes on ACC annexation.  This is solely my opinion, and I am sharing my finding with other people that might find this beneficial.

I’m voting Yes to ACC annexation because of the following personal reasons:

  • Saving of $16,680 in education cost for 60 credit at ACC.  I have 3 kids, so I’m hoping to save at least $50,000.
  • ACC plans to offer a Bachelor degree in Registered Nurse.  According to Salary.com The starting salary of a registered nurse is $60,000.  My wife is thinking about pursuing this in the future.
  • Even if my kids and wife decided not to go to ACC.  I still hope that you’re kids, neighbors, or maybe yourself can benefit from a lower cost of higher education.

Your action today will impact the future.  What’s your vote?

 

Special Credits:

Five Questions to Understand Your Money Story

Last week, I shared a money story about a young man who broke out from the common belief that high school kids should work at the fast-food restaurant for their first job, and made $100 per hour doing what he loved, instead of $100 per week from the fast food restaurant. That story has a significant impact on my personal money story.

What is money story?

Money story is how you think, feel, and handle money.

  1. What do you think about money?
    • Do you think money is the root of all evil?
    • Are you always thinking about a college fund for your kids even though you don’t have any kids?
    • Do you believe that you must have a lavish wedding since it is a once in a lifetime moment?
  2. How does money make you feel?
    • Does money make you feel safe?
    • Do you feel money will ruin your relationship with family or friends?
  3. How do you handle money?
    • Do you spend more than what you make?
    • Do you budget?
    • Do you buy on impulse?

Why is it important to understand your money story?

Surprisingly, most people learn about money when they were around 2 or 3 years old, and by age 7, you’ve formed a belief around money based on your observation and what your parent taught you, directly or indirectly. So, most likely you are not even aware of your money story.

However, it is crucial for you to reflect on your feeling, thinking, and habits on money before you can make all the necessary adjustment to improve your financial health.

For example, as a parent, I won’t serve my little girl a bowl of broccoli and expect her to eat them all when she already holds grudges against broccoli. So, I try to understand why she doesn’t want to eat her broccoli? What is she thinking, how does the broccoli make her feel? She might not like the feeling of having too much gas after eating broccoli, or the taste of broccoli. By, understanding her situation, I might be able to come with incentive or a different game plan to help her eat vegetables.

Similarly, by knowing your current belief about money, you can have a plan to overcome those limiting belief and grow your finance.

How do you find your money story?

Here are five questions to help you understand and reflect on your money story.

  1. What did your parent teach/tell you about money?
    • Did you parent talk to you about money when you’re a kid?
    • Did you get an allowance from your parents?
    • Did you parent teach you to save your money?
  2. How does money make you feel?
    • Do you feel like it’s time to throw a party when you get a bonus or tax return?
    • Do you use your money to help a charity or other people?
    • Do you need some saving to feel safe?
  3. Do you believe in spending money on yourself?
    • When was the last time you invest in yourself? (such as education or vacation)
    • How do you prefer to treat yourself? Hang out with friends after work? Spend some me time in a spa? Eat out at nice restaurants on weekends?
  4. Are you able to control money?
    • Do you have any credit card debt?
    • Do you buy everything with cash?
    • Do you have a budget?
  5. What has been the money theme in your life?
    • Has it been mostly negative or positive experience?

Try to write down your story somewhere because next week, we will talk about six strategies that I have learned from various people to change my perspective on money and improve my financial health.

Share your thought

What’s the theme of your money story?  Has it been mostly positive or negative?  If you need help to figure out your money story, feel free to connect with me at our group.

Please share this story with your friends or family that might be able to benefit from this.

What’s your money story?

During one summer break, a father told his son to get a summer job, with the intention that his son learned about hard-work. The boy didn’t know what kind of job he should apply to, and the father quickly suggested a fast-food restaurant. The boy made $100 after one week of hard-work a the burger joint. The father was proud of his son, but the son didn’t enjoy working at a burger joint.
 
One week later, the boy quitted his job. He started printing out flyers to teach tennis lessons for younger kids. He rode his bike and posted those flyers around the neighborhood. Little that he knew, he got 5 clients that paid him $20/hour for a group tennis lesson. At that moment, the boy realized that he collected $100 in one hour instead of one week. And, his income did not depend on one source, his employer.
 
Unfortunately, I am not that boy.  I learned about the importance of multiple of sources and thinking on a bigger level at later age. But, that’s the story that changes my whole perspective on money and hard work.

What is my money story?

When I was young but old enough to remember (maybe around seven years or older), I was the thrift one among all the kids in my family. I am not sure what impacted my perspective on money, but I was a hoarder. I like to save money and spend none if possible. I remembered my brothers and sister withdrew some money out from their savings to buy brand name clothes, toys, or to support their hobbies. Unfortunately, I didn’t spend any money on those things. My parents felt sorry and bought me some stuff because I just never asked for toys or clothes.

Once I graduated from college, just like most people, I believe in getting a good job, save in 401K, buy a few stocks on my own and hoping I will be able to accumulate enough for retirement. I know I can do this because I’ve been living a thrift life since I was seven years old. 🙂

I’m aware that I always have the itch to be an entrepreneur. Maybe that’s because my dad has always been a business owner, but I’ve never invested any money or time to learn to be one.

Unfortunately, my great job, which I relied on, went through new management. Our 1-year-old son is going through chemo treatment (he will finish his chemo by March 2018). Things changed. Luckily, I remembered the story that I told you earlier about the boy who teaches tennis. I realized it is time to take more control over my financial situation, not relying on just one employer.

That’s why I put my time and energy to help you, especially if you are a parent, to realize the importance of multiple sources of income.

Take Action Immediately

Don’t wait until you have no choice.

Take action now because everything that you do will have to start from zero.

Please share this article with your friend or someone who can benefit from it.

 

Photo by Maryna Davyda on Unsplash