I’ve been regularly contacted by readers who want to invest some of their money specifically in the stocks of an individual corporation for various reasons, mostly relating to people finding companies that match their personal values.

For most individual investors, there are really two options to follow when buying stocks of a specific company: DRIPs or via a brokerage. My personal preference is generally the DRIPs, though brokerages do have some advantages. Let’s look at both.

DRIPs, or dividend reinvestment plans, are plans offered directly by some companies that enable you to buy a small number of shares of a company’s stock, then have the dividends from these shares constantly used to buy more shares until you’re ready to sell them. These are nice for people who want to buy and just sit on the stocks for a very long time, contributing a small amount of money each month to buy more shares. Each time the company pays out a dividend, this money is used automatically to buy more shares in that company. DRIPs are incredibly effective ways for people to contribute a little bit of money each month and build up a lot of stock in a specific company they believe in.

The fees on DRIP plans vary hugely, and this is the reason that it’s difficult to offer a blanket “recommend.” Some of them charge a fee every time you buy more stocks; those are usually not worth your time. If the company you want to buy into seems to charge a lot of fees, don’t bother with a DRIP from that company. On the other hand, if you don’t see any fees - particularly no fees on regular, monthly purchases - a DRIP might be the best choice for an individual investor.

Brokerages, like Charles Schwab, are a bit more complicated, but if you’re trying to buy money in a company that has an expensive DRIP, they might be a better route if you’re careful. Generally, unless your brokerage is giving you a few fee-free trades a month, you’re going to have to pay each time you buy into that company - this is the real disadvantage of many brokerages. If you’re like me and just want to buy into a specific company perhaps once a year with a large lump sum and want any dividends to just pay out into your savings account, then a brokerage might be the best bet. However, I only went this route because the DRIP plan for the single company I wanted to invest in wasn’t particularly good.

The best way to do this is to open an account with your brokerage of choice (there are a LOT of options out there - I am using Scottrade), put some money in that account, and then execute a “limit” order for that stock. A limit order lets you specify the price you want to buy at - if you do a market order, you’ll just get the lowest price that someone happens to be selling at the moment, which is often higher than the current price of the stock. I usually put in a limit order for a bit below what the stock is currently trading at - a quarter of a point or so. Once you own the stock, just sit and wait.

I generally save up the money in a savings account that pays 5% and do a single “buy” each year into specific stocks, then I hold them and watch the company diligently. As long as I still like the company and how their business is doing, I hold. If something changes (and it hasn’t yet so far), then I will sell everything I have in one “sell.” This approach greatly minimizes the brokerage fees and in my case is quite a bit cheaper than the DRIP for the same company.

In a nutshell, if you’re interested in just one specific company to invest in, research their DRIP plan. If there doesn’t seem to be many fees, get involved with that plan. If the fees are excessive (basically, if the fees cost you more than 2% of the money you’re investing), look at a brokerage, especially if the DRIP says you have to pay on each reinvestment.

A reader named Tom writes in to ask:

You’re always talking about minimizing interest rates when it comes to reducing debt. Shouldn’t you really focus on whatever methods you can use to minimize the total amount that you have to pay each month?

If you look exclusively at your monthly budget and at nothing beyond, it makes sense on some level to merely minimize the total amount you have to pay in bills each month. However, once you start carrying that perspective out to its logical conclusion, it stops making much sense at all.

A very shortsighted scenario. Let’s say Mindy has $1,000 in debt repayment each month and brings in $1,800. It’s very difficult for her to make the payments each month, so she often uses a credit card to pay several bills, reducing her actual debt repayment each month to about $700 and adding $300 to her credit card balance. This means that each month she’s spending only $700 on debt repayment out of that $1,800, which gives her more breathing room for the moment.

However, each time she puts $300 on her credit card, she’s raising the minimum payment on that bill by $15 or $20. This means that the next month, she’ll have to put $320 on the credit card. The cycle continues onward until she reaches her credit limit and then her credit is weak and she has to get another card. The only way she ever escapes from this is by either finishing off a debt or getting a better paying job - if neither occurs, she will be paying debt forever and eventually reach a point where she can no longer pay it each month.

A better scenario. More likely, Tom was actually more interested in looking at a 15 year mortgage versus a 30 year mortgage. Following Tom’s philosophy, one should always take the 30 year mortgage because it affords you more breathing room in your monthly budget. Over the first fifteen years, this is a reasonable philosophy, but then at the fifteen year mark, if you took the shorter mortgage, it’s now paid off and thus the thirty year is eating you alive.

The long view. The best approach of all is to always take the long view with any debt, and the best way to do that is to pay them off in their entirety using the smallest lump of cash possible, no matter the timeframe. The easiest way to look at this is to use the interest rates, because the higher the interest rate, the greater your debt becomes without you doing anything.

It’s also better to always pay more than the minimum payment on whatever your highest-interest debt is each month, even though that means a larger chunk of your monthly budget is eaten by debt repayment. Every time you pay ahead and reduce the total amount owed, the less interest it will build up and the less money you’ll have to pay in the long run. If you don’t have the free money each month to do this, look for ways to reduce the interest rate on your various debts - the end result will be some smaller payments and thus some freed-up money with which to start getting rid of them so debts aren’t a part of your life.

I am constantly amazed at the creativity of companies that offer credit cards. They use a wide diversity of tactics to appeal to people and convince them to either start using a credit card or use a credit card more than they actually would. Why? The more you use a card, the more likely you are to carry a balance on the card, and the more likely it is that the credit card company will make a mint off of you. Here are seven of my favorite tactics that card companies use to cloud the issue.

Appealing to your social conscience. This is my current favorite tactic, with my favorite example being the American Express Red card. Available in the UK, the American Express Red card donates 1% of your spending to Global Fund, a charity created to fight against AIDS. Even better: if you spend more than 4,000 pounds on the card, that percentage goes up to 1.25%. Why, the more you spend, the more you’re helping the world! Right? Right? Many local banks mimic the same deal: here’s a local credit card from the Albina Community Bank of Portland, Oregon, that “gives back” 1% of all spending on the card to local charities. Such thoughts make it easier for many to use the card, as they think, “If I use my plastic, Timmy’s playground will be that much better…” then the bill comes, the minimum payment is made, and the credit card issuer cleans up on the interest.

Advertising some spectacular “benefits” up front. When a credit card offer comes in the mail, the 0.0% number is the one that sticks in the head. “It’s free money!” some will think. Well, that 0.0% is often only for balance transfers and only for a short time - aside from that, the interest is well in the teens. Even better, the companies couple this with user agreements that consist of dozens of pages of small text, something most people won’t bother to read. Which is no big deal, really, considering that part of each of these agreements is a statement that the card issuer can change the rules at will.

Mixing with your desire to spend time with your family. Remember that old family board game, The Game of Life? I certainly do, but I don’t remember the newest addition to the game: Visa cards. That’s right - a classic board game has been “updated” to brand with the Visa logo. Whip out your credit cards so you can go on vacation, kids!

Distributing a lot of “points” that don’t provide strong merchandise choices. Many credit cards, including the well-promoted Chase Freedom card, offer a program that affords you points, which you can then exchange for a wide variety of items. Well, more like “wide variety” - many points programs are rather limited on the items you can get. “Redeem your points for gift cards/certificates, hotel stays, car rentals, travel on any airline with no blackout dates, or merchandise” says the offer, but the selection is often very arbitrary or the price of the item costs such an exorbitant amount of points that you had to have burnt through many, many thousands of dollars on your card to get it.

Conspiring with youth culture. What seven year old girl wouldn’t want a Hello Kitty Platinum Visa card (yes, I realize that Hello Kitty has something of a wider market than that). Even the executives at Sanrio, the company offering the card, admit that the card is targeting pre-teen girls. Hopefully, parents out there have some sense about allowing an eleven year old girl to have a credit card, but with the average American household with one or more credit cards holding down roughly $9K in credit card debt, I worry about it.

Trying to tap into your spirituality and politics. The Enlightenment Visa is a points-based credit card that directly targets … well, environmentalists and Buddhists. The rewards catalog for this card features some impressively overpriced and focuses entirely on tchotchkes of direct appeal to what I often describe as the SUV environmentalist crowd or, perhaps more commonly, metrospiritualists. I have no problem with someone who authentically subscribes to such a spiritual worldview, but it seems to me that such a worldview shouldn’t be expressed through use of a Visa card. Yet it apparently has appeal to people seeking out a “socially conscious” credit card.

Leveraging your status as a fan of an entertainer or sports team. Such cards are designed to draw in “super fans” who must have everything with their favorite entertainer or sports logo on it. Take the KISS credit card, with a nice 32.99% interest rate the first time you are late on a payment, or the NFL Extra Points card which can include your favorite team’s logo, a 1% points program for overpriced NFL merchandise, and, if you dig into the fine print, a 29.99% APR if you’re a day late on a payment. I would brush this off if I hadn’t seen both of them in use in the past month or so.

What’s the best thing you can do as a consumer to avoid such rip offs? First, ignore the picture on the card or the “identity” of the card. A credit card is a tool, not a means of expression - would you use a hammer made out of balsa wood if it was emblazoned with Hello Kitty or the logo of your favorite NFL team? Next, don’t encourage your children to use credit cards when they’re young. Keep everything in tangible cash so that they really understand the concept of money. Credit cards add an abstraction layer that makes it hard for many adults, let alone children.

The birth of our daughter is ever so close - it’s literally going to happen any day now. We’re pretty much constantly preparing for her arrival around here - cleaning, moving stuff around, and so on.

Book Review: The 4 Hour Workweek Independently, J.D. came to the exact same conclusion about this book as I did in my review of the book. (@ get rich slowly)

The Cheapskate Guide: 50 Tips For Frugal Living This is an excellent little list of ideas for frugal living. (@ zen habits)

Keeping A Level Head In A Down Market: Should You Stay The Course? An excellent look at a disagreement between personal finance bloggers. (@ lazy man and money)

The Simple Dollar Retro: Orson Welles, A Zither, and Personal Finance I don’t know if I’ve ever had a piece for the site tickle my fancy quite as much as this one.

Several readers have written to me recently about investing in gold and silver coins. Here’s one:

While perusing the internet, I came across a political movement towards a new gold and silver-based currency called the Liberty dollar. They are selling 1-oz silver “Liberty” coins for $20 plus shipping. What do you think about this currency from an investment standpoint? How is this different/better/worse than investing in silver bullion? Thanks!

The Liberty dollar that the reader writes about is one of several private currencies produced by people who want the United States to return to the gold and silver standard, meaning that a dollar bill would be worth a certain amount of gold. This is a political argument and the people involved are serious enough about it to buy silver and mint their own coins made of silver.

At current prices, silver at about $11.75 an ounce. Thus, a coin made out of one ounce of silver should come at a slight premium to this price - probably $13 an ounce. A coin made of a precious metal has a slight premium because of the aesthetic appeal and the easy quantification.

Is the Liberty dollar thus cost effective as an investment? Not really. Is it effective as a political statement? Maybe - that’s for you to decide for yourself.

Why would an individual want to invest in rare metals, like gold or silver? Precious metals can be a part of a well-diversified investment portfolio. Over the long haul, they return quite well, but also can be highly volatile. One big advantage is that they often are stable when the U.S. stock market is unstable, which can make your overall portfolio more stable.

How should an individual invest in rare metals? There are a lot of ways to invest, from tangible metal (coins and bars) to certificates representing ownership of a certain amount of metal to mutual funds made up of an assortment of metal. It’s really up to you; I have a relative who has a lot of silver and gold coins locked up in a box in his basement which he refers to his “apocalypse” fund. I myself own a small handful of one ounce silver coins and a single one ounce gold coin.

One major problem in owning the metal yourself is that you usually have to acquire it from a dealer, who will usually sell it at something of a markup (8-10%) and also buy it at a bit of a markdown (8-10%), based on the current market value of the metal. Thus, it’s very hard to make a quick buck with such items as you’ll be eaten alive with such marks. This is why I’m fine owning a bit of metal directly almost as a novelty, but if I were to do serious investing in precious metals, I would focus on a precious metal fund like the Vanguard Precious Metals and Mining Fund.

If investing in precious metals is of interest to you, do some research and jump in. It’s an interesting place to put your money - and a surefire way to meet some interesting people. However, I personally wouldn’t invest my money in individual Liberty coins at $20 a pop unless I were doing it for political reasons.

Each Sunday, my wife and I receive the Des Moines Register on our doorstep. It provides us material to read over while we eat breakfast on Sunday, and we usually peruse the flyers inside the paper as well to see what’s on sale at various Iowa grocery stores in the next week (most of these flyers cover most of the state of Iowa).

We also usually take the time to leaf through the coupon flyers in the paper. There are usually one to four flyers that contain coupons from large food and consumer goods companies, usually touting various name brand products. We usually find about two to three coupons per paper worth clipping, and the savings is usually enough to pay for the paper and a bit more.

The question that most frugal people ask about this situation is how is this worthwhile? Most of the coupons in such sections don’t offer enough of a discount over the generic product to make it purely cost-effective. The ones that are cost-effective are often for products that we don’t buy anyway. So why look?

The real reason is there are about two coupons per issue that are really worthwhile, and finding them while eating breakfast is definitely worthwhile - for me. For example, a while back I found a $3 off coupon for Luvs diapers which, when used during the next grocery store visit on the least expensive package, got us 40 diapers for about two cents each - an incredible deal.

Is the time invested cost-effective? Probably not. If it doesn’t happen as a leisurely activity over breakfast, we usually don’t bother with the coupon section at all. It is simply not cost effective to browse the Sunday flyers for coupons as a separate activity. That’s not to say it’s a worthless activity - you can often save a buck or two from the browse if you know what to look for.

The best approach I’ve found? Browse through them very quickly, just looking for items that are very similar to things you regularly purchase. If you know the price and the coupon is worthwhile, clip it; if you don’t know, the coupon should be a dollar off at least before bothering. If you find one that’s really stellar for your use, you might find it worthwhile to find an online coupon broker and get a bunch of them. Using this quick rule of thumb might cause you to miss a coupon or two that’s worthwhile, but it will very quickly lead you to good coupons that are worth your while. Of course, if you don’t have that casual time with the Sunday newspaper anyway, the coupons aren’t worth the effort.

Almost every day, I get a very sad tale of woe. It comes from someone who is carrying a debt load that seems to be beyond what they can handle. They list out their litany of debts to me and ask me how they can make it, believing that I can wave a magic wand and make it better - after all, I got out of some pretty desperate debt.

Most of the problems that these people face are solvable if they’re willing to put their nose to the grindstone and work on it, but the chunk of debt is often so large that they can’t see this and it sinks them further into a state of sadness.

Does this sound like you? Do you have a debt load that seems too large for you to handle and you wake up every day depressed about it? Here are seven things that you should do immediately to get this ship turned around.

Do something. Don’t sit around and wonder if you should follow Plan A, Plan B, or Plan C while you keep slipping further into debt. Most of the time, you’re focusing on what amounts to a trivial difference - a few hundred dollars over a very long period. Most people accrue much more than that in interest in a month on their debts. Pick a plan and get started with it - the only criteria you should worry about is understanding the plan in detail.

Talk to someone. Confide in a family member. Confide in an old friend. Some people even choose to confide in me. The point is to find someone that can provide some emotional support to your right now. Your immediate future is going to be filled with some hard choices - it always helps to have someone to talk to about it.

Get the full story. Get out every single debt you have and make a list of them. Find out the exact interest rate on each individual debt, how much you owe, and how much the minimum payment currently is. No matter what debt elimination philosophy you follow, this is an essential first step.

Find options for reducing each debt. Again, before you decide on a debt repayment plan, try to lower the interest rate on all outstanding debts. For credit cards, call the number on the back of the card, ask to speak to a supervisor, and request a rate reduction. For installment plan loans and student loans, research online and find out if there’s a rate reduction if you automatically pay the debt by direct deposit - or any similar reduction.

Get rid of some small assets. Got any DVDs you don’t watch? Sell them. Got some savings bonds in the closet? Sell them. Old video game consoles? Sell them. Valuable collectibles? Sell them. Any item that you have in your home that has value but doesn’t contribute in any significant way to your daily life should go. Don’t spend a bunch of time maximizing every cent out of the DVDs or video games, either - the hassle of eBay is usually not worth the small fraction more that you can get there. Then, take this lump sum of cash and use it to start the debt repayment process, whichever way you decide to go. Having that cash in hand to make the first dent into the debt monster is huge - and this is a great way to do it.

Hide your credit cards. Put them in a box up in the closet, out of sight, out of mind. Leave them there for a while. Learn to live without them. If you can’t afford something without the plastic, then you can’t afford it, period.

Dip your toes into frugality. I found frugality to really be empowering when first recovering from debt. Try eating a lot of simple meals at home, even if you don’t know how to cook well. The realization that you just had a simple supper that cost you about $0.60 versus a $10 take-out meal is usually an epiphany, and when you start doing it, you want to keep doing it. Put a moratorium on buying new clothes. Avoid places where you’re tempted to spend money. Look at all of your monthly bills and trim or eliminate some of them. If you’re already doing this stuff, check out The Complete Tightwad Gazette at the library and start reading up.

No matter what your debt situation is, there are immediate actions you can take that make you feel like you’re making progress - or at least alleviate some of the pressure of the situation. The real key, above everything else, is to take some action now, not later - right now is the best time to get started.

A few people have wondered what I’m going to do at the end of the “52 Personal Finance Books In 52 Weeks” series. First, I plan about three summary posts that tie up the whole series. After that, I’m still going to review personal finance books, probably weekly, but not in a “series” like before. I also have one other really big and neat idea that I plan to start in December for a trial run - I think it’s a really cool idea, anyway. What is that one? You’ll have to wait until then to find out!

Save Money On Movies, Music, Television, and Books This is a great compilation of tips on how to save money on home entertainment. I’m actually a very big fan of Pandora for my music needs - free internet radio is a great thing. (@ lazy man and money)

No More Free Money: Pulling The Plug On Credit Card Arbitrage Hot tip: applying for a lot of credit cards quickly is always bad. One thing credit card companies do is check how many times your report has been pulled recently and, no matter your score, if it’s been pulled a lot, they’ll either reject you or give you a low limit. Why? It looks like you’re trying to open up a lot of lines of credit very quickly and there’s pretty much no reason that you’d do that that a credit card company would like. (@ money, matter, and more musings)

Examine Your Motives: Going To College I agree, college won’t be a great experience for you if you’re doing it because it’s something you’re “supposed” to do. (@ clever dude)

The Simple Dollar Retro: The Frugal Geek’s Toolbox The title pretty much says it all.