Archive for May, 2009
Friday, May 15th, 2009
During World War II, victory gardens were small gardens in civilian homes started in order to support the war effort. Now it looks like the new term is “recession gardens”, as people try to reduce costs and increase their green factor. So many trendy names for a backyard garden!
We started out with rosemary, oregano, and thyme growing in a little planter that came with the house, which basically grows wild without any help from us. In addition, my wife started a little container garden on the back porch, and we’ve been eating the tasty results for the last month.
According to this CNN article on recession gardens, we are not alone:
W. Atlee Burpee & Co., the largest seed and gardening supply store in the country, says it has seen a 25 to 30 percent spike in vegetable seed and plant sales this spring compared with last.
The National Gardening Association expects 43 million American households to grow their own fruits, vegetables, herbs and berries this year. That’s up 19 percent over last year, according to a 2,559-household survey the group conducted in January.
How much money can you really save with a garden?
Last year, Burpee released a report saying a family will get an average 25-to-1 return on its investment in a garden. So, by that count, a family that spends about $200 on a medium-to-large garden, as Michelle Obama reportedly did, will save $5,000 in grocery bills over the course of a year.
That statistic is inflated, said Mike Metallo, spokesman for the National Gardening Association. Metallo’s group says a $70 investment in a garden will yield $600 in produce for the year. To get those savings, a gardener has to know what to plant, when to plant it, where to plant it, how to deal with different soil types and how to care for the garden.
Keeping It Simple: Basil and Tomatoes
I don’t know about all that, but we started small by only devoting one old medium-sized pot to this effort. We thought about our favorite vegetables, and I figured that the most expensive ones were always tomatoes and fresh sweet basil. We love making our own pesto, caprese salad, and bruschetta topped with olive oil, tomato, and fresh basil.
At the supermarket, one tiny little packet of fresh basil (0.66 ounces) cost $2. Instead, we went to a local nursery and bought an entire basil plant for $2. Add another $10 for some potting soil and some recommended chicken manure as “organic” fertilizer that may last us years, and we were all set. A few months later, and I was amazed at the results. We just ate most of our (small) tomatoes, but here is our basil plant:
The neat thing is that this could be done inside, or on the patio of a small apartment. The savings won’t be enormous, but neither was our effort. Most importantly, the basil is both fresher and better tasting. Now we can expand our garden-inspired menu beyond rosemary roasted chicken and potatoes. All the credit goes to Mrs. MMB, who did all the work and also discovered that you can crumble in some egg shells for added nutrients and to keep out slugs (that’s the white stuff).
Update: Salon.com also has an article on recession gardens.
Posted in Frugal Living | 25 Comments »
Thursday, May 14th, 2009
I am happy to be able to offer special Costco membership certificates to MyMoneyBlog readers. They are $50 each with free shipping, and are good towards new Gold memberships and also upgrades to Executive Membership. This is exactly how much it would cost normally from Costco, but they include a special Costco coupon booklet ($35 value), including:
- a free rotisserie chicken (3 meals in 1
)
- a free 2lb. bag of Kirkland Signature™ coffee (roasted by Starbucks)
- free photo processing (50 free digital prints - 1 hour photo)
- and more…
The rest of the coupons can vary, but they might be something like $3 off a Food Court pizza or case of water. This offer is not available through Costco locations.
Really, if you’re going to purchase a membership anyways, this is a no-brainer. You pay the same price, and get free stuff. Simply order the certificate online and bring it in to Costco to redeem. Would also make a good gift idea as you can purchase multiple certificates. (To buy a new Executive membership, buy two certificates. You will also receive two coupon booklets.)
I am an Executive Member myself, and enjoy the 2% cash back plus savings in a variety of other ways (Sharebuilder bonuses + 25% commission rebate, check printing discount, etc.). But for many people the regular Gold membership is plenty. See Is Costco Executive Membership worth it?
Posted in Deals & Offers, Frugal Living | 26 Comments »
Thursday, May 14th, 2009
Every Friday until 9/25/09 starting at 9am ET, Mars is giving out 250,000 coupons for a free candy bar at RealChocolate.com. Also, an additional 250,000 coupons will be made available tomorrow, May 15th. Includes M&Ms, Snickers, Twix, Dove Bar, 3 Musketeers, and Milky Way. Limit one (1) Coupon per email address per Friday and four (4) Coupons per household during the Offer Period.
Unlike the KFC fiasco, there are no printer coupons which can be replicated. However, you’ll have to wait about six weeks for your snail mail coupon. I’m getting kind of bored of these promotions… but at least this one seems reasonable simple.
Posted in Deals & Offers | 3 Comments »
Wednesday, May 13th, 2009
I’ve been meaning to post some smaller updates about my ongoing experiences with person-to-person lending at LendingClub, but I decided to wait and roll them up into one larger post.
Current Portfolio
I now have a total of 32 active loans with $1,122.21 in outstanding principal. Most are A grade, with a few Bs. Here is a screenshot from my account page:
These are the loans that originated after LendingClub completed their SEC registration, which means I can sell these loans on the open market. I also have $91.91 in 4 notes that were pre-SEC registration (these are accounted for separately), all A grade.
Performance
All 32 loans are current, with no late or defaulted loans. I don’t think any have even gone temporarily late. According to LC, my “Net Annualized Return on Investment” based on my interest payments received so far is 8.80%. This is net of all fees. The oldest loans are about 16 months old now, almost halfway through the 3-year term. So far so good.
You can view the statistics for all LC loans here. This study states that as of the end of November 2008, lenders earned an average rate of 9.05%. If you are familiar with Prosper, you’ll note that this is significantly better than their stats. There are several reasons for this, in my opinion. For one, an A grade loan on LendingClub is a lot better quality than an A loan on Prosper. You need to have a 660 credit score as well as other additional requirements just to make their lowest G grade. Also, LC is much more stringent on approving loans. Only about 10% of loan applications are accepted. Their data verification system seems to be more comprehensive and weeds out a lot more questionable and/or fraudulent loans.
Loan Filters / Methodology
For the most part, I only lend to borrowers with a nearly perfect credit profile. I don’t use their PortfolioMatch tool, I handpick each of my loans. It doesn’t take very long; Here’s my basic search filter: A/B grade only, 714+ credit score, debt-to-income ratio < 10%, zero delinquencies, and 50% funding status. The high funding status usually means that the loan has already been approved, with LendingClub verifying enough application information.
I check whenever I remember to, probably once every two weeks or so, and if I see something I like, I throw either $25 or $50 at it. My ideal borrower has a 10+ year clean credit history, a stable government job, and is just looking to consolidate debt into a lower rate. Paying 8% APR from LendingClub is a lot better than 10-20% from even the best prime credit cards, and new credit is harder to get now. I like the idea that they can clear out their consumer debt in 3 years or less.
Open Market
You can now buy and sell loans, so there is no longer a fixed 3-year commitment. I’m happy with my returns so far, and have not yet tried to sell any of my loans on the open market. I do see that loans with a good payment history of 6 months or so are asking a 4-6% premium to outstanding principal, so it might be a feasible strategy to repeatedly find good loans and sell them after 6 months. You might be able to limit your exposure and still maintain a decent return. (Sellers pay a 1% transaction fee.)
Self-Directed IRA Option
In March, LendingClub announced that you can now hold their P2P loans in a Self-Directed IRA and get the tax benefits. The main downside to this is that you are subject to a $250 annual account maintenance fee. Unless you have a very large amount of IRA funds that you wish to commit to this, $250 is a big drag on performance (1% of $25,000, 5% of $5,000). However, you can also hold other things like real estate or physical gold bullion in this Self-Directed IRA, so it does offer additional flexibility.
Safety of Principal
With the new post-SEC setup, you are now technically buying notes from LendingClub. This brings up the question of what would happen if they went bankrupt. This was previously addressed in my Q&A with Rob Garcia, Director of Product Strategy. In addition to that, I saw on TechCrunch a couple months ago that LendingClub secured another $12 million in Series B venture funding.
$25 New Lender Bonus
If you are interested in lending, you can still use this special $25 lender sign-up link to get a free $25 to try it out with no future obligation. There is no credit check and you don’t even have to deposit anything. After you are approved, the $25 will show up in your account balance, and you can lend it out immediately.
If you’re looking to borrow at LendingClub, my advice remains the same. Send in your information, and see what interest rate they offer you. If you like it, try and get a loan. If your full amount is not funded, you can either accept partial funding or walk away with no obligation.
Posted in Investing | 46 Comments »
Tuesday, May 12th, 2009
Another one of my new joys of home ownership is having to worry about termites eating my house from the inside out. Munch munch munch! The previous owners were signed up for something called the Terminix Inspection and Protection Plan, and the bill for next year came in recently so I’m trying to decide whether to renew. According to the Terminix website, it includes
- Certified annual inspection of your home and property
- No termite control fees if activity is found
- Free repairs of new termite damage upon discovery of live activity
The price is supposed to vary by area but for me it costs about $300 per year. This fee does not include any sort of preventative treatment.
So basically, I pay a regular annual fee which will cover all of my future termite control costs. Sort of a termite insurance plan. Well, almost all because the fine print excludes drywood termites, which are different from the more common ground or subterranean termite. According to Orkin, subterranean termites cause 95% of all termite damage in North America. However, they also thrive primarily in warmer coastal areas like where I live. So… I don’t know if this is a big deal or not.
Annual Inspection - Visual Only
I’ve already experienced an annual inspection earlier in the year, and I wasn’t really impressed. Basically a guy shows up with a stick and walks around the inside and outside of your house looking for evidence of termite activity. He looked under the sinks, inside cabinets, and pokes a few spots here and there. He did not inspect the attic, which would seem to be an easier place to spot termite damage. It took less than 20 minutes.
I pointed out a beam in the garage that had a hole in it and that released what looked like termite droppings (little brown salt-sized bits) when poked. He confirmed that it was termite droppings, but concluded they were old and there was no live termites. The house had been treated for termites when we bought it, so he might be right. But how can he tell that they haven’t returned? He didn’t take any samples for testing, take pictures, or anything like that.
No More Termite Bait Traps
Since our house has a bunch of those little green termite bait traps all around the outside, I thought he’d be checking those as well. Nope, it turns out that they stopped using that system (at least in my area). That struck me as lazy and/or cheap. I’d much rather be able to lift up a cylinder and see if there are termites lurking around, rather than only rely on seeing termite poop or actual visual damage to my house. I mean, look at this little factoid taken from their own site:
Costs vs. Alternatives
In the end, I’m not all that excited to pay $300 for someone to visit my home once a year, especially when they have an incentive to not find anything wrong. I don’t even get any preventative treatments, say once every 3 years or something. I haven’t gotten a quote back from Orkin yet, but according to their website they still do the bait and monitoring system.
According this CostHelper page, chemical treatment would cost around $1,350-$2,500 and a tent fumigation would cost $1,200-$2,500 for a 1,250 square foot house. Extreme damage would involve wall removal and replacement, which Terminix supposedly covers but sometimes only with a fight (see below).
Consumer Complaint Websites
I read through this RipOffReport page as well as this Terminix Consumer Alert page.
What do you think? Anyone have any experience with Terminix, especially their “Inspection and Protection Plan”?
Posted in Home Improvement, Real Estate | 41 Comments »
Tuesday, May 12th, 2009
I received a snail-mail postcard that advertised up to 30% off certain FedEx Express shipping services, and 10% off FedEx Ground until May 31st, 2009. After that, you’ll still get either 16% or 8% off eligible services. Seems like a potentially useful offer for those with eBay businesses, online shops, or other shipping needs.
The card actually directs me to chinese.fedex.com, but the English enrollment link ends up here with code cs10578709. Available to both existing and new FedEx account holders. The fine print:
Apply now to enjoy up to a 30% discount on select FedEx Express services and a 10% discount on select FedEx Ground and FedEx Home Delivery services, when you ship with FedEx now through May 31, 2009.
After May 31, 2009, your account’s previous discount structure, if any, in place immediately prior to joining the Choose FedEx program, will be reinstated, subject to the terms and conditions of such discount structure; if no previous discount structure existed on your account prior to enrollment in this promotion, discounts of up to 16% on eligible FedEx Express services and up to 8% on eligible FedEx Ground and eligible FedEx Home Delivery services will go into effect, subject to applicable terms and conditions.
Eligible FedEx Express services for the 30% discount: FedEx Priority Overnight®, FedEx Standard Overnight®, FedEx 2Day®, FedEx Express Saver®, FedEx International Priority®, FedEx International Economy®, FedEx 1Day® Freight, FedEx 2Day® Freight, FedEx 3Day® Freight, FedEx International Priority® Freight, FedEx International Economy®Freight
Eligible FedEx Ground and FedEx Home Delivery services for the 10% discount: All FedEx Ground, and FedEx Home Delivery, single piece shipments.
Posted in Deals & Offers, Entrepreneurial | 4 Comments »
Saturday, May 9th, 2009
Postage rates will rise on Monday, May 11th. For example, a first-class stamp will become 44 cents, up from 42 cents. For some reason my Costco keeps reminding me of this, promoting the fact that they are selling a pack of 100 Forever stamps at a whopping 25 cent discount to face value. I thought retail stores didn’t profit from selling stamps?
Forever stamps allow you to buy stamps once and know they’ll be good forever - you never have to worry about future rate changes or buy those annoying 1-cent stamps. However, there is no point in stocking up on them, because Forever stamps are not a good investment. For one, postage rates have not outpaced inflation historically. But more importantly, according to the 2006 Postal Accountability and Enhancement Act, the postage rate will never be allowed to outpace inflation.
It seems the best you can do is by right before the next hike (like right now). I suppose I should just buy the Costco 100-pack and not have to worry about stamps for the next five years or so.
Sources: Slate and Postal Accountability and Enhancement Act
Posted in Investing | 27 Comments »
Friday, May 8th, 2009
How about some Friday afternoon humor:
I love the scene with a bunch of speakerphones in an empty conference room talking to each other. With the growing popularity of virtual personal assistants from sites like GetFriday, I bet this is happening more often than most people think. I remember the story about medical transcriptionists where a big company got a contract for something like 50 cents a line, who subcontracted to a self-employed woman in Florida being paid 25 cents a line, who then subcontracted to someone in Pakistan for 3 cents a line. [Direct video link]
Posted in Funny | 22 Comments »
Thursday, May 7th, 2009
Since I can now get 5x ThankYou points on restaurants and Amazon.com purchases from my Citi Forward card, I have been looking into the best way to maximize my redemption value.
The goal is to get as close to making the 5x points equate to 5% cash back by making 100 points = $1. My standard option is to redeem 10,000 points for $100 gift cards to Target and Home Depot, but since the retailer list is getting a bit thinner here are some good alternatives.
Student Loan Rebate Check
Here we can achieve 100 points = $1, but in the form of a check written towards a student loan. From their website:
With the student loan program redemption, Customers can apply their points towards any student loan program -financial institution. Please call 1-800-THANKYOU for details.
You can redeem in increments as small as 2,500 points for a $25 check. You have to call them up, no online redemption. The CSR will ask you for your lender’s name, and they’ll mail you a check written out to your lender (i.e. Citi Student Loans). You are then supposed to add in your account number or whatever else is necessary, and then send it on to your lender. Reader Chris shared that he has a workaround if you lender doesn’t take third-party checks:
I just have the check written out to my bank, Chase, and then write my checking account number in the memo space. I drop it in an ATM and they have always deposited it into my checking account just fine. I’ve been doing this for years with no problem. I would just apply the money myself to my auto-payments and keep my 0.25% rate reduction.
Mortgage Payments
Here we can get up to about 100 points = $0.80. (5x = 4% cash back.) The increments are as low as $25 for 3,300 points, and the ratio gets slightly better with larger check amounts. From the website:
ThankYou Members who redeem will receive a letter with a check issued on behalf of ThankYou Network made out to the financial lending institution to be used towards their monthly mortgage payment. To redeem, members must contact our ThankYou Service Center (1-800-THANKYOU) and must provide the Agent with the name and correct spelling of your mortgage financial lending institution.
Again, you must confirm with your mortgage servicer that they will accept checks from a third-party. I would still prefer to just cash the check and apply it to the mortgage myself.
Expedia Travel Credit
This is another method that we can achieve 100 points = $1 by booking travel directly through the ThankYou/Expedia website. It’s basically Expedia.com, except that the flight costs are shown in ThankYou points. So instead of a $200 flight, it will ask for 20,000 points*.
One benefit of this system is that there are no blackout dates or seat availability issues. If you can find the flight on Expedia.com, you can book it with points. Also, all taxes, fees, and surcharges are included in the point total. In this way, the variable redemption is actually better than the old fixed point option, where the points only covered the base cost of the tickets and you had to pay the taxes and fees separately.
* I just checked this by testing out a SFO-LAS flight on both sites. It was either 12,700 points or $119, which is a little bit off. However, this is because Expedia.com is currently running a promotion until 5/31/09 which waives their booking fees. Otherwise, it should match up almost exactly.
Posted in Credit Cards, Deals & Offers | 9 Comments »
Thursday, May 7th, 2009
Brokerage firm Schwab lowered the annual expense ratios on many of its in-house mutual funds this week. For example, the Schwab S&P 500 Index Fund (SWPPX), which used to have an expense ratio of 0.36%, now has an expense ratio of 0.09%. That’s just $9 a year for every $10,000 invested. In addition, the minimum initial investment in each of the Schwab Equity Index Funds is now only $100, with no minimum balance requirements.
According to this CNN Money article, “This is not a promotional offer… These are permanent reductions.” This is basically what Fidelity did a few years ago when it lowered their S&P 500 index fund expense ratios to 0.10%, and they have kept it that low since, so there’s hope. Although technically they can always raise the expenses later, I do think ongoing competition will make it hard for them to do so. From the prospectus:
Schwab and the investment adviser have agreed to limit the “net operating expenses” (excluding interest, taxes and certain non-routine expenses) of the Investor Shares, Select Shares and e.Shares to 0.09% for so long as the investment adviser serves as the adviser to the fund. This agreement may only be amended or terminated with the approval of the fund’s Board of Trustees.
Also at 0.09% and $100 to start, there is the Schwab Total Stock Market Index Fund (SWTSX) which tracks the entire US Market (not just the largest 500 or so companies) through the Wilshire 5000 Index.
Schwab Traditional and Roth IRA accounts
I took a quick look at the Schwab IRA accounts, and they appear to have no account fees or minimums. You must initially open with $1,000, but that is waived if you make an automatic monthly transfer of at least $100.
Overall, this is a nice development for smaller investors with Schwab that want to invest in some broad index funds. However, I’ll stick to Vanguard for my IRAs since their fees are nearly as low on the Total US funds, and Vanguard is still much cheaper on all other asset class index funds.
Posted in Investing | 7 Comments »
Wednesday, May 6th, 2009
This is a friendly reminder that you can still get a $25 head start to your child’s college fund if you open a 529 account with the Ohio CollegeAdvantage plan by May 31st, 2009 and fund with $25 of your own. Not only is the free money nice, but this is actually a very good plan in which I am making monthly automatic contributions.
Rated a Top 529 Plan by Morningstar
In a recent article The Best and Worst 529 College-Savings Plans by Morningstar, the Ohio CollegeAdvantage plan was rated in the top 5 plans:
Features they liked included having a wide variety of investment options (including active/passive, multiple age-based options, and even ultra-safe CDs), as well as low total expenses. In-state resident can also deduct up to $2,000 of contributions per year, with excess carryover allowed.
My Investment Choice: Inflation-Protected Bonds
529 plans aren’t perfect, and you have to be careful about what you’re invested in. This article I found on BH summarizes my concerns well:
…saving for college isn’t like saving for retirement. The run-up is much shorter, 18 years at most instead of 30 or 40, so most of the miraculous gains of compound interest are lost. Second, the payout is far more immediate and inflexible. People can choose when to retire, delay if they have to, and ride out ups and down in the market over decades. For most students, college happens three months after graduation, ready or not, and the check is due on Day 1.
I explored some conservative 529 investment options here, and based on my conclusions I am currently putting all my contributions into the Vanguard Inflation-Protected Bond option. This works especially well since TIPS are best held in tax-advantaged accounts.
Refer-A-Friend Bonus Instructions
- You can enroll online or via mail. The online process was quick and easy, and I didn’t have to mail in anything.
- The first step is to input your personal info and choose a login/password. Next, you’ll verify your e-mail and complete the application.
- After that, you’ll choose your funding amount and select an investment fund. Your initial deposit must be a least $25, and is funded using the account/routing numbers of your bank account. At the bottom, you will need to enter a referral code to get the bonus. Enter *.
- In 1-3 days, your initial deposit will be sucked out, and in 5-7 business days you will get your $25 bonus. The $25 will be deposited directly into the 529 account, and will be invested in the same thing as your initial deposit.
* Number is randomly generated. If you can’t see any numbers above, please use 2483590. With this program, both the newly referred and the referrer get $25. As promised, I have received several referrals from readers, and have thus included their referral codes to be shared here. I probably won’t have time to do it again for this promotion, but keep your eyes out for future similar offers.
Posted in Deals & Offers, Family, Investing | 1 Comment »
Tuesday, May 5th, 2009
If you’re interested in what Warren Buffett and Charlie Munger said in their famous Question & Answer session of the 2009 Berkshire Hathaway Annual Meeting, the best raw source I found was this page of the Omaha World-Herald. It’s written in a “live blog” format, which seems to cover all the major questions in easy-to-read bites with adding too much extra opinion or analysis.
Posted in Investing | 3 Comments »
Tuesday, May 5th, 2009
The Oprah Show is giving away coupons for a free Kentucky Grilled Chicken meal from KFC until 9:59pm CDT 5/6/09. 2 pcs Grilled Chicken, 2 sides, and a biscuit. Free lunch!
The official website is UnthinkKFC.com, but you have to install some coupon printer software on your computer (to prevent making a bajillion copies). Ironically, due to the site crashing earlier, right now you can simply download the .pdf file from Oprah.com.
Posted in Deals & Offers | 18 Comments »
Tuesday, May 5th, 2009
TreasuryDirect, which allows individuals to buy securities online directly from the US Treasury, has to be the least accessible financial website in the country. It takes me about 20 minutes to log in each time! Let’s look at all the hoops we get to jump through:
Account number - Of course it can’t be a username you can remember like “bob222″, but is more like Z-334-946-124. This makes me have to dig up my encrypted login/password file.
Password - Use your own keyboard? Nope, you must click it out on a randomized virtual keyboard. Gets around basic keyloggers, but not something that catches your screen as well. I’m actually okay with this one, but I’m glad my password isn’t very long and my vision is good.
Access Card - Finally, you need to read characters off a Access Card in order to access your account. (Like a secret decoder ring!) Of course, being a physical object, I can never find it. I ended up transcribing the entire card contents onto a spreadsheet file, and shredded the card.
Now, finally you can buy a savings bond. Can you imagine the hassle if every financial institution were like this? I understand the need for security, but I think having a physical type of verification token should be an option for the customer, not a requirement.
Lost TreasuryDirect Access Card?
If you lost your card, you’ll have to call (304) 480-7711, verify your identity, and request for a new one to be sent to your mailing address. Your old card will no longer work. In the meantime, no access. Call early and keep trying until you reach someone, because if they’re busy you have to leave a message (no hold system?), and they never called me back.
Posted in Funny, Savings Bonds, Treasury Bills and Bonds | 23 Comments »
Tuesday, May 5th, 2009
Do you have an ING Direct savings account with unused referrals? I usually have lots of $25 bonus links available, but have been falling behind again. The first 25* people who comment below tonight and leave a working contact e-mail (real name not required, e-mail will not be shared publicly) will get one filled by me for free, which is $10 for you. Gone in 15 minutes, wow! Will do it again later.
Due to comment moderation, your comment may not show up right away. One referral per person. You cannot have had a “freebie” before. Look for a message from me to your e-mail address with further instructions later on.
Posted in General | 31 Comments »
