Time Again to Reconsider Refinancing Your Mortgage?

If you have a mortgage with an interest rate over 5% or even 4%, hopefully you have explored refinancing it to a lower interest rate. Yes, it can be a bit of a pain, and that is why many people leave tens of thousands of dollars, if not over a hundred thousand dollars, on the table. A one-time hurdle now is better than worrying about skipping lattes forever! Here are some useful nuggets of information that will hopefully motivate you to pursue it further.

Mortgage rates are back near record lows and refinance applications are spiking. From the NY Times on 1/20/15:

The average rate on a 30-year fixed-rate mortgage was 3.8 percent at the end of last week. That is down from 4.5 percent as recently as last spring, the lowest since May 2013 and far below the 5 percent-plus rates that prevailed as recently as early 2011. […] Homeowners who secured their current mortgage in late 2013 or early 2014, or anytime before mid-2011, may want to at least plug their numbers into an online calculator to see if the potential savings are worthwhile.

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Home price appreciation may mean you can refi and get rid of private mortgage insurance. Home values have been rising, so you may now be eligible to refinance when you weren’t in past years, which could reduce your interest rate and/or enable to you stop paying for mortgage insurance.

20% of people who could benefit from a refinance didn’t… From a NBER paper and this CBS Marketwatch article

For example, in the period they study, December 2010, 20 percent of households that would have benefited from refinancing and had the ability to refinance did not do so. The median amount of unrealized savings was approximately $160 per month, or $11,500 per household over the remaining life of the loan.

… and they could have saved big bucks.

… a household with a 30-year, fixed-rate mortgage of $200,000 at an interest rate of 6.5 percent that refinances when rates fall to 4.5 percent will save over $80,000 in interest payments over the life of the loan, even after accounting for typical refinancing costs. With long-term mortgage rates at roughly 3.35 percent, this same household would save roughly $130,000 over the life of the loan by refinancing.

Shop around! People spend more time comparison shopping for a $500 computer than a mortgage that could save you $10,000. From Bloomberg:

Mortgage interest compounds the cost, and over the life of a loan, small differences in an interest rate really add up. The best way to save, then, is to shop around for the best rate possible, but a new survey by the Consumer Financial Protection Bureau (CFPB) finds that half of homebuyers consider only one lender or mortgage broker. That’s particularly unimpressive considering that typical shoppers will spend at least four hours choosing a new computer.

There are new tools to help you comparison shop. Forget average interest rates. You want the interest rate for your situation. The Consumer Finance Protection Bureau (CFPB) has a new rate checker tool that takes into account your credit score, state of residence, house price, and down payment size to see what other interest rates people are getting. I like they show an actual distribution of rates and the number of lenders offering that rate:

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In the end, you will have to gather lots of paperwork and probably deal with a couple hiccups to get your refinance done. I never said it would be fun, but it is profitable. You can try the big networks like and Quicken Loans, or you can ask around for a referral to a reputable mortgage broker. The CFPB recommends that you get quotes from three or more lenders. That way you can compare and even negotiate one off the other. “Rates often change from when you first talk to a lender and when you submit your mortgage application, so don’t make a final decision before comparing official Good Faith Estimates.”

Consumer Reports Product Testing Details

crmagVox has an in-depth look at Consumer Reports, including their continued efforts at staying unbiased, rigorous testing methods, and their future financial outlook.

To ensure they’re getting the same thing you’d buy at a store, they buy all of these products anonymously, at full retail price. To maintain independence, they don’t run any ads in their print magazine or on their website and don’t even allow manufacturers to trumpet positive test results in their own ads elsewhere. For many of these products, Consumer Reports is literally the only group testing this thoroughly — and in some cases, they’ve noticed potentially dangerous defects and alerted manufacturers or regulators to issue recalls.

I have been a Consumer Reports subscriber on and off for years, and my parents also subscribed to it when I was a kid. I love their info when buying appliances, but when I’m not making any major purchases the unread issues tend to stack up in a big pile that whispers “I’m wasted money!”. Their constant reminders to renew just serve as reminders that I am not using what I’m paying for. So I cancel. Consumer Reports must have a very frugal client base, so I bet I’m not the only one that thinks like this.

Then I read stuff like this and I want to subscribe again. That’s my cycle. The print subscription is $29 a year. Adding an online access costs $20 a year, making it $49 a year. This is handy when I need car seat reviews or something specific. Getting the online access alone is $30 a year or $6.95 a month. A la carte is probably the best option for me, but as an American I love everything to be “unlimited”. :)

Simple Living and Minimalist Parenting Quotes

I was catching up on some long reads and finished the article When Mommy and Daddy Took the Toys Away which explored parents who are simplifying by keeping their kid’s toys and other material goods to a minimum.

Only having a few toys? Not expecting more toys when shopping? Huh, kind of sounds like my childhood. The snarky side of me just thinks that “minimalist parenting” sounds a whole lot like “parenting without gobs of disposable income”. In retrospect, it was so much easier for my parents. They had so much less money to spend! 😉

All kidding aside, I highlighted a couple of quotes in the article, as I think they apply to everyone. We all know that adults have their own toys and desires for more toys.

On dealing with envy:

“We don’t overcome envy in our lives by getting what another person has,” Becker says. “We overcome envy by being content with what we have and being grateful for what we have.”

On balancing simplicity and priorities (Salem is a kid):

“You don’t really need to have a whole lot of toys to be happy,” Salem says. “Just the ones that you really want.”

Save Money: Bring Your Own Cable Modem & Stop Paying Crazy Rental Fees

Updated. According to this CNN Money article, both Comcast and Time Warner are jacking up their modem rental fees again for 2015. Time Warner will now charge $8 a month, up 33% from $5.99. Comcast will now charge $10 month, up 25% from $8.

These fees are now so high that it is a “no-brainer” decision to buy your own modem. Unfortunately, many people either won’t notice the fee or don’t even know that bringing your own equipment is an option.

Being charged $8 a month is $96 a year. A quick look on the Time Warner Cable compatible modem list showed several models that can be found online at retailers like Amazon.com for under $50. (Here is the Comcast Xfinity compatible modem list.) And that’s just for the basic model rental – the model with a built-in WiFi router costs another $4.95 a month – nearly $60 a year – while you can just buy a router for 20 bucks! Crazy.

For my family member paying for Time Warner, I stuck with a familiar name brand and picked the Motorola Surfboard SB6121 for $64.99 and free shipping. (The SB6141 at $80 is the next model up and compatible with the fastest speeds available, though you’ll have to subscribe to one of the most expensive monthly plans.) Both are DOCSIS 3.0 which ensures future compatibility.

The installation process was quite simple:

  1. Buy the modem. Wait for it to arrive. Remove old modem (unscrew cable cord and unplug power). Install new modem (screw in cable line and plug it power).
  2. Call your provider or start a Live Chat session online. Time Warner is 1-800-TWC-HELP (1-800-892-4357), or pick the “Buy or Lease your Modem” option when chatting.
  3. Provide them with the Cable Modem ID (MAC address) found on the back or bottom of your new modem. Wait 30 minutes or less and your high speed internet should be working again.
  4. Remember to return old modem (this is really the hardest part).

Unless you plan on moving really soon, at $65 for the modem with free shipping you’d break even in less than 9 months. Even better, consider it a $65 investment that distributes $8 of tax-free income every month. That’s like earning 147% APY at a bank with a 0% tax bracket. You’d need $9,600 at 1% interest to earn $8 a month in taxable income.

Some people have accused Time Warner of making their cable internet speeds slower and/or experiencing service interruptions along customer service responses of “We can’t help you, it’s not our modem” after switching to their own modems. Share your experiences in the comments below.

Sling by Dish: Live Internet TV with ESPN for $20 a Month

One of the notable announcements from the 2015 Consumer Electronics Show that Dish Network will stream a package of major cable networks live over the internet. Getting channels like ESPN, Food Network, and CNN without a traditional cable subscription is a big shift in the industry and a sign of things to come. Official press release, NYT.

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The specific product is called Sling TV and Dish promises to offer the following 12 channels as part of their “The Best of Live TV” core package for just $20 a month:

  • ESPN (live sports!)
  • ESPN2
  • CNN
  • Food Network
  • Travel Channel
  • HGTV
  • Cartoon Network
  • TNT
  • TBS
  • Cartoon Network
  • Disney Channel
  • ABC Family

Here is a list of devices that it will work on:

  • iOS and Android devices
  • Mac / OS X
  • Windows PC
  • Amazon Fire TV and Fire TV Stick
  • Google Nexus Player
  • Select LG and Samsung Smart TVs
  • Roku TVs, boxes, and Streaming Stick
  • Xbox One

No contracts, no hardware installation, no credit check. More channels will be available in themed packages at an extra cost. The service is designed for individuals – You can only stream one show at once. (You can’t watch CNN on your TV and then ESPN on your tablet. Or it seems CNN on your TV and CNN on your tablet.) Even though I watch less TV than ever, I still pay for traditional cable for the ability to watch ESPN or Travel Channel when I do happen to catch some free time. This type of package could save me some bucks.

Related: Haggle to lower your cable and satellite TV bills.

Flexible Spending Account Reminder: Use It Or Lose It!

rxbottleHere’s the annual reminder to use up your Healthcare Flexible Spending Accounts! I still dislike these things, but it is what it is. Note:

  • Some plans allow a grace period until March 15th of the following year as opposed to a December 31st deadline to use your 2014 funds, but it may only apply to claims and not late purchases. Check with your employer.
  • Alternatively, employers can allow participants to carry over up to $500 in unused FSA funds into next year. Check with your employer.

If you didn’t exhaust your funds with insurance copays or deductibles, check out these well-organized lists:

Effective January 1, 2011 items such as cough medicines, pain relievers, acid controllers, and diaper rash ointment now require a prescription and a manually-submitted claim for reimbursement. These FSA items are still available over-the-counter without a prescription:

  • Eye care (contact lenses, solution, drops)
  • First aid supplies (bandages, gauze, tape) for emergency kits
  • Wheelchairs, walkers, & canes
  • Family planning products (birth control, pregnancy tests)
  • Home testing aids (blood pressure, diabetes, thermometers)

Cook It Yourself: Learn a Skill, Save Money, Improve Your Health

I’m still into the “Cook It Yourself” movement/meme/trend/whatever. If you’re looking for a new year’s resolution and consider yourself a DIY person, why not CIY in 2015? Knowing how to cook simple, delicious food is a great skill to have and it can’t be bought with money. Here is a collection of articles and quotes related to this idea.

Corporations cook differently than humans. The New York Times has a neat article called What 2,000 Calories Looks Like. Basically, industrial food is made to be cheap but tasty. That usually involves adding a bunch of salt, fat, and sugar. So, you could have a single peanut-butter milkshake (2,090 calories):

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Or you could cook yourself a feast including pasta, potatoes, eggs, chicken wings, turkey chili, coffee, and even beer and stay within 2,000 calories:

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Writers, nutritionists, doctors, chefs and Michelle Obama have all been promoting a hot new diet: home-cooked food. “People who cook eat a healthier diet without giving it a thought,” Michael Pollan recently told Mark Bittman, both authors and advocates of the cook-it-yourself diet. “It’s the collapse of home cooking that led directly to the obesity epidemic.” The magic of the diet, its advocates say, is that it doesn’t mean skimping on portions or going without meat, eggs, cheese, alcohol or dessert.

This is Michael Pollan’s position of Eat Anything You Want, Just Cook It Yourself, as put into a short 2-minute video:

Well-known food writer Mark Bittman has a new book called How to Cook Everything Fast which mixes the right recipes with time-management tips to bring homemade food to tired weekday cooks. You can find a long list of reviews for it here. I enjoyed his quote that “the most radical thing that you can do for your health, if not the world at large, is cook.”

Here’s another good 2-minute video with Mark Bittman taken from the Time article The Truth about Home Cooking that explains some of his philosophy.

When I talk about cooking, something I’ve been doing for the better part of five decades, I’m not talking about creating elaborate dinner parties or three-day science projects. I’m taking about simple, easy, everyday meals. My mission is to encourage novices and the time- and cash-strapped to feed themselves. Which means we need modest, realistic expectations, and we need to teach people to cook food that’s good enough to share with family, friends and, if you must, your Instagram account.

Because not cooking is a big mistake—and it’s one that’s costing us money, good times, control, serenity and, yes, vastly better health.

Don’t let the corporations convince you that cooking is too hard; it really is doable if you avoid the common pitfalls and plan ahead. I agree with Bittman in that you should learn to make food you really want to eat, first and foremost. See if these Bittman recipes excite you: quick spaghetti squash or quick chicken parmesan.

Want more recipe ideas? Skip the poorly-chosen recipe from Sam Sifton’s Home Cooking Manifesto and try these 10 realistic recipes from Megan McArdle instead. Also see the links inside my Dinner A Love Story book review.

Feel free to share your own links and thoughts in the comments.

Saving Money on Cold & Flu Medicines

It’s flu and cold season, and I’m just recovering from being sick myself. Who knew there was even something called Tylenol Cold Multisymptom Liquid Severe or Mucinex Fast-Max Severe Congestion and Cough? That is, if you can find it while wading through an ocean of this:

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Plus it costs nearly 10 bucks? This Atlantic article reminds us that all of these over-the-counter drugs are just combinations of the same old drugs like acetaminophen (Tylenol) or diphenhydramine (Benadryl). Even better, you can buy the generic versions for a fraction of the price, either individually or in their common combos.

The most important part is convincing yourself that generic versions of medicine have exactly the same effectiveness that the name-brand versions. Per the article, in order to be allowed on a pharmacy shelf, the generic version of a drug must deliver the same amount of active ingredients into your bloodstream in the same amount of time as the brand-name drug. You know which group of people buys the most generics? Pharmacists, because they see past all the marketing gibberish.

A new site called Iodine has a Cold & Flu Helper Tool that will help you determine what you need based on your symptoms, and help you find the generic version from places like Costco Kirkland, CVS, Walgreens, or Safeway. Or you can do what the author (an MD) does and keep generic versions of each individual drug, and make your own combo as needed.

Learn something, save money, and avoid taking unnecessary drugs with their potential side effects. Win-win-win!

Obihai FREE Monthly Home Phone Service; Get Started For $29.99

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Updated: $29.99 with free shipping (40% off) for a limited-time. If you still have landline phone service and are looking for a cheaper alternative, Obihai is officially supported by Google:

Obihai is excited to announce official support for Google Voice. With a Google Voice account and a companion OBi device you can make and receive VoIP calls on a regular telephone. To get started, just login to the OBiTALK website, add your OBi device and select Google Voice as your service. You’ll then confirm your account with Google, and within minutes, you will be making and receiving calls from the comfort and convenience of your home phone.

An Obihai VoIP phone adapter is a little box that will allow you to plug in any standard landline telephone and use Google Voice to make free phone calls within the US and Canada. You can also make cheap international calls starting at 1 cent a minute.

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It’s tough to beat under 50 bucks upfront and no ongoing monthly fees for unlimited home phone service. I bought one earlier this year – check out my OBi200 Adapter + Google Voice Installation Review.

Obihai is running a holiday promotion where you can get a Obihai OBi200 VoIP Telephone Adapter from NewEgg for only $29.99 with free shipping from December 18th to December 21st, or until supplies last. Retail price is $49.99.

You must use promo code EMCWHWB45.

Quality Clothing as Heirlooms? Celebrating Things That Last

I like my smartphone as much as the next person, but I’m also intrigued by things that last a really long time. Things that my children can inherit from me. Things like quality tools, classic books, good knives, or cast iron cookware. Up until today, I hadn’t really thought about my clothes in that way.

Outdoor clothing company Patagonia released “Worn Wear” before last year’s Black Friday as an “exploration of quality” and an “invitation to celebrate the stuff you already own”. Found via Farnam Street. Essentially it profiles a bunch of interesting folks who have used their Patagonia clothing for a long time. Depending on your perspective, the video could be about anti-consumerism, a great example of retail branding, or simply a bunch of cool people who do cool things.

Watching the video made me think of my 18-year-old LL Bean jacket. I first got it in high school, it’s been on many ski slopes and multiple continents, and I just wore it last week. Several years ago I had gained some weight and I tried to buy another one but they didn’t make it any more. Happily, it fits again.

From the video: “The most responsible thing you can do is buy used clothes.”

Related: Buy things that help you experience.

Economics of Keeping Your Old Refrigerator

This interesting chart from the Appliance Standards Awareness Project shows how dramatically cheaper and more energy-efficient new refrigerators have gotten over the last few decades. Even as the average size has grown slightly, since 1980 the average cost has dropped by roughly half while the annual energy usage has dropped by nearly 2/3rds.

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This WaPo article says this means it’s wrong to have a second refrigerator. Keeping your old, energy-wasting fridge could cost you $100 a year or more in extra electricity costs. At that rate, it may be better to either throw out the old fridge or even buy a new one.

Doing the math. If you don’t have your specific energy usage numbers, a fridge built to 1980 standards would use approximately 1,000 kWh more per year than a 2014 model. At the national average of 13 cents per kWh, that’s $130 a year. (I would recommend checking your own power bill because your actual per-kWh electricity cost could vary significantly.)

This caught my eye because we have an extra standalone freezer. It may use additional electricity, but it also reduces grocery trips and allowed me to fit 20 pre-made slow cooker meals inside at one time! More on that experiment later.

Dinner: The Playbook Book Review – Preplanning is Critical For Success

dinnerplaybookWe hit consecutive 10 weeks of cooking at home x 5 times a week! (Now we’re going on vacation so the streak must end.) Some days are fun, some days you just want to get it on the table.

Since I liked the first book by Jenny Rosenstrach so much, I also bought her second book Dinner: The Playbook – A 30-Day Plan for Mastering the Art of the Family Meal. While the first book was more autobiographical, this one is more focused on what you need to make home-cooked dinners happen. First, you need the right recipes:

I can’t stress this enough: You will cook more regularly if you choose simple recipes. By choosing simple recipes, you will get dinner on the table more efficiently and you will not end up with a pile of dirty dishes that makes you want to chug a bottle of beta-blockers. By minimizing the prep work and the cleanup (and the beta-blockers), you will be far more likely to do it again the next night. And that is the goal. Sustainable routines. Pleasant tableside experiences. Success. Which for our purposes right now will be defined as “a fifteen-minute period of time during which food is consumed without drama.” In short: The best home cooks choose the easiest recipes.

The book contains over 80 such recipes. But even with a dead-simple recipe, if I am faced with another trip to the grocery store after work, I’m going straight to the frozen lasagna (or worse, my kid’s chicken nugget stash!). You’ll also need to incorporate some structure and pre-planning for success.

The best tip that I learned from Jenny Rosenstrach’s books was to plan every week’s dinner out in advance. I plan for 5 nights cooking, 1 dinner-from-a-box (frozen dumplings, lasagna, premade burritos, etc.), and one dining out each week. Every Saturday night or Sunday morning, I pick out 5 recipes that I want to try. (Usually three come from a Rosenstrach book or blog!) I scan the recipes and (1) make sure that it really is doable with my limited culinary skills and (2) note what ingredients I need. Once you get better, you can pick the ones that share ingredients to save money, but I wouldn’t worry about that in the beginning. Just pick whatever sounds both tasty and easy.

My older kid wakes up at 6 am every single day, so on Sunday morning at 7am we hit the grocery store and Farmer’s market (in the same complex, sweet!). The world is still quiet, the man at the farmer’s market stand with the good salad mix always gives her a free banana, and I never have to go decide if I want to go to the store at 6pm on a Wednesday just for one ingredient.

Why is this important? See my flowchart. If you get arrive home from work and you don’t have all the raw materials in front of you and a plan to make into a meal, you will fail. Remove all roadblocks! Fail to plan, and you plan to fail! Insert other cliche here!

In addition, try to do whatever prep work you can each morning. My thing is just to double-check that I have all the ingredients, like making sure the spice containers aren’t nearly empty or the herbs aren’t yellow or rotten.

Finally, you need a 30-day challenge to get you going. By committing to 30 days and 30 dinners, you will hopefully be able to break out of your current rut and have enough momentum to make homemade dinners a regular habit. I suggest taking her option of backing this off to 20 dinners in a month, making each week 5 days on and 2 days off.

Bottom line: Good book, similar ideas to first book but less about her and more clear on purpose. I bought it mostly for the additional simple recipes. Cooking at home saves us so much money each month, this book easily pays for itself.