Archive for the 'Frugal Living' Category
Sunday, November 25th, 2012
Holiday shopping season is upon us… According to a Black Friday survey, and the average shopper spent $423 this long weekend. Another National Retail Federation survey reported the average spending per person in 2011 was about $704. (They also spent $130 on themselves.)
Although I still avoid crowded malls like the plague, I’m not one of those Scrooges that say that you should say “sorry, I’ve gotten myself into some debt, so this year I won’t be giving any gifts”. There’s no need to spend lavishly, but even if things are tight, gift-giving should be something that you planned for ahead of time. Otherwise, unless you live like a miser, what you’re basically saying is “I prioritize giving stuff to myself higher than giving to others.”
In reality, my main problem with gift-giving is dealing with all the extra entropy generated. You get all this stuff, a certain percentage of which is useful and the rest that isn’t. Therefore, in addition to saving money, my “battle plan” includes trying to reduce the chaos and clutter inherent in the gift-giving process.
Use up all your gift cards. Every holiday season, we are lucky to receive a number of gift cards. A year later, a chunk of those gift cards still sit unused. Since I already had an entire year to use them on myself and didn’t, the new mission is to use up all those gift cards to buy other people gifts before the next wave comes in. If all else fails, I try to force myself to sell them for cash at a gift card vendor. Run your own gift card price comparison like I did, or use a site like GiftCardGranny.com.
Get 5% back on all online purchases up to $1,500 from Discover. I do all my shopping online anyway. See here for details.
Buy discounted gift cards first. For large purchases, consider buying a discounted gift card to the store where you’re shopping (with a rewards credit card of course), and then use that gift card immediately to buy the final gift. You can even buy them while in the store from your smartphone. Don’t do this unless you are sure you’re going to shop at that store.
Redeem all those points you’ve been meaning to use. If you read this site, then it’s quite likely you have a stash of points somewhere. Earn ‘em and burn ‘em! Citi ThankYou points, Chase Ultimate Rewards points, American Express Membership Rewards points, Discover Cash Back or other balances that you need to request, and so on. The best redemption rates are usually for either a gift card or cash.
Sell your stuff. Really, actually sell it, not just think about selling it! Use your gift-giving urge as motivation to sell your old stuff. I know, it’s hard. Try selling electronics and popular items with an Amazon Seller account, you’ll get a better price than selling to a business, but it’s a little less crazy than eBay. Use the proceeds to pay for gifts or donate to charity. If you want zero hassle, run a sellback price comparison like I did for an old iPod Touch.
Cash Back portals. Cashback portals have become very popular, and most are having promotions right now which vary day-to-day. Sites that I have regularly use and cross-compare are eBates ($10 new user bonus after any purchase of $25+), Mr. Rebates ($5 new user bonus – minimum cash-out balance is $10), BigCrumbs (no bonus, but often offers the best payouts), FatCash, and Chase Ultimate Rewards mall (need appropriate Chase card). You can even earn cash back from Amazon and eBay now in certain categories. If you use these places, don’t forget to request a payment!
Credit card bonuses. Around the holidays, the banks usually have some new offers to grab us customers. Remember, use these loss leaders for your own benefit by never carrying a balance! I usually go through another wave of applications near the end of the year, all on the same day with different browser windows. Recently there are some new offers that I may jump on – 40,000 Thankyou points = $400 from Amazon from Citi, 50,000 American miles from Citi (100k if you do the business version too), $800 in Southwest Airlines airfare from Chase, and 50,000 points = $500 in gift cards from American Express.
All together, I’m sure I could scrounge up $704 with these tactics, counteracting both the cost and clutter of gift-giving. I’ll certainly be happy when I am done with shopping, though. Got some other ways that you help offset the hit from the holidays? Share in the comments below.
Monday, November 19th, 2012
Price drop! Virgin Mobile, which uses Sprint cell towers, offers the Apple iPhone as of June 2012. The plans start at only $30 a month – as outlined below – but you must buy a phone from them. The prices have recently dropped- 8GB iPhone 4 is $349 (from $549) and the 16GB iPhone 4S is now $449 (down from $649). Even though this is a higher upfront cost, your monthly bill can be much, much lower with Virgin which will save you hundreds over the course of a 2-year contract.
Their Beyond Talk plans at just $30 a month will get you 300 voice minutes, unlimited text messages, and unlimited data (throttled after 2.5 GB each month). For $50 a month, you can get unlimited minutes. To get the $5 discount, you must sign up for automatic monthly payment with a credit card, debit card or PayPal account. No contract. Here are all the plans:
The site also suggests that you don’t have to pay those government taxes and fees that amount to ~$5 a month on most postpaid plans, although you may be subject to sales tax:
All of the Beyond Talk Plans are inclusive of taxes and surcharges. However, we collect sales taxes on all Top-Up transactions for all services that we process directly and, in certain states, we collect regulatory fees. Retailers are responsible for collecting sales taxes and, in some states, regulatory fees for Top-Up transactions that they process.
Is this a good deal? Since we’re using the Sprint network, let’s run some numbers:
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Monday, November 12th, 2012
Updated with new deals. The Ooma Telo is a VoIP system that creates a home phone service through your broadband internet. Just plug in your regular landline phones and go. Features include unlimited domestic long distance, 911 service, caller ID, voicemail, and call waiting. In addition to the one-time purchase price, new customers must pay a share of government taxes and regulatory fees that works out to around $5 a month. Consumer Reports rated it their #1 home phone service in their June 2012 issue.
I bought my system in December 2009 for a then-good deal of $158, and I remembered worrying about the FCC shutting them down because I couldn’t believe their business model could be so cheap over the long haul. Well, I’ve now gotten nearly 3 years of home phone service for that $158, working out to about $5 a month. (Early adopters with the original Core system were grandfathered out of tax recovery charges.) It appears now that as long as the government gets their share of phone taxes and fees, they won’t be shutting down Ooma any time soon. I’m glad I spent the extra $40 to port my previous landline phone number.
The best compliment I can give about the Ooma system that I don’t even notice that it’s not a landline. It just works reliably. In my entire time of ownership I remember reading about a few hours of downtime in the middle of night, and nothing within the last year. The call quality is always great, and I can even use my fax machine with it. In some ways it’s even better than my old landline, because I can get e-mail notifications of voicemails and then listen to them on my computer or smartphone.
The “unlimited” phone service technically has a limit of 5,000 minutes per month under the explanation that it is meant for personal use. That works out to an average of nearly 3 hours per day, every day, so that’s close enough to unlimited for me. They do regularly bug you to upgrade to their Premier level of service which has added features for another $10 a month, but I’ve never felt the need to. Just make sure your number is on the Do Not Call list and you should be fine.
One alternative is the Obihai + Google Voice combo, but as of right now that’s only guaranteed to be free through the end of 2012. I know that many people are cell-phone only now, but for many households the most frugal option might be a Ooma box plus a basic prepaid phone plan for under $10 a month. Whenever possible, lower those recurring monthly expenses!
Current Ooma Deals
As I am an existing user, there is a refer-a-friend promotion right now where you can get Ooma for $139.99 + free shipping using my referral code SAD5171. Expires on 4/30/2013.
Monday, November 5th, 2012
Updated with new 5% off code. CouponTrade.com is another marketplace for unused gift cards. You can buy gift cards from other individuals at a discount from face value, or you can sell your gift cards (partial balances okay) at a price that you name and get cash instead.
The main difference between CouponTrade and other gift card sites like PlasticJungle is that at CouponTrade the seller sets their own price as opposed to fixed pricing. Therefore, you have a chance at selling at a higher price than competitors, or buying at a lower price. For example, at times sellers will curiously list at full value, turns out in the hopes that someone has a coupon code that CouponTrade will honor on their end.
Buying fees details. There are no fees for the buyer, just pay the listed price and get free shipping. Sometimes you’ll find a great deal, other times the prices are too high, and finally many times there will be no stock at all. After the holidays, activity should pick up. Here are currently active coupon codes:
- GIFT4U – $5 off $50, existing customers eligible, can only be used once, can’t be combined with additional coupons. Expires 12/2/12.
- CTHOLIDAY – 5% off, new customers only, can’t be combined with additional coupons. Expires 12/31/12.
Selling fees details. If your gift card does not sell, you won’t be charged anything. If your gift card does sell, the standard fees are a flat 10% commission plus a listing fee of $1.75 for a physical gift card and $0.99 for an electronic e-gift card sale. You can choose to get paid via check, Amazon gift certificate, or Paypal. Current promo codes:
- 4FREE – Free listing fee. Expiration unknown.
- SELL5 – Half off gift card fees (regularly 10%). One time use only, one single gift card listing. Cannot be combined with other offers. Expires 1/31/13.
Looking for where to enter your promo code at CouponTrade? Here are some sample screenshots:
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Thursday, October 25th, 2012
The following is a guest post contributed by reader Nathan, who recently started driving a vanpool in Chicago which saved him over $350 a month in addition to making a lower environmental impact. Thanks Nathan for sharing your experiences.
According to the Bureau of Labor Statistics, transportation costs are the second largest U.S. household expenditure after housing costs. In fact, between 2010 and 2011, an 8% rise in transportation spending was the largest percentage increase among all major components, 3.1% above even healthcare. With fuel costs rising for the personal daily driver, and even public transportation costs increasing because of fuel costs and increased demand, I sought the impossible in looking for a way to remove transportation from my budget altogether. I found my answer with vanpooling.
Vanpooling is similar to carpooling. Employees that live and work near one another and share similar schedules can form a group that conveniently gets them between home and work. With a “VANpool”, however, a municipality, university, corporation or non-profit organization provides a van for a group of people to use so that nobody in the group has to actually own and operate a personal vehicle. Each rider typically pays a low monthly fare based on distance and number of participants, which covers all costs of the vanpool including fuel, maintenance, insurance, tolls, roadside assistance, and van washes (the actual cost of purchasing the vehicle is often subsidized). And in many cases – here’s where MMB readers might get excited – the driver doesn’t pay anything!
I started a vanpool in Chicagoland about two months ago. I drive my 2012 Dodge Caravan 50 miles roundtrip each day, leaving the downtown city center where I live for the suburbs where I work. I drive five riders, who each pay $114 each month to Pace (the regional suburban transit provider) for the privilege to ride, and $20 each month to me to pay for parking (I pay a discounted rate of $99/month for parking instead of the $250/month average, a whole other story). The riders end up paying less than they would have in fuel costs alone if they were still driving, and could even consider getting rid of their vehicle altogether.
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Friday, October 19th, 2012
In an effort to spiff up my now 2-year-old iPhone 4 so that at least it felt slimmer and newer to me, I wanted to switch to a thin and minimalist case. The official Apple-branded black bumper case at an Apple store looked nice but was priced at a shocking $29. So I jumped onto eBay and found what appeared to be the exact same case for 99 cents. Free shipping. No sales tax. Credit cards accepted via PayPal.
Just 99 cents? How was this possible? Here’s a cost breakdown:
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Tuesday, October 9th, 2012
It’s getting colder, and the windows in the 90-year-old house we rent are single pane and very drafty. In the wintertime, this equates to a 100-300% increase in our electric bill. On a recommendation by a neighbor, we decided to install some simple plastic shrinkwrap insulation. You can find it in hardware stores and online for only a few dollars per window. Here is a five 3×5 window kit by Duck brand for under $9 with free Super Saver Shipping:
There’s also a 5-window shrink film kit by 3M brand for $18. I went for the cheaper one, but the 3M seems like it gets slightly better reviews. They come in a big sheet and also a couple of different sizes, so measure your windows first to make sure you use the sheets most efficiently.
Basically, you first tack up some double-sided tape on your window borders inside and then put on this saran-wrap type of plastic loosely over it. Then, you use the hot air from a hair dryer to “shrink” the plastic and remove all the wrinkles. The result: you can still see out your windows, but it reduces drafts and you have an insulative air pocket. Here are some quick pictures of my handiwork:
(click to enlarge)
The first one is after I put up the plastic and took out the wrinkles, and the second one is after I removed the excess plastic. I was a bit skeptical of the product beforehand, but it turned out pretty good. The wrinkles all came out, and the tape seems to be pretty airtight, at least for now. I can even tell where cold air came in by seeing where it fogs up the plastic. You can tell there is plastic sheeting there if you look closely or hit the glare just right, but overall it’s pretty unnoticeable especially if you use blinds or drapes.
I’m going to do the rest of the bedroom windows. At a cost of less than $20, it should easily pay for itself in heating bills. If I owned the house as opposed to renting, I might consider replacing the windows instead.
(This post is actually from a few winters ago, but it keeps getting regular search engine visitors so I have updated it and added more information.)
Thursday, October 4th, 2012
Here’s another potential way to cut those monthly expenses. FreedomPop is a start-up offering wireless 4G data service with a free basic plan including 500 megabytes data per month. You can earn more free data by referring your friends or doing things like product surveys or trials. No contracts, no cancellation fees, no ads. Otherwise, small overages will cost $0.02 per MB and bulk plans start from 1 GB for $10 per month. More details:
- 4G Coverage details. The service is currently based on being an MVNO of the Clearwire WiMAX 4G network which has a coverage area of about 1/3rd of the US. There are stated plans to use Sprint’s 4G LTE network plus their 3G network as a fallback in 2013.
- You’ll need a WiMAX modem, currently available as a USB modem stick or mobile WiFi hotspot “hockey puck”. The modems are “free” with a $49/$89 refundable security deposit and $5 shipping. Alternatively, you can pre-order a iPhone 4/4S or iPod Touch sleeve for $99 which won’t add much bulk.
- No per-household limit. Based on media interviews, they are okay with households getting multiple devices each with their own free 500 MB allotment.
- Fees and Upsells. They say no gotchas, but… they want $3 a month for “Speed Plus” which removes any data throttling. Usage alerts? Another $2 a month. If your account balance falls below $2 and you’re within 100 MB of your limit, it will automatically “top-up” with a $10 charge (you can turn this off in your billing settings). If you don’t use the service that month (less than 5 megabytes) they will charge you a $0.99 inactivity fee.
500 MB per month likely isn’t enough to replace your broadband internet connection, but it could definitely improve your cell phone bill. Brainstorming the various ways you could use FreedomPop to lower your monthly phone costs…
If you already pay for data, you could use this service and downgrade your current plan. If you only have a cheap basic cell phone plan for under $10 a month, now you can supplement any smartphone with free data. You could even turn an iPod Touch into a smartphone with no monthly costs at all by using Facetime, Skype, Google Voice, or other free VoIP services like the Vonage Mobile app. There are even rumors FreedomPop may start their own VoIP client. As a rough rule-of-thumb, a Skype-to-mobile/landline runs about 1 MB per minute. I’d still try and use WiFi or text messages when possible.
Looking at our billing history, I use around 1 GB a month and my wife uses only 300 MB a month. I think if I actually paid attention, I could stay under the free limits. However, I’m not sure I like the vibe of this company as their business model seems to be to advertise a completely free service but nickel-and-dime you into paying at least a few bucks per month. Once our contract is over, I don’t know if I’d rather deal with this or just switch to a Straight Talk $45 Unlimited prepaid plan with a used iPhone. But the upfront commitment is small, so I may try it out.
More: Businessweek, TechCrunch, GigaOM
Wednesday, October 3rd, 2012
These days when you inquire about repairing something, you’re often confronted with a $50-$100 minimum diagnostic charge with no guarantee that it’ll be fixed. Combine this with carefully planned obsolescence by the manufacturers, and it’s no wonder that people tend to throw things away rather than fix them.
I was reading an AARP magazine article (yes, I read AARP magazine) about a growing chain of Repair Cafes in Amsterdam, where volunteers gather and help you repair your things from appliances to furniture to mending clothing. I think it’s a great idea for people to share their skills and help each other out in the community. Also profiled recently in the NY Times. My skilled 4-Her wife mends my clothing all the time, albeit reluctantly as she’d rather me look like I fell out of a J. Crew catalog…
I was also happy to find out that there are some local groups in the US doing similar things. It might be cool to volunteer at one, even if just to learn how to fix various things.
There are also many online guides to fixing your own stuff. Check out iFixit.com, their Self-Repair Manifesto, and their goal to make a free repair manual for every device out there from cars to iPhones.
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Friday, September 21st, 2012
My parents gave me a very generous present of an iPod Touch for Christmas 2009. It came in very handy while traveling and at the gym, but then I got an iPhone (business expense!) and stopped using the iPod. It felt tacky to sell, so I waited. Finally, with all the talk about selling “old” iPhones right now, I figured it was time to sell (and use the money to help pay for a plane ticket for a grandparental visit, of course). I didn’t want to mess with Craigslist or eBay, as right now I just want it done quick and easy. There were a lot more options out there than I thought!
Details and condition: Apple iPod Touch (3rd gen, 64 GB). I don’t believe she paid the original retail price of $399, but it was at least in the mid $300s. Fully functional with original box, charging cable, and headphones. The screen is still smooth as glass and unscratched, but the metallic backside has many small scratches.
Real World / In-Person
Here are the options I found if you prefer to walk into a physical store and sell your electronics.
||Cash value quoted. Get 25% more as store credit ($68)
Online / Mailing it in
With these websites, you get a quote and then mail in your gadget using a prepaid shipping label. Once they inspect and verify, they will send you payment via gift certificate, check, or PayPal. There is the added risk of loss during transit, or a rejection if they disagree on condition, but most of them will ship it back for free.
The wide range of prices shows that you should definitely compare prices when selling this way. That was surprising, considering Apple products are nearly commodities now. I shop at Amazon.com regularly and value Amazon.com credit at least at 95 cents on the dollar, so I went with them. The Amazon brand backing helped as well. I probably could have gotten more if I listed on eBay (remember to account for eBay and Paypal fees), but I went ahead and printed out the prepaid UPS label and dropped it off at the nearest UPS store. I’ll update this post if I have any issues with the sellback. Please share your own experiences in the comments.
Tuesday, September 11th, 2012
Earn more. Save more. Those are the two ways to get out of debt and build wealth. I’m a big proponent of doing both, but for many people it may be easier to cut back on some luxuries rather than land a higher-paying job, start a side business, or become an investing wizard. It’s also more effective due to marginal tax rates. Let’s say you are single resident of California and your (taxable) gross income is $50,000 a year.
If you were to go out and earn another dollar as an employee, here’s how that additional $1 would get broken down:
You’d only keep 58 cents. On top of that, a lot of extra or freelance work is done as an independent contractor. That means you’re self-employed and get the happy task of paying another 7.65% of payroll taxes (the employer share), which brings your total tax hit to 49.6%! So in order to keep $1 in your pocket, you’d have to get someone to pay you $1.99. In that case, your choice becomes:
This relationship helps me visualize the power of spending less. Now when you save $1, you can feel good knowing that you’d have to have earned $2 of income to equal that. But on the flip side, when I get a check from a side project for $500, I know I’ll only keep $250 of it.
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Friday, August 31st, 2012
My favorite travel rewards card for many years has been the Starwood Preferred Guest® Credit Card from American Express. The reason is the combination of flexibility and value. This is the only annual fee card that I’ve kept consistently over the last 5+ years. Why?
- When redeeming towards hotel stays, you can get 2-6 cents of value per point, more than often the value you’d get from airline miles/
- Rather have miles? You can convert 20,000 points to 25,000 miles, which is 1.25 miles per dollar spent, 25% more than most other airline-specific cards.
- You can “top off” a variety of frequent flier accounts to get to that coveted reward ticket level. Your miles aren’t worth anything until you actually use them!
- You can convert just a few miles to keep your other miles from expiring.
Current Sign-up Bonus For New Accounts
American Express has been bumping up the sign-up incentive for the Starwood card once a year recently, so now is a good time to apply if you don’t already have the card. They are giving out up to 25,000 bonus Starpoints – 10,000 bonus Starpoints with your first purchase and another 15,000 points when you spend $5,000 within 6 months. The required spending in the past has been as high as $15,000, and the total bonus has been as low as 10,000 Starpoints. The annual fee is waived during the first year, then $65 a year after that.
(Note: If you don’t see the 25k offer, try clearing your cookies or using the Private Browsing / Incognito Mode of your web browser. Try right-clicking on the link to find this option.)
Either I’ve had one, or my wife has had one, or I’ve had the business card version of this card for the last 5+ years. Transferring points within between household members is quite easy and free. The Starwood Preferred Guest® Business Credit Card from American Express also has a similar offer good for another 25,000 bonus points – 10,000 after your first purchase and an additional 15,000 when you spend $5,000 within the first 6 months – enough for up to 6 free nights at a Category 1 or 2 hotel. Annual fee waived for the first year.
Starwood Points Convert Easily to Frequent Flier Miles
The first reason why this card is so useful is that Starwood points (or Starpoints) can be converted to miles to major domestic airlines and several international ones, including Alaska, American, Delta, Hawaiian, United, and US Airways (full airline partner list). That means 1 Starwood point = 1 frequent flier mile. The ratio is lower (2:1) for United.
Imagine that you’re only a thousand miles short of a free ticket, but you need to buy a ticket and would really like to make it free. Although there may be other options that involve spending money, you can simply “top off” your balance by transferring as little as 1,500 miles to the specific airline programs that you want. You can even convert a specific number of points. Just need 2,854 miles here and 1,567 somewhere else? No problem.
With most airlines, your miles expire after a period of inactivity. But since any activity counts (not only flying), I could quickly transfer 1,500 miles over in order to save 20,000 hard-earned miles from expiring.
For every 20,000 points you convert, you get an additional 5,000 point bonus. So 20,000 Starwood points = 25,000 miles on the airlines listed above. That’s 25% more miles per dollar than those airline-specific credit cards (although the waived baggage fees are appealing).
Great Hotel Rewards Card
Starwood is a growing collection of over 1,000 mid-scale to very-upscale hotels in nearly 100 countries, from the business-oriented Four Points and Sheratons to the upscale W and Westin hotels. This card has come in very handy for travel to international and bigger US cities.
Short-notice and emergency stays. All room taxes are included when you use points, and there are no blackout dates unlike other hotel programs. I’ve used them in a pinch, burning just 3,000 points for a last-minute $120 a night room at the Vancouver Airport Four Points (Category 2).
Luxury international hotels. I’m usually happy with a Holiday Inn Express by the airport for a business trip, but when traveling for leisure it can be very convenient to stay downtown near the action and sights. In a city like Paris or Rome, this can mean big bucks. With this card, I’ve stayed at $300 a night hotels like the W New York, Westin Madrid, and Westin Venice. Being able to stay up late into the night in Venice instead of having to leave was amazing. If you redeem for 4 nights in a row in a Category 3 or higher hotel, the 5th night is free.
Cash and points option. If you want the best value for your points, don’t miss “cash and points” opportunities. For example, I found a $400 room at the Westin Rome in Italy or W Hotel New York Times Square for 8,000 points + $150 a night. Run the numbers yourself using the booking engine at SPG.com and look for the “SPG Cash & Points” option. The value of 30,000 points can be easily greater than $500.
Finally, as a baseline 9,500 Starpoints = $100 gift card at Amazon.com.
Starwood Preferred Guest® Credit Card from American Express application link
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