My wife has been attending Weight Watchers meetings for a few weeks, and I noticed that my recently renewed Blue Cross health plan provides a $150 weight loss benefit. According to the Blue Cross web site, I can apply for the weight loss benefit by mailing in an application form along with copies of her Weight Watchers membership book and receipts.
While $150 is not a lot of money, it is a nice extra incentive to try to live a healthier lifestyle. Even better, I'm well on my way to a thinner (and healthier) wife and a fatter wallet.
My homeowners association recently hired a landscaping company to prep and seed about 12,000 square feet of the "dust bowl" common areas in our neighborhood. The contractor recommended hydroseeding the area, where grass is grown by spraying a mixture of grass seed, fertilizer, paper mulch, and water on the prepared soil (cost $3,600).
The 1,000 square foot area in front of my property was also a mess, but I wasn't prepared to pay a contractor a fortune to do the job. Being cheap, I decided to tackle the job myself. To minimize costs, I used a technique that I read about in an old copy of Jerry Baker's Lawn Book which I refer to as the "hayseed method":
I prepped the soil by removing all weeds and rocks.
I seeded the area with a bag of drought tolerant Fescue grass seed that cost about $8 at Walmart.
I applied some granular Vigoro fertilizer (left over from a prior application) to the newly seeded area.
I mulched the area with a couple of bales of straw that I bought for $5 each at a local farm stand. The mulch helps keeps the seed moist, cool, and in place (like the paper used in the hydroseeding method).
I water the newly planted seed on a daily basis.
The common areas were hydroseeded two days before I seeded the area in front of my property, but my grass sprouted before the professionally done job:
So far, my "hayseed" method (right) is outperforming the hydroseed method (left). On the downside, I did have one neighbor ask me if a truck carrying hay tipped over in front of my house. I thought that was hysterical, but I guess I shouldn't be surprised by the comment since most of my neighbors don't even cut their own grass. Either way, the frugal homeowner in me would love it if my $20 job could continue to outperform the professional $3,600 job.
I ended up buying sixteen cans of College Inn broth for $8 (50¢ each), one can of Del Monte tomatoes for $1, and one can of Del Monte peaches for $1. My 9/24/06 Valassis coupon booklet had some pretty lousy coupons for this deal, and I was only able to get my hands on one coupon for $1 off 6 cans of College Inn broth:
18 Del Monte Products
$5 Checkout coupon
(1) $1/6 Coupon
$10 Mail in rebate
The final result was that I was paid $5.61 to buy eighteen cans of Del Monte products. If I had bought them at the regular price, I would have paid $15.02 for the same eighteen items.
I would also like to stash an equal amount in a 2 year CD, but have not been able to find an attractive deal. Patelco Credit Union is offering a Flexible-Term 6% APY CD for 12 to 23 months, but I am not comfortable with the fact that this account would have private, and not government NCUA insurance. Patelco was originally a credit union for employees of the Pacific Telephone and Telegraph Company, so it does have a proven track record. I am still on the fence about them though, and will continue to look for other options for a 2 year CD.
If you became incapacitated (or worse), how difficult would it be for your family to get a clear picture of your assets and liabilities and assume management of them? A recent article in Parade Magazine (Get Your Finances Organized) got me thinking about this. If I were to die tomorrow, would it be difficult for my wife to understand our complete financial picture (checking and money market, brokerage, 401k, and IRA accounts, CD's, as well as paper and electronic U.S. Treasuries, mortgage, credit cards, monthly bills, etc.)? Yes, it sure would! That concerns me because even though we discuss our finances frequently, my wife has little interest in the details of our various accounts.
The Parade article recommends creating a "crib sheet" detailing your financial picture. Their article gives a general overview of the information to include on on this crib sheet, but I think a sample document would have made a nice addition to the article.
Fortunately, there are some good resources already out there:
I know that I need to break down and document our personal financial information. It's hard to motivate yourself to do this though when you already don't have enough time to juggle work, life, and family. Once I finally get it done, I will keep copies of it in the fire resistant box we keep at home as well as in our safe deposit box.
Much like the Post cereal deal I mentioned a couple of weeks ago, a similar deal for Del Monte products is available this week.
The most important piece of the deal is a $10 mail in rebate that Del Monte is offering when you buy 18 participating Del Monte products between 9/01/06 and 11/30/06 (download rebate form link):
BUY: Eighteen (18) products from Del Monte Foods from at least three (3) of the following participating
brands: 9Lives® Dry Cat Food, Kibbles ‘n Bits® Dry Dog Food, Del Monte® Vegetables, Del Monte®
Fruit (excluding Del Monte® Fresh Fruit and Dried Fruit), Del Monte® Tomatoes, StarKist Flavor Fresh
Pouch® Tuna Products, College Inn® Broth.
The next piece is a Del Monte promotion at Stop & Shop supermarket where you get a $5 checkout coupon with the purchase of 15 participating Del Monte products.
The final piece is to use some Del Monte coupons that will be included in the 9/24/06 Valassis coupon booklet (including College Inn Broth, Del Monte Fruit, Tomatoes, or Vegetables, and StarKist Tuna).
I will report back on the final details of my experience with this deal, but it should result in getting 18 Del Monte grocery items for free.
Is having a large family the newest way of keeping up with the Joneses? Back in May (before I started this blog), the Boston Globe Magazine had a memorable feature on well-to-do families in Wellesley, Massachusetts who are having a large number of children: Full House.
"For some people in Wellesley," says Goldston, "having four kids has become the new status symbol, like having a luxury SUV. It says you can afford it; you can have a nanny to help you out."
"People in this town like to have a lot of kids, but they don't necessarily like to raise them by themselves." Morris's husband would like to have a fourth, and seeing so many bigger families around her, she's felt some pressure to try to keep up. "If all your friends are having four, does that make you more likely to do it? Absolutely." But after having three kids in three years, she feels she is just starting to get her life back under control.
As a parent, I found this trend slightly disturbing. Why focus on people who consider children to be as much of a status symbol as an expensive home, a fancy SUV, or a Rolex watch?
I can't begin to imagine how hectic life is for the families in article with 6 or 8 children. How do you raise such a large family without a staff to help with cooking, cleaning, childcare, and transportation? Good grief, is that a healthy environment for a child to grow up in?
I can certainly relate to the joys (and hardships) of being a parent. However, having four children just because your friends do is just plain irresponsible. Although it is an affluent town, it sounds to me like Wellesley is full of Big Hat, No Cattle residents as described in The Millionaire Next Door.
This jump was particularly good news for me since I have been holding a position in ORCL that I started building in 1995. I have been watching this stock flounder for the past few years as it has traded at a fraction of its 2000 high.
Since the favorable capital gains tax cuts have been put into place, I have been considering selling my position in ORCL. A large tax hit will still be waiting for me though, since my split-adjusted cost per share is $2.77. A phone call to my CPA is probably in order as I continue to consider cashing in my chips. I would love to see ORCL hit $25, since that would break through a psychological sell level that I seem to have. Go, Oracle go!
Why would any intelligent person use a debit card instead of a credit card? I just read the latest anti-credit card diatribe from a one trick pony at the Morningstar Forums, and just don't understand where this guy is coming from. He has a history of credit card problems, and overcame them by becoming a Dave Ramsey zealot whose philosophy is All debt is bad! (even 0% car loans).
Here are some of his latest pearls of wisdom from Morningstar forum user chipmunk:
Studies have long shown that the average credit card user spends 12% - 18% more compared to the average cash buyer ... So, it is clear that, even if you use a credit card and pay it off in full every month, you are still losing money.
It sounds to me like the debunking of the rebate/airline miles myth is spreading and having an impact. I think the ripoff credit card companies are finally starting to feel the pinch of people wising up and switching to debit cards.
There is NO positive side to credit card use. You will spend more if you use credit cards. Even by paying the bills on time, you are not beating the system!
How could anyone dispute the fact that credit cards are superior to debit cards in every way as long as you pay your balance in full every month? Here are the facts that the debit card fanatics refuse to acknowledge:
An informed and responsible consumer doesn't confuse payment method with poor spending habits.
If you are the victim of credit card fraud, the bank's money is lost, not yours.
Your maximum liability for credit card theft is $50 per card, but can be unlimited with a debit card (see federalreserve.gov for details).
A credit card provides you with a 30 day interest free loan.
Many credit cards offer rewards and extended warranties.
Responsible credit card use helps improve your credit score, which can impact your ability to get a loan, insurance, or a job (Bad Credit = Not Hired).
CD rates are dropping, so it's time to think about locking in one of the remaining 6% deals out there. This morning, the attractive World Savings: 6.01% APY for 15-Month Internet CD deal that I took advantage of on August 31st has already been replaced with a 5.76% APY 13-month internet CD.
I have to admit that I was wrong about the recent decline in CD and T Bill rates since I didn't anticipate the drop in oil prices and the low CPI-U inflation numbers last came out last week. Along with the housing slowdown, these events seem to have convinced Mr. Market that rates will be trending down over the next year. At this point, it looks like I'm done with T Bills and savings bonds for now and will stick with CDs, high yield money market accounts, and a few EE savings bonds for my cash holdings.
The Valassis coupon insert in today's Sunday Boston Globe contained an advertisement for mail-in rebate of up to $7 on Scotts® Turf Builder® WinterGuard products.
The rebate form can be found online at the Scotts web site: scotts.com/fallrebate/. The offer is valid for $3.00 off a 5,000 sq. ft. bag of Scotts® Turf Builder® WinterGuard product or $7.00 off a 15,000 sq. ft. bag purchase made between August 31, 2006 and October 18, 2006.
Series I Savings Bonds Watch: August CPI-U numbers released
The U.S. Bureau of Labor Statistics released the August 2006 Consumer Price Index (CPI-U) inflation data this morning. It increased by 0.2% last month, indicating that inflation is under control (Key inflation gauge tiptoes higher).
Although this number can impact interest rates as well as the stock and bond markets, let's see what this means for Series I savings bonds (I Bonds). As I mentioned earlier (Should You Sell Those Savings Bonds?), the variable interest rate portion of I Bonds is determined by the semiannual CPI-U rate. Now that the August 2006 CPI-U data is out, we only need the September 2006 CPI-U data (to be released on October 18th) to determine the initial variable interest rate for I Bonds issued on November 1, 2006.
I watch the CPI-U data on a monthly basis, which I use to help me decide if I want to buy I Bonds. In my opinion, the ideal time to buy I Bonds is in late April and late October, after the previous month's CPI-U numbers have been released. This allows you to know the rate of return for your I Bonds for both the first and second six month periods, which is important since you must hold I Bonds for 12 months before they can be redeemed.
As an example, let's assume that the September 2006 CPI-U number remained unchanged from the August 2006 number released today. Using the CPI-U data from March 2006 (199.8) and August 2006 (203.9) (courtesy of www.inflationdata.com), we can calculate the initial variable rate for the November 2006 issue I Bonds:
For this example, let's also assume that the fixed rate for the November 2006 issue I Bond remains at the current value of 1.40%. That would mean these bonds would earn a rate of 5.50% (1.40% fixed + 4.10% variable) until the variable rate is reset in 6 months.
I will be doing this calculation for real when the September 2006 CPI-U numbers are released next month. Of course, I will not be buying any I Bonds before November 2006 since they would only earn 2.41% (1.40% fixed + 1.01 variable) for the first 6 months. I can get a much better return during those 6 months with a high yield money market account, T-Bills, or CDs.
Similarly, I will make my next I Bond buy decision in late April 2007. Once the March 2007 CPI-U numbers are released, I can perform the same calculation as above using the September 2006 and March 2007 CPI-U numbers:
Do you have an old bank account or stocks that you may have lost track of? If so, you're not alone. According to the Massachusetts Abandoned Property Division, 1 person in every 10 has abandoned property.
Every March and September, the Sunday Boston Globe contains an insert that lists owners whose unclaimed assets have been forwarded to the Abandoned Property Division within the past year. The latest insert had a list of over 40,000 new owners of unclaimed assets, which is a fraction of the listings found in their searchable abandoned property database www.findmassmoney.com.
In March, a family member found that they were somehow owed several hundred dollars from from a car that they traded in last year. I don't know the details of the situation, but they did apply for and eventually received their money.
Anyone can do a simple search to see if they have any unclaimed property. The National Association of Unclaimed Property Administrators (NAUPA) is a great place to start your search. NAUPA is a non-profit organization affiliated with the National Association of State Treasurers. Members represent all states and the District of Columbia.
The NAUPA web site, www.unclaimed.org, has links to the Abandoned Property Division for each state, as well as a link to the National Unclaimed Property Database web site www.missingmoney.com. Take a few minutes to check these sites out and maybe you'll find that you have some found money heading your way!
I've already admitted that I love books and TV shows that document poor personal financial habits (Big Spender: A Financial Intervention). One reoccurring theme in these cases is when a person who is a Saver marries a person who is a Spender.
The Spender vs. Saver criteria for the poll was as follows:
I try to get a good deal and stay within budget when spending money.
I enjoy watching my savings grow.
I save and plan for the future.
I buy what I want when I want.
Convenience is more important than price.
Why not spend? You can't take it with you!
Eighty-one people responded to the poll, and I found the results surprising:
Wow, almost half of the people polled reported that they were in a "mixed" marriage with one Saver and Spender! How do so many people coexist with a spouse whose attitudes about money are the polar opposite of their own? Even worse, 78% of all people polled have a marriage with at least one spender. I can't begin to imagine what life will be like for these people when they are too old or too ill to work anymore.
I also shouldn't have been surprised that only 15% of the responders were in a Saver/Saver marriage. I suppose that is an example of why our country has such a poor personal savings rate.
When I was in college, I made my money by pumping gas at a full service gas station. While most people would ask for regular gasoline, a select few would always ask for "the cheap stuff". I'm starting to think that the latter folks had the right idea.
The Sunday Boston Globe had an interesting Consumer Beat column about some Massachusetts gas stations that have recently started to call 87 octane gasoline Economy grade and 88 octane gasoline Regular grade: Anything but 'regular'.
``They're preying on people asking for the wrong product," said Robert McGrath , who oversees Boston's weights and measures department. ``A lot of people just don't pay attention."
The concern with this change is that people will be paying an extra 15-20 cents per gallon for the 88 octane Regular grade gasoline, when they believe they are getting the 87 octane gasoline. Although consumers should know better, this does seem like a way for gas station owners to profit from customer confusion.
The article also mentioned a Massachusetts gas station that offers an 86 octane economy gasoline that is 19 cents less per gallon cheaper than their 87 octane gasoline. The interesting part is that 86 octane gasoline is not even shipped into the region, so that 86 octane gas is really 87 octane gas. Basically, some people are paying an extra 19 cents per gallon for absolutely nothing.
We had a death in the family recently, which has cut back on my blogging a bit. However, it did make me want to discuss some things that everyone should consider when they are planning a funeral for a loved one.
This may not seem like the time to be concerned about money, but it is important to make sure you do not spend beyond your means for such an expensive purchase. According to the Federal Trade Commission (FTC), a typical funeral costs about $6,000, and many funerals cost $10,000 or more. Spending such a large amount of money is certainly a good incentive to compare prices and negotiate the best deal that you can.
Since the death of a loved one can be a very emotional time, it is not difficult to be coerced into spending far more on funeral arrangements than budgets and common sense allow. Some people may want to give the deceased a lavish funeral to show everyone how much they were loved or they may be pressured to overspend by a family member or funeral home. So where do you begin?
The first thing to do when discussing funeral arrangements with a funeral home is to ask for a written price list. Under the FTC's Funeral Rule, the funeral home must give you a written price list that shows the goods and services that they offer. This list will be invaluable to you when choosing the items and services that are important to you. For more information on the Funeral Rule, check out the FTC publication, Funerals: A Consumer Guide.
In my opinion, the best way to approach this subject is to discuss your own funeral wishes with your loved ones while you are still among the living. Before my grandmother died earlier this year, she told us that she did not want a viewing or any other elaborate funeral arrangements. She wanted to be cremated and insisted upon a small church service followed by a family dinner, and that's exactly what we did. When it's my turn, I also want to keep things simple and inexpensive.
When my time comes, I wonder if my sons will do their homework and decide to buy a casket or urn at Costco (Caskets, for less, at Costco)? That works for me, as long as Costco had the best price.
My investments did pretty well over the past month, with most gains due to a strong showing by the stock market. My cash holdings stayed at roughly the same level, although I did move $10,000 from money market funds to a CD at World Savings (World Savings: 6.01% APY for 15-Month Internet CD).
I will probably starting funding my 2006 SEP IRA contribution soon, so I should see these numbers increase a bit over the next few months.
Brian Pagliaro , vice president of sales for Tufts Health Plan, said, ``All things being equal, everything we paid $1 for last year costs $1.10 now."
Since I have my own health insurance, I have seen this first hand. When I received my HMO renewal packet in August, I was greeted with a 12% increase in insurance premiums ( Another Painful HMO Premium Increase). Unless some major health care reform happens soon, I can assure you that a variant of this article will be written one year from now.
Do you need personal liability umbrella insurance?
Although we already had health, life, disability, automobile, and homeowner's insurance, I recently addressed a gap in our insurance coverage by adding personal liability umbrella insurance to the mix.
In today's litigious society, an accident where you are found to be at fault could cause financial ruin for you and your family. Umbrella insurance is helpful in that case because it provides liability coverage when you exceed the limits of your homeowner's and automobile insurance. Since I own my own home and two automobiles in addition to some financial assets, I decided to get some extra protection by purchasing umbrella insurance.
My local insurance agent informed me that I must have minimum limits of coverage for my home and auto insurance:
Auto insurance bodily injury coverage of $250,000 per person and $500,000 per accident.
Homeowner's insurance personal liability coverage of $300,000.
In my case, it cost an additional $132 per year to bump up my auto insurance liability coverage to the required levels.
I was also able to get a 10% discount on my homeowner's insurance by switching it to the company that I have my auto insurance with. I researched my old and new insurance companies with the free resources at Standard & Poor's, Moody's, and A. M. Best, and found that my new insurer was rated higher than my old one. At that point, I was ready to make the change.
With all discounts, I was able to add 1 million dollar liability coverage (as an endorsement to my homeowner's policy) for an additional $115 per year. Adding in the increase in auto insurance, the total was an additional $247 per year.
I believe that spending about $250 per year for umbrella insurance is a pretty reasonable amount of money to pay for the added liability coverage. Rates can vary though, since they may be based on credit score, driving record, and homeowner's insurance claim history.
Grocery Deal: How I made money buying 10 boxes of cereal
My grocery shopping approach (Strategy: How to Save Money on Groceries) is based on stockpiling items when they can be bought for a good price. This week, I took advantage of a deal where I was able to get paid for taking ten boxes of cereal off of the supermarket's hands.
Shaw's Supermarket had a Kraft Foods promotion this week where you would get a $10 checkout coupon when you spend $20 on participating products.
I often eat Raisin Bran cereal for breakfast, so I focused on the 20 oz. box of Post Raisin Bran that was on sale for $2 (regular price $2.89). I matched this sale up with the 8/13 SmartSource coupon booklet, which contained a coupon for $1 off any 2 Post Cereals as well as a $10 Post/Nabisco mail in rebate form.
Unfortunately, I could only scrounge up four of the $1 off any 2 Post Cereals coupons, which cost me an extra dollar of profit:
10 Boxes of Post cereal
$10 Checkout coupon
(4) $1/2 Coupons
$10 Mail in rebate
The final result was that I was paid $3.61 to buy 10 boxes of Post Raisin Bran cereal. If I had bought them at the regular price, I would have paid $28.90 for the same ten boxes of cereal.
Having a poor credit history will not just make it difficult to borrow money to buy a home or a car, but it could also hamper your efforts to buy insurance or find a job. An article in the Boston Globe today is yet another reminder of how critical it has become to have a good personal credit history:
My credit wasn't perfect, but I never thought my student loans would go against me," said Horton. ``The company said I could reapply once I had two years of excellent credit, but there is no way I am going to be able to pay off those loans that quickly.
From an employer perspective, I can understand how you could question the quality of an applicant who isn't responsible with their own finances. But what about the people who have had their credit history destroyed by identity theft, medical bills, divorce, or the death of a spouse? Where do you draw the line between being a victim and being irresponsible?
the day for which the toilers in past centuries looked forward, when their rights and their wrongs would be discussed...that the workers of our day may not only lay down their tools of labor for a holiday, but upon which they may touch shoulders in marching phalanx and feel the stronger for it.
I read an article in the Sunday Boston Globe this morning that took me for a trip down memory lane (Card-carrying collectors).
I have collected baseball, basketball, and football cards since about the age of four. Although I haven't bought any for myself in many years, I have amassed a pretty large collection in my lifetime. Pack by pack, I accumulated many star and rookie cards from the 1970's and 1980's as well as a several baseball card complete sets.
After reading this article today, I looked through some of my cards for the first time in many years. I had forgotten about the stack of 1982 Cal Ripken rookie cards, chuckled at a young Greg Maddux with a pencil-thin moustache, and cringed at the 1974 Dave Winfield rookie card with my initials scrawled on the back (I was afraid that my older brother would swindle it away from me).
I ended up finishing that 1974 Topps baseball card set about 15 years ago, when I broke down and bought an unmarked Dave Winfield card to replace my original one. Although that 1974 set spends its time sitting in a closet, it is one of my most treasured possessions.
I didn't know it at the time, but those cards I bought in 1974 were my first buy and hold investment. And even though they have some intrinsic financial value, I would never sell them at any price. I fully intend to periodically bore my children, grandchildren, and (hopefully) great-grandchildren with them until the day that my sons inherit them. I don't know what they'll do with my cards, but I don't care because for now they are a time machine that take me back to my childhood. Besides, they are still mine -- for now.
Who knew there was a National Coupon Month? I certainly didn't, until I happened across CouponMonth.com. According to the site, "National Coupon Month is a program of the Promotion Marketing Association (PMA) Educational Foundation, Inc., which is an educational public foundation."
I have been using grocery coupons heavily for the past three years, and have become a big believer in smart shopping and couponing. Check out my approach to grocery shopping here Strategy: How to Save Money on Groceries and see if you can find some ways to cut your grocery spending.
This provision was phased in on a state by state basis from December 1, 2004 to September 1, 2005, and today is the one year anniversary of the date that the entire nation was eligible to check their credit report for free. Why not mark the occasion by requesting one or more of your free credit reports today?
As required by FACTA, Equifax, Experian, and TransUnion have set up a web site (AnnualCreditReport.com) where consumers can request a free copy of their credit report from all three credit agencies. Please note that AnnualCreditReport.com is the only site authorized by Equifax, Experian and TransUnion for this purpose, so be wary of other sites claiming to provide free credit reports.
Now is a great time to do your financial health a favor and give your credit its free annual checkup. While you're at it, check out the identity theft information at the Federal Trade Commission (FTC) web site, which I read about in the September 2006 issue of Money Magazine. The site has some good information about what steps to take if you suspect that you are the victim of identity theft.