Monthly Archives: August 2014

A Great Budget is… YOUR map

A Great Budget is all about you

Part of the reason I created this blog is because I am starting to use a family budget again. I wanted to have some accountability, so I’m sharing my personal journey. I also wanted to help others who are considering a budget for their family.

On a long trip, especially if you have never been to your intended destination before, it is a good idea to have a GPS or map. A great budget is like a GPS or map for your financial journey through life. A well made budget can enable a person to be more financially responsible over the long haul. A great budget directs your finances in the most efficient path to your destination. A winning budget keeps you on the right road to success, no matter how you define “success”.

On a long trip, to be sure you stay on track, you must review the map frequently, adjust for detours or traffic, and watch for road signs. Let’s look at some of the traits for a great budget.

Individualized – A great map is individualized. Your destination may be different than mine. If you are going from New York City to Houston, and I’m going from Savannah, GA to Atlanta, GA, we will need different maps.

Likewise, a great budget is individualized. If you are a single, mid-20 something living with the Parental Units, your budget will be different than your married, father-of-four, mortgage-toting brother’s budget, or your retired grandparent’s budget. Your budget should be specific to YOU. It’s ok to start with someone else’s budget, or a generic budget from some website, but over time, consider customizing it to fit you and your situation.

Detailed – A great map is detailed. Your map needs to show road names, turn directions, and distances to be traveled on each road. It should show approximately how long you will be on each road, in case you forget to check the odometer. On a long trip, a printed map and turn-by-turn directions may take several pages.

Similarly, a great budget is detailed. Your budget should reflect ALL income, and ALL expenses. I like doing my budget in an Excel spreadsheet. If something changes during the month, I can immediately adjust.

Your budget should have expense categories, based on your life.  A great budget will let you see how much you are spending in dollars for a specific category. It should also let you see those categories as a percentage of your income. Within each category, you can add specific lines for more detail. For example, on my budget, the category “Utilities” includes a line for each of the following: Electricity, Water, Cell phone, Internet. The total for each line is added together to give me the total expense for Utilities.

Simple – A great map is simple. If your map is 14 pages, front-and-back, in 9-point font size, with hand-scribbled notes all over the margins, and a coffee stain, you will have a hard time following the map on the open road, much less when you are in rush-hour traffic in a big city. Consider a condensed overview page for a quick glance in traffic.

A great budget is detailed, but it should also be simple enough that you can understand what you are looking at. Budgets can generally be one page. You could show a great budget to a teenager and have them understand the basics of your budget. If your budget is too complicated, you will find excuses to put off using it.

Try to keep a simple overview, even if at various times you need more detail. You can always drill down to get more information if you need it at that time. For example, I keep my budget simple by having the Categories bolded, and all the Categories add together (since I use Excel) to provide the total expenses right next to the total income.

Realistic – A great map is realistic. If your GPS said your trip time from New York City to Houston will take one hour, is approximately 43 miles, and requires 6 gallons of fuel, you would probably look for a new GPS. Even if you haven’t made the trip before, you would probably know that is not realistic.

A great budget is realistic. It should address all of your needs, priorities, income, and expenses. It should have every dollar allocated somewhere, to a specific purpose. Otherwise, any additional income simply “vanishes”, and you are left wondering what happened to it.

If you are trying to pay off debt, a great budget will show approximately how long that will take. If you use a computer spreadsheet, you can update the budget easily and quickly, so it stays realistic and current throughout the month.

Using these four tips can help you to have a great budget that works great for you!
How is your budget? What tips do you have to help me (and others) to develop a great budget?

 

Coupon Sharing – It is Saving or Stealing?

Ethical question regarding coupon sharing

I saw a post by Daniel over at Sweating the Big Stuff regarding how he used PF skills to make a new friend and brighten someone’s day by coupon sharing.

Coupon sharing - image of coupon

Coupon sharing – ok or not?

The basic story is in relation to his purchase of an umbrella. As I understand the article, he lost his umbrella and went to get a new one at Gap. He found a Gap coupon and intended to use that.

However, when he arrived, the store had a special going for 30% off umbrellas. Therefore,, so he didn’t need the coupon. After his purchase, as he was leaving the store, he handed off the coupon to another customer who had a lot of items… coupon sharing, in other words.

Daniel said the other customer was very appreciative.

In the comment section, Kevin said he felt Daniel was stealing from the store by coupon sharing. Kevin felt that if the store wanted everyone to save 30%, they would reduce prices store wide by 30%. Coupon sharing by giving his coupon to a customer who was prepared to pay full price was, in Kevin’s opinion, in effect “stealing” that 30% from the store.

Daniel felt that since the coupon was not unique (it was not addressed to him specifically), then anyone could use it. He gave it to someone, and put a smile on their face.

Personally, we get coupons in our local, weekly newspaper. My wife clips the coupons we can use, and then I take the remainder to work and give them to a co-worker.  She has a little boy and a baby on the way.

My wife was not a Coupon Queen. More like a Coupon Duchess. She was good at it, but didn’t really get started couponing until a couple of years ago. This year, many of the stores have stopped the coupon doubling and tripling. She still uses coupons, but the savings are not as extreme as they were in the past.

What do you think about coupon sharing? Do you think that if a store intended for the coupon to be used by a specific customer, it would restrict that to a specific customer? Do you think the store simply wants to increase traffic, and would prefer to have a sale, even if it is a discounted sale?

 

Car Insurance – I’m on the hunt

Car Insurance – Looking for a new provider

Car insurance is a necessary evil if you drive. I have had car insurance most of the thirty-ish years I have been driving, but I have never filed a claim. As much as I’ve paid for car insurance, I probably could have bought a very nice car. I think I have been made the insurance companies a profit.

All of my cars have been used. Most of my cars have been older. Only one of my cars had full coverage; the 1997 Ford Escort had full coverage until my one and only car loan was paid off. As soon as I had the title in my hands, I dropped the coverage to the state required minimums.

I’m not complaining. I’m glad I never had a claim, because that would mean I had been in an accident, with a damaged car, or injured body. However, I still feel like the insurance companies have gotten the better end of the deal.

The reason for this post is because I have been researching car insurance. Our six month policy is up for renewal. I have been with Progressive the past two years. We ended up with them because of a crazy incident, which I may talk about some day. I wanted to see if we had the best coverage for the money.

To give you some background, I’m 44, R is 43, and we both have good driving records. Currently, we have three vehicles – a 1997 Ford Escort, a 2001 Ford Windstar, and a 2006 Honda Odyssey. R is a home-maker, home-schooling our youngest, so she doesn’t drive much. My day job is 5.5 miles one way, so I drive less than 3,000 miles per year commuting to work in my Escort.

I do have my “side hustle” DJ business, but I only drive the Windstar if I need all my gear; I believe I drive it less than 5,000 miles per year. The Windstar currently serves as a “portable storage unit” as much as it does a “vehicle”. I can fit a basic DJ rig in my Escort, which gets 30+ MPG, compared to the 18+ MPG of the Windstar. Most of my events are close to home.

I add less than 12,000 miles per year to the Escort, including my commute and DJ business. We have the state required minimum car insurance coverage – 25/50/25. In case you are not familiar with what that means (I wasn’t before I started researching), following is an explanation:

  • Bodily Injury (BI) – $25,000 per person – If we were at fault & injured someone
  • BI – $50,000 per accident – if we were at fault & injured more than one person
  • Property Damage (PD) – $25,000 per accident – if we were at fault & damaged stuff
  • No Uninsured Motorist (UM) BI – if an uninsured person hit & injured us
  • No UM PD – if an uninsured person damaged our car (or drove through our house, etc)
  • The UM coverage is supposed to protect you from hit-and-run drivers also. This add-on to your car insurance policy protects you, for example, if you came out of a store to find that someone had backed into your car in the parking lot and left without leaving their information on your door. Your car is damaged, and you have no way of knowing whose insurance to file a claim on.

We currently pay $663 per six months or $1326 per year with Progressive. Flo is either annoyingly cute, or quaintly quirky; neither is enough that I feel any loyalty to her company. Additionally, the Katie Fisher incident is enough to cost them my business. That is not how I want my car insurance provider to treat my family should something happen.

Image of GEICO Gecko

Car Insurance legend… The GEICO Gecko

I’m looking at GEICO, who I used to have many years ago. Like Flo, the Gecko is either cute or quirky. However, I currently work for a company which is owned by Berkshire, which also owns GEICO. So, I get employee pricing discounts on car insurance. I set up three plans on the GEICO website: Plan 1 –

  • 30/60/30 – more than the state mandated minimums for car insurance
  • UM BI – none
  • UM PD – none
  • $498.90 per six months – savings of $164.10 per six months or $328.20 annually

Plan 2 –

  • 50/100/30 – double the state mandated BI, and a little more than the state mandated PD
  • UM BI – 50/100
  • UM PD – 30,000 / 250 deductible
  • $670.50 per six months – adds $15 per six months or $1.25/month to our current Progressive car insurance bill, but the coverage is better

Plan 3 –

  • 300/300/100 – several times the current coverage amount
  • UM BI – 50/100
  • UM PD – 30,000 / 1,000 deductible
  • $766.50 per six months – adds $103 per six months or $17.17 per month to our current car insurance cost, but coverage is much greater

I think I will apply for coverage at GEICO, with Plan 2. It improves our coverage, for approximately the same amount we are currently paying for car insurance. This means our budget should not be negatively affected (by much… it is $1.25 per month more, so I guess that is a “negative affect”. 🙂 I forwarded this information to R, to see if she had any comment. She simply said, “OK”, so I guess I will contact GEICO and see about setting up the car insurance policy this week. My Progressive policy renews on 9/5, so I don’t want to wait. What car insurance company do you use? How long have you been with them? What was the main selling point for you?

Cheap Electronics – hot tech, cool deals

Cheap electronics – How to get the gear, without getting gigged

I like electronics, especially cheap electronics. I’m a guy, so maybe it’s in the DNA. I like gadgets and gizmos, but I’m also committed to staying on a budget for my family. So, if you are like me, how can you have both?

When I was younger, and making more income with less outgo, I bought a new Compaq laptop. It was not cheap electronics. I think it was my first laptop. It was one of the first laptops which had a DVD player, and at the time, was one of the best of it’s kind. This model had the DVD/CD drive and floppy drive, in a wedge shape, which was detachable from the bottom of the laptop.

So, if you didn’t need the DVD/CD player or the floppy (kids, go ask your parents to explain what a “floppy disk” is), you could remove it, lightening the weight of the laptop and improving the battery life. I think it was a screaming fast PII CPU.

I don’t remember the exact price, but I think it ended up being over $1500. As I said, it was not “cheap electronics”. Of course, I bought it on credit, a consumer loan through Compaq, so it probably had 18%-21% interest. I did move it to another credit card, but still, it was nuts.

Technology develops SO fast. Six months later, technology had improved greatly. My laptop was now SLOW, and heavy. I was still paying off the computer loan, though. I had a few other, similar buying experiences.

I do have tech and gadgets, but I have learned how to buy better ways. There is simply no possible way to keep up, and have all the newest stuff, while remaining true to my budget. I love new electronics, but I refuse to just run down and buy them without forethought. I refuse to be the cash cow, sacrificed on the altar of “Hottest New Thing”.

Piggy bank, iPhone, camera, cheap electronics

How to find cheap electronics, and save money

Let’s talk about ways to find cheap electronics.

Last Generation – I usually don’t buy the newest technology anymore. The last generation is often just as useful. It is also cheaper electronics.

For example, I use an Android phone, but if I used iPhone, you would see me buying the 4, or maybe the 4S, sometime after the iPhone 5S was out. We have the same microwave oven that my wife had before we met… we have been married almost 16 years. My first MacBook Pro was a late-2011 model, purchased from the original owner in late 2012. The Xbox 360 was released in 2005; I bought mine as a refurbished unit on Black Friday, 2010, IIRC. Even my “new” MacBook Pro was purchased as a demo model from an authorized reseller.

Refurbished – As I mentioned, my Xbox 360 is refurbished. GameStop was running a Black Friday deal on consoles. I got a warranty and saved well over $100 from buying new. That was almost four years ago. Buying refurbished is a great way to save on electronics. Minor damage can be repaired by the manufacturer, and you can find excellent deals  shortly after the new models come out. Refurbished products often receive more attention by the manufacturer than the “new” model because they don’t want a PR hassle from unhappy customers.

There are various levels of refurbished. The term can include demo or floor units, returns or recalled products, or units which are damaged. Depending on the store, you may be able to find out why this particular gizmo is “refurbished”. You may also be able to get some kind of warranty, or extended warranty.

Refurbished Demo – These are usually the units that are sitting out on the shelf at a retailer  that everyone can look at and touch. They are cleaned from smudges and fingerprints, any missing parts are replaced, and physical damage may be repaired by the manufacturer. The units are cheap electronics because they have some hours on them. Some stores leave electronics running 24/7; some stores turn them off every night. Either way, the demos may have quite a few hours on them. Demo units often have the standard manufacturer warranty.

Refurbished Return – These may have been a Christmas gift which was “the wrong color”. It may have been taken home, and the customer realized the unit was too wide or too tall to install in the intended space. Even though the unit was never used, since the box was opened, it cannot be sold as “new”. The retailer accepts it back, the manufacturer checks everything out, and sells it as “refurbished”, another variety of “cheap electronics”.

Refurbished Recall – It may have been recalled by the manufacturer to repair a defective part. The customer receives an email or postcard to return the item, the retailer or manufacturer sends the customer a new gizmo, and the original unit is updated with the new part, then sold as refurbished.

Damaged – This can include either cosmetic or actual damage. “Scratch and dent” sales are an example of cosmetic damage for cheap electronics. The scratch on the side of the desktop computer case won’t affect how the computer works, just its cosmetic appeal. However, that scratch could cause the price to be reduced a little. Actual damage may include a minor scratch on the monitor, or a cracked monitor. If the scratch is minor, and off to the side, they may just drop the price. If the monitor is cracked, and the screen is unusable, they may replace it with a new monitor.  This can be a risky purchase, so ask about the warranty.

Another way that I use to get cheap electronics is to buy an older model. As I mentioned before, I buy computers and cell phones a generation or two behind the new releases. Sometimes, the manufacturer will replace the guts of a refurbished unit with the newest processor. People want to “look” like they have new gear, so they may not want the “old case”.

We will talk more about buying refurbished in an upcoming post. In the meantime, what have you purchased refurbished? Have you ever made a poor electronic buying decision? What ways have you discovered to make wise electronic purchases? What was your best example of cheap electronics?

10 Money Saving Tips for Low-Income Families

Money Saving – Practical ideas anyone can use!

Saving money is a nice thing for most famililes, but is a necessity for low-income families. Whether your family is temporarily low income because of job loss or underemployment, longer term because of illness or injury, or by choice, such as single income families, as in our case, it can be tough to meet your family’s needs. Let’s look at ten ways to help increase your money saving abilities.

  1. Transportation – For short distances, ride a bike or walk for major money saving… zero gas expense! For longer trips use public transportation, if it is available. If not, try to rideshare or carpool. Sharing your gas expense with two or three people can be serious money saving. Consolidate your trips, making several stops, instead of several separate trips. Do you have a neighbor you can borrow a vehicle from as you need it? We used to have two drivers and four vehicles, one of which was a 1994 compact pickup truck. We gave the truck to a relative this year. Now, on the rare occasions I need a truck, I borrow my neighbor’s. I have been thinking about getting rid of my little car (which is 17 years old, with well over 250,000 miles), and just driving my “DJ Van”.
  2. TV – Drop your pay TV service for monthly money saving. We used to have cable, then satellite. We never really had time to watch it, so we dropped it almost a decade ago.
  3. Movies
    Money saving with DVD's from the library

    “Rent” movies from the library!

    We “rent” DVD’s at the library. This money saving tip allows you to have family entertainment, without blowing the budget. We can keep them one week, and it is FREE. Our library is small, but they still have a few thousand titles, and many regular series. Alternatively, borrow DVD’s from a neighbor, especially one who goes to RedBox every week. 🙂 Just be sure to return the movies so there are no late fees. Our library charges $1/day per DVD if you are late, which negates your money saving quickly!

  4. Internet – This money saving tip takes a little creativity. When money was really tight, we were without internet for over a year. I would go to the library on my lunch break, research what I needed, and save the info on a thumb drive. Since I only had one hour for lunch, I would either save the webpage, or copy the text and save in a word document to read in more detail later. I would also find places with free wi-fi, such as McDonalds, Starbucks, and even the library. Many mornings, I would leave for work early, and drive past the library. I would sit in my car in the parking lot since the library was not open yet.
  5. Garden – Gardening is a money saving top to reduce your food budget, and improve your eating habits. Fresh tastes best in most cases. Research Square Foot Gardening. Start a window box for fresh herbs, or hang an upside-down tomato planter from your patio/balcony for money saving and great snacking.
  6. Coupons – This money saving tip became popular the past few years, seeing shows like Extreme Couponing. Some people say the show is bogus. We don’t have cable TV, so I have never seen the show. There are many forums, blogs, and websites that teach how to use coupons successfully. Recently, many stores have stopped doubling and tripling coupons, so the saving are not as extreme as they have been in the past, but my wife still can save $10-$40 or more on the grocery bill every week. Many department stores also post coupons online or in their circular advertisements. However, don’t buy stuff you don’t need just because you have a coupon.
  7. Water – Use a rain barrel to conserve water for your garden. Consult with local authorities, as some will try to fine you for conserving the water. Don’t water your lawn or garden or wash your car during the hottest part of the day, as much of the water will be lost to evaporation. Make sure your faucets and toilets don’t leak. Another money saving idea… Reuse your towels for a week or so; after a shower, you should be pretty clean, so your towel won’t get dirty… you don’t have to wash them every day.
  8. Phone – This money saving idea has saved us over $3000 so far. We eliminated our home phone line almost a decade ago. We realized the only calls we got at home were telemarketers and robo-politicians. I have no use for either, and don’t care to pay for the privilege of them bothering us during dinner. We pulled the plug and save every month. We use our cell phones, have “naked” DSL for internet, and the home alarm system uses cellular technology.
  9. Groceries – For a weekly money saving strategy, go to a “off brand” grocery store. Sure, those fancy supermarkets have exotic food, but you should not be eating that if you are a low-income family anyway. We shop at Kroger and Wal-Mart for 90%+ of our groceries, and if we are in the area, we go to ALDI. The selection is limited to more basic foods, but that suits our needs fine. Also, a “super” store, like Wal-Mart or Target will have more than just groceries, so we do less driving around to other stores for household repair needs, auto maintenance supplies, health & beauty, etc.
  10. Barter – This money saving idea lets you trade your skill for someone else’s. Do you have a skill that you can trade with someone for their skill? Can you swap mowing their lawn for getting three or four haircuts? Can you trade painting their living room for plumbing repairs? There are many busy professionals, such as doctors or lawyers, who don’t have time or knowledge to do projects themselves. If you have the time because you are out of work, or have the knowledge but not the cash, see if they would be willing to trade services.
  11. BONUS – Obviously, there is only so many money saving ideas you can realistically use. If possible, increase income. If you can’t do that because you are currently unemployed/underemployed, is it possible to get a part-time job, which will not affect your search for a full-time job? If you are employed, can you pick up a few extra hours? Can you start a side hustle?

At one point, I lost my full-time job. I started carrying pizza in the evenings and weekends. When possible, I tried to get shifts that were late at night, so I would not be away from my wife and children while they were awake. This provided my family with cash, a small bi-weekly check, and usually a free pizza or two each shift.

In case someone is curious about the free pizza… Usually, someone would call in with a custom pizza request, then not come to pick it up, or would not answer the door when a driver arrived. Sometimes, the manager would let the closing employees make a pizza at no charge if we’d had a profitable shift. This money saving idea was tasty! 🙂 With two hungry children to feed, the free pizza was a blessing.

Through that job, I met another delivery man who also worked as a delivery man for the newspaper. He helped me get a job delivering papers seven days a week. I delivered papers to convenience stores and boxes in grocery stores. I would arrive between 2 AM and 4 AM, depending on the day, and would be done by 6 AM most days. I would then run back home and have breakfast with my family before they left for school and work (my wife was a school teacher and took the kids with her). In addition to the bi-weekly check, the manager would let us have the coupon inserts from any Sunday papers that did not sell when we put out the new Sunday papers. This was another money saving help.

I later found a full-time job, where I still work almost nine years later. I continued to work the pizza and paper jobs in addition to the full-time job for over a year. I was exhausted, and slept in my car during lunch many times. However, the additional income really helped our family through a tough time. So, if possible, even if it is not your long-term goal, find a side hustle.

How about you? What money saving tips have helped you during a low-income time?

New or Used… The choice is yours

Should you buy that widget new or used?

New or used is a question commonly asked in financial blogs, around the water cooler, and in search engines. Some people prefer the smell of a new car, but some people say that is what “a sucker” smells like. One man’s trash is another man’s treasure. Let’s look at a few things and discuss which is better… new or used.

Buy these items new:

  1. Mattresses – Many thrift shops won’t even accept old mattresses. That should tell you something. If you see an old bed set on the curb, or at a garage sale, keep driving. Bed bugs… need I say more? If the possibility of a bed bug infestation isn’t enough to dissuade you, think of the bacteria, dead skin, and dust mites which eat the dead skin, which are probably infesting the mattress. New or used? Please, just spend the money and buy new.
  2. Electronics –As I have mentioned elsewhere, I am a mobile DJ. Much of my gear is very expensive electronic equipment… speakers, computers, turntables, etc. I have purchased a few items from Craigslist sellers, and have been happy. In my case, I know the gear, I met the sellers in a public place, and had a way to test the gear for proper operation. Still, I did take a chance on buying something which could have had an intermittent problem, or could have had been mistreated, dropped, overheated, or had spill damage inside. Instead of garage sales, consider looking for used equipment on Amazon or direct from the manufacturer’s refurbished site. New or used for electronics is a little harder to answer.
  3. Car seats – These are designed to protect your precious cargo in the case of a car accident. They are designed to be a one-accident item. If you buy at a garage sale, you don’t really know if the seat has been involved in a car accident. Damage to car seat may be hidden; you may not be able to tell just by looking that the seat is no longer strong enough to protect your baby if you have an accident. New or used… definitely go New!
  4. Shoes – Again, here is something which I have purchased in the past. When I was young and not making much money, I purchased dress shoes from Goodwill, then had them new soles put on and used shoe trees. However, if you can afford it, you may find that new shoes are more comfortable. Shoes will mold to fit the wearer’s feet, and if your feet are not the exact shape of the previous wearer, you may find them pretty uncomfortable. New or used… depends on if used makes your “dogs bark”.
  5. Underwear / Swimwear
    Funny underwear photo

    New or used? Underwear is one thing I gotta have new!

    Wash them in hot water, with bleach, and boil them on the stove if you like. I still don’t think I want to go there. Please, for the love of all that is holy (or hole-y… see what I did there? 🙂 ), think this one through. Many thrift shops offer these for sale. Now, I have worn clothing and shoes from thrift shops, I’ve driven used cars, and live in a “used house”. However, I draw the line at “nappy, ol’ draws”. New or used… New in London, new in France… please, only buy new underpants! 🙂

Buy these items used:

  1. Houses – The biggest purchase most people will ever make, a house is primarily your family’s shelter. New homes are more energy efficient than older homes, and are less likely to require expensive maintenance for a while, since everything is new. However, Trulia, a real estate website, says that new homes costs about 20% more than used homes. For a $200,000 home, that is about $40,000. That can make a significant difference in your retirement nest egg. Don’t become “house poor”, by purchasing too much house. Consider purchasing a similar size “pre-owned” home. New or used… your retirement will like used better.
  2. Autos – This is the second largest purchase most people make. However, unlike a house, which over time, generally increases in value, an automobile almost always decreases in value over time. Purchase a new car, drive it off the lot, and return it the next day, and you may find yourself losing 10-20% of the price you just agreed to pay. Over the first year, the value may depreciate an additional 8-12%. If you are a millionaire, you can buy new. Otherwise, consider buying a car at least 2-3 years old. Personally, we purchase cars that are 8-10 years old and drive them a few years. I currently have a compact car that is 17 years old, which probably has 260K+ miles on it (I say “probably” because the odometer quit working over a year ago at 246K miles). New or used? Used is how we roll.
  3. Clothes – Aside from shoes and underwear/swimwear, I don’t mind wearing used clothing. Once I wear a new item one time, it is “used”. Most of my clothing comes from Goodwill or other thrift shops. As I mentioned in another post, I purchased a navy blue, pinstriped Ralph Lauren Polo suit, and had it tailored to fit me for less than $100 total. I later saw the exact same suit at the Galleria mall on Westheimer in Houston for well over $1,000. I regularly find Arrow, Hilfiger, Polo, Dockers, and other name brands at thrift shops, often with the manufacturer tags still on them. Why pay $50 for a new short-sleeve collared shirt, when you can find the exact same shirt for less than $5? With that being said, I do generally buy my pants new at men’s clothing stores, and have them hemmed, because I’m too tall and skinny to find pants elsewhere. New or used, either is ok, but I don’t mind used.
  4. Tools – Often you can find tools at thrift shops or garage sales. Shovels, rakes, and other yard tools, wrenches, hammers, and other shop tools, and occasionally, even power tools. A quality tool that is well cared for will generally last the lifetime of the owner, and can be passed on to your children. I purchased a $50 bench grinder at a yard sale for $8 (all I had left in my pocket). That was over five years ago, and it’s still going. I found a $600 Rigid table saw for $300 at a factory refurbished tool store at a local outlet mall. New or used? Used most of the time.

    New or used tools - used, most of the time.

    Rigid table saw was selling for nearly $600 new. I found a factory refurbished unit for about $300. New or used tools? Used!

  5. Books – I love to read, as does everyone in my family. However, we rarely buy books new. Our primary source of reading material is the library. Print books can also be found at garage sales, thrift shops, and online, often for pennies on the dollar compared to the retail price for new books. eBay, Half, and Amazon are three online sources for printed materials; beware of low priced books with excessive shipping costs. A couple of times each year, our local library also has a used book sale, and often sells paperback for 10-25 cents, and hardcover books for $1-$5 each.If you just want to read, and don’t need a printed copy to keep in your personal library, you also have options for saving money. If you have a Nook, you can get a “library” app which will allow you to “check out” a book from your local library. In other words, you can read the book on your Nook without having to purchase the book from Barnes & Noble. Amazon offers a Kindle app, which allows you to purchase e-books for much less than the printed copy. I have the Kindle app on my cell phone, so I can read anytime, any place. New or used… ”Used” is the blockbuster new thriller.

What about you? What things do you prefer new? What do you like used? What other New or Used comparisons do you have?

Five fanciful fads for frugal fun

Frugal fun that doesn’t involve the TV

Frugal fun… without TV?! Yes, it’s possible! 🙂

Back a decade ago, our idea of frugal fun was watching our favorite shows on cable TV. After the cable no-service tech royally ticked me off, I cut the cable and went to satellite. We loved our DVR, and recorded CSI, History Channel and Discovery Channel shows, and cartoons for the kids.

However, we found that with two small (at the time) children, and full-time jobs, we would fall asleep trying to watch our favorite shows on the DVR. We were so exhausted with work and family, we had no time for frugal fun TV. After a few months, I asked R, “Why are we paying for this again?”

So, we cancelled satellite. That was at least nine years ago. Our family is living proof that one doesn’t need to have the TV on all the time. Yes, our children have survived without TV. 🙂

We have a 46” Sony HDTV, but we don’t even have rabbit ears. We use the TV for DVD’s which we check out free at the library. We also play on our game consoles; we buy used games for cheap (less than $10, sometimes less than $5). Sometimes, I use the TV with the iPad or MacBook Pro as a giant computer monitor, so we can look at photos or YouTube videos.

However, this article involves having frugal fun WITHOUT the TV. So, let’s begin….

  1. Read – Reading… the non-TV thing you can do with your eyes. Now, if you don’t have any of those old-timey things called “books”, you can also read tablets or computers. Find a good novel for a relaxing frugal fun get-away. Pick up a non-fiction and learn something new.
  2. Write – Hand-write a thank you note. Send a birthday card to a relative. Put a recipe on an index card. Even type out a quick Facebook post to let people know that you went “old school” and read a “book”.
  3. Eat – Yes, one of my favorite frugal fun things to do. 🙂 Clean out your fridge, and get rid of left-overs… by eating them. R often prepares veggies and fruits by washing and pre-cutting them. She puts them in air-tight bowls in the fridge or on the table, so it’s easy to snack on something healthy.
  4. Take a hike – Or a walk, or gallivant about the neighborhood. Make a family excursion of it. Grab the pets, and get the spouse and kids off the couch for frugal fun, fresh air, and easy exercise.
  5. Nap – Now that you have overcome your couch potato tendencies by going for a walk, return home for a short rest. Frugal fun can even be had while “doing nothing”. Set your timer and take a 20-30 minute power nap. Awaken recharged, refreshed, and ready to take on the rest of your day.

How about you? What is one of your favorite things to do for frugal fun?

How to Win the Lottery

Today could be the day you win the lottery!

Not even a mouth-breathing, inbred country bumpkin who just fell off a turnip truck realistically thinks they will win the lottery **. Years ago, a well-known radio host said something that has stuck with me. I don’t remember his exact quote, but he basically said that “the lottery is a tax on stupid people, poor people, and people who don’t understand math”.

At various points in my life, I have been stupid, poor, and I don’t generally like math. 🙂

However, I have resisted the siren song of instant riches via lottery winnings. I’m in my mid-40’s, and I have spent less than $20, in total, on tickets to win the lottery. I don’t remember ever purchasing a scratch-off or instant ticket. The only times I remember spending money for lottery tickets was when the power ball jackpot was in the 100’s of millions, and my co-workers would take up money for an office pool, buying many tickets together.

Of course, we all knew it was a long-shot, and none of REALLY expected to win the lottery, but we could all hope, right? We could also all afford to chip in $5 or so. I don’t think it is wrong to blow a couple of bucks here and there on a lottery ticket. Instead of, say, getting junk food at the convenience store, spend that $1 attempting to win the lottery. Either way, you are still out a couple of dollars, but at least you are less likely to be overweight too.

Unfortunately, rather than playing for fun, many low-income people play for money. “If I can just win the lottery, all my financial worries will be over”. The lottery is the lifeboat they put their trust and hope in, as their financial ship is sinking. Unfortunately, the lottery is not only a poor-quality lifeboat, it is not even a good life vest.

Business Insider published an article in 2012 that took a close look at lottery programs, and the problems with the lottery.

As I said before, I don’t really like math. However, if we want to win the lottery, let’s first take a clear look at the math.

Statistics show that you have a greater chance of being struck by lightning than you do of winning the lottery. According to this pdf, The Geography, Economics, and Politics of Lottery Adoption, by Coughlin, Garrett, and Hernandez-Murillo –  – “State lotteries have the lowest payout rate of any form of legal gambling…” Business Insider says simply, “The people who can least afford it are throwing away on average 47 cents on the dollar every time they buy a ticket.

Statistics show that the per capita lottery sales are being predominantly sold in low-income zip codes. The lottery is a punitive tax on the poor. Low-income, mostly uneducated people are the most prevalent buyers of lottery tickets. Even if they do win the lottery, because they are generally less educated, they are easier to take advantage of, and will usually end up squandering their windfall. They will often take the lump sum payout, so they wind up in the highest tax bracket for that year, and generally lose at least ½ of their winnings to taxes.

In some cases, they even wind up in worse financial condition than they were before they won. All their “friends” and “family” begin to come out of the woodwork, asking for help or to borrow money for a car or some “sure-fire” business venture. The winners will often buy luxury items on credit, such as fine automobiles, jewelry, and big homes, rather than purchasing the items with their new-found cash. Once the lottery winnings are gone, they still owe for the purchases made on credit, and now have no way to make the payments.

According to a 2009 survey conducted by UT-Arlington, instant tickets in Texas were more likely to be purchased by an unemployed person than by someone who was employed or by a retiree. Corresponding with UT-A’s findings, Indiana U’s study from 1994 which found that from 1983 to 1991, as unemployment rates rose, so lottery sales tended to rise.

In other words, those who had little to no income due to unemployment, who should be using their limited income for food, shelter, job hunting, etc, were more likely to spend it on the lottery. No doubt, they were hoping for a quick solution to their financial woes from unemployment. “If I can just win the lottery, things will be ok.

So, knowing that we are not likely to win the lottery, and knowing that winning the lottery is probably not even a good idea long term, you may be wondering why I titled this post, “How to Win the Lottery”.

Instead of the “instant ticket”, try this:

  1. Get a pickle jar, peanut butter jar, shoe box, etc. Make sure it is clean.
  2. Make a hole in the top.
  3. The entire month, put the money you would normally spend on the lottery, in the container. A $1 here, $5 there, $10-$20 if the jackpot goes high. If you are like many lottery players, you may average $15-$20/week on tickets. Whatever you would typically spend each month, put it in the jar. Throw your loose change in too… after all, you can spend coins to win the lottery too!
  4. At the end of the month, go to the bank, and deposit whatever is in the jar. Do not spend this money for anything. Once you give this money to the clerk to buy a lottery ticket, you don’t get the money back, right? Same idea here… Once you give this money to the bank teller, you don’t get it back (at least not right away).
  5. Each month for the next year, put your “lottery money” in the bank. One year after you start, if you average $20/week, you will have over $1000 in your account. If you were to do this for 20 years, you would have over $20,000. This of course does not include any interest you may have earned on that money.
  6. Best thing is… using my “sure-fire winning system”, you are “guaranteed” to “win the lottery”, by saving the money you would have normally thrown away playing the lottery.

Have you ever played your state lottery? Have you ever played a national lottery? How much, on average, do you spend on the lottery? Did you ever win the lottery?

 

**No offense to mouth-breathing, inbred bumpkins who just fell off a turnip truck. 🙂

10 ways to Host a Garage Sale and Win

A garage sale can be a win-win deal!

Garage sale season is coming! Want to earn extra money for the upcoming holidays? Want to get rid of some of the stuff around your house? Hosting a garage sale is a great way to do both.

A few years ago, we hosted a garage sale and earned over $500 cash in one weekend, while getting rid of things that had been cluttering up our home. None of our items were over $50, and very few of them were over $20 each. Most of them were in the $1 to $5 range. We followed several of the strategies I have listed below. Using them can help you get the most from your garage sale efforts:

  1. Start with the end in mind. What is most important to you? Do you mostly just want to get rid of excess stuff? Do you want to make a lot of cash? Do you want to have a combination of both? Do you have the time to plan and implement strategies for a successful garage sale? Would you be better served by dropping everything off at Goodwill?
  2. Start planning. Assuming you decide to proceed with a garage sale, plan your garage sale to succeed. Grab your calendar. Check family obligations, school events, and vacation/travel plans. Then check for holidays, school events, and climate trends. The longer people stay, the more likely they will buy something. Seriously, don’t plan your garage sale for holiday weekends, and don’t plan for the hottest/coldest time of the year. You want the greatest number of people to attend, so schedule your garage sale for maximum success.
  3. Start organizing. Pick a place in the house for future garage sale items to reside until the sale. When something is on longer wanted, immediately put it in that area. If you know where you will hold the garage sale, start thinking about how to organize it… clothes here, tools over there. Put large bright colored toys near the road, so they attract the eye.
  4. Location, Location, Location. Like real estate, a garage sale needs to be in the right place for maximum success. A residential neighborhood near a busy intersection is best. If your area has very little traffic, or if you live in a gated apartment complex, do you have a friend who lives in a busy area? Ask if you can have your sale there. Sweeten the deal; offer to help sell their stuff.
  5. Teamwork. Speaking of selling their stuff, a “multi-family” garage sale or a neighborhood garage sale is very popular with customers. Shoppers know they can see more stuff with less driving. Recruit your kids, or borrow someone else’s kids to help. Take shifts so everyone has time to eat, stretch their legs, or take a potty break. Have a trustworthy person stay with the cash ALL THE TIME. Team up with others, advertise together, build friendships, and sell more!
  6. Follow Rules. If you do decide to have a multi-family or neighborhood garage sale, or even if you go it alone, be sure to check with your local HOA or government officials to be sure you are not violating any laws, ordinances, or guidelines. Paying a fine from your garage sale proceeds would not be fun!
  7. Advertise. To get the greatest number of people to attend your garage sale, they have to know about your garage sale. The newspaper classifieds are the most common place to start. Make simple signs, with arrows, on bright, neon color posterboard, and put them at intersections. Use a wide-tip marker, so drivers can READ the sign. Craigslist is great option, as it is free, you can run the ad several days before the sale, it’s free, and you can add photos of some of the items. Also, it is free. 🙂
  8. Take Life Easy. Lay out your sale so that it is easy for your customers. The longer they stay, the more likely they are to buy. Think about traffic flow and parking. Think about traffic flow for the people walking around shopping. Hang your clothes up. Get a tag gun, and tag clothes with prices. Put stuff on tables, so Grannie doesn’t have to kneel down to look at it.
  9. Get Real. Even though the movie just came out, no one is going to pay $40 for a dirty, torn Teenage Mutated Ninja Tortise backpack from back when you were a kid. Ask for a realistic price. Your sentimental value is worthless to others.
  10. VIP Service. The longer people stay at your garage sale, the more likely they will buy something. Have t-shirt bags / plastic grocery bags available so they can carry their loot to the car. Offer to help them carry stuff to the car. Offer them cold water / hot chocolate, depending on the weather; sell it for a little extra cash, or offer it free if they purchase a certain amount. Have fun, upbeat music playing. Have a “free” box, especially with small things for little kids… old toy cars, etc. Give their kid something free, and a parent will feel more obligated to buy something from your garage sale.

Your customers have your money in their pocket. Treat them special, make them like you, make it easy for them to shop, and they will give that money to you.

Your turn… Have you had a successful garage sale? Tell us about it. What worked in your case? What do you wish you had tried? What suggestions do you have to make a garage sale rock?

25 Date Night Ideas for Under 25 Dollars

Date Night doesn’t have to break the budget!

Date night is not just for engaged couples or newlyweds. R & I have been married for nearly 16 years. Like any couple, we have cycles of up and down, closeness and distance, passion and apathy.

In an effort to help strengthen the ties that bind, I want to begin having date night more regularly.

When we were newlyweds, we had time and money. We had two incomes, the economy was much better, and we had more discretionary funds. We did everything together. Date night was often weekend getaways. Date night was sometimes dinner at a nice restaurant. She worked for an airline, and I had a company car; sometimes, we would travel domestically. We went camping, traveled with friends, went to the beach, or went to visit family. Date night might be the movies, bike riding, or hanging out with friends.

Now, we have two children and one income. The older daughter is VERY athletic, and attends public high school, in part so she can participate in organized sports. At school, in addition to JROTC, she is on the varsity basketball team, varsity soccer, and cross country. In the off-season, she is on a travel basketball team. Her coaches expect that she will get offered scholarships for basketball, as she LOVES the game and is an

Our younger daughter is homeschooled, so her schedule is a little more flexible. Still though, she is in Children’s Choir, with practice every Wednesday night. My wife works in the church nursery every Sunday. I have my day job during the week. Some Friday nights and weekends, I have events for my small business. I’m a DJ, and do 30-35 weddings annually, plus parties, school dances, corporate events, etc.

Why do I mention this (besides the fact that I am proud of our daughters)?

Because, life gets in the way of living. Date night is now going to Target, Lowe’s, or Wal-Mart. Often we are there for something the kids need. We have no family close by, so we can’t stay gone for long. Having kids is a blessing, but they are a big responsibility. Extracurricular activities take time and money. The need to make additional income for food, glasses, clothes, school supplies, and health insurance puts restrictions on the ability for the two of us to “get away” for date night.

In an effort to balance our desire for date night with the realities of our budget, I’m looking at more frequent, less expensive date nights. This is part of the “personal” of personal finance.

Since we are on a budget, I set a ‘soft” limit on most date nights to $25. There are many options for a date night on a budget. You just need a little bit of extra creativity and maybe some planning. Following are 25 ideas for date nights for 25 dollars or less.

Obviously, not all of these date nights will work for everyone. For example, we used to live one hour from the beach. Now, we live at least six hours from a beach, and fuel prices have at least doubled. There is no way we can visit a beach for less than $25 now, unless someone else is driving and paying for the gas!

25 Date Nights for Under $25

  1. Picnic – at the park, at the lake, even your living room floor if the weather is bad… one of our favorite dates, even before we were married
  2. Visit the beach – again, this used to be a favorite date, but we can’t drive there for $25 now
  3. Local arts and crafts festival – one of her favorite activities
  4. Visit a museum on half-priced or free day – A local art museum has a free Thursday night once a month. Perfect for date night! Also, if you have a membership to a local museum, often that membership is honored by other museums.
  5. Hike in a state park – it doesn’t have to be a long hike/camping trip… just watch out for poison ivy!
  6. Find a recipe, buy the ingredients, and bake something together. Invite another couple over to share your date night.
  7. Visit a free concert at a car show – downtown, at a high school, or in a park, this date night is popular during the summer in many cities
  8. Go to a matinee movie, “movie night in the park”, or have a double-date night with another couple at a drive-in movie
  9. Go to your local zoo – We haven’t lived in Houston for years, but the Houston Zoo used to be very inexpensive, due to corporate sponsors. They also had free days during the year.
  10. Libraries sometimes have drama night, where people will dress up and act out parts from a book. Another idea is a high school drama department play or show.
  11. “Taste of your city” – Local restaurants invade downtown and showcase their offerings.
  12. Groupon restaurant deal
  13. Volunteer in your community – the animal shelter, the nursing home, the hospital
  14. Take (or teach) a class at the library – art, beekeeping, dance, guitar
  15. Visit a local fair or circus (think Shriner’s, not Cirque du Soleil)
  16. Model clothing for each other at the mall… free date night, if you don’t buy anything
  17. Go shopping at a thrift shop or resale store – Goodwill, Salvation Army, ReStore, etc
  18. Do a home improvement project together – this date night could last several nights
  19. DIY decorations for your home – get an idea book at the library or look at Pinterest
  20. Visit a new neighborhood and look at model houses – get more ideas for your home improvement or decoration projects
  21. Have breakfast or lunch at a small diner or local “hole-in-the wall” café – ask the waitress what she recommends
  22. Eat at home, then go to a four-star restaurant… for dessert only 🙂
  23. Make dessert together, and invite another couple to bring ice cream
  24. Go meet the ice cream truck and buy ice cream for the neighborhood kids
  25. Use the $25 for gas and go on a day trip (just bring a lunch)

WHAT you do is less important than WHO you are doing it with. You are going on a date night to be together, as friends and lovers. Leave behind the distractions of work, bills, homework, business, yard work, and family responsibilities. Since your little ones aren’t there to be tugging on you, and your teens aren’t there to get grossed out… kiss, hold hands, look  into each other’s eyes.

Most importantly, during date night, put away your phone. Focus on each other. Be present, be engaged, be in the moment of date night with the one you love.