Category Archives: Expenses

Mentors – Who Represents Your Business?

Mentors in small business can affect your bottom line!

Everyone has mentors. Some mentors teach you what to do. Other mentors teach you what NOT to do.

At 18, I got my first “real”, full-time job. The company serviced offshore oil rigs, and the drilling crews who lived and worked there.

Mentors are everywhere - photo of offshore oil rig

Mentors are everywhere, even in the oil field

When you are 100+ miles off the coast, working seven days a week, 12 hours per day, you don’t have time to “hit the drive-thru” for a burger after work, go grocery shopping, wash your laundry, or scrub your toilets. You’re too busy chasing black gold, pushing pipe, and swinging from the monkey board. You work hard, in all kinds of weather, at all hours of the day. It is good money, but you earn every dollar!

So, my employer provided kitchen and housekeeping services for drilling companies. We cooked, washed dishes, swept, mopped, changed and made beds, washed towels, sheets, and laundry, scrubbed toilets, and so forth. We were like the hotel staff for an oil field “resort”.

Yep, I was 18, and had hated washing dishes and cleaning my room in my parent’s home. Now, I was doing it as a full-time job. I’m sure my mother probably enjoyed the irony. 🙂

The training mentors were older and “wiser” in the ways of the world. Most had been through various jobs and marriages before ending up on a “resort” in the oil field. Like the roughnecks they served, they worked hard, lived dangerously, and partied like rock stars when they made it ashore.

Most of my training mentors didn’t pay much attention to me, the skinny, awkward “man”. They didn’t take an interest in me as a person, and they didn’t make a long-term impression on me. However, some twenty-five years later, I still remember one mentor.

The oil rig I was working on at the time was a few miles off the coast of Louisiana. In that part of the world, good Cajun food is a requirement, and rice is a mealtime staple. I don’t remember the name of this training mentor, so we’ll call him “Bob”. Bob was an older man, nearing retirement age, very crotchety.

As the “new kid”, I was working nights, so when I came to the galley to eat “breakfast” before starting work, it was approaching dinner time (for the day shift). As was the normal routine, there was Cajun food out for dinner, and I was going to eat that for my breakfast. I had previously noticed that Bob would cover the uneaten rice after the meals, and put it back out the next day.

No problem. Growing up as the oldest of four children, I was used to Mom doing that at home.

However, that day, when I went to add some rice to my Cajun “breakfast”, I noticed that there was mold growing on the cooked rice. Although money was tight growing up, and four hungry kids would have probably finished leftover rice long before mold would have started growing, I have no doubt Mom would have thrown moldy rice away.

Anyway, I grabbed the bowl and headed toward the trash can, pointing out the mold to Bob. He grabbed the bowl from my hands, growled at me to “shut the #@*% up”, and proceeded to rinse off the rice before placing it right back on the food line for the crew.

O_o

I have no idea why Bob did this. He wasn’t paying for the groceries himself. Our company was not stingy with the groceries. We had weekly steak night, weekly seafood night, and the kitchen was open 24/7. As far as I know, there were no “cost cutting profit-sharing” systems. The economy was good, and the oil business was especially good.

Twenty five years later, I still remember his actions.

Today, I have a small business. Contract employees work for me, and represent my company name. I want to be sure to mentor them the right way.

What did I learn from this “demented” mentor?

* Some people should not be trusted with your company name, much less as a mentor for your new staff.

As an impressionable new guy, this “mentor” was tasked with teaching me the corporate culture, and proper procedures. “Feed your client moldy rice” was probably not what the home office had in mind.

* Some people are penny wise, and dollar dumb.

Bob “saved” a few cents worth of rice.

Rice is cheap, oil is expensive.

Bad PR is even more expensive. If the crew had gotten food poisoning, it could have slowed or even stopped them from drilling. Just one shift  would have cost the drilling company thousands of dollars, or more.

My “mentor” would have lost his job. My employer probably would have lost their contract on that rig, and possibly the contracts for all the other rigs operated by that drilling company. Due to oil field gossip, my employer could have lost other contracts with other drilling companies in the region.

I wish “Undercover Boss” had been around back then. I found out later from co-workers that this was a regular occurrence, but that Bob had connections in high places within the company. They were apparently letting him coast to finish out his time until retirement.

What about you? Have you ever had a “demented mentor”? Have you ever worked for someone who taught you more lessons about what NOT to do, than they did about the right way to do things?

Reduce Electrical Bills – Improve your Budget

Reduce Electrical Bills with these simple tips

I have been trying to find ways to reduce electric bills. It is one of the largest expenses every month for our family. Following are some tips I have found.

Washing – Do not run washing machines (dish or clothes) until you have a full load.

Drying – Clean the lint trap on your clothing dryer. Not only will this help reduce electrical bills, it can help your dryer last longer. Modern dryers measure the temperature of the air to adjust how hot the heating element needs to be. If your lint trap is plugged, it can cause the temperature readings to be incorrect. This can cause excessive electrical use.

I also found out the hard way, lint buildup can cause your heating element to run hotter than it should. At best, this can cause the heating element to overheat and need early replacement. At worst, it could cause a dangerous lint fire. Thankfully in our case, I just had to replace the heating element, which was partially melted.

Line Dry – Hang your clothes outside. Reduce electrical bills while getting fresh air! If you are embarrassed about your underwear hanging outside, buy a laundry pole that will hold three to four lines. Hang sheets and towels on the outer lines. Hang your unmentionables on the inner lines, so that the sheets will hide most of them.

If your clothes are stiff when line dried, it is likely that not all of the detergent has been washed out of the cloth. There are many recipes for making your own laundry at home (another money saving tip). Most of the home made laundry detergents will not leave your clothes feeling rough and stiff when dried on a line.

Hot Water – Put an insulation blanket on your water heater. Better yet, get an instant hot water unit or a solar pre-heater. Turn down the temperature on the water heater a few degrees is another suggestion to reduce electrical bills.

Climate – Adjust your thermostat, and run a ceiling fan in conjunction with your HVAC unit. This can help reduce electrical bills year-round. During the summer, our temperature inside is around 78*, and during the winter, it’s about 65*. We wear shorts and lightweight shirts during the summer, and socks, flannel pants, and warm shirts or sweaters during the winter.

Heating – Maintaining creature comforts can be tough in the winter. Use a room / space heater to reduce electrical bills. This will heat only the room you are using. This allows you to leave the rest of the house at a cooler temperature. I do this in my DJ practice area, and in our bedrooms at night. Of course, if you have an open concept house, or on the weekends when everyone is home and in different rooms, this may not work as well.

Upgrade – Replace your old mercury switch thermostat with a new smart or programmable unit. I’ve never used one, but the Nest is very popular. I replaced our old thermostat with a programmable unit. The thermostat was around $100, IIRC. We had a heat pump system, so the thermostat was more expensive. However, being able to program the temperatures to our schedule, I was able to reduce electrical bills, which paid for the thermostat very quickly. Since I did the work myself, there was no installation cost.

Lighting – Simply replacing lightbulbs can reduce electrical bills. New LED bulbs are expensive, but you can sometimes find good deals on multi-packs. Replace halogen floor torch lamps and incandescent bulbs. Don’t buy the CFL “curly Q” bulbs, as they are filled with mercury, a toxic heavy metal.

Reduce electrical bills without using candles

Reduce electrical bills?

I buy lights made by CREE, rather than GE for a couple of reasons. Not due to their lighting specifically, but because of GE’s business practices, and tax dodges.

Instead of leaving the light in the hallway on, or the vent-a-hood light over the stove on, use LED nightlights. These use pennies of electricity each year, which will reduce electrical bills while still providing area light for safety.

Use fluorescent light tubes in your shop, garage, or basement. They produce little heat, use very little electricity, and provide a nice even lighting for safety in the shop.

Charging – Charge your cell phone and laptop at work or in the car, rather than leaving them plugged in at home all the time.

Vampires – Get power strips, so you can flip one switch to kill all the power to several devices at one time. This will reduce electrical bills by preventing “vampire” loss. Modern electronic devices, such as TV’s, DVD players, computers, and microwaves all stay in a constant “low power” standby mode. The devices must have power to operate the receiver for the remote control, as well as the clock and calendar (used by your game console, for example). This causes the device to draw power, even when “turned off”. All this power being used by all these devices will add up each month.

Security – You can reduce electrical bills while still providing safety and ambiance outside your home. Consider installing outdoor lights on timers, light sensors, or motion sensors. Buy solar lights for walkways.

Windows – If you don’t have insulated windows, and cannot replace them, you can still prevent drafts and air leaks. We are currently renting. The house is old, with aluminum framed windows. It doesn’t make sense for the landlord to replace the windows, since they are functional, and the landlord doesn’t pay the light bill. I went to Lowe’s and bought a few packages of the plastic sheeting that goes over the windows inside the house. For less than $50, I was able to reduce electrical bills. I left the plastic up over the past year. We had less pollen and dust inside in the spring, and the interior stayed cooler in the summer. Winter will be here soon… The cost of the plastic will be divided by two years of service.

Doors – You can also reduce electrical bills if you make sure your doors are weatherstripped properly. Our doors are warped, so even with proper “real” weatherstrip, they still leak air badly. I need to work on them this autumn. Last winter, on REALLY cold days, I used “gaff tape” to seal around the cracks. It was too cold to remove the doors and try to fix them properly. Gaff tape looks like duct tape, but doesn’t leave adhesive, and won’t pull the paint off the walls or doors. It is about $20 per roll, but I use it for my DJ business to tape down wires at events. I just stuck it to the doors, and at night, stuck it to the door frame to seal off the gaps. Since it didn’t peel the paint, when we left in the morning, we could just open the door.

What tips have you found to reduce electrical bills?

Cheap electronics 2 – Hunting for the bargain

Cheap electronics – How to shop and get the best price

As I mentioned in the previous post, I like electronics, especially cheap electronics. So, if you want to get cheap electronics, how do you do that?

Start with the manufacturer. Many manufacturers will refurbish and resell their own products. They definitely know their products, know where to get the parts to repair them, and know how to make sure they work correctly. After all, they built the unit in the first place!

Apple is one of the best known examples of manufacturers offering quality refurbished products. I looked at purchasing a refurbished MacBook Pro, and that was exactly where I went. With OEM parts, and Apple staff installing, you know it will be done right. I have been very happy with my HD Sony TV, and have been told that Sony is another company who offers refurbished products. So, start at the manufacturer’s website and look for “discounts”, “specials”, or “refurbished” items when looking for cheap electronics.

Wait for special pricing. Certain times of the year are best for buying cheap electronics. Black Friday is probably the best known single day, but retailers and manufacturers often run specials at other times of the year. They may be planning to clear out inventory, or perhaps a new product is about to be released. Look on their website for a place to sign up for “email specials”.

Warranty Coverage. A benefit of buying new is the warranty. When you buy new, the manufacturer and sometimes, the retailer, provides a warranty on the product, covering the parts and labor to repair. The warranty may simply provide a replacement unit. Either way, it is good coverage for your new cheap electronics.

Refurbished items may also come with a warranty. It may not be as long as the original warranty, say six months to a year, instead of two or three years. However, it does provide some reassurance that if the repair was done poorly, you will not be stuck if it dies next week. Usually, buying from the manufacturer will provide the best warranty on the refurbished item.

Research your options. Don’t impulse buy if you really want to get cheap electronics. Search Google, Amazon, or cnet are places to look for reviews. eBay is a great place to find pricing information, especially if you are considering buying refurbished or used. You may find a different product or manufacturer which could suit your needs even better.

Know when to buy new. There are some items to avoid buying refurbished. Printers, TV’s, and external hard drives come to mind. Printers will be difficult to get completely clean, TV’s are bulky and hard to ship safely, and external hard drives are so easy to drop or damage in shipping. Even if the manufacturer refurbishes these, I would strongly consider buying new.

Buy a bundle. Sometimes, a manufacturer or retailer will put together a bundle or a package deal, such as a desktop computer, a monitor, and a printer. These bundles can be a good deal, but if possible, try to get the exact specs and model numbers to be sure they have the specs you need.

How do you get the best deal on cheap electronics? Tell us about your experience!

Five simple tips to trim the budget

Five Simple Ways to Reduce your Expenses and Trim the Budget

Trim the budget - photo of scissors cutting money

Trim the budget – five simple ways to reduce your expenses

At the end of every month, you should review your budget for the following month. I just did that last week. That way, you know how much money should come in, as well as when and where it will be coming from. Equally as important, this will show how much money is going out, as well as when and where it is going. Increasing your income is great, but most of us can find ways to trim the budget more readily than we can find ways to increase the income as much.

If you are spending more than you make, you can’t simply print more money and keep spending. Only the government can do that. Unlike our clueless clowns politicians, you have to choose… trim the budget, expand the income, or some combination of those two options. Increasing income is the best option.

However, generating additional income can be difficult for some people. A previous employer of mine forbid their employees from working a part-time job, small business, or any other “side hustles”.

Several years ago, I worked with a lady who’d had heart surgery. Her doctor wouldn’t release her to work full-time. She received a disability income from the government, if I remember correctly, and worked part-time for the company I worked for at the time. If she earned above a certain amount, which was less than it would take for her to be self-sufficient, she would lose the disability income, which was also not enough for her to live on. So, she was stuck in a dead-end, low-paying job several years, living with her kids and grandkids, until her full retirement / SSI kicked in. She was unable to earn enough to get off disability, and unable to earn enough staying on disability.

No matter your income level, chances are, there are steps you can take to reduce your recurring monthly expenses. This article will look at a few ways to trim the budget.

Thermostat – One of the easiest ways to trim the budget is to reduce your monthly electric bill. You can do this if you adjust your thermostat by a couple of degrees. We keep our thermostat at 78* during the summer, and 68* during the winter. In our previous home, which we owned, I replaced the old-fashioned thermostat with a programmable unit. It would adjust the temps to 82* during the summer, and 65* during the winter while we were gone to work, and then readjust them just before we normally got home. At night during the winter, after our normal bed time, it would let the temp drop to 60* while we were sleeping. We were under the blankets, so it was not a problem.

Dryer – When I was growing up in SE Texas, during the summer, we hung our laundry outside to dry. This is a very easy way to trim the budget. The dryer is a huge electricity hog, so doing this consistently can have a big impact on your monthly bill. During the winter, you can run the dryer for half the time, then let the clothes air dry on an indoor line. This can also add moisture to the indoor air, which is usually very dry during the winter.

TV – Do you really need all those channels? Do you really NEED any channels? Trim the budget by downsizing or eliminating your TV bill. Over the past decade, we saved hundreds of dollars merely by turning off our pay TV services. At least consider getting rabbit ears and see if you can pull in any local stations, if you “MUST” have TV.

Phone – Do you actually use your land line? As a step to trim the budget, we cancelled ours almost a decade ago. We realized most of our callers were either telemarketers, or politicians. Everyone else called our cell phone. Since you can take your cell phone number if you move to a different provider, consider dropping your land line. If you must keep your land line for DSL or the alarm system, drop all of the extra services, like call waiting and caller ID.

Internet – We have basic DSL, without a land line phone, from our local phone company. I would love to have cable internet speed, but realistically, I don’t need that speed all the time. I am a mobile DJ, and purchase my music online. It takes longer to download than I wish, but as a way to trim the budget, I have stayed with a slower speed service. Can you deal with a slower connection speed for monthly savings?

These five simple methods to trim the budget can potentially save you $50 to $100 or more per month. That is $600 to $1200 or more per year. How much more would you need to earn to have that much after taxes?

How about you? What are some simple tips you use to trim the budget? What has been your biggest saver so far?

 

Healthy Savings are not just a walk in the park

Healthy Savings – ideas to keep your budget, and your health, in top shape

“Healthy Savings” can describe a large discount. Healthy Savings can also be a play on words, to describe a situation where you save money, while partaking in healthy activities. This is the definition I will be writing about in this article.

Face it, what good is the lifestyle you work hard for, if you are so sick, tired, or out of shape that you can’t enjoy it? How many people do you know who worked hard, sacrificed, and saved their entire life for a great retirement, only to be unable to do the things they want to do? No one knows the future, and there are no guarantees, but usually people who take care of themselves live longer with better quality of life than those who do not.

Gym memberships are incredibly popular. They can also be incredibly expensive. Many people sign up with good intentions, but then, drop out. Unfortunately, due to how the contracts are designed, if you don’t use your membership, you don’t get a break on the price. Often, there is a minimum one year contract with monthly auto-drafts, whether you work out daily, or never darken the door. So, how can we take care of body and our budget at the same time?

Of course, you can simply put a treadmill, free weights, or machines at your house, and work out on your schedule. However, many people prefer being able to work out with others, and find the accountability of your exercise partner to be very beneficial.

Following are five ways you can have free or nearly free gym access.

Membership Benefit – Many large companies have a gym at the headquarters. They know that healthy employees are less likely to miss work due to illness. See if your company would consider installing a basic gym at your facility.

A free gym down the hallway from your office would be majorly Healthy Savings! If you work remotely, or are not close to the headquarters, do they have partnerships with any of the national gym chains, such as Gold’s Gym? I worked for a company which offered a 20-25% discount to the gym membership, plus no initiation fee. IIRC, since the bill was taken out automatically pre-tax, it also lowered the employee’s taxable income.

Attend college – When I was single, and living near Houston, the local community college had a small, but nice, gym. Racquetball, tennis, basketball, and a weight room. As a student, even if only taking one class per semester, you had gym access at no charge. That is Healthy Savings, Professor!

Side Hustle – Does your local gym need someone to work the front desk a few hours per month? Do you have fitness training where you could team up with a trainer to assist? Could you start your own part-time fitness or training business? Healthy Savings for free facility access, plus a side hustle income.

Personal Trainer – Some personal trainers will team up with a local gym for Healthy Savings. They will host their personal fitness training at the gym. Access to the gym is generally included with your training fees. Often, the gym will allow you to use the facilities outside of your “official” class time.

Free Pass – Many gyms will offer free day passes to try out the facilities. Often, “mom & pop” gyms are very generous. They don’t have the name recognition and fancy facilities that the national chains have, which can add up to Healthy Savings for you. You may find them to be much more willing to offer free passes, or special pricing to earn your business.

Also, many “mom & pop” gym operators are not really trying to run their gym as a business, but more as a serious hobby. Basically, the owners like to work out, and they like to socialize with others who like to work out; a gym gives them an easy way to do that. All the gear is a tax write-off, and they get to have a great workout facility and do something they love. If they make a little money too… score! 🙂 Since they are not in it for the money, they may be more generous with passes.

Keep in mind all of the exercise routines which do not require gym access. One of my favorites is from the US Army.

Healthy Savings - photo of soldier

Healthy Savings … the Army way.

I can attest to the quality of the training. It is full of distance running, sprinting, stretching, jumping, and body weight exercises, like sit-ups, push-up, and more. There are many other routines you can follow as well, such as Crossfit. Combined with proper nutrition, your budget and your waistline will slim down.

Healthy Savings can help you enjoy the lifestyle you work for.

What other ways have you come up with to experience Healthy Savings? What is the best value for gym membership you have discovered?

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?

 

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?