Happy Halloween!

Happy Halloween. I guess my only little financial thing today is how many children are going to show up today? I bought two bags of M&Ms, peanuts and regular to give out. Last year I bought a box from Costco and I had tons extra.

This year I'm hoping enough kids come so that I don't have any extra. Unfortunately I have yet to have one trick or treater. What is going on? I used to be so excited to go trick or treating. I loved getting candy.

If not I guess I should donate the candy or get DH to take it to work. It's not the fact it was $4 for the 2 bags, but I will gain weight if I sit here and eat all the candy. Sigh.

Hope everyone else has better luck.

Festival of Frugality #98

The Festival of Frugality #98 is up at beingfrugal.net. Looks like a great festival. My article "Dining in can be expensive" was submitted.

A couple of articles I liked were "Top 10 Cheapest ways to exercise" by silicon valley blogger, and "Do vacations spoil you for normal".

My thoughts on cheap exercise is the way to go. Though living in CA, I had a great deal on a gym I used year round. Now out east, well let's say gyms are no longer cheap so I have to exercise outdoors/indoors alone. Ugh. I prefer the gym because the weather out here isn't the best.

And going on vacation spoils me because I hate going to work!

401k Match Bonus...

Every November the company my DH works for goes over their benefits and improves them. They also have open enrollement. Right now I'm debating eye insurance but that's another day.

For now I'm bursting with supreme happiness. Wowsa! DH got some fantastic news. Turns out the company has decided to do away with the vesting schedule with the 401k match. No more 3 years to vest. Fantastic. That means the 6% they've been contributing is ours immediately!

That's tremendous, it's like a 6% raise to DH's salary, without doing anything. DH complained he won't see the money until retirement, but every penny saved is a penny we don't have to save. Anyway it's nice to see our little nest egg growing fasting and knowing it's all ours. We don't have to subtract out the unvested portion anymore.

Plus, this new company every two weeks they deposit the 401k instead of the old company which took 6-8 weeks to make a deposit. And it every quarter they would make the match however it would the quarter after that the match would occur.

What a nice bonus.

Great Deal Eating Out...

I found a coupon for $25 for McCormick's and Schmick's. So yesterday we went to MS and had dinner. I had the monkfish, DH had the bluefish, and we shared the quahog appetizer. I took home half my meal and ate it for lunch.

The Monkfish was $20.95, Bluefish $18.90, and Quahog $8.85 the total bill was $48.70. The tax was $2.44 and the total was $51.14. So the $25 was applied and the final bill was $26.14. But I used a $50 gift card to MS. I bought 2 $50 GC to McCormick's = $100 for $80, basically a 20% discount. Also because I used am AmEx CC I get back 3%. So our bill including tip was $35.14. But we only paid 77% = $27 including tip!

For a seafood meal out for the two of us I was impressed with the deal. Plus they have a diner club where you get $1=1 point spent. So after 500 points you get a GC for $25. Another bonus.

Yes I could cook some of this fish at home, and I do, but I also enjoy eating out. And for a deal like this it cost less than going out to eat TGIF, Applebee's, etc.

Carnival of Personal Finance #124

The Carnival of Personal Finance #124 is up at the Millionaire Mommy Next Door. She did a simply awesome job. It is very well organized and beautifully done.

I submitted my question on Going Carless. Lots of great articles. I reccomend you checking them out. She has a poll going with different categories. And the winner in each category gets a free blog.

Anyway couple of great articles to check out, "the quiet millionaire" and "why personal finance is personal." Lots to read.

Poll: Lying to a spouse

72% of people say they never lie to their spouse about finances and 27% say just a little lies to their spouses. Very interesting. No one actually admitted to lying to their spouse.

I find that strange because there are many people who are in debt, and say their spouse refuses to listen or participate. On the Women In Red message board, there are women who hide their debt from their spouses. Often afraid of letting their spouses know the real truth.

For example, on Oprah this past week there was a woman $135k in debt. Yep you read that right, not a mortgage, but CC debt. And her husband had no idea. He had ignored their finances and left them entirely to her. So is it considered lying or denial on the part of the husband?

So I find it great that most people don't lie to their significant others. So if you have debt then your SO knows all about it?

Personally I think DH and I both tell over/underestimation of costs. We never sit there and lie but we do forget to metion some expenses etc. But nothing big, anything over $20 we discuss. But the details are sometimes fuzzy.

Cell Phone Data Plan...

My DH wants to add a data plan to his cell phone for $10/month. I am against this. Now I'm about to sound extremely cheap, but please try where I'm coming from. First, DH works all day and the cell phone is barely used. I don't know how and why he really needs to be texting people and surfing the web from the phone, when he has a laptop at work and at home. I feel it's just because everyone else has it he wants it. He wanted an iphone, which I said if he saved his blow money $10/week he could buy it.

Yes he earns a good income and we don't have debt, but I don't like the idea of increasing our fixed monthly expenses. Already I feel that our monthly expenses are huge. We have cable, internet, and phone. Cable is even premium with HD, DVR and movie channels.

Should I agree to adding on the $10 data plan we should cut the movie channels? Is this unreasonable? It's just $10/month, but I feel if we keep justifying these expenses they add up fast.

I really have become the saver in the relationship where he used to. He's been changing a lot since MBA school where now he wants a new car. When we meet (8 years ago), he called me foolish for wanting a nice car. He said it was to get from point A to B. But now he feels like we're poor compared to other students. I just want to scream about we are not going to finance anything. I already hate we're taking out $8500/year to pay for his private MBA and cash flowing the other $10k/year. Most people in school with him are 100% loans. We're saving maximum for retirement and paying 50%+ of the tuition, books, etc.

I feel that this is a slippery slope to be walking down.

Dining in can be expensive...

In this article by msn, the author claims that it's more expensive to cook than to dine in. The truth is that it is always cheaper to eat in. However, it is true that eating in can be expensive.

The real comparison is determining the if the exact meal you prepare at home is as expensive as restaurant food. The article claims that a man claims to have spent $30 for the couple cooking, shopping, and preparing a meal. But the same meal would only be $17 from a restaurant.

I find this rather hard to believe. For example as a couple we had two very expensive meals over the weekend. We had cajun scallops and NY strip steak both courtesy of Costco. The scallops were $9.99/lb and the steak $6.49/lb.

Now we ate a one pound of scallops + cajun style rice, entire meal for two with rice, veggies, salad, scallops = $12. However, maybe an hour of prep time which could be $50. BUT because we're both salary we don't get extra pay for working that hour so it really only cost $12. Plus for us to both eat scallop dish at a cajun restaurant it would be easily $18/plate = $36 without tip and tax. How is eating out cheaper?

Second example is eating the NY steak. That would easily cost us $25/plate but we ate it for $8 for the two of us sharing a 1 lb steak and all the fixings. $8 versus $50 doesn't seem like much comparison.

And yet we all eat out. The reason? Convience. There are some meals which are just easier to easier to eat out. My DH hates making ravioli, so we usually eat it out or buy it premade. He also hates making pizza nowadays.

But reality also is that there are some foods which are impossible to make. More ethnic foods like Indian curries which have expensive spices that can be difficult to find. We enjoy eating out those foods which are cheap to make if you already have all the ingredients on hand, but difficult otherwise.

I don't think you can compare eating out with cooking at home. Do you think it's cheaper to eat out?

Going Carless...

I have been thinking more and more about trying to go carless. Downsizing and getting rid of both of our cars and getting 1 car. But DH isn't buying it. He likes the freedom of having two cars. We only have two cars because where we lived apart for 2 years in Southern CA. It was impossible without two cars.

So we ate the major depreciation on the cars before we even arrived out East. When we first moved we thought about selling one of the cars. But then my DH got into 3 car accidents immediately and we negated the idea. But we've been fortunately accident free since then. I still rarely drive my car, though we have had issues with the focus.

So I decided to run a couple of numbers about how much we'd save by selling one car. We might get $4k for the Focus. Plus we would not have to pay for insurance and maintanence. Insurance would be $75/month savings we would have 2 drivers, 1 car, and no discount for multi-car. The gas would not drop much because we'd be carpooling, but DH drives to work daily, and I would need a monthly transit pass. Currently I carpool, bike, and use public transit occasionally. The pass would cost $90/month. So the savings might be close to a wash because I don't use pass now but rather pay as I go. The pass works best if you use the transit daily, and I can catch rides 50% of the time and biked daily during the summer.

I wonder if it would still be worth it? We basically would net the $4k for sale of the car. The monthly savings would be minimally. The biggest factor holding us back is the Focus is the car we use for hauling stuff around, going camping, going snowboarding. But it is a more unreliable car. The corolla doesn't have fold down seats and carry as much. But we'd have to keep it because it's so much more reliable.

I guess we still should discuss it more. I wonder if the convience factor is worth the $4k?

Pros and Cons of Landlording...

What are the pros and cons of being a landlord? I think there are many. On any financial board there is always someone asking the question of whether it's worth it being a landlord. And there are those who say it's great and those who say it's not. However the reality is that even landlords will tell you it's not an easy job.

The obvious pros of landlording, is having someone else pay your mortgage. If you buy a house in an area where rents are high and mortgages are low you'll come out ahead. Along with an enforced savings by paying off the mortgage, a landlord is able to reap the benefits of home appreciation. They are able to diversify their portfolio with investments other than stocks. Also in retirement, after the mortgage is paid off it a rental property can provide an alternative stream of income.

However, there are many cons against owning rental properties and becoming a landlord. First, renters do not care for the place like an owner. Thus, typically most rentals are trashed and require more $$ for upkeep. What sort of upkeep? Well if a water heater breaks on a weekend you can't tell the renter to wait, you need to fix it asap. Unlike being frugal at home, with a rental you have to fix the house immediately, not wait for a good deal.

Second, the possibility of a renter not paying and needing to be evicted. Or being unable to find a renter and having a property sit vacant. This means needing to have amount of cashflow to carry the property during times when the mortgage isn't being paid by the renter.

Third, landlords often have to carry extra insurance in case their renters get hurt or have someone visiting who is injured on the property. They should also form an LLC and protect their other assets in case any renter/visitor sues them.

But overall I think the pros and cons balance out. The main thing is finding a property which will have a return on investment of at least 8% annually by having a strong positive cash flow. I would never be a landlord if the rent generated by the property did not cover the mortgage, insurance, and 10% maintenance costs. If not I think the money and time would be better spent invested in index mutual funds.

Another factor is being a landlord takes time. If you hire a management company they will take 10% of the rent which increases the amount needed to generate a positive cashflow on the property. Hence it could be a good retirement or job for a stay at home parent. But it might be too time consuming for people working full-time.

California Foreclosure

Okay so I now know someone going into foreclosure over $50k. I don't know if this is a wise move or not. Yes it's a lot of money. And yes the person does have the $50k to pay it off, but they refuse to "throw good money, after bad."

The question, is this a smart move or not? The foreclosure will ruin the person's credit. However, is it worth ruining one's credit over $50k?

I guess it's much like bankruptcy. For one person $50k is enough to drive them to declare. While for others having $300k in debt is nothing. It depends on the situation.

Would I do it? Probably not, mainly because there are too many variables which could arise from the foreclosure. It will make finding another job more difficult. It can make getting any loans more difficult. But I say the same thing about BK. However I realize I could quickly end up in either position given the right circumstances.

I wonder though if this is the right move? To the friend, my advice was to carefully consider if it is worth doing just for $50k. That's barely more than what they paid for their fancy car.

CA wildfires...

I am hoping our friends home in CA are fine. They've all evacuated from the Rancho Bernardo area, Irvine area, etc. My best friend's house was very close to the wildfires. She was within 3 blocks of the fires. Our other friends also are hoping to hear news about their house. Right now they are just watching and waiting.

I guess this is a good reason to keep your insurance up to date. My best friend hadn't made her payment, but she caught up on Sunday. She was being lazy. Geez.

Car...what you need or want?

DH and I went to look at a couple of used cars this weekend. We specifically were looking at Subarus because of the space and AWD. We had never test driven or even seen a subaru. We just picked a Subaru outback, legacy, & impreza based on what everyone we work with and live by has said.

So we saw a pretty good deal on a used 2004 Subaru Outback Station wagon. But while we were there we also saw the new 2008 impreza wagon. They were similar in price $17k for the impreza and $13k for the outback.

We were very impressed with the handling of both cars. We were also very happy with the larger space in both cars than what we currently drive. But we realized that the two cars we saw were very different cars. The Outback was substantially larger than the Impreza. We decided we would start thinking about replacing my DH's Focus next year but we needed to nail down a target price range and car specifically.

DH preferred the Impreza, while I preferred the Outback. So we talked in the car. The Impreza is a car which we might have to replace in 3-4 years after we start our family. It's a little larger than our cars and has a bit more storage space. The Outback is easily a car we could fit 2 children, dogs, and stuff into.

DH said a car is a car, you should drive what you want. I think we should look long term and buy something which will be usable longer than just a few years. This lead to the discussion whether you should buy a car you can use 90% of the time or a car you think you'll use 70% longer term?

My DH's argument is that we'll use the smaller car for 90% of the time for the next 3-4 years. Then if we have to trade it in for something larger because of necessity, then at that time you reevalute it. He equated it to buying a stock, you reevaluate at each point in time. You buy a car you will use for 90% of the time and rent if necessary.

I pointed out that cars depreciate quickly. That if we bought even a used car, it would depreciate in 3-4 years and we'd again have to be dumping more money on the table to buy another new used car in 3-4 years. If we moved up into an Outback from an Impreza, then we'd eat a harsher depreciation, time, energy expended buying another car versus just buying a car we can grow into till it dies.

It's a difficult financial decision. So do you buy a car you need or want? Is it purely a financial decision?

So as you can see this is about 1-2 years away our decision but we need to start planning and looking. I would like to pick up something used. And it would be lovely if something would just drop in our lap. But we have to keep our eyes open and our finances ready just in case.

Review: Debt Consolidation Site

I said I'd write an unbiased, objective review of the Debt Consolidation Care Website. First of all this is a website for people who are in debt and attempting to get out of debt. This website does not appear to be associated with any financial "guru" or celebrities like Suze Orman, Dave Ramsey, David Bach, etc.

They provide a service where they help people to get out of debt. The first way they do is this by suggesting that people consolidate debt through them. This is supposed to lower interest rates and make the monthly debt payment more manageable. This appears to a standard service. Because I am not consolidating any debt, I did not attempt to try out the program.

The second part of their website, is the forum discussing debt. The forums covers a broad range of topics including getting out of debt, bankruptcy, and getting loans after ruining your credit. The topics in this area seemed well organized and easy to follow. It appears that many people have a lot of experience in dealing with creditors and how to pay them off. This area also appears to give support to those getting out of debt. This area does not however suggest cutting up any and all credit cards, etc. Rather it stresses getting out of debt but not being critical of those still using credit.

The third part of the website is blogs of people getting out of debt. The blogs do not appear to be the typical blogs I enjoy visiting, but I'm sure there are many blogs which would be helpful for those interested in reading blogs about digging out of debt.

Fourth, there is a section to read about how to get out of debt under articles. I really liked this section and felt there was a lot of information well organized into topics. Also the calculators for determining how long it will take you to get out of debt and how much to pay is easy to use.

Overall this is a very easy to use website. It looks like it could be supportive of those getting out of debt. It might be a starting point for those looking to improve their financial situation.

Curbing a spender?

If you are a saver in a relationship with a spender how do you curb a spender? Do you just budget all the necessary expenses and savings and allow the spender to use the rest? Do you ask for guidelines that they are allowed to spend $X per month or pay period?

When asked by the old roommate, about merging finances as an older couple, she mentioned her S.O was a spender. She has always been a saver. So so doubted that if they married, she would be able to curb his spending habits.

So the question arose how do you manage the situation? The easiest answer is marry/cohabitate with someone who has common financial habits. But that's easier said than done. I know I have it relatively easy because I'm married to a saver, while I'm considered in the relationship the spender. Which seems quite a stretch when compared I would say against the average. But to curb my own spending, is I typically ask myself "Do I really need it?" And I put down an item and promise to come back another day and get it if I really do want it.

So what creative methods have you found to curb your spendy partner's habit?

Coupon Update #5

Unfortunately I haven't been using my coupons very much. I am overstock on health and beauty aids for at least 3 years. And I am somewhat stocked on certain foods.

But I've still found that the majority of the food we buy and eat aren't huge coupon savers. One area I've started eating is Oatmeal. I eat it everyday for breakfast, so I suppose I can save a lot on a box of oatmeal.

But overall buying meat and fresh veggies hasn't changed. I've gone to eating frozen veggies, but my DH doesn't like it. He prefer fresh veggies and complains about it. So I try to do one day fresh, one day frozen. Apparently the vitamins provided by frozen veggies are substantially less than fresh/raw veggies because it doesn't withstand the freezing process

Has my couponing this year been a help or hindrance? I'm still debating, I think it's been more work than it's worth. But I did learn about getting free/cheap shampoo, toothpaste, deodorant, etc. So maybe it's not a complete waste of time.

I am doing still doing it but very, very slowly.

Dental Update #3...

To summarize, I refused to pay $350 for a cancelled dental appointment in July. I have sent back proof about changing insurance, I have sent proof the dental office was not eligible for coverage with my new insurance (they are but OUT OF NETWORK). I called and reported them to the insurance company, and it turns out they have been reported multiple times for violations of misleading people to get work done when it wasn't covered.

I have written two more letters saying I'm not paying it. Got another 3rd letter saying I'm responsible for the $350.

What are my options? My DH says to keep saying I'm not paying. This time to explain the cost of the cancellation was way above the reasonable guidelines of the state. They were deceptive, which they were but refuse to acknowledge. I also reported them to the state dental office, but hey they obviously don't care and have been reported before.

Can they send it to collections? How will this affect my credit? What are their recourse? Should I offer to settle for $50?

New Poll: Lying to a significant other?

The question is whether you tell financial lies to a significant other? Most people I guess will say no. However I wonder if it's really true or it depends on how you define lie?

In general I would have to say I don't lie to my spouse. However, I do sometimes get the numbers wrong and hence I do think I tell white lies to my spouse about our finances. Like what?

Well I bought this shirt for $8.99, I might say $10. Or I got a haircut for $40, but it was $42. Just sort of a rounding of numbers. I noticed my DH does it as well, he'll round up and down and be in the ballpark of the number. However later I might see the charge or he'll see the charge and ask why is it $X?

Is that a lie or just a slip of the tongue? Is it important? Should we be counting every penny and accounting for it?

Also is not telling your significant other the $ amount a lie? Where I go grocery shopping and he knows I went or sometimes not, and never realizes what I just bought? Should I say I went shopping this evening and spend $40 (more likely $37.xx). Or is it just water under the bridge?

Retirement Poll Results

Wow. Looks like people reading the site are doing great in saving for retirement. The poll closed this evening and it appears that 45% of readers have saved more than $100k for retirement. 18% have between $25-100k, and 31% have less than $25k, and only 1 person doesn't have retirement savings.

This is quite remarkable considering the average savings rate in US is supposed to be 1-2%. And that the average retirement savings in the US is $45k.

Great job! I look forward to joining the $100k club as well.

Why Tip?

Do you wonder why the US the only country where tipping is expected? That is most other countries they include tips in the price of food? The prices of services have already factored in the "tip".

I would prefer that we not tip as a society and instead increase the price of services. That way people don't have to sit and wonder about tipping. They don't have to ponder how much to tip a dog groomer, dog walker. Or what's appropriate for a cabbie who doesn't help you with your door and bags. Or do you need to tip your hair stylist every time and then extra at Christmas? Or your babysitter every time and Christmas as well.

These so called rules get very complicated and confusing quickly. It seems like you need to tip for every possible service in the US. Eating out, carrying a bag, delivering an item, etc. Often you feel awkward and unsure not only about whether to tip but how much?

If we moved to a system where a tip was considered a bonus I think it would be so much easier. We wouldn't have to worry so much about offending the tippee. Plus I think that the people expecting to be tipped outrageous.

Nowadays everywhere you go, there is a tip jar next to the register. Which leads me to wonder just for punching a cash register I need to leave a tip? Basically every time I spend a penny someone else is looking for more money?

Would it stop you from purchasing an item if it was a bit higher and no tip was necessary? I think not. It might make you consider your purchases more, but you'd feel it was more worth it because you wouldn't have worry if you were "breaking" the rule by not tipping.

Would you pay more to stop tipping? Or is tipping just part of the culture and too ingrained? Or are we moving towards overtipping?