Could you Survive Without Earning/Spending Money?

Jul 22, 2009 @ 08:49 am by EMS

An interesting read from Style Magazine:

Could you Survive Without Money?

The article details the life of a gentleman near Moab, UT who lives in a cave and basically fends for himself.  He brings up the very good point that his lifestyle reflects life for millions of years before “modern” man and that the typical American’s lifestyle just doesn’t make sense on a lot of levels.

While I certainly don’t want to go find a cave to live it, this article does make you think twice about our constant strive for material things.

Hot Water Heater Energy Savings – Round 1

Apr 09, 2009 @ 08:46 am by EMS

Yesterday I received our first “real” gas bill since the gas hot water heater was removed (I say “real” because the previous month’s bill was an estimate, and I couldn’t use it for an accurate analysis of gas usage).  For those who don’t remember, I replaced our natural gas powered hot water heater with an electric one back in February.  At the time, I was concerned that I had made a mistake going from gas to electric, but I didn’t have much choice given that I would have had to go with a “power vent” natural gas model, which was not available at the time.

The new gas bill shows that we used 4.7 MCF of natural gas in March of 2009, compared to about 7.3 MCF in March of 2008.  At current gas rates, this translates to about a $40 savings.  Considering that this bill really covers 2 months of use (due to the previous month’s estimated bill), it comes down to about a $20/month savings.

Our electric bill with the new hot water heater went up about $17 last month.  So it looks right now like I’ll be saving about $3/month, at least looking at these initial numbers.

So, it looks like I should have held out and waited to find a power vented natural gas hot water heater.  The differential between the numbers is going to just get worse as soon as PA electric deregulates and the price we pay for electricity sky rockets starting next year.

LED Light Bulb Experiment – Not So Good

Mar 03, 2009 @ 12:06 pm by EMS

In late December 2008, I purchased a 3 pack of LED light bulbs from Sam’s Club.  While the bulbs were expensive, topping out a $15 for the 3 pack, I figured that buying one pack as a test would be a reasonable expense.

The bulbs advertised that they use 10% of the electricity of a normal incandescent bulb.  The bulbs I bought were for a candelabra light, so I unfortunately wasn’t able to test that claim using the Kill-A-Watt.  The candelabra that I would be putting the bulbs in had room for 6 bulbs, so I would be replacing 3 of those with the new LED lights.

The first thing that I noticed after installing them was that these bulbs were no where as bright as the incandescents they were replacing.  Since I was only replacing three bulbs out of six, I was able to get away with it.  However, if I had bought six bulbs, I’m sure that they would not have had produced enough light to be a practical replacement.

The bulbs actually didn’t look too bad.  Unlike some of the florescent bulbs that I’ve tried, these bulbs didn’t look too cheesy in the candelabra.

The bad news is that within 3 weeks of installation, the bulbs started to die (unfortunately, I can’t identify a specific date because the bulbs are so dim that I may not have noticed that one of them had died right away).  After the first bulb stopped working, I emailed the manufacturer, Lights of America to see if I could get a replacement.  That was on February 6th, and as of March 2nd, I still have not received a response.

The remaining two bulbs both died within three weeks of the first failure.

As far as electricity savings are concerned, my electric bill did decrease about 10% in the given time frame, however, I had also purchased a new, more efficient, refrigerator which is probably more responsible for the decrease than the LEDs bulbs.

Given this experience, I cannot recommend these LED bulbs at this time.  They just aren’t durable enough or pump out enough light.

Disclaimer: I did install the lights on a lighting fixture that is controlled by a dimmer switch.  However, the dimmer control is incorporated into the light switch (not a circular knob) and is left on “full” at all times.  The LED light packaging states that they do not recommend installing the lights on a dimmer circuit.  If someone has had better luck with these LED lights from Sam’s Club, please post in the comments.

Is Amazon Prime Worth it’s Cost?

Jul 31, 2008 @ 08:39 am by EMS

I received an email last week notifying me that my Prime Account would expire at the end of August.  For those of you who don’t know, Amazon Prime is a yearly subscription service that costs about $80 and entitles you to free 2-Day shipping on many (I hesitate to say most) of their items.

Before renewing for 2008-09, I did a little research on my own Amazon spending over the past 11 months.

  • Past 11 month spending at Amazon: $2,489
  • Previous 11 month spending at Amazon (before signing up with Amazon Prime): $959

These numbers had me a bit worried at first, because I had more than doubled the amount that I had spent at Amazon.  Was Amazon Prime making me a frivolous shopper?

I went back to look at the numbers and realized that close to 50% of my Amazon spending was due to a much needed computer upgrade.  Costs reflected in that one purchase amounted to over $1,000, which made the total Amazon spending over the past 11 months a bit more palatable.

I looked at how much I saved using Amazon.  Since Amazon isn’t charging state sales tax, I saved 6% off of the purchases right off the top ($149).  Purchasing the items online without paying for shipping also saved me a bit of gas money, but this number is a bit more difficult to quantify.  Also, being able to purchase items online without worrying about shipping time saves a ton of personal time for me.  If I realize I need to get something, I’ll check Amazon first.  If I can get free shipping and the price is comparable to what I would pay locally, I’ll generally go with the purchase from Amazon as long as it’s not an immediate-need item.  This was a big plus during the holiday season, and I suspect we purchased close to 50% of our holiday gifts from Amazon this year.

So am I going to renew?  Yes.  Am I going to spend as much at Amazon this year as I did last?  I hope not.

Results from Playing the Arbitrage Game

May 11, 2008 @ 10:37 am by EMS

In June of last year, I decided that I was going to experiment with earning interest off of a 0% credit card promotional rate. Ideally, I would have liked to have found an offer where I could write a credit check to myself, cash it, and then just let that balance sit in a high-yield savings account for the full year. Unfortunately, I couldn’t find an offer that didn’t tack 3+% off of fees for the total amount cashed, so this didn’t work out.

Rather, I opened a 0% for one year credit card with Chase.  I used that card solely for daily purchases until I came to within about $1,000 of the card’s credit limit.  It took me about 5 months to reach this level, all the while paying just the monthly minimums when I received statements.

The money that I traditionally would use to pay these purchases was deposited into’s high yielding savings account.  Unfortunately, high yielding wasn’t so high once the Fed starting cutting rates last fall, so I didn’t make out quite as well as I would have hoped.

I’m going to pay off the card in full this month (Yes, I know I have another month to work with, but I’m playing on the side of caution here).

During this time period, the interest paid on my EmigrantDirect account was about $325.  I’m estimating that about 66% of that is from this scheme.  Therefore, I figure I’ve made about  $214 (before taxes) on this plan

All in all, it was pretty easy money.  I was able to keep up on the status of the accounts via Quicken, and I was very careful about making sure the payments were made, etc…  Once simple screw up could end up costing me money.

That being said, I don’t think I’m going to do this plan again unless rates get back up to 4.25%+.  The 2.75% that Emigrant’s offering now isn’t enough to entice me back into the game.

Keeping my car to 200,000 miles??

Sep 21, 2007 @ 11:10 am by EMS

After reading an article (sorry, couldn’t find the link) that stated the cost savings one can realize by keeping a car for several years, I decided to see calculate approxiametly how long it would take me to reach that with our 2001 Mercury Sable (purchased by us in 2005).

Sable 200,000 mile prediction

Since I have mileage records dating back to July 2005 from oil changes, etc…, I simply plugged those into Excel and created a trend line. Then I extended the trend line out until I hit 200,000 miles, which will probably happen in the summer of 2011.

Originally, I had planned to replace this car either in late 2007 or early 2008, but the more I think about it, the more I want to try for 200,000 miles. The vehicle is in pretty good condition (except for 1 cosmetic dent) and I take it in regularly for maintenance. Since this vehicle is primarily a commuter car, as long as it gets me to and from work, I’ll be happy. Our family has already outgrown it, but the thought of owning 2 minvans gives me the heebie-jeebies. Having 4 years to be able to save for a new vehicle (and therefore less debt) is very enticing, plus I’m hoping that by 2011, we will start seeing some improved fuel efficient cars beyond the 20-30 mile standards we have today. Another plus for keeping it this long is the low insurance rates I pay for this vehicle.

I’ve definitely decided to keep it through 2008.

Getting and Keeping Good Credit

May 09, 2007 @ 09:37 am by EMS

We have a college age intern here at work who was talking to me about how to obtain a good credit score. I’m not an expert in such things, but my wife and I both have excellent credit scores (both just slightly below 800) so I feel somewhat qualified to give at least some rudimentary advice.

  • Be an honest and responsible consumer – this is by far the best way to keep and maintain a good credit score and it encompasses all of the other tips I’m about to share with you.
  • Don’t maintain a balance on your credit card – I still remember being in college and using my credit card for a stereo receiver that I wanted for my dorm room. Being quite new to the world of credit, I bought the stereo on my card without any idea (or even understanding) the finance charges that I would receive if I didn’t pay the balance in full the first month. I received my 2nd credit card statement and was astounded to see a $26 finance charge. Only then was I able to wrap it around in my little head that if I continue to buy things on this card and don’t have the money to pay off the bill within 30 days, I’d be paying a good bit of “extra” money for the things that I buy. This whole concept was foreign to me at the time. Realizing that $26 was about 5 hours at my then minimum wage job, I halted all extra spending until that credit card debt was paid off. Since that time, I’ve only carried a debt on my credit cards twice in my life, and both times I had formulated plans to pay off the debt within 3 months BEFORE making the purchase.
  • That being said, apply for a credit card early in life – I had my first credit card fully in my name at 18 and I’d recommend others do the same. Get the card, but don’t use it. Establishing credit early can make a big difference down the road, as long as you are responsible with it.
  • Pay your bills on time – I’ve been fortunate enough that I’ve never experienced the hardships that are related with medical emergencies or large unexpected expenditures of cash, so I’ve always been able to plan ahead for the bills and expenses encountered.  I would recommend to everyone that they set up and stick to a routine for paying bills.  I use a bill basket and pay the bills as they come.  Others wait to pay them once a month.  Either way works, just choose one and stick to it.

I know I’m not writing anything earth-shattering here, but they are just a few tips I want to share with those who are looking to start building good credit.

Switching Bank Accounts

Dec 18, 2006 @ 11:19 am by EMS

With the upcoming holiday break, I’ll finally have some time to finalize something I’ve been working on for two months – switching over my bank account.  My current bank has done some pretty stupid things lately.  They’ve increased ATM and other fees twice in the past two years, have extremely long lines at the teller on the rare occasion when I go to the teller, and refuse to offer paperless statements.  I’ve heard good things about the Pennsylvania State Educator’s Credit Union and have decided to give that a try.  After finding out that my wife is an eligible participant because she graduated from one of PA’s state university’s, I signed right up.

So now I have an account there, but there are still a ton of things that need done:

  • Change both of our direct deposits to go to the new account.
  • Update our automatic withdrawals for a bunch of monthly payments – house, car, life insurance, car insurance, etc…
  • Link the new account with my ING Direct and Emmigrant Direct accounts, as well as our online investment accounts.
  • Find the local ATMs.
  • Setup for paperless statements and reenter all of my online payment accounts.

This will be the first time I’ve ever not had a local bank branch to work with, so I’m going to keep my current account at the local bank at least initially.  I’ll keep it funded with the near minimum to avoid service changes, but I think once I change both of the direct deposits, they will start hitting me with a new charge.

Once everything finishes up, I’ll have the following advantages:

  • A savings account with a much higher interest rate (5.05% vs. the pittance I get now).
  • A very large network of surcharge free ATM machines.
  • Paperless statements + automatic update within my money management software (Quicken).

I think the only disadvantage I’ll face is that I’ll have increased difficulty when depositing cash, but that is rarely an issue in my household.

Personal Finance Podcast

Nov 15, 2006 @ 01:04 pm by EMS

I ran across a pretty good personal finance podcast from Perdue University a few weeks ago. Subscribe to it here. The professor (not sure of his name) is currently covering the retirement system here in America and is a pretty good place to start if you are looking for some basic info.

I found the podcast from Productive Strategies’s list of free academic podcasts.

Get Out There and Vote Today!

Nov 07, 2006 @ 08:30 am by EMS

Like it or not, politics play a huge role in you and your families financial decisions.  It drives me nuts when folks start complaining about our politicians and then I ask them a question about voting in which I get a blank stare in response.  If you don’t vote, you lose your right to complain in my book.

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