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Date: Tuesday, 19 Aug 2014 04:00

Rebate sites are a great way to save money easily when shopping online. Just click through these sites instead of going directly to the store, and they’ll keep track of your visit and rebate you a portion of your purchase.

There are quite a few of these sites out there, and they compete against one another. These rebate sites get paid when you shop there, too. That’s how they earn the money that they share with you.

I’ve been working on an improved version of my cash back comparison engine. It now has a browse feature for the stores.  You can do a rebate site comparison over a dozen sites in the engine now:

Try it out and see which site is giving the biggest rebate for your favorite stores!

The post Rebate site comparison engine update appeared first on Mighty Bargain Hunter.

Author: "John Wedding" Tags: "Announcements, Rebate Sites"
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Date: Wednesday, 06 Aug 2014 03:58

I was chatting briefly with a colleague yesterday about married life.  (He was going to be best man in a friend’s wedding in a couple of weeks.)  In the course of the conversation, I admitted that saving money was a heck of a lot easier before I was married, but that I wouldn’t go back to being single by choice for anything.  Everything has pros and cons.

He saw the picture of my daughter that I have in my cube, and pointed to that as one of the pros.  I certainly agreed.

Our daughter is our one and only.  Being an only child has pros and cons, too, of course.  One of the pros is that whatever part of our income that would go to her enrichment is hers alone.  No one else is competing for that slice of our income in that way.

Most bigger families have more restrictions on what they can do for their kids

Likewise, being part of a larger family has its pros and cons.  The opposite side of the pro above is that larger families are more likely to need to make tough choices about what their kids participate in.  If the money needs to enrich the lives of three or four children, the pot of money either needs to be bigger, or the children cannot do as much as would otherwise fit into their schedules.

The restrictions might be matters of practicality, as in running the children to different practices just isn’t possible because of schedule and time.  Or, rather than participating in, say, three activities, they may only be able to participate in one or two each — on the reasonable assumption that favoritism is inappropriate, of course.

The sliding fee scale

Activity clubs don’t ignore the fact that participation gets expensive when you have several kids, and many charge a smaller fee for additional children.  Large families, in effect, get an activity discount.

Though I could perhaps get bitter about this, and observe that the people in charge of setting the fees stand to be subsidized by smaller families like mine — due to the fact that they themselves have large families — that’s not really a productive way of thinking.  It does more harm than good to start judging a large family for being large.  (Who’s to say that the large size of a family is due to abundant blessing from God, or due to reproductive irresponsibility?  Certainly not I!)

Besides, there’s more to it than that.  Economically, it makes sense to encourage families to sign up more, or all, of their kids.

Let’s say that there was no discount, so a family with one child would pay $800/year, and a family of five children would pay $4,000/year.

Is it a fair charge?  Yes.  It is an onerous charge?  Yes, it is.  Might the parents stare down the barrel of that $4,000 expense and opt out?  Possibly.

Now, let’s say that the club charges $800 for the first child, $700 for the second, $600 for the third, and $500 for the fourth and beyond.  This is still expensive for the five-child family — $3,100 — but the family can see the nearly 25% discount they’ve been given, and are more willing to pay it.

The silver lining

Yes, they’re paying $620/child, and we’re paying $800/child.  At the same time, though, a larger club activity can take advantage of their scale, and the experience will likely be better with more participants.

Regardless, though, our total payout is $800, while theirs is $3,100.  We’ll still pay less, total.  That will always be the case.  I guess we’ll take that!

The post Large families and activity discounts appeared first on Mighty Bargain Hunter.

Author: "John Wedding" Tags: "Family, Kids and money"
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Date: Thursday, 31 Jul 2014 03:40

I use rebate sites for as many of my online purchases as I can.  After getting a free account, it’s only a small amount of extra work to save a few dollars — or even more than a few! — on thousands of online stores.

Mr. Rebates is one of a number of rebate sites available.  Using Mr. Rebates is simple:

  • Sign up for a Mr. Rebates account, which is completely free.
  • Log into Mr. Rebates before you shop online.
  • If Mr. Rebates offers cash back on purchases from your favorite stores, go through the links on Mr. Rebates to get to the store instead of typing it into your browser.

It really is just about that easy to start accumulating your rebates!

How it works under the hood

Mr. Rebates

Mr. Rebates has to get their money from somewhere in order to pay you your rebates.  They wouldn’t stay in business very long if it came out of the website owner’s pocket, right?

The quick answer is that the store you bought from awards a commission to Mr. Rebates for sending them your business.  What Mr. Rebates then does is share part of that commission you. The part they retain is their profit, which keeps the lights on and puts food on the table.

Features of Mr. Rebates

Mr. Rebates has been around for quite a while — since 2002.  They hit the market early, but now there are quite a few other competing sites. But, like other sites, Mr. Rebates has unique features that make it different:

  • Reasonable minimum payout. The minimum amount required to receive a quarterly payment from Mr. Rebates is $10.00.
  • Monthly pay-out with PayPal.  My rebate money goes in to my PayPal account as long as I request it before the month changes.  It’s very reliable.
  • Sign-up Bonus.  There’s a $5 bonus that comes with your first purchase.  Ka-ching!
  • Store of the Week.  This Mr. Rebates feature is a store that has higher-than-normal rebates for a full week.
  • Weekly Deals.  The front page features extra store-specific incentives, like a flat percentage off any order, free shipping, etc.
  • Seasonal extra rebates. Depending on the time of year, a group of stores will qualify for extra rebates.  So whether it’s back to school, Valentine’s Day, or the holiday season, expect that the places you’ll shop to have extra rebates.
  • Favorites List.  You can consolidate the stores you shop at most in a list for quick access to the rebate links.

This rebate-site has been around for over a decade  You don’t stay in business that by not paying your rebates, so I see Mr. Rebates staying around for some time to come!

The post Rebate site review: Mr. Rebates appeared first on Mighty Bargain Hunter.

Author: "John Wedding" Tags: "Rebate Sites"
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Date: Wednesday, 30 Jul 2014 03:32

A washer and dryer are mainstays in many households.  They are in our household, for sure.

We bought a used washer and dryer set four and a half years ago.  Over the past couple of weeks, the washer was whining loudly.  First we heard it within the drain cycle, then in the spin cycle.  When it started squealing during the wash cycle, I sensed that its time was almost over, because that sounded like a transmission problem.

Our family had done some repairs on it already to fix a bent support frame, but a new transmission runs upwards of $100.00.  Considering we paid $200 for the whole machine, this expense was questionable.

Time to hit Craigslist for another set, right?  I’m of the opinion that older is better when it comes to most large appliances.  So, off we went, and started emailing and calling people.

Unfortunately, we aren’t the only frugal people in our area

Looking on Craigslist for a used washer and dryer was a bit of a treasure hunt.  The sets that were any good didn’t last long.  The Craigslist ads were being removed left and right by the posters as other bargain hunter scooped them up.

One gentleman we called fixed up machines for a living, and he was selling them as fast as he could fix them, basically.  He recommended that we drove out to his place early Sunday morning to pick one of the two he had left.  This wasn’t feasible because we do the church thing, but it was clear that if we didn’t come out, he would get another buyer quickly.

We visited one woman with a machine.  She didn’t know the capacity of the machine.  As I told my newsletter subscribers, I would have had to pay to find out the capacity of the machine, but it would have been worth it to do so since it was too small for what we needed.

On the way home from that visit, we stopped in a secondhand store.  Several washing machines were out front — sold.  One more was in the back — on layaway.

For used washing machines, it’s definitely a seller’s market.  There’s a lot of buyers out there.

Getting a used machine can take time — more time than you may have

We ended up getting a Roper machine from Lowe’s.  There was a sale going on, so the price was pretty good for a new machine: under $350.  It seems to get our clothes clean, but man, it sounds … different.  Maybe part of this new sound is driven by the manufacturers doing their best to get clothes clean on a tight, mandated energy budget.

No kidding: the washer sounds like a robotic goose in heat.  And from what we can gather, this is normal for the newer machines!

We got this newer machine for a couple of main reasons:  (a) the price was decent, and (b) we could get it right then.  The second one was the more important consideration, actually.  Our dirty clothes were piling up, and our old machine was noisy, which was not normal.  Basically, we didn’t want to risk completely breaking our current machine, because that would put us at a big disadvantage.

Were I to do this again, I’d plan a bit further in advance than we did.  We had a bit of notice — a few weeks, maybe — and could have looked more than we did.  We waited too long to look in earnest. The best time to look for a used washing machine is before you actually need one!

Saving (potentially) $200 or more is a fair trade-off on paying with time vs. paying with money. But that depends on leaving enough time so the search can happen.

The post Want a used washer? Budget some time appeared first on Mighty Bargain Hunter.

Author: "John Wedding" Tags: "Bargains, Home and Garden"
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Date: Thursday, 24 Jul 2014 03:52

A big part of personal finance advice revolves around finding ways to spend less.  Less money going out the door means more money staying in your bank account.

By and by, some purchases draw an above-average amount of fire.  Bottled water is one of them.

I’ve seen at least three posts over the past few weeks that include bottled water as one of those things you shouldn’t buy.  Though I do agree that it can get expensive if you drink it all the time, bottled water does have redeeming value.

There’s always context to be considered

I’ve been writing things online for nearly a decade now on personal finance and money issues, and it’s easy to get an echo chamber effect in this area.  It’s fairly easy to boil down the basics of personal finance to a few core ideas.  The ways to save money found in The Tightwad Gazette are still valid.  And many of those ways to save money weren’t new when she published them in the 1990′s.

Tap water, passed through a faucet-mount filter works out to be about a dime a gallon.  A gallon of drinking water from Walmart is about a buck.  The math is pretty easy there.

But sometimes, there’s more than just math to consider.

I had a meeting in a neighboring town with some colleagues.  We went up in two vehicles because we were coming from different places.  On the way back, it worked out that I rode back in the other vehicle.  One of my colleagues — also a mentor of mine — had a nice, roomy vehicle.

In a compartment in the inside of the back door, he had some bottled water, and told me to help myself.

I remember that because of how hospitable it was.  Looking back, it was a pretty inexpensive way to earn points with me.  If it was an “ethical bribe” then he slipped me a nickel as he shook my hand.  In the grand scheme of things, bottled water is cheaper than soda, and it’s almost certainly healthier.

I’ve also experienced the flip side of this.  Our Toastmasters Club had an open house.  I had bought a reusable seven-gallon water container with a plastic faucet, and filled it with water to bring for refreshments.  I was looking to kill two birds with one stone:  bring refreshments to the open house, and get a water container for our personal use so we could prepare a bit for storms and the like.

That container, filled up, weighed almost sixty pounds.  After the party, I think it weighed about fifty-nine pounds as I lugged it back to my car.  Filtered tap water just wasn’t the first choice of anyone.  With all of the other beverages there, I can’t blame them.

To summarize …

Is bottled water expensive compared to tap water?  Absolutely.  Are there times when bottled water is inexpensive compared to the value it delivers?  Yes.  Are there times when the cheaper alternative is a waste of effort?  Yes.

It’s all about context!


The post In praise of bottled water appeared first on Mighty Bargain Hunter.

Author: "John Wedding" Tags: "Food and Groceries, Frugal Living"
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Date: Sunday, 20 Jul 2014 03:13

There are lots of advantages that come out of being in a healthy marriage.  A healthy marriage takes work, and lots of communication, especially about financial matters.

Over time, I’ve come to view differences of opinion on money matters with my wife less as argument, but more as different perspective.  Partners have different ways of looking at money, and taking both into consideration is better than either perspective alone.

“Oh we’ve got eggs now …”

We’ve talked for around a year about getting some chickens.  We eat a fair number of eggs — as do our dogs, from the dog food we make.  Raising chickens is one way to work towards our own egg source.  It’s also an exercise in hedging against dependence on external grocery supply chains.  (Prepping on a small scale, if you will.)

My wife did a lot of the legwork for deciding which breeds to get.  We tended toward breeds that were more or less egg-laying machines.  She and her parents also did a great deal of design and construction work on the garden and coop area in our backyard.  Though we bought a few female chicks, we also had the opportunity to take over care of three hens.

The hens (at least one, maybe two) started laying eggs again after they had overcome the shock of the new surroundings.  When the chicks we have grow up, we probably will be getting a few dozen eggs a week.  That’s more than we would want to eat.

Naming the chickens:  Two philosophies

The majority of the chickens we got were either Sussex or Red Star hens.  The Sussex, being an English breed, got names of queens:  Elizabeth, Mary, etc.  The Red Stars, though neither Russian nor Soviet, got names of Russian and Soviet first ladies:  Yekaterina, Raisa, etc.

I was a bit more pragmatic with my naming (which didn’t fly):  Egg Laying Profit Machine 1, Egg Laying Profit Machine 2, etc.

This also feeds into how I saw us distributing the fresh eggs that we weren’t going to eat.  We have about three months before the chicks will be old enough to start producing.

Selling the extra eggs:  Two perspectives

I wanted to start up the bidding war.  The eggs will likely be brown (which commands a premium in the right circles) and will be free-range and organic, which also command premiums.  Therefore, sell the limited supply of extra eggs to the highest bidders — the people within our circles that were willing to pay the most for them.

Well :) this was flatly rejected.  Her plan was to sell them at a more nominal price to friends if they wanted them, or give them as gifts.  Initially I was thinking Why why WHY are you underselling them like that?! but I suppressed being too heavy-handed and heard that her take was to build relationships.

That simmered me down a bit, because there’s a lot of merit to that.  Taking care of friends is indeed extremely important — not because there’s the expectation of getting something in return, but because good friends are a lot more valuable than the few extra bucks per dozen that some people might shell out for the eggs.


The post Build profts or relationships with fresh eggs? appeared first on Mighty Bargain Hunter.

Author: "John Wedding" Tags: "Food and Groceries, Making Money"
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Date: Friday, 18 Jul 2014 03:42

Ebates was the first rebate site I used.  I’ve been a member since 2002.  The site has been around since 1998.  That’s last century, if you’re keeping track.

I use rebate sites all the time.  Every chance I get, as a matter of fact!  For a miniscule amount of extra work, I can save a few dollars or even more than a few on a lot of online purchases.

Using Ebates is simple:

  • Sign up for an Ebates account, which is free.
  • Log into Ebates before you shop.
  • If Ebates offers a rebate on purchases from your favorite stores, go through EBates to get to the store instead of going to the store directly.

And that’s about all there is to start accumulating your rebates!

Briefly behind the scenes

Ebates Coupons and Cash Back

You may be wondering where Ebates gets the money to send to you in the form of a rebate.  (No free lunches, right?)

The short answer is that the store you bought from sends the money to Ebates in the form of a commission.  Ebates referred you to the store, so they get the commission, but then they turn right around and share part of it with you.  The part they retain is their profit for making it all happen.

Features of Ebates

Ebates has been around longer than most rebate sites, but there are a number of other competing sites now.  Still, Ebates has unique features, even though the look and feel of the site seems just like I remembered it in 2002!  Here are the special features that make Ebates different:

  • Low minimum payout.  The minimum amount required to receive a quarterly payment from Ebates is $5.01.  That’s low for the range of rebates sites.
  • Daily Double.  One store a day is the Daily Double.  For one day only, the rebate for that site is … wait for it … double what it normally is.  Truth in advertising at its finest!
  • Seasonal extra rebates.  Depending on the time of year, a whole bunch of stores will qualify for extra rebates.  This time of year is approaching back to school time, so a number of clothing stores have higher-than-normal rebates going on.
  • Browser add-in and apps.  The browser add-in and apps will detect whether or not your store qualifies for a rebate, and makes the sign-in process even easier to get to saving money.
  • Product search.  If you’re looking for a particular product, you can try the keyword-based product search feature.  It draws from the inventory of rebate-eligible sites and shows which sites have the item, and how much rebate you’ll get when you purchase it there.
  • Periodic sign-up bonuses.  Occasionally Ebates offers a sign-up bonus for new accounts.

But, as I mentioned, this site has been around a long time.  It was around when the Internet’s inventor was Vice President!  (Well, not quite, but it has been around for 16 years!)  You don’t stay around that long time by not paying your rebates, and I don’t see Ebates going away any time soon!

The post Rebate site review: Ebates appeared first on Mighty Bargain Hunter.

Author: "John Wedding" Tags: "Rebate Sites"
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Date: Thursday, 17 Jul 2014 03:51

It’s not a secret that people give away or throw away lots and lots of stuff.  Stuff that’s outlasted its usefulness.  Stuff that’s broken.  Stuff that reminded them every day of their lousy purchase.

We’ve gotten useful castaway items right from within our subdivision.  We scored a nearly-complete set of patio furniture that just needed a little bit of cleaning. Recently we happened upon a stash of building materials: pressure-treated wood and other odd pieces.

A few days ago, my father-in-law picked up a Radio Flyer wagon that was thrown to the curb. The front axle was bent. He fixed that very easily, and now it works great for carting small garden equipment back and forth from the house to the garden.

Easy fixes … if you know how!

People throw away things because it’s a good deal for them to do so.  The value of what they’re throwing away is less than the value of the space it’s occupying in their lives, whether that space is physical, emotional, or both.  None of us are a room without a roof.

I’m all for taking advantage of good deals.  If it’s better for them to throw something away, then great.

On the other side, if it’s a good deal for someone to pick up the discarded merchandise, that’s great, too!

Here are five reasons that should not be deal-killers when you’re deciding whether or not to pick up free stuff:

  • Missing parts.  If it’s only one or two parts missing, they most likely can be replaced with a bit of scavenging or researching.
  • Dirt.  The patio furniture we picked up needed a good cleaning.  But that was it.  After that, it was in remarkably good shape.
  • Rust.  Rust can be removed if it’s slight, and not structural.  Covering the item with a rust-preventive paint will keep it from coming back too quickly.
  • Cosmetic damage.  A dent in an otherwise functional item isn’t a big deal.  Heck, I pay for damaged items! (At a discount of course!)
  • Slight structural damage.  The wagon my father-in-law picked up was slightly damaged.  Slightly-damaged items can be fixed with some tinkering.

What other things about discarded items shouldn’t scare you off?

The post Five things about discarded items that shouldn’t scare you off appeared first on Mighty Bargain Hunter.

Author: "John Wedding" Tags: "Free Stuff, Frugal Living"
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Date: Monday, 14 Jul 2014 15:42

The blog A Young Pro had this year-old article in his Twitter feed recently.  The title: “When is it Okay to Spend Money?”

He recounts the story of a really bad week with his car.  He gets in an accident, and then locks his only set of car keys in the car, while the car was running.

If it were I, the only thing more depressing would be finding out that my daughter has started listening to Hanson.

But then there’s “the list”

So, naturally — and reasonably! — he wrote a list of things that, to him, were worth spending money on.

And, naturally — and reasonably! — “spare keys” was at the top of the list.  (That was his only set that he locked in his car!)

Completely for fun, though, I’m going to take his list, and turn it upside-down.  I’ll argue that these are awful things to spend money on.

  • Spare keys.  Your car is on its last legs.  Why buy an extra set of keys?  It’s going to the junkyard anyway.
  • Real Estate.  I can rattle off three people that I know personally who have been foreclosed on.  And how many people got burned in 2008 with the real estate crash?
  • Work Clothes.  Unless there’s a uniform, who are you trying to impress?  Your materialistic peers?
  • Transportation for Work.  Why are you traveling so far?  Time is money, man!  Have you never heard of telecommuting?
  • “Experiences” with my Wife and Daughter
    • Movies.  Overpriced concessions, sticky chairs and floors, and excessive advertising are “experiences” I can do without.
    • Travel.  We’re sitting in a car, or being groped by the TSA, or being handed our airline ticket prices from a roulette wheel.  All to stand in line for 3 1/2 hours to see the freakin’ Frozen princesses.
    • Trips to the Zoo/Aquarium.  Remember, pandas are bears.  And tigers are not just big versions of Morris.  You’ve been warned.
    • Family Ice Cream.  Two words:  lactose intolerance.
  • School.  Isn’t this one self-explanatory?  Let’s get tens of thousands of dollars into debt just for a glorified (job) hunting license.
  • Professional Training.  Congratulations!  We certify that you paid money for the training we delivered to you.
  • Stocks/Bonds/Mutual Funds.  Risky/risky/risky.
  • Insurance.  We, as your insurance company, will ensure that we will do everything in our power not to pay you.
  • Food.  (OK, this one I can’t turn upside down without being mean.

It’s all about context!

The post When is it NOT okay to spend money? appeared first on Mighty Bargain Hunter.

Author: "John Wedding" Tags: "Commentary"
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Date: Sunday, 13 Jul 2014 20:57

Statistically, I’ve passed the midpoint of my life.  As I’ve gotten older, I’ve been thinking more about calling, and legacy.  Calling, in my mind, is the most important thing I can do, which would be the most difficult for someone else to do had I not done it.  Legacy, in my mind, are the traces of my life left here after I’m gone.

Calling is something that both my wife and I have been talking about.  After all, we agreed to go through our lives together, so we each need to consider, and value, what God calls the other to do.

It sure would be neat if He called us to do the same thing.

A couple’s common calling

A family we know is participating in hosting an orphan for a few weeks this summer through Project 143.  (Please check out their website to learn about Project 143′s mission.)

We attended a presentation that discussed the particulars of the outreach.  In the presentation, the father talked about how he and his wife were led to do this as a couple.  Hosting the orphan was “a God thing” first and foremost — but beyond that, it was they who were called to do this more so than he or she was called to do this.

The “they” part is important.  They’re waiting to see how God uses this hosting — which is wise.  Nonetheless, this is a step that they’re taking together, and it’s one step toward discovering a common calling for their lives, regardless of whether that calling ends up dealing with orphans or with something else.

Wise stewardship of finite resources

Hopefully it’s not too much of a jump to call this kind of joint calling a “good deal.”  The positive impact we can leave is limited by money and time.  Time is by far more important than money, because eventually we run out of time.  But, given that happens to everyone, there’s also the consideration of money.

Hosting the orphan for just a few weeks is not cheap:  thousands of dollars.  A family typically has only so many thousand-dollar chunks of change lying around.  And, unfortunately, money can only be spent once, so this money cannot be used for something else — like, another completely different, separate calling.

Now, a calling is a calling — and who am I to say that two separate callings are bad? — but a couple with a common calling enjoys a number of benefits:

  • More resources available to make an impact.  Reducing the number of competing “draws on resources” increases what can be put toward one particular need.
  • Economies of scale.  A larger chunk of change can open up volume discounts, setting up a foundation for wider reach, etc.
  • Increased impact through a wider skill-set.  Husbands and wives in strong marriages tend to complement each other well.  One is strong in an area where the other is weak.  Doing something together can cover the bases better.
  • Efficiencies of time.  If one person can work 5,000 hours on a calling in a lifetime, then two can work 10,000 hours.  The number of hours is the “hard limit” that can’t be overcome.  Even better:  Working together they might be able to be far more efficient than just the “sum of the parts.”
  • It’s a good accounting for one’s life.  I believe that we will all be asked to give an account for our lives.  A joint calling, with the person you promised to spend the rest of your life with way back when, certainly isn’t a bad accounting.  And, in a practical way, a common meaningful and purposeful activity is a good way to strengthen the bonds with your spouse.

If you’re married, finding a common calling is a good thing to do with your spouse.  This is one of life’s good deals, in the big picture.

The post A common calling is a good deal appeared first on Mighty Bargain Hunter.

Author: "John Wedding" Tags: "Biblical Finance, Charitable Giving, Fam..."
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Date: Sunday, 13 Jul 2014 03:38

A high school friend posted a link to this Mother Jones commentary on an Economist article dealing with education in personal finance.

The main point brought out is that “courses in personal finance do not appear to have an impact on adult behaviour.”  The article specifically mentions that financial education had no impact on degree of saving.

Knowing is half the battle …

I either never learned about, or completely forgot about, the safety lessons included in G.I. Joe cartoons.  (But, with the magic that is YouTube, I can educate myself.)

How things went down:  Someone would get themselves into an unsafe situation, like having their arm set on fire, or getting near a downed power line, or becoming stuck on the center of a frozen pond.  A G.I. Joe guy would just happen to be in the vicinity to get them out of the mess, and would explain for all of our benefit what the safety hazard was, and how to get out of it.

The grateful civilians would then say, “Now we know! … ”

And the red-laser-shooting G.I. Joe guy would say:  “… And knowing is half the battle.”

… but it’s only half the battle!

Getting back to the personal finance education topic, I suppose that I wasn’t surprised to hear that classes in personal finance didn’t really have much of an effect on later behavior, for a few reasons:

  • People learn far more from their adult relatives’ actions than in the classroom.  I didn’t learn about spending less than I earned from a textbook.  I learned it from my parents, and my grandparents.  That was how they dealt with their finances, each day, every day.  Their actions spoke, and taught, far more than any classroom would have.
  • Basic financial literacy is … really pretty straightforward.  I wouldn’t expect that the basics of personal finance would really round out a full year-long class.  Possibly a semester-long class.  But stretching the material out, it would seem, would get pretty dull pretty quickly.  This would give people reason to tune out when they otherwise wouldn’t.
  • Knowing is only half the battle.  Learning how to balance a checkbook, or how to budget, or how to save for big expenses, is one part of the equation.  Let’s be generous and agree with the G.I. Joe guys: it’s half the equation.  The other half, then, is following through.  It’s the lack of follow-through that gets people, even if they know the right thing to do.  Getting 50% right is still failing under most circumstances.
  • The other half, frankly, isn’t fun and carefree.  Restraint from impulse buying, saving for a rainy day, and packing lunches just doesn’t get the juices flowing for most people.  As much as evangelists may try to make this a fun activity — I suppose I’m one of them — in a way it feels like living life with the throttle on.  It takes discipline and constant work to maintain a frugal, financially-responsible lifestyle.  I’ve even come to the conclusion that it isn’t supposed to be fun.  But, I also suspect that if it were actually fun, everyone would be doing it, and that’s not the case.
  • The not-fun part usually wins over the I-should-know-better part.  That’s the crux.  People who know better don’t do better because they’ve gotten used to a certain level of “fun” that is more than they can afford.  They don’t want the pain associated with the absence of that fun — even if they know that down the road it will cost them lots more.

So, even if people do know about good personal finance, knowing is only half of the battle.  The other half is doing it.

Where did you learn about personal finance?  Did it have a lasting effect on how you handle your finances now?

The post The other half of the personal finance battle appeared first on Mighty Bargain Hunter.

Author: "John Wedding" Tags: "Basics, Personal Finance"
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Date: Saturday, 12 Jul 2014 03:55

Free Money Finance was one of the first personal finance blogs I commented on.  This was in 2005, so nearly … TEN years ago?!  Yikes.

FMF is very successful, and I’ve had the pleasure of meeting him in real life.  I can attribute what I know of his success to a number of things, and one of those things is that he practices every bit the personal finance he writes about.

Seventeen years of year-by-year data

The post today showed the year-over-year change in his net worth.

What struck me with this table was not the (multiple) double-digit gains.  It was the length of the time period.  He’s used Quicken faithfully and has seventeen years of his financial transactions at his fingertips.

What a great asset that is!  A full financial picture for that long is incredibly useful both for accurate reporting come tax time — IRA contributions and other transactions need to be tracked more or less forever — as well as for seeing trends and changes over a good part of a lifetime.  It’s a financial baseline of epic proportions.

The cost of (re)collecting these data

The trick to pulling this all together is to process the data as they come in, in a timely manner.  At the point of the transaction, the financial institution or business is basically required to provide you with a record of the transaction free of charge.  It’s yours for your use, or non-use.

Further away from the time of the transaction, though, they’re not obligated to produce the record for you for free, or even at all.  There may be requirements imposed on them to keep records of financial transactions, as well as requirements as to how long they have to provide them to you if asked, but don’t count on them producing them after that.

A few examples where letting your data slip through your fingers can cost you:

  • IRA contributions.  My tax software asks for total contributions to IRAs.  As in, all of them.  If I don’t have all of them, then I can go back to the brokerage to get them — for a fee.  As in $10 per statement, possibly plus labor.  It’s not free, by any means.  But, there can be tax consequences to not having this information when it comes time to withdraw.
  • Bank statements.  Recovering paper statements are the same deal: it costs.  But even electronic statements are sometimes only available for a limited time.  It can be a few years’ worth, but that’s not “all of them.”
  • Individual bank and credit card transactions.  Slightly different from statements but containing the same information, the transactions are in a structured format suitable for importing directly into Quicken.  A friend of mine found this out the hard way.  Our credit union was moving over to a new back-end system, and they had announced for months that people needed to download their transactions, because they wouldn’t be kept after the cutover.  Well, my friend waited until the last minute, and they cut over a bit early, but there was nothing that could be done anyway.  Procrastination kills.  He didn’t lose all records, but he did have to enter a few hundred transactions by hand into his accounting software.
  • Receipts.  Much of what is deductible needs proof.  You either have the receipt, or you don’t.  For store purchases, there’s often no recovering a missing receipt.

Archiving — and even better, processing — your financial data is a good bargain.  I wish I had done it more regularly myself.

So … have you been doing this regularly?  Any times you wished, like me, that you had done more?  I’d love to hear about in the comments!

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The post The value of your financial data appeared first on Mighty Bargain Hunter.

Author: "John Wedding" Tags: "Organization, Personal Finance"
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Date: Thursday, 10 Jul 2014 03:30

I’ve been a musician for most of my life.  I play piano in two church services each week.  I doubt I could quit if I wanted to. :)

For most of that time as well, I’ve been a bit of a closet drummer.  Lately I’ve also had the chance to hit the kit at church as well.  (I’m still too loud.  I need to be more like Steve Gadd and less like Animal.)

The drum set I bought at a pawn shop a while back is at the church.  I finally got some new heads for the drums so that they didn’t sound like #4 washtubs.

Guitar Center … for drummers?

I got the heads at Guitar Center.  They had a clearance bin with some decent deals, and I loaded up.  The guy working there helped me out a lot with my questions, and the heads work great.  A few days following the purchase, I got an email from him asking how the heads worked out.  That was a nice touch!

I go to Guitar Center fairly regularly these days.  I guess I gave them another chance after what appeared to be a raw deal on a keyboard.  Following that incident I’ve overall been pleased with the service I’ve gotten there.

The last time I was there, I saw a sign advertising: “Fresh Sticks for a Year!”  It’s called the Guitar Center Stick Club.

The sign in the store didn’t list the price of the club.  The link above indicates that it’s $20/year.  This gets you a card that entitles the owner to $5 towards sticks each month for a year.

Intrigued, I checked the fine print.  (There’s always fine print.)  The fine print from the link:

Limit 1 per customer. See a sales associate for details … Year’s worth of sticks is $5 per month for 12 months. Card will never exceed $5. Monthly amounts do not roll over. Ask your local expert for details. Stick Club is only available in-store.

So I can conceivably get $60 worth of sticks for $20, here’s how the fine print taketh away:

  • “Limit 1 per customer” — The maximum amount I can save with this deal is $40.  Forty bucks isn’t insignificant, but … that’s it.
  • “Stick Club is only available in-store.”  Not online.  In-store.  Which means I have to go into the store to get the deal.  Which takes time, and gas …
  • “Year’s worth of sticks is $5 per month for 12 months.”  To get that maximum $40 savings, I have to buy sticks each month.  They win either way.  Either I come back into the store — which I have to do to get the deal (see above) — or I don’t, in which case they’re ahead $15.  Four visits is break-even.
  • “Card will never exceed $5. Monthly amounts do not roll over.”  So if I miss a month, it’s gone.  Too bad, so sad.
  • “Ask your local expert for details.”  There may be even more terms and conditions!  Yay!  Not.

So, is the Guitar Center Stick Club a snare?  *** rimshot ***

As with all other things, it depends.  From Guitar Center’s standpoint, they’re playing the numbers.  They’re selling you up to $60 worth of merchandise for an upfront $20.  They’re hoping that (a) you forget, or (b) that they make it up on the back end by getting you into the store those twelve times.

But … if you’re a drummer and go there regularly anyway, then no doubt you’re already buying sticks, so why not?  Or, even if you’re not a drummer, but go there regularly and have a lot of drummer friends … then sure, why not?  The once-a-month visit to the store would not only not be a chore, but people wouldn’t have to twist your arm at all!

It’s all about context!  Store deals are usually a win for you if you’re already dropping a lot of cash there.

The post Is the Guitar Center Stick Club a snare? appeared first on Mighty Bargain Hunter.

Author: "John Wedding" Tags: "Rewards, Shopping"
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Date: Wednesday, 09 Jul 2014 04:22

Businesses love monthly subscription services, also called recurring charges.  Why collect money just once from a customer when you can collect from them again, and again … and again?

Even better than that:  Most of the time, the recurring charges just happen, magically, without the customer’s intervention … unless they want to quit, of course.  It’s easy to forget about the charges.  Which, of course, is exactly what the businesses want you to do!  They don’t want to give you a regular opportunity to re-evaluate whether you need their service or not.

Here are a few tips on how to put these charges in the correct perspective:

  • Figure out how much the service costs per year.  The monthly fee can make a service seem cheaper than it is.  f you have an $83/month gym membership, that’s $1,000/year.  A bit less cheap, no?
  • Figure out the cost per use.  For that same gym membership, if you average 20 visits per month, that’s a little over $4/visit.  IIf you pay $10/month for a DVD rental service, and it takes a week on average to get a CD, watch it, return it, and get the next one, then you’re paying $2.50 every week to watch a movie, regardless of whether you actually watch the movie or not.
  • Regularly review your bills.  Prices rise.  And way back when, you agreed to a whole bunch of terms and conditions — which you almost certainly didn’t read in their entirety — that stated that by continuing to use the service you agreed to accept said cost increase.
  • Regularly re-evaluate your charges.  Ask whether or not you’re getting value for the services you’re being charged for.  If not, then cancel at the earliest opportunity.

The (recurring) pendulum swings both ways

I’d like to highlight how Done By Forty cast the statement described in the last tip above:

All things being equal, a dollar of recurring-cost savings has more impact than a dollar of earnings. This is because recurring-cost savings can cut money out of your baseline spend forever, while no income can be guaranteed over the long haul.

Baselining is wise to do.  It not only works for bargains, but it also works for budgets — particularly on the expense side.  How much is going out the door each week / month / year for various recurring expenses?  Find out if you don’t know.  It’s a good gut check, and a good opportunity to discover all of those charges you may have forgotten about!

Here are a few benefits to ditching some of those recurring charges that aren’t bringing value to you anymore:

  • It frees up cash flow for some other purpose, just as if you were paying off a debt.  That outflow is gone.  That outflow can be directed somewhere else, or into a savings account, where it accumulates with time.  Aim a money hose at a bank account and watch it fill up.
  • Reduced expense baseline means more time to weather a storm.  If you have to go without income for a while, you can go without income for longer if less money is going out the door.  It buys you time to replace the income stream.
  • Reduced expense baseline means less money needed to retire.  If you can live on less, you’ll be able to get more years for your money if / when you stop working.  A million dollars goes a lot further if your expenses are $20k/year than if they’re $100k/year.

Other benefits?  Other takes?  Let us know in the comments!

The post Seven tips on recurring charges and recurring savings appeared first on Mighty Bargain Hunter.

Author: "John Wedding" Tags: "Budgeting, Retirement, Saving"
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Date: Saturday, 05 Jul 2014 15:48

As humans, we’re very good at putting on appearances, even when they don’t match our reality.  If we have a lot of money, we can appear as if we don’t.  If we are just scraping by, we can “put on a good show” and try to appear more affluent than we are.  Unless your neighbor gives you a peek into his investment portfolio, it can be really difficult to tell how they’re doing financially.

The disconnects are even bigger when trying to wrap your head around the finances of someone who is worth many times more (or less) than you are.  The financial decisions they make, or don’t make, are completely different, because their context is completely different.

Shutter a $125 million acquisition

In the July/August 2014 issue of Inc. Magazine, there’s a brief article on DailyCandy, a email newsletter that featured one great shop or product a day.  DailyCandy launched in 2000.  Dany Levy, the creator, sold it to the likes of NBC and Comcast for about $125 million in 2008.

In 2011, NBC and Comcast shut it down.  Levy was “shocked, dumbfounded” when she found out.  (Rightfully so, no doubt.)

What struck me was that $125 million is a life-changing amount of money for nearly everyone.  Only about thirty thousand people worldwide are worth this much.  This isn’t just the 1%.  This is the top half of the 0.001%!

But even as big a purchase as this was, it wasn’t so big that it couldn’t be shuttered by an even bigger corporation.

You know what happens when you assume …

This is a reminder that context is incredibly important.  If you aren’t experiencing, or haven’t experienced, that level of wealth, you just don’t know.  Further, the series of financial decisions you’ve made are different than the ones your neighbor, your colleague, your parents, or your boss made, for better or worse.

Some other examples:

  • Nearly all Americans, on a global scale, are rich.  If  you worked 40 hours/week, 50 weeks/year, at minimum wage ($7.25/hour), you’d be in the top 9% globally.  Even someone earning one-quarter of poverty level in the US — $3,000 per year — is within the top third globally.
  • Even setting that aside, people who have always been middle-class don’t “get” poor.  It takes someone who has been, or is, to gather the courage to try to explain it in words, and it’s eye-opening.
  • The same with being homeless.  It wasn’t until I helped a homeless person briefly that I got even a glimpse.  And even then, I went back to my home and my wife afterwards.
  • Or completely buried in debt, or unable to get a loan.  This is why Dave Ramsey can speak so powerfully on getting out of debt.  He’s been there, even if he no longer is there.
  • There’s myopia all around.  Gwyneth Paltrow can act — no question.  Even her country music isn’t bad.  But when she recommends a miniskirt that costs a good-sized middle-class paycheck to her fans, who likely are middle-class-ish, said middle class does a big giant facepalm.  But for the things we see, there are other parts that we don’t, so I’m sure there are unique rough spots that come with that territory, too.

All of this to say: What you have, or what you owe, only makes sense in the context of your life.  Placing your personal finances on top of someone else’s context just doesn’t compute.  So make financial decisions in your context, not someone else’s.

The post Your personal finances are not someone else’s appeared first on Mighty Bargain Hunter.

Author: "John Wedding" Tags: "Commentary, Personal Finance"
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Date: Friday, 04 Jul 2014 06:08

Personal finance, and the difference between good and bad deals, are always a matter of context.  What could be a great deal in one context could be a lousy deal in another.  Sometimes spending more money is better than spending less; other times, it’s the opposite.

When I read this article on Money Talk News which listed ten “dumb deals” that people fall for, I disagreed with most of them on the basis that these “dumb deals” were actually false economies in disguise.  As in, you feel like you’ve gotten a deal, but it actually ended up costing quite a bit more than whatever money wasn’t spent.

There were several themes to these ten items.  The premises of three of these themes were questionable, which I’ll discuss below.  (That, and ultimatums such as “There’s no excuse for paying to download e-books” just encourage me to say: “Challenge accepted.”)

  1. Libraries.  The premise: “Why buy ebooks / books / DVDs / magazines when you can just borrow them from the library for free?”  Why it can be a false economy: Well, here are several reasons:
    1. You have to go there twice — once to pick up the book, and another time to return it.  That takes time, and probably takes gas.  The county library is more than a 15-minute drive away, and the bigger one in the neighboring town is more than a half-hour away.  That doesn’t sound anything like “free” to me.
    2. You can expect to wait a while for the popular books.  My wife waited four months after the release of the latest Rick Riordan novel to check it out from the library.  The library bought twelve copies, and she signed up prior to the release of the book, and she was 95th on the wait list.
    3. Same thing with DVDs:  You have to go there twice.  It doesn’t take too many trips there to make a Netflix subscription cheaper.  Those DVDs are delivered to your door, and the selection of what you can watch far exceeds what any county library can offer.  If you love to watch movies, there are frugal ways to do it, but going to the library is at the bottom of the list, as far as I’m concerned.
    4. And once again, with magazines.  The only subscriptions we get in our house are ones we read cover to cover and got through a discounter, or ones that I got free with airline points that were about to expire.
  2. Generic vs. name-brand.  The premise:  “Why buy name-brand medications or name-brand anything else when generics are cheaper?”  Why it can be a false economy:  Sometimes the generic version is not only not “just the same,” but also can be detrimental.  It’s not one-size-fits-all:
    1. I know for a fact that sometimes the generic version of a medication has side effects different from, or is less effective than, the brand-name medication.  We had to get a formulary tier exception for one medicine my wife was taking because the generic wasn’t doing as it should.  She did research and her doctor agreed.
    2. Generics sometimes are just not a substitute.  Generic foods have a different, usually cheaper, composition.  Generic batteries leak and corrode the insides of your electronics.  Sure, give generic or store-brand a try, but it’s silly to go generic at all costs.
  3. Free vs. paid software. The premise:  “Why pay for antivirus software / phone apps when there are free ones out there?”  Why it can be a false economy:  It ignores the cost of free.  Pay with money, or pay with time and frustration.
    1. Using some free antivirus software, frankly, is a battle of wills.  Sure, you do get some functionality at no out-of-pocket cost, but then the “fun” begins.  Buttons to features that look great, but are only on the “premium” version of the product, or advertisements, or click-through gates that offer you the chance to upgrade when you start up the program.  Every.  Single.  Time.
    2. Some great apps are free, true.  But free or “Lite” versions of apps limit what you can do with them.  There was a free spreadsheet app that I downloaded to my daughter’s tablet to get her to track her cash jars.  It was noticeably clunky, and lacked any of the features that make Excel easy to use.  The result was that it really didn’t work.

Paying for something, or paying a bit more for something, isn’t dumb at all if you’ve discovered the hidden costs of the cheaper alternative.

It’s quite smart, actually.

The post Someone’s “dumb deal” is another’s false economy appeared first on Mighty Bargain Hunter.

Author: "John Wedding" Tags: "Bargains, Free Stuff, Frugal Living, Per..."
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Date: Thursday, 03 Jul 2014 03:16

As the father of a daughter, I’ll likely be thinking about wedding costs a lot sooner than I want.  I’m reminded of this every day as I watch my baby girl grow up at record speed.

Unless tradition reverses course, I’ll be expected to foot the bill.  That’s what happens when the coin toss shows up “female.”

The link on the MSN homepage to this article was titled “How much does the average wedding cost?”  Curious, I clicked through.

The article compared the average cost of a wedding today, with what it cost 80 years ago (in the middle of the Great Depression).  After adjusting for inflation, we spend more than four times as much on our weddings as we did 80 years ago.

Bargaining at its most refined

The essence of personal finance is recognizing good deals in context.  Whether something is a good deal or not depends entirely on the context.

There can be big social pressures, and even bigger family pressures, to “put on a good show” for the wedding.  This fact is not lost on wedding planners, bridal shops, and everyone else who has anything to sell to this market.

Add to this the fact that it’s meant to be a once-in-a-lifetime event, so there’s only one chance to nail it.  This by itself nudges people into spending more rather than less.

Navigating through the money parts of wedding planning successfully involves both (a) exiting with your finances (mostly) intact, and (b) exiting with a feeling of satisfaction, and without feeling that parts were unnecessarily cheap.  It’s a fairly hefty balancing act, actually!

So what’s the answer?  It depends

The balancing act boils down to being lavish on the important parts, and less so on the unimportant part.  Deciding which are the important parts, and which are the unimportant parts, though, depends completely on your values.

Looking back to how much our wedding cost twelve years ago — my, time flies! — and adjusting approximately for inflation, we fell in quite a bit below average.  This, with about a hundred guests.  Some of the trade-offs we made, and didn’t make, for our wedding follow:

  • My wife and her mom organized the whole thing.  There was no wedding planner to go through.  They were the wedding planner.
  • The rings were a lot less expensive than they could have been, but we love them.  My wife isn’t a diamond person, which helps a bit.  Nowhere near the “two months’ salary” benchmark the diamond industry would have us believe.  And she gets compliments on hers all the time.
  • The decorations were very pretty, but my wife did a lot of the legwork.  My wife loves to create prettiness wherever, whenever, so she took this on full bore, assembling all of the decorations herself.  We took a trip to what amounted to a wholesale store for interior decorators, and she was able to get exactly the kind of artificial flowers she wanted to use — along with candles and other things.
  • No open bar at the reception.  What is a budget-buster for many a wedding reception was not at ours.
  • We didn’t skimp on a photographer but we did get a great deal.  My wife’s matron of honor put in a plug for the photographer she used, and he was great.  Our engagement photo shoot and our wedding pictures came out fantastic.  And since he was “pro-am” he cost about a third of what a professional photographer would have charged.
  • Our “limousine” was her matron of honor’s minivan.  Saved a few hundred there (at least!)

This is a list of some of our trade-offs.  Some of our other friends made different trade-offs, and that’s fine!  They were putting money into what was important to them, not what was important to us, or any of their guests.

I’ve also heard stories about people trying to save too much money in areas that were actually important to them, and they weren’t pleased when they got what they paid for.  But by that point, it’s too late, and it can leave a sour taste for a long time.

Spend money on the things that matter.  Don’t spend money on the things that don’t.  Doing that much will maximize your “wedding goodness” for the price tag you can afford, whatever that price tag happens to be.

The post How much should you spend on your wedding? appeared first on Mighty Bargain Hunter.

Author: "John Wedding" Tags: "Budgeting, Family, Frugal Living"
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Date: Tuesday, 01 Jul 2014 15:13

If you’re looking to build up a nest egg more quickly, or simply to work toward spending less than you earn, you’ll need to spend less money, make more money, or both.  Welcome to the cold, hard mathematics of personal finance.

On the income side, you can get a second job, or start a side businessEach has its pros and cons.

For people who got (maybe) two or three B+’s mixed in with their A’s in high school, tutoring is a skill for which there’s demand.

Hordes of eager potential students

The trick with starting a tutoring side business — or any business, for that matter — is figuring out how to tap into that demand.  Then, once you’ve located a few clients, it’s a matter of continuing to find more until you have as many as you want, at a price you’re willing to accept.

Wyzant.com is a website that makes tapping into the marking of people looking for tutors as easy as (a) signing up for a free account, (b) fill in what you tutor and where you live, and (c) jumping through a few easy hoops to show a modicum of competence in what you say you’re able to tutor.

After that’s done, the emails start flowing.  You’ll get notifications of potential tutoring jobs within a travel radius you specify.  You’ll get emails with contact from potential students.

It’s that easy to tap into the market.

But it’ll cost you!

Of course there’s a catch, right?  There’s always a catch — or a side effect, or a tradeoff.

In this case, the catch is that Wyzant slices off a percentage of your hourly fee for each hour that you tutor.  The fee starts at 40%, and goes down as you log more hours through Wyzant.

This is the price for easy access to the tutoring market.

How long do you need Wyzant?

If you’re looking for tutoring jobs, Wyzant will give you a steady stream of opportunities, no question about it.

I’ve dome a little over 50 hours of tutoring through Wyzant.  Aside from responding to emails promptly and doing the work, it’s pretty smooth.  (Except for the rogue edge case, which wasn’t Wyzant’s fault.)  And Wyzant does take steps to increase business for tutors.  They offer discount packages for people who want to purchase blocks of tutoring time, and the discount comes out of Wyzant’s cut, not the tutor’s.

But with each new job, there’s a question to ask:  “How much longer should I use Wyzant?”

For me, the answer would be sooner rather than later — which is why I recommended to start with Wyzant! — but for some, they’re happy tutoring and leaving all of the marketing to Wyzant, and that’s fine.  Further, as long as I’m doing work with leads that Wyzant hands me, I’m showing my acceptance of their terms, and willingly bearing the costs of tutoring through them.

But, a good tutor is a good tutor regardless of how they find their clients, and a good tutor with their own client list can price their services more competitively, or just make more money per hour.  This doesn’t happen overnight, and it is more work than just bringing a bucket to the Wyzant lead machine.

Wyzant is a great place to start getting tutoring gigs.  It’s also a great idea to consider when it make sense to market your services on your own.

The post Want to earn extra money tutoring? Start with Wyzant appeared first on Mighty Bargain Hunter.

Author: "John Wedding" Tags: "Making Money"
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Date: Sunday, 29 Jun 2014 03:10

Giving children solid grounding in money management is crucial.  Budgeting, saving, frugality, and financial planning are important components of living on one’s own and taking responsibility.  It’s unlikely that personal finance skills will be taught in school to any appreciable degree, so it’s up to parents to do this.

We give our daughter an allowance.  It’s the same introduction to money management that I got when I was a child.  It’s what I know.

But, in order to this be a series of teachable moments, there needs to be structure and purpose.  Here are five key features of how we’re going about it:

  1. We break up the allowance into three broad categories.  We also set the percentages for each category:  10% for tithe, 30% for savings, and 60% for spending.  She has three jars that each part goes in — a starter version of the envelope method.  Why this is key:  We want to instill in her that not all of the money that comes into her hands is available for spending.
  2. We insist that our daughter puts the tithe portion in the collection plate.  Our daughter also sees us do likewise; we’re leading by example.  This feature of her allowance was there from the start.  Some might argue that insisting on a child tithing misses the point of the tithe, which is an act of worship to God.  But, if we’re providing the funds, it’s not just that we should have a say in how she uses those funds.  We are accountable to God for how she uses those funds.  Eventually, the money coming into her pocket will be her earnings, and then she will be accountable to God for those funds.   Why this is key:  We as parents only have a small window of opportunity to exert a positive influence on our daughter, and part of that is instilling a biblical view of money and stewardship.
  3. We insist on discussion if she wants to dip into the savings portion.  If we save, we should save for a purpose.  Likewise, if we withdraw from savings, we had better count the cost of doing so, because that can be done only so many times.  Why this is key:  Adults have to be able to save, and understand why they need to save and how long it will take them to reach their goals.  By putting 30% of her allowance in a separate jar each week, she sees how that grows with time, and can begin to figure on how long it will take to reach whatever goal she has in mind.
  4. We allow her to spend the rest as she likes (within reason).  Today we went into a couple of stores.  One was a confectionery and gift shop.  My daughter has a love for stuffed animals, and saw a bear that she liked.  She had her money with her.  My wife initially said no to the bear, for the reason that she already has several stuffed bears.  But — and I don’t do this often, and not in front of our daughter — I took issue with that and discussed it with my wife.  We eventually left the decision up to our daughter whether to buy it or not.  Why this is key:  There has to be the “opportunity” for our daughter to make mistakes.  If she doesn’t make a few now, then she’ll make bigger ones later.
  5. As she gets older, we’ll let her outgrow the allowance.  Right now, her allowance isn’t too bad.  As she get older, if we plan things correctly, the allowance will begin to be constraining, and at that point she’ll start investigating other ways to make money.  Why this is key: Eventually the allowance goes away, and the burden falls on her.  Best to make this transition earlier rather than later.

For those of you with “allowance experience,” what other features do you use?  We’d love to hear them in the comments!

The post Five keys to making a child’s allowance a teaching tool appeared first on Mighty Bargain Hunter.

Author: "John Wedding" Tags: "Biblical Finance, Budgeting, Family, Kid..."
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Date: Friday, 27 Jun 2014 15:57

I don’t hang out at money.stackexchange as much as I used to. No hard feelings, though: I’m glad to see that the site finally made it out of the 3+ year beta purgatory it was stuck in.  They even sent me a cute little green piggy bank for being one of the more active users (for a time, anyway).

The people there — myself included, I hope — genuinely do want to be helpful.  And I give a lot of credit to people who come with basic questions and who are humble enough to ask.

Questions that make you flinch a bit

There were a couple of questions recently for which giving the answer is a bit hard.  The questions were basic, and you just knew that the person wasn’t going to like what you had to say, even if it was exactly correct, and what they needed to hear.

One of them dealt with disability insurance.  The question was: “How to start disability insurance when already disabled?”

Ouch.  We had to break it to this person that he was too late.  Here’s how I answered:

You may find some company who will insure you, but they won’t pay anything based on what you already have. That’s a pre-existing condition, and it’s uninsurable.

It’s a bit like asking the casino if you can bet on red after the roulette wheel has already stopped on red.

Though the insurance company won’t cast it in those terms, when they issue you a policy, they’re placing a bet on you. They’re betting that your premiums, plus whatever they earn on your money, will be a lot greater than what they have to pay out in claims to you.

But, they can (will) only make the bet if the outcome is unknown. If the outcome is known — meaning they’d definitely need to pay out — then they won’t make the bet.

He asked this question on June 6th.  I answered on June 7th.  The last time he visited the site (as of now) was June 9th.  He may have just needed the answer to that one question, but I wouldn’t blame him for not coming back, even if he had more questions!  Not many people would want to risk that level of blunt honesty again.

But this kind of “too-late” problem is true of any kind of insurance.  It’s a no-go if a payout is certain.  You have to get the policy before you suffer whatever you’re insuring against.

It’s a good reminder to take a bit of time to assess the risks you face (whatever they are) and insure against them appropriately.

The post The sad news about disability insurance appeared first on Mighty Bargain Hunter.

Author: "John Wedding" Tags: "Insurance"
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