Sunday’s NY Times had a funny Op-Art piece that parodies the iPhone ads about which apps save you money (some are free, others cost $.99 to $30 to download). You may recall I gushed about these ads, which have been running on back page of the NY Times’ front section.
The Op-Art piece reads: “iPanic: helping you deal with the loss of your life savings, one app at a time.” A sampling of the “apps” including:
Never Mind: $3.99 “Choose a vacation from more than 1,000 popular destinations, dinner at a restaurant you’ve always wanted to try or a round of golf at any one of your favorite courses. Never Mind calculates the money you save by not going.”
4merly Hot: $14.99 “Tired of economizing alone? Upload a picture of yourself when you had money, then use your iPhone to meet other singles pretending they still have money, too.”
Fantasy Finance League: $9.99 “Field your own 401 (k). Make imaginary trades with stocks you used to own. FFL keeps score, compiles stats and automatically updates when you could have retired.”
2 Late Now: $7.99 “Create, edit and save spreadsheet files documenting all the things you wish you’d never bought.”
Scrape: $6.99 “By using your iPhone’s GPS, Scrape lists part-time jobs within a five-mile radius of your current location. Find the opportunity to match your experience and skills, from valet parking to wearing a taco costume.”
Hmmm…the message I’m getting is that even as we watch our life savings disappear, we continue to pay for luxuries like the iPhone (guilty as charged!) But in my defense, I only download free apps.
So maybe you don’t have an iPhone, but I bet you have some other secret spendy habit that you are loathe to reveal to other bargain hunters. Spill the beans!
I’m continuing my theme of giving frugal gifts that have a higher sentimental value than than monetary value for Father’s Day, which is June 21. What are you giving your Dad for Father’s Day? Share your idea in the comments section.
- Write your Dad a card saying what you love and appreciate about him.
- Put a new spin on two old gifts, wallets and ties, by giving him a necktie wallet!
- Ask each of his children what they love about their Dad on DVD. He’ll always have the video to watch. If you have a budget, give him the video on one of those new-fangled flip video cameras.
- Frame a picture of you and your Dad. A picture is worth a million words and all that jazz.
- Get him a fancy schmancy gadget but save money by purchasing a refurb. Apple certifies all their used products and some come with a one-year warranty.
- Write a dozen of your favorite memories of your Dad on slips of paper and put them in a jar (I used a recycled mason jar on Mother’s Day).
- Give him time off so he can do what he pleases.
- Check out CNET’s top 5 WORST gifts for Dad. It gets good at No. 3.
Find more gift ideas at Gifts.com or Surprise.com.
One reader’s story of how she went on a gift moratorium.
I like this site, FindABetterBank.com. It looks at where you live, the features you want, and your banking habits to suggest a checking account with the lowest fees.
For my preferences it spit out a list of about a dozen accounts with annual fees from $0 (ING Direct) to $334 (Citibank). Funny thing is, I currently bank with both these companies. The list of suggested banks tells me what percentage of my requested features each account has, how far away the nearest branch is and the number of locations within five miles.
The site is run by two guys who believed if it was easier to switch banks the best banks would win. FindABetterBank.com has a great FAQ page that tells you the site makes money – through fees collected from participating banks and credit unions. They say these fees do not influence their presentation of each bank, but more details about how they collect the fees would strengthen this argument. (Sites like this typically make money through referral fees when a person clicks through to a bank and opens an account.)
FindABetterBank.com updates their info every 3-6 months and currently includes 85 major banks across the country.
This is a guest post reader Anirudda Gore, who is a 20-something software professional who writes about getting the best value for money at LetsBeCurious.blogspot.com.
I reached my nearest gas station this morning and found $2.63 per gallon, not the cheapest price but it was the closest station. Because I had to get to work on time, I bought that costly gas. Since then I’ve been thinking:
- If the cheapest gas is not available at my nearest gas station, how far should I drive for a better price?
- Is a difference in 5 cents per gallon worth burning the fuel and time?
I created a formula to decide whether you should drive to a far away station to fill-up OR whether it makes sense to buy expensive gas at a nearby station.
When To Drive That “Extra Mile”?
There are two elements behind my motivation to drive to buy cheaper gas:
- Save money on gas
- I can buy more gas at a cheaper price, which means I will get more miles from that tank
Let’s calculate how much more “extra” distance you will travel if you buy cheap gas:
Your monthly/weekly fuel expenses = FE (constant)
Gas Price at the cheaper but far-away station = Pc
Gas Price at the expensive but nearby station = PE
Distance between the two stations = DIST
Your car’s average Miles Per Gallon = MPG
c = cheaper, E = expensive, v = volume
Volume of gas bought in gallons = Total money spent/Price of gas per gallon
Thus, the volume of gas bought at cheaper far-away station, VC = FE/Pc
Volume of gas bought at expensive nearby station: VE = FE/PE
Extra gas you would buy at cheaper gas station: VC - VE = FE/Pc- FE/PE = FE (1/Pc – 1/PE)
Extra miles you can drive if you buy at cheaper gas station:
ExtraMiles = Extra Gas * MPG
ExtraMiles = FE * Difference in Gas Prices at two stations * MPG / Pc*PE
Here’s How To Decide
Plug-in your values in formula above and calculate ExtraMiles.
- if ExtraMiles > DIST: you drive more miles while spending the same amount so consider driving to a cheaper station
- if ExtraMiles < or = DIST: it makes more sense to buy gas at the nearest station, even if more expensive
Application of formula: Case #1
FE = $30
Pc = $2.59 per gallon (3 miles from my apartment)
PE = $2.65 per gallon (1 mile from my apartment)
DIST = 2 miles
MPG = 25 miles per gallon
ExtraMiles = FE * Difference in Gas Prices at two stations * MPG / Pc*PE
= 30*0.05*25/(2.59*2.65) miles
= 5.46368 miles
I get to drive (5.46368 – 2 =) 3.46368 miles extra (one way to my work), thus I will certainly drive away to get that cheaper fuel.
Application of formula: Case #2
FE = $30
Pc = $2.55 per gallon (12 miles from my apartment)
PE = $2.65 per gallon (1 mile from my apartment)
DIST = 11 miles
ExtraMiles = FE * Difference in Gas Prices at two stations * MPG / Pc*PE
= 30*0.10*25/(2.55*2.65) miles
= 11.09878 miles
I only get to drive (11.09878 – 11 =) 0.09878 miles extra; definitely not a go-for option.
Conclusion
“The cheaper, the better” should not be the rule here. Cheaper gas costs $2.59 in Case #1 which is available 2 miles from my home while cheaper gas costs $2.55 but I need to (burn more fuel and) drive 12 miles from my home. Total money spent is $30 in both cases but gas purchased in Case #1 lets you drive (3.46368/0.09878=) 35 times more than that purchased in Case #2.
So the next time you plan to fill-up your car tanks, remember it’s not just how many dollars you save but also how many miles you drive to get that gas. The formula takes into consideration both these factors and thus gives practically guided numbers. Once you decide how much money you want to spend on gas this week/month, now just calculate the ExtraMiles and go from there.
Bargain Babe’s two cents: I like the concept of ExtraMiles, but think it is important to take into account time spent filling up and actual savings. How many people spend the same amount on gas each month? Not me. But I’m curious, what do you think of the ExtraMile approach?
My $25 gift card giveaway ends tomorrow, June 9, 2009. To enter, sign up for BargainBabe.com emails and you can win a $25 gift card to Target or Trader Joe’s! Here are the rules for the gift card giveaway.
1. One new reader who signs up between May 26 and June 9 to receive my free daily OR weekly emails will receive a $25 gift card to Trader Joe’s or Target.
2. One existing reader who already receives my weekday OR weekly emails will win a $25 gift card to Trader Joe’s or Target. If you already receive my emails, you are automatically entered to win. You do not need to do anything to be eligible. You do not need to email me to double check.
3. If I am in your RSS feed, you are not eligible to win. You must sign up to receive my emails to be entered in the giveaway.
4. The drive ends June 9, 2009 so sign up now!
5. Winners will be chosen at random on June 10. I will email those readers to make sure the email address is valid. Readers will have 48 hours to respond. If readers do not respond, alternates will be notified.
6. Winners will be announced on the blog June 13. Gift cards will be mailed to the winners.
Any questions? Leave a comment.
Thanks to all the wonderful folks who came to hear me speak about saving money at the West Valley Public Library on Saturday. It was one of my best speaking gigs yet!
I enjoyed meeting Carrie, Bob, Meital, Maria, Liz, Janet, Karen, and many more readers. I also got two tips from them I wanted to pass onto you:
- If an item is on sale at Nordstrom, you have a better chance of negotiating a discount than if it is full price. Because after a certain point, sale items are shipped to Nordstrom Rack, where the company makes even less money off the item. Ask a salesperson if this is the best they can do on the price of a sale item. A reader said she has gotten a deal more than once.
- Southern California residents can buy “twofer” tickets during the off-season (called the Summer Fun Pass in-season), and you may be able to sell – or buy – the second ticket at a discount. One reader said this was possible, another said Disneyland was writing your name on the back of each ticket so you could not hand them off to another person. Does anybody know which one is right?
I speak to all sorts of groups (public, private, religious) and tailor my talks to your interests. Email me if you need a speaker and want to save money!
Here are some great posts I’ve been reading:
RecessionWire lists sites to watch free TV, movies, read books, magazines and newspapers, and listen to free music in a post titled Media wants to be free
Wise Bread noticed that phone books are being delivered more often and suggests 17 creative things to do with them
Time reports the savings rate is up to 5.7% while credit card spending is down 11%
The Simple Dollar asks if saving money is bad for the economy
Consumer Savvy Tips offers 5 ways to reduce your laundry costs, including one I’d never heard of
Got monster medical bills? Hire an advocate, says the Oregonian
Common Sense With Money crunches the numbers and shares the best double coupon deals at KMart
Frugal Dad has a story about 12 things his grandparents did without
Wal-Mart is hiring 22,000 workers across the country, including 1,000 or more workers in Arizona, California, Florida, Michigan, New Jersey, South Carolina, Utah and Virginia,” according to a CNN story.
The hirings are significant in lieu of our depressing unemployment rate, which economists predict will rise to 9.2 percent after the economy lost 520,000 jobs last month. That’s a 25-year high!
I’m very conflicted about Wal-Mart. I don’t like to feature their deals on BargainBabe.com because of their checkered past. But I know for many people shopping at Wal-Mart is a way to make ends meet. I “vote” with my dollars and let others do the same. To each their own, right?
Because of the recession, however, I’m wondering if people are applying for and taking jobs they wouldn’t otherwise consider.
[poll id="26"]
My post about the hassle I went through to redeem a $2 gift card from Subway generated a storm of comments, including this one from a reader named Summer Sweetie:
I appreciate your steadfast effort to breakdown the bad Subway tactics. I do hope that the cashier didn’t have to pay for their company’s error but in the case that they did I hope the next time you go you add something to their tip jar. Working in the food industry myself it makes me upset with my employers when I’m made to look like a fool to a customer, but it’s even worse if I have to pay for their mistake.
As it turns out, of the 30 readers who left a comment on this post, only 5 had trouble with their own cards. Another 10 had no problem and 15 either had not tried their cards or did not receive a card. I’m glad to hear most people did not have any trouble with their cards. Subway has been (slightly) redeemed, in my eyes.
WalletPop, a fabulous personal finance blog that I envy terribly, had a great post about how to get things for free. The story has 12 slides that each cover a different store or type of store, including Wal-Mart, CVS, Walgreens, Rite Aid, Target, Kmart, clothing stores, Office Depot, supermarkets, and warehouse clubs.
Most of it has been said before (combine coupons with sales or rebates) but it is a good roundup and very concise. Check it out!
Thanks, Dad!
Ever wonder who we as a country owe money to? Foreigners are the answer about a third of the time. Of the United States’ $11 trillion debt, $3.3 trillion is owed to the following countries, according to a very cool graphic that ran in the June 8, 2009 issue of Newsweek (but is not available online, sadly).
Thanks to a reader named Dan who supplied this chart:
$767.9 billion – China
$686.7 billion – Japan
$213.6 billion – Caribbean countries
$204 billion – France/India/Korea/Mexico/Singapore/Turkey
$192 billion – Algeria/Bahrain/Ecuador/Gabon/Indonesia/Iran/Iraq/Kuwait/Libya/Nigeria/Oman/Qatar/Saudi Arabia/U.A.E./Venezuela
$138.4 billion – Russia
$128.2 billion – U.K.
$126.6 billion – Brazil
$124.3 billion – Egypt/Israel/Italy/Netherlands/Norway/Thailand
$106 billion – Luxembourg
$89.5 billion – Belgium/Canada/Chile/Colombia/Malaysia/Philippines/Sweden
$78.9 billion – Hong Kong
$75.8 billion – Taiwan
$67.7 billion – Switzerland
$55 billion – Germany
$54.7 billion – Ireland
$156.7 billion – all others
Related:
Friday Fun: what comes after trillions? (BargainBabe)
National Debt Clock (Brillig.com)
For readers in Los Angeles, you can meet me at the West Valley Public Library this Saturday, June 6, in Reseda, California.
Starting at 1 p.m. I’m speaking about frugal vacation strategies, Disneyland discounts, and how to negotiate a deal. We’ll also go through the steps to create a simple budget (the same one that saved me $2,000 the first month I tried it).
The West Valley Public Library is located at 19036 Vanowen St. in Reseda, CA 91335. See you June 6 at 1 p.m.!
Most budgets look backwards. You pull out your bills and receipts from the past month and add up what you spent. That number indicates how much you will spend this month, right? Wrong!
A better budget looks forward.
But first, let me tell you why traditional budgeting drives me batty by looking backward!
- The past is no indication of the future. Just because you spent $97.21 on gas last month, doesn’t mean you are going to spend the same amount next month.
- Expenses vary widely each month (excluding fixed bills like housing, cell phone, or car payment). A plane ticket eats up your cash one month, while gifts or a new outfit may eat up your dollars the next.
- Most non-fixed expenses are hard to predict, and thus are hard to budget for.
We all know budgeting is smart. But for years I struggled with it. I spent hours pushing paper and writing down what I spent, trying to make the income number bigger than the outgo number. I used a fancy excel spread sheet that a financial planner gave me that automatically summed built-in categories. It even had a plan of attack for “irregular expenses” that had me chasing after all the one-time expenses from the past year and dividing them by 12 and depositing that much each month into a special account. At first, I was so thrilled with this system I pushed it on others.
But it, too, failed.
The spread sheet was extremely good at helping me figure out where my dollars went. But it made no attempt to keep my spending in check. And it couldn’t predict what I needed to save money for – airfare? wedding gifts? bicycle repairs?
When I left my steady job to launch BargainBabe.com I had to do something. Namely, figure out if Hubby and I could survive on one salary. We weren’t going to have enough regular income to cover our past spending habits, so I focused on absolute necessities and bills we were going to have to pay no matter what. This included:
- rent
- gas and electricity
- Internet and cell phone service
- gasoline (two full tanks only)
- doctor visits
- medicine
- savings to max out our 401(k)s and IRAs
I subtracted these necessities from our income.
Then I made a second group of expenses for all the irregular items that come up, including car insurance, car registration, car repairs, dental visits, Christmas presents, magazine subscriptions, charitable donations, vacations, yoga passes, and oil changes. I looked at what we spent on these categories last year and estimated how they would change in the coming year, then I divided by 12. (Okay, looking backward is occasionally necessary – and useful).
I set up an automatic withdrawal from checking to a special ING savings account to cover our irregular expenses when they come up.
After subtracting the absolute necessities and irregular expenses from our take home income, I’m left with our discretionary income. This number is very important because it represents the actual dollars we have to spend each month. All my other dollars are spoken for.
Discretionary dollars go toward:
- groceries
- clothing
- bus fare
- extra gas
- movie tickets/entertainment
- vitamins
- toiletries
- meals out
- hair cuts
- travel
- home maintenance
- gardening supplies
- and everything else!
Once you figure out your discretionary income you are nearly done. The last step is to grab an index card and put this number at the top. Each time you spend, subtract it from the total. In lieu of an index card, use SmallSpend.com on your mobile Internet device.
This way you know exactly how much money you have left each month and do not spend more than you earn. The first month I tried this forward looking budget, my credit card bill dropped by more than $2,000. Hallelujah!
This system is also MUCH less time consuming because once you calculate your discretionary income, you only have to write down each purchase. And that makes it easy to say no or wait for a better price!
1. Being brand loyal. We like loyal dogs, but sticking to one brand hinders sales! You don’t want to pay full price, do you?
2. Failing to anticipate need. Buying ahead of need when things are on sale is the savvy policy. Just make sure you’ll use the item before its shelf life expires.
3. Using dial-up or having no Internet access at home. The Internet is basically useless these days if you have dial-up. You can’t watch videos or read pages with many pictures, which just about every website has these days. High-speed connections cost about $35-$40 a month in my neck of the woods, which you can make back by reading newspapers and magazines online, printing coupons, signing up for the email lists of your favorite airlines and travel sites, watching TV online, and so much more.
4. Buying a new car instead of a car that is new to you. Consumer Reports crunched the numbers and made a pretty chart showing the best used car deals. In the first few years, vehicles across categories dropped in price between 20 and 75 percent. What a deal!
5. I’m leaving this one open for you to add! What is the top quality or behavior that makes someone an unsavvy spender?
Related:
Benefits of saving habits that make you look poor (SavingAdvice.com)
KNTV in Las Vegas identifies three top money-wasting habits
50 habits that will leave you eating ALPO for dinner (MySuperChargedLife)
FreeMoneyFinance lists 15 things we overpay for
The brochure for the Crate & Barrel summer sale boasts prices up to 50 percent off for the store’s lovely American contemporary furniture, housewares, and accessories. Folia botanical plates are $8-$9 (orig. $13-$15), a Potomac twin sleeper is $999 (orig $1,400), and a bamboo ice bucket is $20 (orig. $35).
The sale starts June 5 in stores and online. Go early on the first day to nab the furniture floor samples, which are priced ridiculously low but may be slightly worn.
